Abercrombie & Fitch's website shows everything that's wrong with the brand
REUTERS/Claro Cortes
The company on Thursday reported a net loss of $63 million, or 91 cents a share, for the quarter ended May 2, compared with a loss of $23.7 million, or 32 cents a share, a year earlier.
Same-store sales fell 8% and total sales dropped 14%.
Abercrombie is trying to revive business by redesigning stores, toning down the heavy use of logos on its clothes, and dropping its sex-charged advertising.
But a review of the company's inventory shows it still has some problems.
1. Abercrombie is trying to become more like a fast fashion company with cheap, trendy styles like those found like Forever 21 and H&M. But Abercrombie's clothes cost more than its fast fashion competitors. Here's an example:
Abercrombie/Forever 21
2. Customers aren't willing to pay up for the Abercrombie brand. Most of the items advertised on the site are marked down from their original prices by discounts of up to 70%.
The clearance section contains an endless variety of see-through crop tops, patterned leggings and t-shirts stamped with the Abercrombie logo.
Abercrombie & Fitch
3. As part of its turnaround, Abercrombie said it would stop selling so many clothes printed with its logo.
Teens are no longer interested in advertising the brands they are wearing, and the Abercrombie brand in particular is no longer perceived as cool, according to analysts.
But the company still has a massive amount of inventory stamped with its name.
Abercrombie & Fitch
Abercrombie & Fitch
"A&F now needs to be much more decisive about what it stands for and who it wants to serve: in essence it needs a much clearer and more relevant brand identity," Saunders wrote in a research note. "This is far from an easy task... and A&F has to tread a careful line between toning down the brasher elements of its image and becoming too generic - which will pitch it more firmly against cheaper competitors like H&M and Forever 21."
NOW WATCH: It's official: Under Armour is on fire
- US buys 81 Soviet-era combat aircraft from Russia's ally costing on average less than $20,000 each, report says
- 2 states where home prices are falling because there are too many houses and not enough buyers
- A couple accidentally shipped their cat in an Amazon return package. It arrived safely 6 days later, hundreds of miles away.
- Upcoming smartphones launching in India in May 2024
- Markets rebound in early trade amid global rally, buying in ICICI Bank and Reliance
- Women in Leadership
- Rupee declines 5 paise to 83.43 against US dollar in early trade
- Election Commission issues notification for sixth phase of Lok Sabha polls
- JNK India IPO allotment date
- JioCinema New Plans
- Realme Narzo 70 Launched
- Apple Let Loose event
- Elon Musk Apology
- RIL cash flows
- Charlie Munger
- Feedbank IPO allotment
- Tata IPO allotment
- Most generous retirement plans
- Broadcom lays off
- Cibil Score vs Cibil Report
- Birla and Bajaj in top Richest
- Nestle Sept 2023 report
- India Equity Market