“I believe that in order to be successful, you have to lead with great product; a strong brand proposition. You have to have a fantastic experience in your stores and now, of course, in your digital and online channels. And you have to be obsessed with everything about your customers — what he wants, and what’s going to be next for him.”
Although Kessler is global brand president for the core American Eagle brand, he also spoke briefly about the new store concepts the retailer has been working on for all of its formats. In addition to American Eagle, it has the intimates concept Aerie; men’s wear designer Todd Snyder, and Tailgate, which sells licensed collegiate products.
Kessler said he loves stores, and told attendees that malls are important to the company’s brands. Further, the company works with landlords to drive traffic. But he also said the company is always looking at other locations, a move to make sure its brands are in the right sites. That’s because the customers haven’t gone away, but maybe the mall may have changed, he explained.
And with four brands already in American Eagle’s portfolio, Kessler said, “We are not looking for any additional acquisitions at this time. There are so many opportunities in Aerie [and] there are enough opportunities in Todd Snyder.”
Kessler said of the core American Eagle brand: “We’ve emerged as the clear leader in the space. The American Eagle brand did over $3 billion in sales last year. We’ve had several years in a row of positive comps…and we have number one market share in almost every apparel category that’s important to us.”
The key category at the teen retailer is jeans because “jeans drive traffic, jeans drive customer loyalty and we believe we have the best jeans because we constantly focus on innovation, fit, quality and value.
“Jeans have always been part of youth culture,” he said, adding that the brand proposition is based on the company’s belief in individuality, self-expression, and youth empowerment. In the company’s latest advertising campaign, based on authenticity, the teens styled themselves. “They take what we make and they make it their own,” he said.
As for why Kessler loves stores, he said: “I firmly believe that a physical, well-curated physical experience with a brand is the most powerful way you can drive customer engagement. I think there’s no better way to get customers to understand what you believe in, what your brand is, than having them stand in your store and be immersed in your environment.”
He said opening a store also creates a huge digital halo that drives traffic to the stores and a rise in digital traffic in the area where the store is located. He said the company’s web site did more than $1 billion in sales last year and represented more than 25 percent of its total volume. The brand gets 75 percent of its traffic and almost 50 percent of digital sales from a mobile device.
According to Kessler, technology isn’t front and center in the stores because customers most likely have it in their pockets or in their hands as they walk through the stores. “We’re going to build ways that the customer can use their mobile devices to interact with our stores,” he said, emphasizing that the stores are about the brand and the product.
To celebrate the brand’s 40th anniversary last year, the company introduced AE Studio, its newest store prototype located in Manhattan on 15th Street and Union Square West.
“It showcases our leadership in jeans,” he said, noting that the concept features a jeans gallery that showcases every fit, wash and style available. The men’s offerings are on one side and women’s on the other side. Technology is used in the fitting rooms to scan for fit or request assistance from a store associate.
And because the store is located in the vicinity of the New York University campus, it houses a literal laundry where they can do their wash and dry — “All they need is their college ID” — while they shop the store, Kessler said. The area features a customization space where there are 60 choices of patches to select from for placement on jeans and jackets.
The second floor has a social area used as an activation studio for events, and is also home to the brand’s social media team so they can engage directly with customers in the store.
Aerie, Kessler said, is a “lesson for all of us of what you can do when your brand becomes the mission and becomes more powerful than just a retailer.”
Kessler noted that Aerie in 2014 stopped retouching photographs, and became the “first apparel brand, and first intimates brand, to offer un-retouched photos in women’s apparel….The brand has become a powerful tool for body positivity.”
He also cited Aerie as the “fastest-growing retail concept in the country.” The store is structured as if it is a marketplace of little shops within the store, such as bralettes and loungewear in one area, and a bra gallery in another. There is also a swim section.
At Todd Snyder, Kessler spoke briefly about the brand’s flagship on 26th Street in Manhattan and how the company wanted to “showcase men’s in a modern way.” The store features casual apparel, a men’s suiting shop, a full-time tailor, and dress apparel. There’s also a footwear shop that houses the brand’s sneaker collection. As for amenities in the store, there’s an Aesop shop, barber shop, coffee shop and café, and a place where one can get a drink.
There are four Tailgate stores on four college campuses. The original Tailgate is in Iowa. The others are in Tennessee, Georgia and Wisconsin. Each store has a local brand ambassador, who is also a well-known graduate of the school.
Kessler’s final advice to attendees: “Our customers are going to continue to evolve. That will require that these stores continue to evolve and that our brands continue to evolve.”