Although the past fiscal performance hasn’t quite been so appealing for teen apparel retailer Abercrombie & Fitch, there is hope on the horizon as the company moves strategically toward a new brand identity and increased customer loyalty.
Consider the following:
Net sales for the company’s second quarter of $783.2 million were down 4% versus last year, with comparable sales for the second quarter down 4%. What’s more, Abercrombie's sales dropped for the 14th consecutive quarter.
Direct-to-consumer sales grew to approximately 23% of total company net sales for the second quarter, compared to approximately 21% of total company net sales last year.
Company officials pointed to two important developments in the quarter that gives them great confidence moving forward:
The company began to roll out new brand positions for both of its brands. Officials said a new brand voice is being communicated to consumers. What’s more, two experienced brand presidents were brought on to help execute against the company’s strategic priorities, including ensuring a successful implementation of its new brand positions, heightened awareness, and increased relevance.
Evan Magliocca, Brand Marketing Manager at Baesman, told Loyalty360 that Abercrombie & Fitch has some branding challenges ahead.
“But, it has one of the best foundations to support that endeavor,” Magliocca said. “It has best-in-class omnichannel initiatives that have shown great returns as stated in the earnings call. Hollister Co.’s loyalty program should boost brand advocacy after its recent launch. It also has an amazing mobile experience that’s meticulously tailored to customer interaction and ease of use. The Martech pieces are in place, as is the customer experience; the barrier is simply brand identity. It’s such a massive shift and those don’t happen overnight. It takes months—even years—for brands to change how customers perceive them. Once it solves the branding and target customer issue, I think you’ll see A&F return as a flagship apparel brand.”
Abercrombie & Fitch continues to focus on increasing customer-centricity and engagement at all points of contact to allow customers to seamlessly interact and shop the way they prefer. Its new fully remodeled Hollister stores continued to perform well.
What’s more, the company continued to invest in mobile and omnichannel capabilities and expand its social media presence. Across brands, Abercrombie & Fitch has more than 20 million Facebook fans, and close to 7 million Instagram followers, which is up 30% over last year and an average of more than 120 million impressions and over 2 million post engagements every month.
Peter Pantano, Marketing Analyst, Pointillist, told Loyalty360 that as Abercrombie develops its omnichannel capabilities, it opens the door to massive amounts of customer data.
“If properly leveraged, Abercrombie has the opportunity to exponentially improve customer experience,” Pantano explained. “The future of Abercrombie depends on how well it expands across new channels while growing its existing ones, as well as on how integrated and actionable the insights from its data are (both in-store and digital).”