“Abercrombie’s biggest weakness is that it is all about Mike,” stated analyst Robert Buchanan from A.G. Edwards and Sons.

According to the Huffington Post, retail giant Abercrombie & Fitch is closing 180 stores by 2015.  Upon hearing the news, I began to slowly imagine a world without the lawsuits, their sexual indoctrination on our youth and a rare opportunity for brands to realize that when you stoop to selling nothing but sex, you become irrelevant.

I tweeted this afternoon after following A&F for over 15 years, “Christmas has come early, A&F closing 180 stores by 2015.” Fiona, a friend of mine and tweeter-extraordinare, brought up another side to the equation- the loss of jobs in an already hurting market. Citing industry trends and vacancy rates, Fiona was concerned about empty locations in malls and kicking an already struggling retail market square in the stomach. Frankly, she had an excellent point.

When we lose any retailer, partial or wholly, it will hurt the economy through taxing, jobs and overall morale. However, is this a unique opportunity for this retailer to become more competitive and stop the schick of selling over-sexed apparel without any regard for it’s after effect? Because A&F’s aftereffect has been demoralizing the retail landscape for decades.

Controversy leads sales

I wrote my first piece on Abercrombie when I was 16 and focused on how close their tables were, not allowing handicapped individuals to enter. I penned the piece for the Catholic Spirit Magazine and knew at that moment, I wanted to uncover the seedy in retail and business. I also received my first cease and desist. I still remember the trepidation and ultimately the GLEE at having made a dent in something I considered to be an injustice. Sometimes, it’s too hard to cut through the metal-menusha, but denting the facade, makes it easier for others to cut through.

At the time, Abercrombie had come out with their controversial catalog, the A&F Quarterly which was a far-cry from the original intent of the over 100 year old brand: Quality outdoor clothing.  They survived bankruptcy in 1976 and were reborn as a sporting goods outlet, to rebrand only again in 1988 under the guidance of mother brand, The Limited. In short, they’ve evolved in the market when others have dramatically failed. Only, after their 1988 rebrand, they built an empire on high-priced casual college clothing, with a demographic of 18-22, which although narrow, was highly successful. Was… and apparently no longer, is.

Like every retailer, Abercrombie has faced incredible criticism with labor practices, racism within its products and sexism. Most remember that Abercrombie started the trend of padded bras and thongs for a 7-10 year old crowd with its Abercrombie Kids brand. In 2002, CNN ran a story that featured boycott’s by parents concerned about the latest trends. In 2011, the Washington Times featured a piece on new criticism over Abercrombie selling padded bathing suit tops to preteens. While other retailers focused on following trends, A&F continued to push sex, in new and radical ways. Employees started speaking out on Glassdoor.com and various other outlets, including Jezebel.com.

 

The “Look Policy”

Abercrombie and Fitch has a, “Look Policy” which each employee must adhere to, while working in front of customers and inside the store. According to Tumblr, several employees are posting questions of the “look policy” including asking what “hairstyles are ‘legal” and whether or not they can be asked to re-do their hair once they arrive at work. It should also be noted that those at Hollister and Gilly Hicks, (Abercrombie owned brands,) face the same regulation in the look and feel of their employees. Additionally, A&F found themselves in hot water after an investigation started uncovering deceptive financial practices and breaches of fiduciary duty. In one of their most recent gaffes, the company tried to counter a lawsuit with “The Situation,” a cast member of Jersey Shore to prevent him from wearing their clothing on the reality show. (Here’s a photo of the letter A&F’s lawyers sent MTV networks.)

 

A Crisis Of Brand

In the beginning, the controversy helped the brand become relevant and “edgy” with its target market. However, the old marketing practices have become stagnant in a culture where teens are becoming more aware of how companies operate and their core values. Unfortunately, some are citing this as the cause of their store closings. According to Reuters, Mike Jeffries, Chief Executive Officer and Chairman of the Board of Abercrombie & Fitch Co., said:

“The second quarter results we are reporting today are disappointing and below our expectations coming into the quarter. In particular, we saw a further deceleration in the trend in our international stores, while our U.S. chain stores also comped negatively for the quarter for the first time since 2009.

Closing 180 locations, seems more of a move to re-organize the brand and less of a stunt to clarify which stores are under performing. So where is the opportunity? A&F is a publicly traded company, answering to shareholders. In an interesting juxtaposition, Mike Jeffries, (A&F President) has a contract that expires in 2014. Jeffries certainly has the “look” to lead A&F, (He literally looks like an older version of an Ivy-League undergrad, complete with hair gel, hair dye and swagger. BusinessInsider has an easy-to-follow timeline on Jeffries’ reign, that I highly recommend.)

Sex Sells, But For How Long?

It’s widely publicized that Jeffries is the main creator of the “sex sells” campaigns citing that he wanted A&F to, “sizzle with sex” when hired by Limited Brands to run the company. During the recession, instead of lowering prices to appeal to a new demographic and weather lower sales with ease, Jeffries raised prices to “preserve the brand;” which actually worked. Jeffries also has a history with over-expansion after his failure with Alcott & Andrews.

“Executives in the industry attributed the problems at Alcott & Andrews to over-expansion and oversized stores; too little variety in its merchandise; a penchant among professional women to buy their clothes in either department or local stores, and the recent 20-month softness in women`s clothing sales.”

Sound familiar? Alcott & Andrews closed their stores in 1989 after rapid expansion. Just over 20 years later, Jeffries is facing a similar predicament. Can he save the retail giant, in time? In a particularly stining Op-Ed in Forbes, Brian Sozzi claims:

Abercrombie & Fitch’s brand ambassador, (Jeffries) should have been pushed aside when his last employment contract expired in 2009 for mistakes made up to that point, such as oversaturating U.S. malls with the namesake brand (many stores have since been shuttered), hanging onto the premium-priced Ruehl clothing concept for too long, and periodic media accounts of discrimination at the store level in the hiring process.”

Fiona, brought up an excellent point, no one wants to see any retailer fail. However, when one is so poorly managed and has a track record scattered with lawsuits, and a certain flair for disingenuism, one has to wonder if it’s time for Abercrombie and Fitch to hit the big, sexy lake in the sky.