Saturday, May 18, 2024

I compared American Eagle and Abercrombie and found 2 millennial brands remaking themselves for Gen Z in very different ways

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I visited American Eagle and Abercrombie to compare the two retailers.

Jennifer Ortakales Dawkins/Business Insider

American Eagle Outfitters and Abercrombie & Fitch used to be considered millennial brands.Today, both retailers have found success with Gen Z shoppers. I visited the stores to compare how they’ve captured young customers.

Gen Z has a way of making millennial fashions cool again, often causing chagrin or amusement to millennials like me.

It should come as no surprise that Gen Z helped revive two major apparel brands that millennials fervently shopped at as teens — back when the mall was the best place on earth.

American Eagle Outfitters and Abercrombie & Fitch have seemingly hit the lottery with young shoppers. Along with Uggs and Coach, brands that rose in the early aughts have gained a new customer base thanks to smart marketing and a little nostalgia.

After struggling with declining sales, American Eagle was the first of the two brands to turn itself around, with more inclusive marketing to regain the teen market and fewer logos on its merchandise. In 2018, comparable sales were up 5% for its namesake brand. American Eagle also owns brands like Aerie and purchased menswear brand Todd Synder in 2015.

In 2022, American Eagle reported $5 billion in annual net revenue. This year, the company reached record Q3 revenue of $1.3 billion, up 5% compared to last year.

Abercrombie began plotting its comeback once former CEO Mike Jeffries resigned from his post in 2014 and took Abercrombie’s exclusive, sexualized, and super-preppy image with him. After Fran Horowitz took over as CEO in 2017, the company’s sales began to improve.

In 2022, the company reported $3.7 billion in annual net sales. That year, Horowitz introduced an “Always Forward Plan,” which outlined how the company would achieve annual revenue of more than $4 billion by 2025.

Abercrombie’s stock was up more than 285% in 2023, surpassing Nvidia’s massive gains, Bloomberg reported. The brand has come a long way, appealing to a slightly older customer base of 20- and 30-year-olds instead of just teens.

“We are no longer a jeans and T-shirt brand,” Horowitz told investors in a recent earnings call.

I visited both stores to compare the two. I wondered how they’ve successfully captured Gen Z customers and set themselves apart.

First, I visited American Eagle. The exterior of the American Eagle store.

Jennifer Ortakales Dawkins/Business Insider

The store is located at 599 Broadway in Manhattan’s Soho neighborhood. This location is called The Gateway, a multilevel store that houses all of the AEO brands. I focused on the American Eagle brand for this story.

Women’s clothing was at the front of the store.Denim is a key category for American Eagle.

Jennifer Ortakales Dawkins/Business Insider

American Eagle’s women’s clothing began at the front entrance, featuring many trendy denim items like maxi skirts and tube tops.

The styles were youthful and trendy. Mannequins were styled with layers of denim.

Jennifer Ortakales Dawkins/Business Insider

While American Eagle certainly carries pieces that are appropriate for many ages, the focus seems to be on styles geared to teens.

There were several markdowns. American Eagle makes its sweaters with soft materials.

Jennifer Ortakales Dawkins/Business Insider

I went shopping at the height of the holiday season and saw an emphasis on soft and cozy materials and a lot of promotions. Some sweaters were 30% off. A pair of faux leather cargo pants was 50% off.

I spotted a ‘bear hug’ sherpa jacket.The fleece jackets were very soft.

Jennifer Ortakales Dawkins/Business Insider

In keeping with that theme of soft layers, there was a “bear hug” sherpa jacket available in several bright and pastel colors. I really liked the one that came in a green and baby blue pattern, so I picked it up to try it on. The jackets were also 40% off.

The women’s denim took up an entire section of the store.A wall of denim in the American Eagle store.

Jennifer Ortakales Dawkins/Business Insider

American Eagle carries a variety of denim styles and washes. Keeping with the Gen Z focus, there were a lot of wide-legs, flares, and bell-bottoms. While American Eagle does carry skinny jeans, they weren’t positioned as prominently.

