Once very much a teen brand, Abercrombie & Fitch's (NYSE:ANF) chairman, Arthur Martinez, outlined a new plan to skew toward older millennials as part of the retailer's turnaround effort.
Although Martinez believes millennials will continue the trend of spending more money on eating out and electronics and less on apparel, Abercrombie plans to continue in its quest to win over the older set of this powerful demographic.
The last few years have been difficult for Abercrombie, which reported a net loss of $63.2 million in the first quarter, Women's Wear Daily reported. That loss is almost triple the $23.7 million loss incurred one year ago. However, same-store sales did modestly improve in the second quarter, and the retailer expects this to continue in the second half of the year.
Last year Abercrombie & Fitch announced it would pull logos from its clothing and reduce inventory. Martinez, who took over as chairman in January of 2014, said that while the company is seeing some positive signs, the logos would be coming back.
The new logos will be tweaked to appeal to the millennial consumer. It will be subtle and less visible, not splashed across an entire garment.
But don't expect a turnaround to happen quickly, as the initiatives are still in the early stage. On a larger scale, the company is repositioning its two brands, Abercrombie & Fitch and Hollister. Abercrombie will skew toward college students and those slightly older, but not toward shoppers in their mid-30s.
At the moment, there is still no CEO for the retailer since Michael Jeffries was pushed out by shareholders' request back in 2014.
The company is also testing a wholesaling arrangement that will launch sales on another site during the current quarter. Martinez did not give specifics but believes the experiment is a good test on working with other retailers.
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