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Reinventing an American

Icon:
Abercrombie & Fitch

Manal Akhtar
Katrin Franye
Jason Ip Chuk San
Mike Kaminski
Alejandro Brusi Montero
Zhengran (Max) Zhu

(211532876)
(214002711)
(212286613)
(212084133)
(214011597)
(212140000)

MKTG 4321 S
Dr. Markus Geisler
0
April 6, 2015

Table of Contents
EXECUTIVE SUMMARY .................................................................................................................................. 2
INTRODUCTION ............................................................................................................................................. 3
INDUSTRY LANDSCAPE .................................................................................................................................. 3
ANALYSIS ....................................................................................................................................................... 5
SWOT ANALYSIS ............................................................................................................................................ 5
MYTH MODEL PERSPECTIVE ......................................................................................................................... 7
CUSTOMER EXPERIENCE DESIGNS ................................................................................................................ 8
PROBLEM ...................................................................................................................................................... 9
ALTERNATIVES............................................................................................................................................. 10
RECOMMENDATION ................................................................................................................................... 14
IMPLEMENTATION ...................................................................................................................................... 16
CONCLUSION............................................................................................................................................... 18
APPENDICES ................................................................................................................................................ 19
ENDNOTES................................................................................................................................................... 22

EXECUTIVE SUMMARY
Starting out as a small athletics supply store to becoming one of North Americas most
recognizable brands, it is undeniable that Abercrombie & Fitch (A&F) has a long and storied
history in American culture. That history is also filled with brilliance by way of innovation and
rebranding, as well as defeat through bankruptcy and controversy. In fact, Abercrombie & Fitch
has had its fair share of issues in terms of controversial practices and the inability to rebrand and
reposition itself in the retail industry and in the minds of its consumers as well. Although the
company maintains its strength in its vast portfolio of brands, its weaknesses are heavily
restricting any ability for the company to make a rebound in the market. These weaknesses
include the ease of substitution by similar brands such as Aeropostale and American Eagle, as
well as the fact that their merchandise is generally sold at higher price points in comparison to
these competitive brands. The companys focus on being physically attractive and exuberating
sex appeal combined with their overly-sexualized in-store experience forms the basis behind
their brand image of an all-American retailer. As a result of this belief, the company has made it
its mission to ensure that their strategy centered on inclusiveness is maintained. With the new
social trend towards beauty in all shapes and sizes, the companys practices have been criticized
and negatively received, which inevitably led to a decline in sales and its customer base.
Alternatives to improve A&Fs current business model include: changes to their target market,
brand image, and product offering. After analyzing and weighing the strengths and weaknesses
of each alternative, we felt it would be the most beneficial for A&F to employ an initiative that
aims to change their company image. In doing so, we believe that adopting a Doppelganger
mentality to continually match up with consumers current tastes and preferences would be
crucial in turning around the companys performance.
2

INTRODUCTION
Are you beautiful? In a perfect world, the answer to such a question would obviously be
yes, everyone is. However, by Abercrombie & Fitchs standards, we would not all make the
cut, and that is where things took a nasty turn for the company.
Although A&F was established in 1892, it did not start selling modern apparel until 1979.
In that time, the company experienced both good and bad periods serving as a large supplier of
hunting and sporting goods, eventually culminating with the companys bankruptcy in 1977.
Following its failed attempt to focus on athletic clothing between 1979 and 1988, the company
was acquired by Limited Brands and it changed its focus entirely on modern fashion. From that
point on, the company not only experienced massive financial success, but it also established
itself as a fashion and cultural icon.
With scandals and declining sales plaguing their every step, recent times have not been so
favourable for the company. A&F is now scrambling once again to promote a more positive
corporate image, which saw long-time CEO Michael Jeffries stepping down from the company
and bringing in a wider range of sizes. However, the question still lingers to what else the
company can do to get itself out of this sticking situation and once again become one of the top
American retailers of clothing.

