Aber­crom­bie & Fitch emerges into the light

Fash­ion la­bel has shed its night­club-like stores and provoca­tive im­age to fos­ter a cli­mate of in­clu­siv­ity, says So­phie Christie

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Tanned male mod­els with abs of steel used to stand at the en­trance to Aber­crom­bie & Fitch’s UK flag­ship store on Lon­don’s Sav­ile Row, placed there to en­tice teenage girls through its doors. The mar­ket­ing wheeze was part of the brand’s of­fi­cial strat­egy, ex­e­cuted un­der the guid­ance of for­mer chief ex­ec­u­tive Mike Jef­fries, to get at­trac­tive young peo­ple through its doors and spend­ing money. In a 2006 in­ter­view he said: “Good-look­ing peo­ple at­tract other good-look­ing peo­ple, and we want to mar­ket to cool, good-look­ing peo­ple. We don’t mar­ket to any­one other than that.”

He said the com­pany went af­ter the “at­trac­tive all-amer­i­can kid with a great at­ti­tude and a lot of friends”, adding: “A lot of peo­ple don’t be­long [in our clothes], and they can’t be­long. Are we ex­clu­sion­ary? Ab­so­lutely.”

It took seven years for Jef­fries’ com­ments to “go vi­ral” and pro­voke ire from cus­tomers and the media. In 2014, un­der in­tense scru­tiny for the re­marks and 11 con­sec­u­tive quar­ters of neg­a­tive sales, Jef­fries stepped down af­ter 22 years with the com­pany, tak­ing with him the over-sex­u­alised brand im­age he had cre­ated.

Sales at the 126-year-old firm first be­gan to slump dur­ing the 2008 fi­nan­cial cri­sis, when teenagers opted to shop at lower-priced fash­ion brands such as H&M and For­ever 21. Its share price tanked from a peak of 84p in Septem­ber 2007 to 15p the fol­low­ing Novem­ber.

Se­nior man­age­ment made the de­ci­sion to over­haul the re­tailer’s mer­chan­dise and close un­der­per­form­ing stores, but its lack­lus­tre per­for­mance con­tin­ued – wors­ened by Jef­fries’ con­tro­ver­sial state­ments a few years’ later.

Florence All­day, fash­ion an­a­lyst at Euromon­i­tor In­ter­na­tional, said that while Aber­crom­bie got rid of its shirt­less mod­els in 2015, it was per­haps “too lit­tle, too late”. She added: No FTSE 350 com­pa­nies re­port­ing.

New car reg­is­tra­tions (UK), Fac­tory or­ders (US), Durable goods or­ders (US), ISM non­man­u­fac­tur­ing in­dex (US), Sen­tix in­vestor con­fi­dence (EZ), Re­tail sales (EZ)

Tues­day

Full-year re­sults: Safe­store Trad­ing state­ment: Fer­rexpo, SIG, Mor­risons

Halifax house “Such ob­vi­ous ob­jec­ti­fi­ca­tion and sex­u­al­i­sa­tion, aimed at very young girls, was widely recog­nised as out­dated and in­ap­pro­pri­ate sev­eral years be­fore­hand.”

Sales re­mained slug­gish for three years af­ter Jef­fries’ de­par­ture, and while rev­enue from its Bri­tish divi­sion con­tin­ues to dwin­dle, the US busi­ness, un­der new boss Fran Horowitz, ap­pears to be re­bound­ing, with five con­sec­u­tive quar­ters of sales growth.

Aber­crom­bie was founded in 1892 by David Aber­crom­bie as a sport­ing goods chain, sell­ing fish­ing and hunt­ing equip­ment in­clud­ing shot­guns. A por­tion of the busi­ness was then bought by Ezra Fitch, though both left the com­pany in the early 1900s. Busi­ness peaked in the late Thir­ties when its sports ap­parel was worn by celebri­ties such as Ernest Hem­ing­way, be­fore it was trans­formed in 1992 un­der Jef­fries who made it into the preppy clothes re­tailer we know to­day.

