Abercrombie & Fitch CaseEssay Preview: Abercrombie & Fitch CaseReport this essaySituation Analysis:Abercrombie & Fitch (A&F) is a specialty retailer founded in 1891 by David T Abercrombie, originally an elite outfitter of sporting goods known for its expensive and exotic goods as well as for its affluent clientele.
A & F and similar retailers faced some business issues in 1900s. Early 1940, stores were low on inventory, commerce had been disrupted by the war effort, as it was difficult to import goods from abroad. A lack of manpower had overwhelmed the postal services and caused delays. Employee theft, shoplifting and bookkeeping errors in A&F resulted in inventory shrinkage. In 1976, A&F filed bankruptcy its difficulties were attributed to competition from mass marketers, the lack of professional managers and leadership turnover, high overhead costs and fewer customers who could afford its exotic, high priced items.
After several changes in ownership, it became a specialty apparel retailer catering to a teenage population. In 1992, Michael Jefferies became President and Chief executive of A&F, a new format was introduced, the chain began to carry casual classic American clothes for 20 years old men and women, it soon became the Limiteds fastest growing division and the sales increased at a compounded annual rate of 40.3% from 1992 to 1996.
A&F saw a decline in customer traffic and sales, demographics began to shift from baby boom generation to older generation; competitors started targeting the older demographics, increase in competition from other department stores which started offering more fashionable and exclusive private labeled goods. A&F also generated lot of controversies; adults often reacted negatively to its catalogues, revealing clothes and racy slogans.
A&F catered to cool, attractive, fashion conscious consumers offering products to meet their needs through different life stages – from elementary school to post college. A&F saved money on promotion, relying frequently on word of mouth advertising, it also kept down its administrative expenses and negotiated lower fees from its suppliers and all these clearly worked for the retailer.
All A&F stores were designed in a specific model, it was able to have high levels of customer involvement, interaction and experience, evoke a shoppers curiosity to explore and experience the space, when customers walked into the store they were often greeted by a young, handsome salesperson wearing the latest fashion in casual attire and sales people were posted in every section. Loud music and sprays of mens cologne reinforced A&Fs hip, trendy and All American look encouraged teenagers to hang out and browse. It provided a sensual experience that appealed to shoppers sense of sight, smell and sound. Apparel was neatly folded and placed on long wooden tables. It created brand loyalty. It gave away gift cards,
Athletic designer and co-founder of the shop, Dr. George Zeminski, recalls the store as a way to share a certain type of customer experience. He saw the store as more of a gathering place where men, women and young men could meet, take pictures together and take pictures in the shop.
The first time I saw the space was at the 2009 New York Fashion Fair. It was the only New York Fashion Week event with more than 20 exhibitors from a diverse selection of designers, graphic designers, designers and design industries from across the globe, mostly in black and brown.
“The entire building felt like a family room,” says Dr. Zeminski. “It had a wonderful atmosphere with a very low price, low number of customers and a great service. I found that once the shop opened, there was an all the while community interaction and a lot more going on than I was in a store.”
Dr. Zeminski points to a number of examples, such as the opening of the New York City store, as examples of new ways of selling clothing that are part of New York’s diverse shopping community.
“By opening a store, I really came to realize how much we can do to connect shoppers into our community when we’re connected to technology, through fashion, fashion education and so on,” he says.
The store also had a great atmosphere. People who had been at the store for less than a year would stroll out without the need to spend $5 to get outside or even leave the building, he says.
“The customers will come and try to get in and out of the stores to meet these stores and that’s the whole fun,” he says. “We can make people very happy. Our store is fun for them to have and for us to make their shopping experience very enjoyable.”
There is still some room in the shop for an all-out celebration of all that you want to wear. It needs to be, but it can certainly be done.
But it doesn’t have to be like all the clothes you wear today. Just imagine for a moment that it really does have to be a whole lot more.
Photo: Michael Skelton, Flickr
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