Abercrombie & Fitch, the retailer that's known for its hunky models and clothes that scream "Abercrombie" says it's ditching its logo. From now on, the retailer says its clothes will be logo-free, at least in North America.
It’s an odd twist considering Abercrombie helped create the demand for teen clothing with big logos.
Well, no surprise, teens are fickle, said Barbara Kahn, a marketing professor at Wharton.
“In general, I think there is a trend that kids are not into logos as they once were because there’s more of an emphasis on showing your own individuality,” Kahn said, adding that it also depends on the logo - and right now Abercrombie’s is out of fashion.
Ronnie Moas, an analyst at Standpoint Research, says the the fast-fashion trend has created a big shift in the teen clothing industry and knocked Abercrombie off its perch. He downgraded the stock in early July. Moas said retailers like Forever 21 and H&M are putting out the newest fashions quickly and cheaply.
“At Abercrombie you’re paying $50-$60-$70 for a dress and at H&M it’s $20,” Moas said.
There’s no logo, so teens can mix-and-match and feel like they’re creating their own, individual style. While this is good news for young shoppers, it’s bad news for retailers, said Simeon Siegel, an analyst at Nomura.
“Leaving the brand premium means your pricing power probably erodes,” Siegel said.
Siegel said it’s not just Abercrombie that's having problems, but all teen retailers that have relied on brands in the past.
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