INDUSTRY LANDSCAPE
To get a better idea of the current state of A&F, it is useful to examine its industry
landscape as well as the present status of some of its competitors. Although retail sales took a
massive hit during the financial crisis of 2007-08, current retail sales have bounced back and are
nearly at the levels of those before the crisis. As the economy continues to improve with job
3

creation as well as the expected increase in disposable income due to lower gas prices, retail
sales are also expected to increase. But one thing has changed - where consumers shop. Rather
than shopping at individual brand boutiques (i.e. American Eagle, Aeropostale or A&F),
consumers are now choosing to spend their money at larger retailers who offer a greater selection
and often at lower prices. These include stores like H&M, Forever 21 and Zara where consumers
are often less brand conscious and prefer to have the freedom to choose from many brands and
different fashion styles.
Nevertheless, boutique brick-and-mortar stores are still a major driving force in the retail
fashion industry. While A&F is struggling, - their 2015 first quarter earnings report fell short of
analysts expectations and management has withdrawn $80 million from its cash reserves i - they
are not alone in this situation. In fact, Aeropostale (who targets the 14-to-26 age group) has
experienced declining sales with many financial analysts predicting financial losses for the firm
in the near future. Both companies however, rely on physical locations to drive their sales, as
their stores account for roughly 90% of sales. Their third competitor - in terms of both fashion
and target market - American Eagle (AE) also finds itself in the same position with declining
sales and a loss of relevance. More recently, AE has seen its stock prices surge due to a new
market strategy that attempts to broaden its consumer base and offer more incentives through
promotions (but fewer discounts) for consumers to shop at their stores.ii
Despite this and the reduced appeal of in-store shopping, A&F still has the opportunity to
maintain its profitability and image. Retail sales are still powerful, particularly during the holiday
season, and companies such as AE have proven that retailers are able to emerge from temporary
slumps. It is now up to A&F to make the necessary changes to succeed in the evolving market
environment.
4

ANALYSIS
To further identify the opportunities that can be explored in the retail sector, below are
three models that position A&Fs brand within their external environment.

SWOT ANALYSIS
Please see Exhibit A for a condensed version of A&F retail environment.
Strengths:
A&F has a strong and varied portfolio of brands under its umbrella, catering to a range of
age groups including Abercrombie, Abercrombie Kids, Hollister and Gilly Hicks. According to
its 2014 annual report, A&Fs brands can be found in malls across the world, operating 843
stores in the US and 163 stores abroad. iii Despite having a low global presence, the company
still has strong brand recognition - affiliated to its nationality - and its major presence in the
States obviously reinforces that message. Lastly, A&F has a strong e-commerce presence as total
online sales totalled 19 percent of overall sales in 2014. iv
Weaknesses:
Two of A&Fs four brands, Abercrombie and Hollister, carry related products with
similar prices and can easily replace one another as substitutes. Without differentiating their
brands through intensive marketing efforts, A&F is unable to maximize the benefits from each
brand, which increases the risk of cannibalization by one of them. The American retailer is also
extremely reliant on the US market; for instance, 52% of total sales were attributed to the US and
the remaining 48% were from international sales and direct-to-customer sales (Exhibit B). v
Therefore any changes in American consumer preferences or macroeconomic factors will
heavily impact Abercrombies financial performance.
5

Almost all of A&Fs products offerings are targeted to millennials yet are priced
extremely high relative to competitors such as Aeropostale and AE. For example, denim jeans at
Abercrombie generally retail for $68-$88 whereas similar jeans at Forever 21 retail for $25.vi
This can essentially limit the amount of merchandise bought at Abercrombie & Fitch, seeing as
most young consumers buying from the clothing brand do not have the disposable income
necessary to make frequent purchases. Current brand image and marketing tactics also give rise
to the companys lack of focus in regards to an online presence. When shopping at an
Abercrombie & Fitch store, customers tend to find loud music, dim to no light , heavily scented
perfume, alluring pictures, a disorganized layout, all while being served by extremely attractive
staff members. This would be ideal if the store was catering to teenage boys and girls, but this is
a major turnoff for several other people. (Exhibit C)
Opportunities:
As long as American values continue to resonate with local consumers, A&F has the
potential to gain deeper penetration in foreign markets, particularly in China and Japan. With the
rise of e-commerce and a strong online platform, A&F will also be able to remain in a
competitive position going forward, as it already grasps many of the first-mover advantages in
this area. Lastly, the mens and womens apparel industry is improving in the wake of the Great
Recession, posting 5 and 4 percent growth respectively in 2013. vii These numbers are a
promising indicator for A&F and retailers alike in the industry.
Threats:
More notably, A&F has been subject to negative publicity in the last three years due to
their discriminatory hiring practices and the offering of small clothing sizes for females. These
decisions have caused a damper on their performance, which was apparent in 2013 when their
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sales dropped by 11 % in comparison to 2012. This was also the same time when Mike Jeffries
remarks resurfaced which regarded only targeting thin and cool college and high school
students.viii Overemphasis on the American market is also a potential threat as it is not consistent
with the globalization of the retail fashion industry. Brands such as ZARA, H&M and Uniqlo are
still expanding in the US and therefore pose a viable threat to A&Fs key market share. ix