When A&F first en­tered the Euro­pean mar­ket a decade ago with its Sav­ile Row branch, a queue of cus­tomers would snake around the street in or­der to ex­pe­ri­ence the night­club-like at­mos­phere of the store. In the dimly-lit space, mod­els were sta­tioned on the bal­cony to dance to the thump­ing mu­sic while sales as­sis­tants walked around spritz­ing the re­tailer’s sig­na­ture Fierce cologne.

The unique at­mos­phere kept shop­pers want­ing, and A&F’S in­ter­na­tional em­pire grew to more than 1,000 stores, with branches in Europe, Asia and the Mid­dle East.

The com­pany also launched off­shoot brands; some of which proved suc­cess­ful, oth­ers which didn’t. Un­der­wear re­tailer Gilly Hicks, mar­keted as price in­dex (UK), Trade balance (US), JOLTS job open­ings (US), Con­sumer credit (US) Con­sumer con­fi­dence (EZ) the “cheeky cousin” of Aber­crom­bie & Fitch, closed in 2013 af­ter five years (al­though it re­launched on­line in 2017), while Ruehl No. 925, which sold up­scale cloth­ing for young adults, closed in 2010 af­ter six years.

Hol­lis­ter, which sells sim­i­lar but more af­ford­able cloth­ing than its par­ent com­pany, and Aber­crom­bie & Fitch Kids, aimed at seven to 14-year-olds, have been more suc­cess­ful, al­though both have at­tracted their fare share of crit­i­cism.

In 2012, when A&F an­nounced plans to open a chil­drenswear arm next to its flag­ship store on Sav­ile Row, the heart­land of English be­spoke tai­lor­ing, busi­ness own­ers on the street protested.

Hol­lis­ter, A&F’S big­gest brand, has also been at the cen­tre of a num­ber of con­tro­ver­sies in­clud­ing, in 2010, pro­hibit­ing a staff mem­ber from wear­ing a Re­mem­brance poppy be­cause it was not con­sid­ered part of the ap­proved uni­form. The re­tailer was sub­se­quently lam­basted by the Bri­tish press.

But in many ways Hol­lis­ter has been Aber­crom­bie & Fitch’s sav­ing grace, be­com­ing, over the past few years, its key rev­enue con­trib­u­tor.

In Novem­ber, A&F posted quar­terly sales of $346m (£274m), com­pared with Hol­lis­ter’s $515.1m, an an­nual in­crease of 1pc and 4pc re­spec­tively.

Horowitz, who ini­ti­ated a turn­around plan for the busi­ness when she as­sumed her role in 2017, said “im­proved per­for­mance” would al­low it to close 20 fewer US stores than pre­vi­ously planned.

De­spite Euro­pean sales lag­ging be­hind those in the US, A&F said it had no plans to exit the mar­ket. In fact, the re­tailer is ex­pand­ing its shop­ping­cen­tre pres­ence and this Septem­ber opened a 5,554 sq ft store at the Traf­ford Cen­tre in Manch­ester, one of a hand­ful of pro­to­type stores be­ing opened in Europe to trial the brand’s new di­rec­tion.

“We are not the Aber­crom­bie & Fitch that you once knew,” Horowitz said at a com­pany in­vestor day in April. Stores are no longer de­prived of nat­u­ral light from boarded-up win­dows, and the mu­sic is set at a com­fort­able level. The shirt­less mod­els are long gone, as are the provoca­tive ad cam­paigns.

An A&F spokesman said there re­mained a “few out­dated per­cep­tions of the com­pany” but that it had worked hard over the past four years, un­der new lead­er­ship, “to evolve and en­sure that in­clu­siv­ity is in­te­grated into all that we do”.

Re­tail ex­pert Clare Bai­ley said Horowitz had made the right de­ci­sion to re­work the brand’s propo­si­tion to match what to­day’s con­sumers want. “Aber­crom­bie has a strong per­son­al­ity and iden­tity, and in the cur­rent re­tail land­scape this will work in the com­pany’s favour”.

‘A lot of peo­ple don’t be­long [in our clothes], and they can’t be­long. Are we ex­clu­sion­ary? Ab­so­lutely’

Top, cus­tomers queue out­side the Lon­don Hol­lis­ter store, owned by A&F. Left, Fran Horowitz, CEO. Be­low, an A&F model

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