The men’s section was upstairs. The men’s section at American Eagle.

Jennifer Ortakales Dawkins/Business Insider

Half of the second floor was devoted to American’ Eagle’s activewear for women, while the other half was devoted to the men’s clothing.

Of all the brands under the AEO umbrella, the men’s clothing seemed the least touched since the early aughts. While the styles have been updated for today’s trends, there were still lots of plaid shirts, graphic tees, and cargos.

I made my way to the fitting rooms on the bottom level of the store.The fitting rooms at American Eagle.

Jennifer Ortakales Dawkins/Business Insider

After checking out a couple of other brands on the bottom floor, I went to the fitting rooms. There were plenty of rooms, and they were all empty, probably because most shoppers were on the upper levels of the store.

I tried a pair of AE77 jeans and T-shirt. Trying on the stovepipe style jeans.

Jennifer Ortakales Dawkins/Business Insider

I tried on a pair of jeans from American Eagle’s AE77 collection, which the company markets as premium, sustainable denim.

I liked the look of the stovepipe style, but they were a little big. I tried on a size 4 because they didn’t have the 2 in stock.

The cropped crewneck T-shirt was a nice quality and 100% cotton.

Next, I tried on the faux leather cargos and a henley top.Trying on faux leather cargos.

Jennifer Ortakales Dawkins/Business Insider

The cargos were fun and comfortable. They were a flattering fit — not too baggy or too slim. The henley was soft, and I could see it being a good layer underneath my sweaters this winter.

I loved the sherpa fleece jacket.Trying on the “bear hug” sherpa jacket.

Jennifer Ortakales Dawkins/Business Insider

I tried on the sherpa jacket on top of the previous outfit. The second I put it on, I knew I had to get it. As the marketing promised, it felt like hugging a giant plushie. It was warm enough to wear as outerwear on its own or layered underneath a bigger coat. I immediately pictured myself wearing it on my flight home for the holidays.

The jacket is made from 100% recycled polyester. I noticed that many of American Eagle’s clothes are made with recycled materials, undoubtedly another approach to appeal to environmentally-conscious Gen Z customers who like to buy lots of things, but also want to be sustainable.

I bought the entire second outfit. I walked out of the store with my purchase.

Jennifer Ortakales Dawkins/Business Insider

Earlier this year, I vowed to stop buying new clothes to save my wallet and space in my closet. But alas, I loved the second outfit too much to resist. I’d had a similar fleece jacket saved to my Pinterest, and I’d been wanting to replace a pair of faux leather pants, so I told myself it was meant to be.

Next, I visited Abercrombie & Fitch. Outside the Abercrombie store in Soho.

Jennifer Ortakales Dawkins/Business Insider

I walked down a couple blocks to Abercrombie’s Soho store at 547 Broadway. Abercrombie’s Fifth Avenue flagship is a better comparison to American Eagle’s Gateway store. However, I chose this Abercrombie store, which is much smaller, for the sake of proximity and focused on how the clothing, marketing, and target customer compared.

Women’s clothing was at the front of the store. The front of the Abercrombie store.

Jennifer Ortakales Dawkins/Business Insider

The store seemed busy. I walked in at the same time as a group of 20-year olds who sounded smitten with Abercrombie’s sweaters.

Abercrombie’s popular Sloane pant was front and center.The Sloane tailored pant.

Jennifer Ortakales Dawkins/Business Insider

Trousers have diversified Abercrombie’s pant sales into categories outside of denim.

In an earnings call, CEO Fran Horowitz told investors that while denim continues to be an important part of the business, the company has seen strong conversion in non-denim pants.

“We are really focused on the fact that bottoms are much more than denim today,” she said. 

Abercrombie also had several markdowns.The crew pearl-button cardigan was discounted 30%.

