Robert Hanson’s long-term vision for American Eagle Outfitters Inc. includes fewer promotions, a rejiggered store base and, ultimately, a global expansion that will pay for itself.
But as Hanson talked up his long game, investors were apparently disappointed the retailer didn’t boost third-quarter projections and the stock fell 3.8 percent on Tuesday to $21.22.
Hanson, the longtime Levi Strauss & Co. executive who took over the teen retailer as chief executive officer in January, is thinking in years, not quarters. His goal is first to fortify the American Eagle and aerie brands and grow the North American business while planning global Web and retail expansion.
“It is critical for us to make sure that we are as strong as possible domestically in order to achieve the long-term growth potential in North America as well as the opportunities we have for further expansion,” Hanson said.
For the American Eagle chain, that means focusing on branding and intrinsic value while “selectively pulling back against the promotional cadence of the past several years.”
The American Eagle chain will also cut 20 to 30 stores a year while opening 25 to 30 new ones, with a particular focus on urban malls and the West Coast and other underdeveloped areas. Hanson noted the brand does not have stores on New York’s Upper West Side or Upper East Side or in the Financial District.
As the U.S. business strengthens, Hanson said the company would expand its international presence, funding the effort by licensing operations in some countries. The ceo said the American Eagle brand has a consumer awareness of about 30 percent in the markets the firm tested.
American Eagle is already planning to open four stores in Mexico next year and Hanson said there’s an opportunity for 50 doors.
When the company goes into a new country, it plans to arrive digitally first.
“The new global flagship model is going to be driven by mobile and tablet experiences,” Hanson said. “The first entry point for almost every customer to our brand is going to be through technology.”
For now, Hanson has the help of Roger Markfield, who is vice chairman and executive creative director. But the ceo said Markfield would be stepping down in early 2014.
American Eagle continues to expect earnings of 37 cents to 38 cents a share this quarter, below the 39 cents analysts expected on average.
Jefferies analyst Randal Konik said investors were focusing on the third quarter and he saw the stock sell-off as a buying opportunity.
“Robert Hanson provided a consistent and focused vision for the company rooted in discipline and [return on invested capital],” Konik said. “We find his focus on improving consistency, driving better fundamentals and growing the business globally very encouraging and given his track record thus far, the plan has a high probability of succeeding.”
“Azzedine has been one of the biggest influences in my life. He has always been such a strong, loving, fatherly figure to me. I call him Papa. His designs are indescribably unique, they are pieces of art. He knew how to make the female form look its loveliest. I have so many memories of him; my favorite might be during my first show with him in Paris. He liked me and he wanted to help me get more work. He called all his friends at Kenzo and Comme des Garcons, and asked them to book me. They said, ‘But she can’t walk!’ And he said, ‘but she has such a great ass!' His friendship and support has been the great privilege of my career. I can't imagine life without him. Repose en paix mon Papa.” - @stephanieseymour tells @wwd. #wwdfashion (📷: @steveeichner) #alaia #azzedinealaia
Azzedine Alaïa, flanked by two of his closest friends, models Stephanie Seymour and Naomi Campbell.
He designed Seymour’s dress for her 1995 wedding to Peter Brant, and treated Campbell (who famously called him Papa), like a daughter. For more on the legendary designer, tap the link in bio. #wwdfashion #alaia #azzedinealaia
Azzedine Alaïa's “I-did-it-my-way” ethos stood out starkly at a time when brands are experimenting with consumer-facing fashion shows, coed formats and trans-seasonal collections – anything to perk up lackluster sales of ready-to-wear in an age of Insta-everything. “It’s not creation anymore. This becomes a purely industrial approach,” the late designer told WWD in an interview last year. “But anyway, the rhythm of collections is so stupid. It’s unsustainable. There are too many collections.” Read more about the iconic designer’s life and work on wwd.com, link in bio. #wwdfashion #azzedinealaia (📷: @WWD Archive, 1986) #alaia
Sneaker reselling app @goat’s latest exhibit, "The Greatest: New York," tells the story of New York's sneaker culture. To celebrate the exhibit, an intimate crowd gathered on Thursday night at the pop-up gallery space, located at Platform in Culver City, to hear guest speaker and illustrator @esymai talk about her own rise in streetwear and women in the business. "For me I'm just someone who is creative. I like to create things," said Chang. #wwdfashion
Azzedine Alaïa, one of the most iconic couturiers of the modern era whose body-con designs defined Eighties fashion, has died in Paris. The diminutive Tunisian-born designer, known for his structured knitted dresses with fitted waists and impeccably cut, figure-hugging second skin silhouettes was deeply admired by his peers, and counted supermodel Naomi Campbell - his adoptive daughter - among his inner circle, one of a gang of glamazons including Farida Khelfa, Carla Bruni and Stephanie Seymour who became ambassadors of his style. (📷: Alexandre Guirkinger) #wwdblast