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Abercrombie & Fitch is turning its back on the real estate strategy that ensured every mall smelled like 100,000 gallons of its Fierce cologne.
What CFO Scott Lipesky said Monday: “We’re willing to walk away from any mall at this point.”
What he meant: A&F now generates 30% of sales online, reducing the need for an IRL foothold in every suburb.
Looking ahead...as A&F’s mall leases expire, it’s reducing its total store count from 881 to a number it doesn’t know or isn’t telling us. That includes cutting down flagship locations to 12 from 19 by the end of 2020. As for the leftovers? They’ll get smaller.
From malls to the M&M store
Some of Abercrombie & Fitch’s mall contemporaries have also decided their NYC flagships are draining AF, Bloomberg reports. Gap, CoverGirl, and American Eagle Outfitters are among the retailers looking to ditch their Times Square flagships.
My takeaway: Equipped with more online sales but lacking a compelling experience angle in stores, young adult apparel and beauty retailers now see stores the size of airport hangars as wasted space.