MYTH MODEL PERSPECTIVE


A&F fulfills the myth of an attractive and popular all-American collegiate individual.
Purchasing from this retailer essentially signifies a desire for belonging and the need to showcase
the group one belongs to. Take for instance, Abercrombie & Fitchs hiring practises where the
company claimed to only hire good-looking people in their stores and then labelling them as
models rather than associates. This not only strengthens the myth model centered on this vivid
brand image, but it solidifies the fact that Abercrombie & Fitch does not appeal to everyone. This
element of exclusion is essentially what separates the cool kids from the rest of the pack, and
wearing Abercrombie & Fitch was an apparent way of making this clear to others. Its target
market is geared towards attractive teenagers who embody the all-American look that the brand
prides itself on. Having blond hair and blues eyes and a physically fit body were definitely things
related to A&Fs preference for a Caucasian brand image geared to popular Caucasians. This
was highly apparent both in stores through the look of its employees and its print advertisements,
especially on its shopping bags. A brown bag with a guys abs was just one of the ways for
consumers to distinguish the brand from others, which not only feeds into the myth of wanting to
belong to the popular clique, but it strengthens Abercrombie & Fitchs brand image tenfold.
(Exhibit D)
7

CUSTOMER EXPERIENCE DESIGNS


For a sample experience of a generic A&F store layout, please see Inside Abercrombie and
Fitch on YouTube (https://youtu.be/6XX1jneTna0).
Ultimately, the perceived landscape is what carries out the myths and brand image that
A&F designs. Regardless of its provocative images, pungent cologne and unbelievably attractive
models, the brand produces a physical dimension that successfully stimulates its loyal shoppers
and simultaneously irks its vocal opponents (haters). This dimension enables their servicescape
to be more humanized. In a post by GQs senior digital editor and social media genius John
Jannuzzi, his recent visit to A&F made him feel like a kid again and - like many others of the 90s
generation of A&F customers - repeatedly referencing to the familiarity of its scent, lack of
lighting and change rooms as he revisited them.x The rush of memories and emotions gave him a
source of familiarity that is nowhere as striking in other stores, going to show that A&Fs bold
tricks and experiential tactics are extremely effective in building human connections and a
humanized environment overall. Striking as it may seem, the unappetizing retail design cues
helps them carve a greater mind share in the minds of all customers and explains why it hesitated
to redesign its stores following its troubles after the 2008 recession.xi
Considering the other environmental dimensions left out of M.J. Bitners research on
servicescapes, the spotlights and dark-lighting of A&Fs stores help reduce the perceived social
density of its stores to the passerby. xii Further augmented by tightly-drawn shutters and loud
music, customer-to-customer interactions are limited and customers are left to experience the
store design by themselves. (Even if they were with somebody else, it would be hard to share
thoughts over the loud music) This is an important control for A&F for many reasons:

i.

It mitigates the impact of undesirable customers - fat, loud, obnoxious, etc. - on their
desired customers, which could prompt them to leave

i.

It reduces the shopping stories shared by customers on formal and informal social
networks (i.e. I was shopping at A&F once and I saw...)

