Armed with a fast-growing, highly engaging loyalty program, Abercrombie & Fitch has made progress toward renewed brand loyalty.
CEO Fran Horowitz was excited about the company’s progress during its third-quarter earnings call on Friday.
“I am pleased to report another quarter of meaningful progress across all our brands, as we continue to execute against our strategic plan,” Horowitz said. “We delivered another quarter of sequential comparable sales improvement and a return to positive comparable sales for the quarter. We maintained strategic investment in omnichannel and marketing while managing our expenses effectively, resulting in operating expense leverage and profit growth. Putting our customers at the center of every decision we make and everything we do remains a North Star for us. That singular focus is reflected in our people, our processes, and our product, and we see that focus translating into positive overall traffic and conversion trends across the brands.”
It was a particularly strong quarter at Hollister, with sales growth across all channels and geographies.
“At Abercrombie, we drove further improvements and are seeing some early signs of stabilization,” Horowitz said. “We continue to apply our playbook across the brands, which calls for a relentless focus on our customer. The results are clear. When we align our products, brand voice, and brand experience, we see improved traffic and conversion as we did this quarter. Those areas in which we are investing our time and money are delivering and in a still-promotional environment. This quarter’s performance with a broad-based improvement across brands and genders is validation that our playbook is working.”
What’s more the company made progress in Direct-to-Consumer with an 11 percent increase in sales year-over-year?
“The shift to mobile continued, particularly with our customer,” Horowitz said. “More than two-thirds of our DTC traffic comes from mobile. The investments we’ve made here are paying off, as phone and app productivity growth continue, driven by double-digit improvement in conversion on these platforms. We continue to build on our strength in omnichannel, with an ongoing international rollout of capability. In concert with these investments, we have made further strides with our physical stores, driving improved productivity from our new prototype and remodeled stores. We continue to retain the flexibility to allow for the most effective melding of the physical and digital worlds, optimizing our customers' engagement with our brands.”
Keeping the focus on the customer also requires high levels of responsiveness and adaptability.
“This quarter, the team continued to spend significant time in stores across the brands, leading to better testing, sharper insights, and faster responses,” Horowitz said. “Our read and react programs ensure we have our must-have items and categories available in just in the colors and sizes we need and that we do not disappoint our customers. Leveraging these capabilities, we responded to strong third quarter and back-to-school business to ensure we are positioned for holiday. I can confidently say that we’re increasingly effective at engaging our customers whenever, wherever, and however they choose to shop.”