American The retailer’s overview Essay

American apparel is an integrated quality high street retailer, clothing manufacturer and distributor operating more than 273 retail stores in 20 different countries. The brand was founded in 1989 by Dov Charney, an eccentric who made a brand which accentuated his personality, style and creativeness. It wasn’t until he re-launched and relocated the company (including the manufacturing) to Los Angeles in 1997 when American Apparel took off as a success. 11,300 people are globally employed (about 5,000 in the LA headquarters and in the manufacturing), and operate more than 273 retail stores in 20 countries.

The company operates the largest garment factory in the United States. (American Apparel website, 2010) The unconventional business model Dov Charney uses means that the company is vertically integrated where all facets of business are intermingled in the one location, and therefore saves money due to maximum efficiency and fast production rates, which means that despite paying $12 per hour for labour unlike using cheap foreign labour as is universal in the garment-industry practice, they still have competitive high street prices.

This is one of the brands main unique attributes, with very few labels now being able to brand themselves as being ‘Made in the USA’. American Apparel has earned its reputation by offering fashionable products of high quality at affordable prices. American Apparel is known for selling exceptionally well fitted, solid colour cotton knitwear, such as t-shirts and underwear for men, women and children.

In recent years the brand has expanded, and is also well known for selling ‘dance inspired’, or for men ‘hipster vintage’ fashion garments including legwarmers, knee high socks, leggings, nylon tricot dresses and trousers, leotards and even vintage coats. As American apparels success doubled every year after 2000, they expanded to include ranges for children, dogs and home ware. They even manufacture their own nail varnish. The retailer’s typical consumer Retail markets can be segmented to target particular consumers. This can be anything from geographical location, psychographic and demographic.

In American Apparels case, they have reviewed who their typical consumer will be. As it is not common for multiple generations in families to shop in the same retail store, they particularly targeted people who don’t have children, however at the same time, they haven’t targeted the under 18’s market. Their target audience is typically politically conscious well educated urban hipsters in their early 20’s, interested in art, fashion and photography and especially appeals to those who like 70’s and 80’s vintage clothing.

These types of people are stereotyped to not own cars, not own stocks and don’t have dependants therefore although they do not have vast sums of money, they don’t have a lot of debt therefore make a perfect customer base for trendy clothing at a reasonable price, with a little extra cash to spend than in other retailers such as Topshop or Zara. The customer base could be grouped with Jack Wills or Crew as prices are similar, and are classed as preppy and fashionable however the advertisements Dov uses is well targeted towards slightly older and more sophisticated crowd.

Buyers look for a ‘uniform’ that denotes their lifestyle, or at least their ideal self. The attraction of sweatshop free clothing pulls in the niche market of politically conscious urban hipsters. The higher quality fabrics and well fitted clothing pulls in those who shop at regular high street retailers, although slightly more expensive they are happy to spend the extra to get good quality clothing. The stores have an art gallery appeal with photography by Charney himself and 70’s and 80’s pornographic pictures, appealing to an edgy crowd wanting a unique shopping experience, not those who are happy with the commercialised shops.

Socially conscious buyers are appealed by the lack of brand logo on the actual garments, even though the brand itself has a very clear brand image which most customers relate to, or at least want to ‘be a part of’. The marketing Strategy ‘The American Apparel image is more rooted in hedonism, rather than social justice however both are largely part of youth culture. ’ After an interview with the New York Times, it became apparent what Dov Charneys vision for the brand was.

He wants a brand which relates to his customer like no other, for today’s generation of young adults, the generation of people who just want ‘to have a beer, smoke a joint, to go to a good movie, to party’. Charney takes most of the advertising campaign photographs himself, another example of how the business is ‘vertically integrated’ . He uses models he finds himself off the street and even his own employees or their relatives. He uses imagery which is provocative, images where woman are scantily clad and makes them look ‘young’.

Making the brand unisex he also uses many male models. Women however are instantely taken by the images verging on pornography, as they ‘want to look like that’, and Charney cleverly uses the fact women are instantely drawn to other images of females looking sexy by making the photography natural and therefore relatable to everyday women. What distinguishes American appaerls marketing ad campaigns to other raunchy brands such as Vitoria secret and Abercrombie and Fitch is firstly, the models are not models.

All different shapes and sizes of girls are used. The photographs are never photoshopped, the girls never wear a lot of makeup and the photos look like they have been captured in someones living room, not a ‘real’ photoshoot. This natural approach gives the impression of inimate photos and art photography. This way of marketing has had a lot of controversy, not only due to the type of advertisement and is it ‘appropriate’ but also to the fact the type of people Charney is targeting for his main customer base.

Pornography could be argued to deflect the customer base, however it still draws people to this socially concsous brand. Charney quoted ‘an appreciation for pornography did not conflict with a social consciousness and that those who thought otherwise were out of step with the rising generation’. Since American apparel started, sales have sextupled in the space of only the first 4 years, making this brand one of the fastest growing. It shows Charney has marketed his brand to exactly hat this generations young consumer wants and needs extremely effectively. [pic]

This graph shows that American Apparel is very average when it comes to choice of key trends this season in comparison with other high-street retailers. As it targets a niche clientele this does not come as a surprise, sticking to certain styles and fabrics with a fashionable twist. Highstreet retailer such as Topshop excels in both presence of key looks and options to choose from due to large target market and focus on delivering both basics and up-to-date fad fashion items, which American Apparel is usually careful not to do, with many of their items lasting years in their collections.

After studying American Apparels trends and style, it is clear that if they were more adventurous in providing their customer with different fabrics and adding more decration and embellishments to clothing they would be rated higher in their option depth and presence of key looks, however this could damage the brand image as they are well known for providing knitted fabrics made with a simple and elegant style. [pic] This bar chart clearly shows that most of the highstreet retailers have similar take on the amount of key trends that they stock.

Again, American Apparel is on the slightly lower scale, however this would be due to the unique clientel they target and their specific brand identity that is reflected in the style of the clothing. They could expend their audience to then increase the key looks they could design, however again this could be detrimental to the brand image. They have a good uptake on key fashion considering their niche market. Summery American Apparel has high stakes in the fashion industry, being well known for their fashionable items, The fissionability analysis shows that the retailer still keeps as up to date with trends as its competitors.

Having a injection of cash into the business could help it expend to reach more customers by increasing its line, as the clear brand identity in the clothes seems to be hindering the possibility of having a larger collection with more choice. The brand does however keep up with latest trends, as shown I the graphs, but to gain advantage over the other stores and put itself in the same league as brands such as Topshop and H&M, a larger range must be shown and the target market of the brand increased. Reduced ‘basics’ items and increased ‘fad fashion’ items will give it a trend advantage.

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