A&Fs employees are also renowned for poor customer service, as their employees are
inadequately trained and are mainly focused on keeping the merchandise neat and folded. xiii
While this may reject customers seeking an emotional connection to the store, it helps A&F
standardize the customer-employee experience across all its 567 stores and, again, making it
appear that the entire store was designed for you (ruffled clothes indicate the presence of other
customers).
In sum, the lack of emotional proximity that A&Fs employees provide to its customers
enhances their brand performance. The richness of their physical and social cues - from images
of playful, vibrant youth to the perceived seclusion one feels as they shop - provides customers
with a one-of-a-kind consumption experience amongst hundreds of similarly-designed stores in
large shopping malls across the globe. Best of all, it delivers its product differentiation at a very
low cost as the largest cost driver for retail businesses (labour) is standardized at minimum wage.
xiv

PROBLEM
Where exactly did A&F go wrong? Firstly, its branding strategy was built around
adhering to the companys all-American look through sex appeal. As a result of this,
Abercrombie & Fitch established itself as the epitome of what is meant to be cool for its
teenage target market. In doing so, the company alienated many groups of people on the basis of
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only going after the attractive consumers who fit the aforementioned look policy. This strategy
was nevertheless more apparent when Jeffries expressed his reasoning to only target the
attractive all-American kids and to exclude those who do not belong to this model. Positioning
the company in such a way has given rise to many other problems ranging from discrimination in
the workplace, its employment practises, and its treatment of customers.

ALTERNATIVES
In order for A&F to turn their business around, it must significantly alter its business
operations in order to embrace the change in customer preferences and the emergence of new
trends. Below are three distinct alternatives that Abercrombie & Fitch can undertake in order to
respond to such things. Each one of the alternatives focuses on one of Abercrombie & Fitchs
key areas of interest: the target market, the companys image, and the companys product
offerings. The following section will detail some strengths and weaknesses for each alternative,
based on criteria we have set, and deliver a final recommendation.

Alternative One - Target Market Evolution


As the initial generation of teenagers has grown out of the Abercrombie & Fitch brand,
the company must align its brand message along the same path that society and its audience have
taken. It must continue to cater to the same age demographics it always has (teenagers and young
adults) as they are the most vulnerable to brands with strong identity values. They are also the
most active brand ambassadors any retailer can mobilize in this market segment, as they interact
with hundreds of other members of the same target market on any given weekday, often sharing
the brands storyline. A&F however, needs to redesign its promotional strategies for the 2015
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Teenager. One who prefers to be the brand himself or herself rather than a person that
embodies a few specific brands. Brought on by the power of digital and social media,
particularly Instagram, young adults now possess the technological channels to build their own
brand images and (nourish) the significance of individual voices and the power of the one
persona behind them. In the words of Marcie Merriman, former director of brand strategy at
Victorias secret, social media and style blogs have given teenagers the impetus to develop
individual styles rather than sharing trend uniforms or must-haves with their peers.xv As a
technology of power, A&F can adopt a cultural image of a techspressive force and join forces
with todays teens to help them express themselves better. Be on their side!
The second component to this alternative addresses a potential contradiction to the
promotion of the aforementioned 2015 teenager. Although the company has had a history with
narrowing its clientele to only the beautiful people in the words of ex-CEO Jeffries, A&F risks
its business to become too focused on this specific niche, which is apparent with brands such as
Brandy Melville. Furthermore, it gives rise to naysayers who spread the image of the A&F brand
as a green Luddite technology - an inauthentic retailer that threatens to make you another victim
of their vicious branding and potentially take away from your ability to express yourself as a
brand. To address this problem, A&F should expand its definition of a beautiful person to one
that the mass majority of society accepts. It will aid in their recovery from a negative image of
being a disrespectful brand, while also helping them own a broader market presence.

Alternative Two - Changing the brands image


The second alternative proposes a change in the way Abercrombie & Fitch sells itself in
regards to its brand image. Its current image is built on physical sex appeal by using attractive
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models and suggestive clothing designed specifically for the small and skinny. Just take a look at
any A&F billboard - one is likely to find several semi-nude young models portraying a sexuallycharged scenario while wearing A&F gear (Exhibit E). This is the dominant theme in any headto-head (H2H) interactions with the brand, particularly in its brick-and-mortar stores. As the
retail setting still remains as a main driver of key sales revenue for most retailers, A&Fs
physical environment may be perceived as more uninviting than inviting. In fact, the atmosphere
captured by scantily clad girls folding clothes, loud electronic dance music (EDM) and its strong
Fierce cologne sprayed throughout the store, can be seen as too focused on selling sex and
intimidating for those who do not identity with these things. On the contrary, retailers such as
Zara make it their mission to save up to 20% more energy and by mobilizing the H2H experience
to build a more powerful consumer-brand bond by forging stronger emotional attachments with
its shoppers. This alternative suggests a move away from being the traditional sexy brand
(physical beauty) and reinventing sexy by means of promoting diversity above all. By
removing its edgy, all-American sex appeal, this could essentially be going against everything
that Abercrombie & Fitch stood for, and so, this alternative would see the company embracing
this new wave of sexiness through cultural diversity both in terms of its brand image and its
merchandise and its employees. In doing so, Abercrombie & Fitch would:
i.

