Aeropostale has launched a new concept, P.S. from Aeropostale, aimed at the tween market, a demographic that has been a challenge for many retailers.
The concept targets kids seven to 12 versus the chain's 14- to 17-year-old core customer. The store carries graphic T-shirts, jeans and dresses similar to the 900-store flagship chain with some exceptions, such as school uniforms for the elementary-school crowd. Ten stores will open this year with a long-term goal of having more than 500.
"We have watched with amazement for years [the way] moms would come to Aeropostale with an older and a younger sibling, with the younger sibling desperately trying to fit into the merchandise that was obviously too big for them," said chairman and CEO Julian Geiger, on the company's fourth-quarter conference call. "We are expanding and extending all of the things we've done well for the high school student to the elementary school student. We are enormously focused on this."
Eighteen months were spent hosting events and focus groups to explore the concept, including finding out whether it would turn off existing customers. At the store, a floor-length mirror with a built-in camera allows shoppers to take their own pictures and see them displayed instantly on screens. Text messages such as "You look GR8 :)" and "Luv U" adorn the walls. To make sure the jeans are more acceptable for moms, their rise was lifted by about one inch compared with the older Aeropostale chain.
The launch comes as Aeropostale has lately been handily outperforming rivals with 11 straight months of comp gains. Although some observers believe its budget positioning (i.e., two t-shirts for $20 promotions) has worked well in the recession, Aeropostale believes it's also benefitting from a cutback in SKUs to focus on best sellers and on-trend product.
But many chains have struggled targeting tweens, a demographic seemingly caught in an awkward age between having their moms dress them and wanting to dress like their older siblings. Tween Brands is converting its Limited Too concept to its lower-priced Justice concept, and just reached an agreement to be bought by Dress Barn. Saks discontinued its Club Libby Lu chain late last year. Abercrombie & Fitch's kids concept, abercrombie, reported a 19 percent comp decline in 2008.
Others competing for the tween dollar include GapKids and J. Crew's Crewcuts concept. American Eagle opened 77kids, targeting two- to 12-year-olds, as an e-commerce site last year and stores are expected to open in the second half.
Some analysts believe if Aeropostale follows a similar formula of focusing on value-oriented and trendy-but-not-risqué offerings, P.S. might just work with the slightly younger crowd.
"From the store environment they've hit it," Customer Growth Partners' Craig Johnson, who toured the stores with the company, told Dow Jones. "It creates something fun for kids to stay in stores longer. It's mom-friendly. But I'm not convinced that this can go to 500 stores."
Discussion Questions: What will define the success of the P.S. by Aeropostale concept? Why has the tween opportunity been such a challenge for retailers?