Lessons Learned From the Decline of Abercrombie & Fitch
By: Hanna Herrin
The Hoffman Agency, Portland-Vancouver
For clothing retailer Abercrombie & Fitch, tight graphic tees, logo-emblazoned sweatshirts, tiny shorts and colorful flip flops all create the “essence of privilege and casual luxury.” It is a stereotype Mike Jeffries — CEO until December of 2014 — labored tirelessly to cultivate.
This strategy worked for a while, propelling A&F forward to become a $4 billion company. Recently, though, the brand hasn’t been so lucky, with sales plunging 12 percent in the third quarter of 2014.
The underlying reason? Their strategy remained largely unchanged, despite the fact that their target market was evolving.
Abercrombie’s decline gives us an opportunity to look at a question plaguing every facet of the industry today. How can we stay relevant in a rapidly changing marketplace?
Be fully committed to change.
Jeffries’ most glaring mistake was his failure to understand that organizations must adjust their strategies to align with ever-changing consumers.
The consumer marketplace — especially amongst the younger generation — is flighty, moving from one trend to another. Here today, gone tomorrow. Organizations that closely monitor the trends in their industry will have a better understanding of their consumers’ current wants and needs, allowing them to adapt their strategies more quickly than their unprepared competitors.
Transparency matters.
Today’s consumers have easier access to information than ever before. This means they have the ability to make informed decisions based on what they read, watch, listen to, and (even more terrifying) what they don’t.
Jeffries — a media recluse — kept out of the spotlight after an interview gone awry. His decision to stay silent, even when A&F began to experience financial troubles, is a good reminder to us all that brands should recognize the importance of having a strong, present figurehead to build trust and credibility in the public eye.
Conformity is out. Individuality is in.
Think back to your high school days. You knew who the cool kids were because everyone wanted to be like them. But just like in high school , popularity is fleeting. Today’s adolescents are different. They crave individuality and desire brands of all kinds to help them achieve a sense of that individuality.
While A&F thrived on the cultivation of a singular, stereotypical image for the products they sold, fast-fashion providers like Forever 21 and H&M gained popularity in their own right because they provided countless unique options to their one-of-a-kind consumers. As a result, fast-fashion stores have been able to stay relevant in the consumer marketplace.
Staying relevant in the eyes of your target market isn’t easy, but armed with these strategies and a willingness to accept the changing marketplace, you’ll be well on your way to maintaining relevancy and capturing success.