Still remain true to the core values it represents, and the brand loyalists who
consumed the existing brand;

i.

Provide its consumers with national values that they would not hesitate to embody,
share and consume (especially in the United States, their largest market).

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National ideologies are always a safe choice for marketers, especially as America deals with its
fallout from the worlds economic stage, and the trend towards promoting beauty through
different looks should definitely not be ignored.

Alternative Three - Diversify the product offerings


Lastly, a third and more drastic alternative suggests that A&F change its product
offerings. Competitors in the fashion landscape such as Aeropostale and American Eagle have
struggled in recent years while H&M, Forever 21 and Zara have flourished in their business
models. What are these models? Rather than focusing on building brand allegiance, these fastfashion outlets have concentrated on the mass production of basic essentials and then selling
them at affordable prices; thus allowing them to realize scale economies. Their offerings are
smart and timeless in many senses, not polarizing to the normal individual yet distinctive in
their style and design. On the other hand, merchandise by A&F can only be recognized by the
large, exaggerated logos and fonts that dominate the front of every item of clothing. While this
may be appealing for the young audiences it targets, the individual that wears the shirts and polos
loses his or her position as the focal point of attention - a trait that counters the personal branding
movement we are participating in today (as described in the first alternative). A&F could address
this concern by producing more brand-neutral clothing and differentiate itself by improving the
raw materials used or changing its price structure (the average price of a full-price basket of
goods was $516, $358 higher than Forever 21 and $129 above the group average.xvi This move
however, could severely decrease the scope of audiences that learn about the brand every day.
A&F could address this in two ways:

13

i.

Creating opportunities for co-creative collaboration between its consumers and its
design process, by allowing them to suggest what items best define them and how
they add to their A&F style;

i.

Implementing programs to cultivate brand loyalty across school campuses in North


America, representing their brand through recruited individuals rather than innocent
consumers (similar to Avon ladies at Avon Products, Inc.).

Each of these ambassadors will be able to infuse A&Fs storyline with their personal stories,
adding depth to the brand message and extending its longevity in the competitive marketplace.

RECOMMENDATION
Rejection of Alternatives One and Three
Given A&Fs current state of affairs, alternative one would push the brand to mainstream
popularity as it would broaden the individuals that are attracted to its brand. For most of its postrevitalization history - after 1988 - A&F has stayed true to bringing teenagers on board with its
culture rather than adapting its culture to support the teenager. By only stocking sizes to a certain
level for girls, it becomes a mythical brand that is a sisterhood of its own and gives any wearer
the admission to its special club. Opening the doors will take away from the specialty of the club
and would demolish the foundational strategies that has made it successful all these years.
On the other hand, A&F is not positioned well-enough to broaden its clothing lines and
remove its iconic, flashy ABERCROMBIE & FITCH top designs. Their quality, while highlytouted, is more expensive to produce than fast-fashion giants such as H&M and Zara and any
significant price cuts could saturate the market with A&F clothing - making it less special and
desirable. An attempt to design clothing with their consumers may not work either; after all,
14

most of the thought leaders are teenagers and their opinions may not be widely accepted by
A&Fs regular teenage shoppers. And hiring brand ambassadors to deliver the brand message
makes A&F more susceptible to bad publicity, which is the exact reason why it discourages even
its own employees to interact with in-store shoppers.
Both of the above alternatives attempt to help A&F evolve with the changing
marketplace, but only resolve A&Fs problems from one dimension and leave another open for
doppelganger image attacks.

