Retail Marketing Case Study

In: Business and Management

Submitted By samdush
Words 1230
Pages 5
James Borda
Retail Marketing
10/5/12

Case 10 Case Study

1. Over the last decade, American Eagle and Abercrombie and Fitch have been two of the main clothing retailers competing for the affection of young adult shoppers, specifically within the teen-college age range of 18-22 years. While both companies carry a similar assortment of clothing apparel and try to cater to the same demographic, each company’s retail strategy does differ in various ways. A retail strategy is defined as the way in which a firm plans to focus its resources to accomplish its objectives. Being that both companies have the same target market and nature of merchandise, they both attempt to look for ways to gain a competitive advantage through their retail strategies. One main difference in their strategies is that American Eagle attempts to gain an advantage by selling their products at lower prices. By offering apparel that is equivalent to that of Abercrombie and selling it at a cheaper price they are able to attract the consumer who is looking to save money. On the other hand, Abercrombie keeps their prices a little bit higher to give off the appearance of higher quality in hopes to attract the consumer who looks to buy name brand, higher end clothing. Moreover, though it is incredibly important to gain a competitive advantage over other retailers in your market, it is even more crucial to sustain that advantage. Abercrombie has positioned itself strictly within the market of 18-22 year olds; to help bolster that position they have engaged in market expansion by opening up a lower priced retail chain named Hollister Co., which targets students in the 14-18 year old range. The unique chain of Hollister not only allows Abercrombie to compete with American Eagle’s lower prices in a new target market, but it also serves to maintain the Abercrombie and Fitch image and position by pulling…...