Jennifer Ortakales Dawkins/Business Insider

Sweaters were 30% off, and some pants were marked down by 50%.

One wall featured eveningwear and party dressesSequins and black are go-to styles for holiday and New Year’s Eve parties.

Jennifer Ortakales Dawkins/Business Insider

One way Abercrombie sets itself apart from American Eagle is its selection of more formal clothing like trousers for the office and special occasion dresses.

Some of the outerwear was designed with eco-conscious customers in mind. Two winter jackets at Abercrombie.

Jennifer Ortakales Dawkins/Business Insider

One jacket was labeled as vegan leather, while another had interior tags touting its recycled insulation.

The store was very long and narrow.Sweaters were stacked in front of athletic wear.

Jennifer Ortakales Dawkins/Business Insider

This particular store felt cramped due to the long, narrow format. Athletic clothing like leggings and sports bras were hidden behind stacks of sweaters.

Denim was prominently featured in the middle of the store.Stacks of denim.

Jennifer Ortakales Dawkins/Business Insider

Gone are the days of Abercrombie’s heavily ripped denim. There are a few distressed styles, but most of the jeans are without holes.

The men’s section was all the way at the back of the store.Men’s clothing at Abercrombie.

Jennifer Ortakales Dawkins/Business Insider

You have to walk past the fitting rooms through a narrow hallway to get to the men’s section. It felt like the men’s clothing had been an afterthought when they laid out the floor plan.

I waited in line for the fitting rooms.Waiting in line for the fitting rooms.

Jennifer Ortakales Dawkins/Business Insider

There were only four fitting rooms, which didn’t make sense for how busy the store was. I waited behind five people for about eight minutes.

First, I tried on a pair of faux leather pants and a half-zip sweater. The lighting in the fitting room wasn’t as nice as the Fifth Avenue Abercrombie store.

Jennifer Ortakales Dawkins/Business Insider

I really liked the sweater and was surprised the XS fit me perfectly because I’m normally a small in Abercrombie’s clothes. The leather pants were cute, but I didn’t like the cropped leg.

Then, I tried a knit bodysuit and a pair of cargo trousers.Trying on a knit bodysuit and cargo trousers.

Jennifer Ortakales Dawkins/Business Insider

The bodysuit fit nicely and I liked the look, but the material was thin. I really liked the pants — they were an office-appropriate twist on the very trendy cargo.

I wasn’t sold on any of the pieces I tried, but I made a mental note of the sweater and cargos for a later shopping trip.

I could see how American Eagle has maintained its appeal for teens.American Eagle carries classic tees and denim, along with more trendy pieces.

Jennifer Ortakales Dawkins/Business Insider

American Eagle has certainly freshened up its selection since its mall days but has kept a hold on young consumers with bright colors, soft fabrics, and styles that are trendy but not overtly fashionable. The brand takes all the viral looks from TikTok and pairs them down into approachable pieces for the everyday teen.

Yet, the brand still carries all the markers of classic American teen style: graphic tees, flannel shirts, preppy stripes, and lots — and lots — of denim.

Meanwhile, Abercrombie has captured the 20-somethings.Abercrombie carries styles that can be worn to the office or a weekend brunch.

Jennifer Ortakales Dawkins/Business Insider

Both brands have been successful appealing to Gen Z, but it was clear they’ve differentiated themselves to serve slightly different demographics.

If American Eagle is a younger, middle-America teen, Abercrombie is like the older, sophisticated sister who goes to school in the city and wears a lot of black. Most of the customers I saw shopping in Abercrombie were college-age, dressed like Soho influencers in baggy jeans and leather jackets. Even the teens I saw in the store had a darker, grungier style.

Abercrombie appeals to this demographic by doubling down on logo-free basics, office-appropriate trousers, and coastal grandmother sweaters. Nearly every piece can be dressed up or down for multiple occasions, making it a shopping destination for 20- and 30-somethings in need of a stylish, yet functional, wardrobe.