Recommendation of Alternative Two


We chose the second alternative as our recommendation for Abercrombie & Fitch so that
the company can adopt a brand image that is more appealing to a wider audience of customers
and to accept diversity rather than continue to focus on a specific set of individuals. In doing so,
the company will definitely need to undergo some changes to its operations, but we believe that
this alternative will allow A&F to maintain its status as an all-American retailer. The brand
image serves as the underlying factor in ushering in the new wave of consumers who are
culturally diverse both in their style and their preferences. Seeing as A&F was big on excluded
anything other than its all-American look, people started turning their backs on the brand and
moving to retailers like H&M and Zara, retailers that embrace diverse body sizes through their
line offerings. Responding to new or emerging trends represents the most appropriate way for
Abercrombie & Fitch to remedy this situation as its current brand image is hurting its sales and
its customers. In theory, the acceptance of diversity represents a new wave for Abercrombie &
Fitch and other retailers alike. The next step is ultimately for A&F to dive headfirst into the
incoming wave and diversify its brand image. This alternative would see the company redefine
15

what it means to be all-American in todays terms. Furthermore, this definition of all-American


needs to address the blending of different cultures and styles as a way to compete in the retail
marketplace. This will show consumers that the A&F brand has more to offer than just
promoting physically attractive Caucasian models.
Furthermore, the adoption of a new brand image is much more cost efficient than
changing the retailers product offerings and less risky than investing in a teenage market that
adopts a new fad every few years. Though doppelganger images will arise to expose A&Fs
rebranding efforts, it is easier to revitalize A&Fs brand image and meaning than to, for instance,
reposition the clothes that they offer (which may involve new product designs, colours and
manufacturing processes). The wide availability of teenagers, its target market, is a gold mine for
A&Fs brand marketers as they can be easily mobilized as actors and actresses to help build new
mythic brand images and battle doppelganger ones as they emerge. And unlike Botoxs target
consumers, teenagers are not facing the same mid-life crises or life stories - this gives A&F the
flexibility to design their brand in many possible ways to battle the disparaging images, without
fear that it may alienate any large portion of its market.

IMPLEMENTATION
In order for Abercrombie & Fitch to change its brand image in the minds of its
consumers, the company must first give them a reason to alter their prior understanding and
opinions on its pre-existing methods of operation. Think of this alternative as a way to sustain
the desire to be a part of Abercrombie & Fitch, but with a more modern acceptance for diversity
both in terms of its employees and its retail stores. By upholding the companys standards when
it comes to its clothing line, Abercrombie & Fitch can definitely implement a move towards
16

diversity through a more diverse workforce, new procedures in regards to its look policy, and the
promotion of different genres of music in their stores.
It comes with no surprise that sex sells and Abercrombie & Fitch is no stranger to using
sex symbols to sell its merchandise; however, this can also be perceived as intimidating for
consumers who do not identify with this all-American image. Because of this, it is important for
Abercrombie & Fitch to introduce more diverse models both in terms of its advertisements and
its employees so that this brand image which is centered on diversity can resonate with a much
larger mass of teenage individuals. In doing so, Abercrombie & Fitch still keeps its powerful
image of being all-American, but it gives consumers a reason to once again wear the clothes
knowing that the connotation of being culturally diverse is another form of sex appeal. At the
same time, it goes beyond just revitalizing Abercrombie & Fitchs image through its promotion
of its workforce; the company also needs to reformulate its stores so that customers are treated to
a much more accepting environment to step into. Music plays a major role in setting the
atmosphere for shoppers retail experience and so, Abercrombie & Fitch can easily incorporate a
much more diverse playlist to really portray that culturally diverse theme throughout its stores.
Furthermore, the company could tailor their music selection so that certain songs are played
during different parts of the day, rather than constantly playing the same genre of music
throughout the whole day. Finally, Abercrombie & Fitchs stores could also benefit by
encouraging its employees to piece together their own unique look using any articles of clothing
from Abercrombie & Fitch rather than have them adhere to a specific dress code which typically
encourages jeans to be worn cuffed and with flip flops for guys for example. As a result of this,
the company can really showcase their shift towards embracing diversity and essentially

17

celebrating individuality and uniqueness, but still demonstrating the all-American look that is
embedded in its clothing and its quality.

