In the mid-1990’s many American retailers like The Gap and Talbots tried to expand their market presence by opening retail outlets in Europe. Many of these ventures failed because of low demand, high rent, and strict country regulations. With the increase of globalization, many American retailers are trying to attract the European customer again, and this time, they are targeting teenagers and young adults.
American retailers are noticing that the fierce loyalty to European brands no longer exists, especially with younger consumers. Many consumers are foregoing Chanel jackets for frayed sweatpants and jeans favored by American teenagers. In addition, the Internet is helping to break down some language barriers and expand retailer and brand presence on a more global scale.
Abercrombie and Fitch just opened its first store in Paris, and has enjoyed long lines and screaming customers every day. Abercrombie understands that most of its clothing can be ordered online and in order to ensure the success of the brick and mortar store, Abercrombie has turned its Paris store into “retail theater.” Customers enter the store through iron gates and a walkway flanked with male models. Inside the building, a four-story staircase winds customers through rows of jeans, t-shirts, and hyper-attractive employees. Each employee is instructed to greet customers the same way, with a “Hey, how’s it going?” in a heavy French accent.
While other American retailers are not going to the extremes that Abercrombie is, many are pursuing the European market. Banana Republic has plans to open in France later this year. Gap recently opened in Milan and is opening a store in Rome later this year. In addition, Tommy Hilfiger, Tory Burch, and Michael Kors are opening flagship stores in Europe. Even Victoria’s Secret, who has no stores outside of North America, is pursuing the European market.
While some European customers are committed to safeguarding their culture and traditions, many are embracing the American retailer with open arms…especially when they come with models.
1. Why are some retailers pursuing European markets when it was unsuccessful in the past?
Stephanie Clifford and Liz Alderman, “American Retailers Try Again in Europe,” New York Times, June 15, 2011.