Read the original article on Business Insider
Avatar

Read more

Share

I visited American Eagle and Abercrombie to compare the two retailers.

Jennifer Ortakales Dawkins/Business Insider

American Eagle Outfitters and Abercrombie & Fitch used to be considered millennial brands.Today, both retailers have found success with Gen Z shoppers. I visited the stores to compare how they’ve captured young customers.

Gen Z has a way of making millennial fashions cool again, often causing chagrin or amusement to millennials like me.

It should come as no surprise that Gen Z helped revive two major apparel brands that millennials fervently shopped at as teens — back when the mall was the best place on earth.

American Eagle Outfitters and Abercrombie & Fitch have seemingly hit the lottery with young shoppers. Along with Uggs and Coach, brands that rose in the early aughts have gained a new customer base thanks to smart marketing and a little nostalgia.

After struggling with declining sales, American Eagle was the first of the two brands to turn itself around, with more inclusive marketing to regain the teen market and fewer logos on its merchandise. In 2018, comparable sales were up 5% for its namesake brand. American Eagle also owns brands like Aerie and purchased menswear brand Todd Synder in 2015.

In 2022, American Eagle reported $5 billion in annual net revenue. This year, the company reached record Q3 revenue of $1.3 billion, up 5% compared to last year.

Abercrombie began plotting its comeback once former CEO Mike Jeffries resigned from his post in 2014 and took Abercrombie’s exclusive, sexualized, and super-preppy image with him. After Fran Horowitz took over as CEO in 2017, the company’s sales began to improve.

In 2022, the company reported $3.7 billion in annual net sales. That year, Horowitz introduced an “Always Forward Plan,” which outlined how the company would achieve annual revenue of more than $4 billion by 2025.

Abercrombie’s stock was up more than 285% in 2023, surpassing Nvidia’s massive gains, Bloomberg reported. The brand has come a long way, appealing to a slightly older customer base of 20- and 30-year-olds instead of just teens.

“We are no longer a jeans and T-shirt brand,” Horowitz told investors in a recent earnings call.

I visited both stores to compare the two. I wondered how they’ve successfully captured Gen Z customers and set themselves apart.

First, I visited American Eagle. The exterior of the American Eagle store.

Jennifer Ortakales Dawkins/Business Insider

The store is located at 599 Broadway in Manhattan’s Soho neighborhood. This location is called The Gateway, a multilevel store that houses all of the AEO brands. I focused on the American Eagle brand for this story.

Women’s clothing was at the front of the store.Denim is a key category for American Eagle.

Jennifer Ortakales Dawkins/Business Insider

American Eagle’s women’s clothing began at the front entrance, featuring many trendy denim items like maxi skirts and tube tops.

The styles were youthful and trendy. Mannequins were styled with layers of denim.

Jennifer Ortakales Dawkins/Business Insider

While American Eagle certainly carries pieces that are appropriate for many ages, the focus seems to be on styles geared to teens.

There were several markdowns. American Eagle makes its sweaters with soft materials.

Jennifer Ortakales Dawkins/Business Insider

I went shopping at the height of the holiday season and saw an emphasis on soft and cozy materials and a lot of promotions. Some sweaters were 30% off. A pair of faux leather cargo pants was 50% off.

I spotted a ‘bear hug’ sherpa jacket.The fleece jackets were very soft.

Jennifer Ortakales Dawkins/Business Insider

In keeping with that theme of soft layers, there was a “bear hug” sherpa jacket available in several bright and pastel colors. I really liked the one that came in a green and baby blue pattern, so I picked it up to try it on. The jackets were also 40% off.

The women’s denim took up an entire section of the store.A wall of denim in the American Eagle store.

Jennifer Ortakales Dawkins/Business Insider

American Eagle carries a variety of denim styles and washes. Keeping with the Gen Z focus, there were a lot of wide-legs, flares, and bell-bottoms. While American Eagle does carry skinny jeans, they weren’t positioned as prominently.