CONCLUSION
After a thorough analysis that covers Abercrombie & Fitchs past business history as well
as the current state of their business operations, it is clear that the company is in trouble. A
controversial CEO, depleting cash reserves, controversy over company values and declining
sales all culminated into present day problems for the company. By using specific models of
marketing, the company also shows no signs of wanting to align with the preferences and ideals
of modern day consumers. It is clear that Abercrombie & Fitch needs to do something, and they
need to do it now. To shake off their controversial image and reinvigorate their business
operations, the company must undergo a drastic change to play into current consumers desires.
As a result of this, we believe that it would be the most beneficial for Abercrombie & Fitch to
change their brand image so that they can sustain the elements of their identity that made them
successful. At the end of the day, if Abercrombie & Fitch does not embrace change, they can
soon be left behind in the retail industry. What is truly important is being ready for the next wave
and not being afraid to ride it when it comes.

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APPENDICES
Exhibit A: SWOT for Abercrombie & Fitch
Strengths

Strong brand portfolio with four brands


under its name: Hollister, Abercrombie
kids, and Gilly Hicks brand
Strong online presence.

Weaknesses

Opportunities

Easier penetration into other markets, due


to strong brand recognition
Improved apparel industry

Brand similarity
Overreliance on the US market
Pricing isnt in compliance with target
markets buyer power
Poor in-store experiences

Threats

Negative brand image. (discriminatory


practices)
Stiff competition from Zara, H&M and
Forever 21

EXHIBIT B: Sales from each geographic region (Abercrombie and Fitch Annual Report 2013)

19

EXHIBIT C: Standard Abercrombie & Fitch store design

EXHIBIT D: Sample A&F myth model

Populist World:
Cultural Ideology:

Youth subculture

In order to be popular, one


must be attractive and
belong to a clique

Desire to be popular and


exclusive

Identity Myth:
Desire is established
through sexy ads and
feeling of exclusivity instore (particular-sized
clothes, specific racial
preference)

Identity Position:
Lack uniqueness,
desirability and social
acceptance

Identify with myth


through ads, clothing
styles and music

20

EXHIBIT E: Sample A&F Advertisements

21

ENDNOTES
i

<http://markets.ft.com/research/Markets/Tearsheets/Financials?s=ANF:NYQ>

ii

<http://www.reuters.com/article/2015/01/08/us-aeropostale-forecast-idUSKBN0KH1B520150108>

iii

A&F Annual Report 2014 <http://www.abercrombie.ca/anf/investors/investorrelations.html>

iv

<http://advantage.marketline.com.ezproxy.library.yorku.ca/Product?pid=5A7C56D0-670A-41DB-A218EFD5FA924AD1>
v

<http://www.abercrombie.ca/anf/investors/investorrelations.html>

vi

<http://www.huffingtonpost.com/2014/12/03/abercrombie-sales_n_6265000.html>

vii

<http://advantage.marketline.com.ezproxy.library.yorku.ca/Product?pid=5A7C56D0-670A-41DB-A218EFD5FA924AD1>
viii

A&F Annual Report 2014 :<http://www.abercrombie.ca/anf/investors/investorrelations.html>

ix

<http://www.fashionunited.co.uk/fashion-news/fashion/clash-of-the-fashion-titans-hm-vs-forever212013121719445>
x

<http://www.gq.com/style/blogs/the-gq-eye/2014/12/abercrombie-ceo-mike-jeffries-is-out-but-how-bad-has-itgotten-really.html>
xi

<http://content.time.com/time/business/article/0,8599,1918160,00.html>

xii

Bitner, M.J. (1992), Servicescapes: the impact of physical surroundings on customers and employees, Journal
of Marketing, Vol. 56 No. 2, pp. 57-71.
xiii

<http://www.dailymail.co.uk/femail/article-447183/Poseurs-Paradise-Whats-really-like-work-new-Abercrombie-Fitch-store.html>
xiv

<http://www.salon.com/2012/02/04/the_absurd_life_of_an_abercrombie_fitch_model>

xv

<http://www.dailymail.co.uk/femail/article-2318963/The-art-perfect-1-25-inch-turn-Inside-Abercrombie--Fitchstaff-guide-thrown-preppy-look.html>
xvi

Credit Suisse, Feb. 2015

22