Levi’s to Stand Alone

Discussion
May 30, 2007

By George Anderson

Levi’s is looking to roll out new standalone stores sporting new styles so the company may once again establish itself as the jeans that teenage girls most want to wear.

According to the San Francisco Business Times, Levi’s intends to move beyond the 45 standalone locations it currently operates with 20 new stores being opened this year. Seven of the 20 have already opened.

Howard Davidowitz, chairman of Davidowitz & Associates, said Levi’s is engaged in an act of self-preservation. “If you are an apparel supplier, it is imperative that you develop your own retail stores to protect your business. You can’t put your faith in department stores, who are pushing brands less and less and private label more and more.”

Levi’s is looking to use its stores to introduce new items it hopes will expand its franchise to greater numbers of young consumers. It has attempted similar approaches to younger consumers in the past without success.

“We’re really focused now,” said Loreen Zakem, president of Levi’s brand wholesale. “As we go forward, we’re crystal clear about our consumer, how we deliver and how we maximize performance across all price points.”

Discussion Questions: What is your reaction to Levi’s standalone store strategy? What do you see as the keys for it to find the right balance between its own stores and other merchants that carry its products? Levi’s is trying to reach consumers across a variety of demographics (adults, teens, etc.) and price points (lines developed for department stores, mass merchants, standalone stores). Can it do all of this successfully?

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14 Comments on "Levi’s to Stand Alone"


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Roger Selbert, Ph.D.
Guest
Roger Selbert, Ph.D.
14 years 11 months ago

I agree with Mark–go online and search for Levi’s. Unless the company was pulling out of all other retailers, the decision to have a few stand-along stores is not that significant. Perhaps it will be useful market research for them, feeding back into product design, price points, etc.

Gene Hoffman
Guest
Gene Hoffman
14 years 11 months ago

With a 4 billion dollar Levi brand in hand,
Will Levi’s stand-alone strategy bust a gland?
Does Levi have the assortment to take the heat
Or will it be another County Seat repeat?
Only time will tell if it has single-store smarts.
The sum of success will come if it has no warts.

Ryan Mathews
Guest
14 years 11 months ago

I actually live near a stand alone Levi’s store. Liz is right. The problem is that the brand is in crisis–a crisis amplified because its most loyal consumers are now almost too old to look good wearing its products and their children, and grandchildren, have little desire to dress like–shudder–Mom and Dad or–shudder, shudder–grandma and grandpa. I say reposition the brand first, open the stores later.

Camille P. Schuster, Ph.D.
Guest
14 years 11 months ago

What is it that is going to be special and different enough to attract consumers to come to a different store? Given all the variations that are out in the marketplace now, why would someone go to a Levi’s store? Maybe Levi’s would be better off working with their partners and developing distinctive styles for different stores? That could be of benefit to both Levi’s and the retailer without the investment in space and personnel.

George Anderson
Guest
George Anderson
14 years 11 months ago

The only way for clothing brands to get their full lines displayed in stores these days is to open their own locations. Opening standalone stores make sense as long as they make money. If they are not doing that, then there had better be some solid evidence that they are driving consumers to buy the brand at some other location. That way they can justify the expense of the store under advertising.

Michael Tesler
Guest
Michael Tesler
14 years 11 months ago

If they presented the “right items” in the “right locations” and have wonderfully designed and staffed stores supplemented with great marketing, of course it can, and would work. But, what has Levi’s done (domestically) over the last twenty years to indicate that they are capable of doing those important elements to successful store operations “right”?

Bill Bittner
Guest
Bill Bittner
14 years 11 months ago
We have an interesting combination of topics today. One article asks about the support “one stop shopping” will get from high gasoline prices and another article asks about a manufacturer’s plan to go it alone…. Obviously different categories, but I believe high gasoline prices will soon begin affecting consumer behavior all around. At first glance this seems to make Levi’s decision to go it alone problematic. But I think high gas prices may encourage some people like myself to no longer regard shopping as chore and merely do it when we must. Instead, it will become a planned event with the Mall as a destination so that multiple purchases across a variety of categories can be made in one trip. If the mall is a series of boutiques, some manufactured sponsored, then Levi may be ready to prosper. I think this is the type of experiment that is worth trying and the lessons learned can both help them operate their own outlets but also learn how to help their retail customers.
MARK DECKARD
Guest
MARK DECKARD
14 years 11 months ago

I’m reminded of the old Saturday Night Live skit about “The Scotch Boutique,” a store that sold nothing but adhesive tape.