The men’s section was upstairs. The men’s section at American Eagle.

Jennifer Ortakales Dawkins/Business Insider

Half of the second floor was devoted to American’ Eagle’s activewear for women, while the other half was devoted to the men’s clothing.

Of all the brands under the AEO umbrella, the men’s clothing seemed the least touched since the early aughts. While the styles have been updated for today’s trends, there were still lots of plaid shirts, graphic tees, and cargos.

I made my way to the fitting rooms on the bottom level of the store.The fitting rooms at American Eagle.

Jennifer Ortakales Dawkins/Business Insider

After checking out a couple of other brands on the bottom floor, I went to the fitting rooms. There were plenty of rooms, and they were all empty, probably because most shoppers were on the upper levels of the store.

I tried a pair of AE77 jeans and T-shirt. Trying on the stovepipe style jeans.

Jennifer Ortakales Dawkins/Business Insider

I tried on a pair of jeans from American Eagle’s AE77 collection, which the company markets as premium, sustainable denim.

I liked the look of the stovepipe style, but they were a little big. I tried on a size 4 because they didn’t have the 2 in stock.

The cropped crewneck T-shirt was a nice quality and 100% cotton.

Next, I tried on the faux leather cargos and a henley top.Trying on faux leather cargos.

Jennifer Ortakales Dawkins/Business Insider

The cargos were fun and comfortable. They were a flattering fit — not too baggy or too slim. The henley was soft, and I could see it being a good layer underneath my sweaters this winter.

I loved the sherpa fleece jacket.Trying on the “bear hug” sherpa jacket.

Jennifer Ortakales Dawkins/Business Insider

I tried on the sherpa jacket on top of the previous outfit. The second I put it on, I knew I had to get it. As the marketing promised, it felt like hugging a giant plushie. It was warm enough to wear as outerwear on its own or layered underneath a bigger coat. I immediately pictured myself wearing it on my flight home for the holidays.

The jacket is made from 100% recycled polyester. I noticed that many of American Eagle’s clothes are made with recycled materials, undoubtedly another approach to appeal to environmentally-conscious Gen Z customers who like to buy lots of things, but also want to be sustainable.

I bought the entire second outfit. I walked out of the store with my purchase.

Jennifer Ortakales Dawkins/Business Insider

Earlier this year, I vowed to stop buying new clothes to save my wallet and space in my closet. But alas, I loved the second outfit too much to resist. I’d had a similar fleece jacket saved to my Pinterest, and I’d been wanting to replace a pair of faux leather pants, so I told myself it was meant to be.

Next, I visited Abercrombie & Fitch. Outside the Abercrombie store in Soho.

Jennifer Ortakales Dawkins/Business Insider

I walked down a couple blocks to Abercrombie’s Soho store at 547 Broadway. Abercrombie’s Fifth Avenue flagship is a better comparison to American Eagle’s Gateway store. However, I chose this Abercrombie store, which is much smaller, for the sake of proximity and focused on how the clothing, marketing, and target customer compared.

Women’s clothing was at the front of the store. The front of the Abercrombie store.

Jennifer Ortakales Dawkins/Business Insider

The store seemed busy. I walked in at the same time as a group of 20-year olds who sounded smitten with Abercrombie’s sweaters.

Abercrombie’s popular Sloane pant was front and center.The Sloane tailored pant.

Jennifer Ortakales Dawkins/Business Insider

Trousers have diversified Abercrombie’s pant sales into categories outside of denim.

In an earnings call, CEO Fran Horowitz told investors that while denim continues to be an important part of the business, the company has seen strong conversion in non-denim pants.

“We are really focused on the fact that bottoms are much more than denim today,” she said. 

Abercrombie also had several markdowns.The crew pearl-button cardigan was discounted 30%.

Jennifer Ortakales Dawkins/Business Insider

Sweaters were 30% off, and some pants were marked down by 50%.

