NEW YORK — Sure, the back-to-school season is important, but for a few teen retailers this could be the most important b-t-s season to date.
This story first appeared in the July 8, 2004 issue of WWD. Subscribe Today.
Perhaps under the most pressure is Foothill Ranch, Calif.-based Wet Seal, which will show off its mix of merchandise for the fall selling season under new creative director Victor Alfaro. The company has refocused its efforts to offer a more fashionable mix of apparel and accessories, as well as a new ad campaign featuring real teens. This new direction is much needed after seven consecutive quarters of same-store sales declines.
But things are starting to look up for the company. Just last week, Wet Seal received $27.2 million in funding from the private placement of equity securities to help finance a turnaround. It looks as though financial advisers believe in the new concept; now Wet Seal is hoping teens will agree.
Wet Seal isn’t the only teen retailer to watch this season. At a time when other specialty retailers like Hot Topic, Hollister and PacSun are seeing a teen market rebound, bankrupt Gadzooks continues to struggle as it repositions itself in targeting the 16- to 22-year-old female demographic. Sales and earnings plummeted as the company closed 158 locations since the end of January. Management hopes to rebuild its business and market position around the remaining 252 stores, but said there was no guarantee it would not need to shutter more locations.
Then there’s American Eagle. The retailer is far from having trouble remaining near the top of the list for teen shopping. However, it realizes that to stay on top, changes have to be made. That’s why the company has undertaken a revamp of its stores, beginning with its New York flagship on 34th Street. The Warrendale, Pa.-based specialty chain has switched gears in its store design. Having begun with a beach house concept, the company is now redesigning its stores to have more of a city-loft feel. American Eagle will begin redesigning all of its 752 stores to fit the new model, at a rate of 40 stores per year.