This sketch revolved around the inanity of a store offering such a specialized product line. Customers came in with the mistaken assumption that the store sold other stationery items or even audio cassettes (though the store did make photocopies at the bargain price of nine cents each).

Good luck Levi’s. Hope you don’t need a visit to the Scotch Boutique to hang your “Going Out of Business” signs….

Suzy Teele
Guest
Suzy Teele
14 years 11 months ago

Many people have already stated the key to the success of a stand-alone store, and that is brand. Coach seems to be doing well with their stores because they do provide a wider selection than department stores like Macy’s. However, they are a strong, desired brand. Levi’s is not a strong, desired brand in the demographics that they are targeting–young people. But they could be successful marketing to me–a 40+ year old mother of multiple children–if they created products that fit my body shape, and that of other baby boomers. There is no shame in serving baby boomers–we have the disposable income and fond memories of the brand. I believe they will struggle to get young people into their stores.

Liz Crawford
Guest
14 years 11 months ago

Stand-alone stores make all the sense in the world. The question is whether Levi’s can do it successfully.

Levi’s hasn’t kept up with the consumer the way other apparel names have–especially among Millennials. I am skeptical that the Levi’s shopping experience and merchandise are equal to the task. Further, the brand name itself doesn’t carry the same cache it did 20 years ago. Look at a few of today’s competitors: Seven, True Religion, Juicy, etc. The meaning of the Levi’s brand isn’t clear today. What badge am I wearing with a Levi’s tag? I am concerned it signals “Mom Jeans” among young women. Perhaps going to a retro could work–like revamping Marilyn pants or 501s (with hidden girdle technology). They need a great campaign to be successful.

Good Luck Levi’s. I’m an old fan. (Old being the operative word).

Mark Hunter
Guest
Mark Hunter
14 years 11 months ago

Creating stand alone stores is an essential part in the building of brand equity. Nike, Sony, and numerous others have done a good job of building equity with their stores while at the same time not jeopardizing their existing retailer relationships. The key for Levi’s is to have a clear strategy as to what the stores are expected to do–making a profit had better not be at the top of the list. The most important thing their stores can do is to help build brand equity while also receiving valuable customer feedback.

Mark Lilien
Guest
14 years 11 months ago

Levi’s web site tells the story: prominently featuring the logos of Sears, Goody’s, J.C. Penney, Macy’s, Nordstrom, Urban Outfitters and Kohl’s. Understated place to click for Levi’s own stores. It’s very tricky to compete with your own customers. I suspect that if the Levi’s stores were lucrative, they’d be rolling them out a lot faster. How can a few dozen company-owned stores give major support to a $4 billion brand?

Gregory Belkin
Guest
Gregory Belkin
14 years 11 months ago

To be honest, creating stand-alone stores like that make me nervous. I can’t help but think about Gateway Country, Gateway’s disastrous attempt at creating stand-alone computer stores. If you think about it, the same issues are comparable here. Gateway Country failed because people were used to buying computers either online or at an electronics retailer such as Best Buy.

In the world of jeans, I believe, most people buy their jeans at specialty stores such as Bob’s, Steve and Barry’s, or the Gap (I admit it, thats where I get ’em).

If Levi’s opens their own stores, the price of their jeans will have to go up to cover costs. What will Levi’s offer as an incentive to consumers to make this switch?

Philip Brown
Guest
Philip Brown
14 years 11 months ago
It is important for Levi’s to establish a retail presence. At the same time it is important to clearly define the purpose of these stores and have realistic performance expectations. If their intent is to directly increase market share through these stores, they will fail. If their purpose is to enhance the brand, improve recognition and incubate new product lines they can succeed. It is importance to recognize that the metrics that define success on these fronts are different than those for a pure-retailer. They are making this move at an interesting time, but they need to move swiftly to avoid becoming “their Father’s Oldsmobile.” Denim has historically been a very cyclical business and growth has slowed dramatically the past two years. “Status” jeans (Seven, Citizens, RocknRepublic, etc.) have been one of the few areas of growth in recent years and that appears to be slowing now as well. iPods, shoes and handbags are growing in importance at the expense of “status” denim. The timing could be ideal for Levi’s as many retailers could be… Read more »
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