One wall featured eveningwear and party dressesSequins and black are go-to styles for holiday and New Year’s Eve parties.

Jennifer Ortakales Dawkins/Business Insider

One way Abercrombie sets itself apart from American Eagle is its selection of more formal clothing like trousers for the office and special occasion dresses.

Some of the outerwear was designed with eco-conscious customers in mind. Two winter jackets at Abercrombie.

Jennifer Ortakales Dawkins/Business Insider

One jacket was labeled as vegan leather, while another had interior tags touting its recycled insulation.

The store was very long and narrow.Sweaters were stacked in front of athletic wear.

Jennifer Ortakales Dawkins/Business Insider

This particular store felt cramped due to the long, narrow format. Athletic clothing like leggings and sports bras were hidden behind stacks of sweaters.

Denim was prominently featured in the middle of the store.Stacks of denim.

Jennifer Ortakales Dawkins/Business Insider

Gone are the days of Abercrombie’s heavily ripped denim. There are a few distressed styles, but most of the jeans are without holes.

The men’s section was all the way at the back of the store.Men’s clothing at Abercrombie.

Jennifer Ortakales Dawkins/Business Insider

You have to walk past the fitting rooms through a narrow hallway to get to the men’s section. It felt like the men’s clothing had been an afterthought when they laid out the floor plan.

I waited in line for the fitting rooms.Waiting in line for the fitting rooms.

Jennifer Ortakales Dawkins/Business Insider

There were only four fitting rooms, which didn’t make sense for how busy the store was. I waited behind five people for about eight minutes.

First, I tried on a pair of faux leather pants and a half-zip sweater. The lighting in the fitting room wasn’t as nice as the Fifth Avenue Abercrombie store.

Jennifer Ortakales Dawkins/Business Insider

I really liked the sweater and was surprised the XS fit me perfectly because I’m normally a small in Abercrombie’s clothes. The leather pants were cute, but I didn’t like the cropped leg.

Then, I tried a knit bodysuit and a pair of cargo trousers.Trying on a knit bodysuit and cargo trousers.

Jennifer Ortakales Dawkins/Business Insider

The bodysuit fit nicely and I liked the look, but the material was thin. I really liked the pants — they were an office-appropriate twist on the very trendy cargo.

I wasn’t sold on any of the pieces I tried, but I made a mental note of the sweater and cargos for a later shopping trip.

I could see how American Eagle has maintained its appeal for teens.American Eagle carries classic tees and denim, along with more trendy pieces.

Jennifer Ortakales Dawkins/Business Insider

American Eagle has certainly freshened up its selection since its mall days but has kept a hold on young consumers with bright colors, soft fabrics, and styles that are trendy but not overtly fashionable. The brand takes all the viral looks from TikTok and pairs them down into approachable pieces for the everyday teen.

Yet, the brand still carries all the markers of classic American teen style: graphic tees, flannel shirts, preppy stripes, and lots — and lots — of denim.

Meanwhile, Abercrombie has captured the 20-somethings.Abercrombie carries styles that can be worn to the office or a weekend brunch.

Jennifer Ortakales Dawkins/Business Insider

Both brands have been successful appealing to Gen Z, but it was clear they’ve differentiated themselves to serve slightly different demographics.

If American Eagle is a younger, middle-America teen, Abercrombie is like the older, sophisticated sister who goes to school in the city and wears a lot of black. Most of the customers I saw shopping in Abercrombie were college-age, dressed like Soho influencers in baggy jeans and leather jackets. Even the teens I saw in the store had a darker, grungier style.

Abercrombie appeals to this demographic by doubling down on logo-free basics, office-appropriate trousers, and coastal grandmother sweaters. Nearly every piece can be dressed up or down for multiple occasions, making it a shopping destination for 20- and 30-somethings in need of a stylish, yet functional, wardrobe.

Read the original article on Business Insider
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