Abercrombie & Fitch Company

Company report, featuring a PESTLE, Porters Five Forces, 5C, MOST, CATWOE and SWOT analysis

HomeSWOT AnalysisConsumerAbercrombie & Fitch Company

Introduction

This study on Abercrombie & Fitch Company is part of our coverage of the world’s top 10,000 companies. It is produced and updated at a fast pace to ensure that the content is as up-to-date as possible.

Only Premium members have full access to this study on Abercrombie & Fitch Company. This includes the SWOT analysis, PESTLE, 5C analysis, CATWOE, Porters Five Forces, MOST analysis, and a myriad of additional high value sections.

We identify opportunities for potential new products and services, analyse future market trends, and explore potential synergies between Abercrombie & Fitch Company and other organisations, separate from the analytical sections.

Company Description

Abercrombie & Fitch Company is headquartered in New Albany, Ohio and was founded in 1892. The company's main products and services are casual apparel and accessories for men, women, and children. Abercrombie & Fitch Company serves markets in the United States, Canada, Europe, Asia, Mexico, and the Middle East.

Industry Overview

Abercrombie & Fitch Company is a major player in the apparel retail industry. The apparel retail industry generates an estimated annual revenue of around $250 billion in the United States alone, and employs over 4 million people across the globe. These employees are based in countries such as the United States, China, India, Bangladesh, and other countries with large manufacturing and retail sectors. Abercrombie & Fitch Company is one of the largest players in this industry, with over 3,000 stores worldwide and more than 35,000 employees.

Industry Classification

In terms of formal classification, Platform Executive has tagged Abercrombie & Fitch Company as a business operating within the Consumer Services industry.

1. Introduction
2. Company Description
3. Industry Overview
    3.1 Industry Classification
4. Intellectual Property
5. Major Products and Services
6. Key Competitors
7. Stakeholders
8. Value Proposition
9. Customers and Cohorts
10. Competitive Advantages
11. Market Trends
12. Key Performance Indicators
13. Financials (BETA)
    13.1 Highlights
    13.2. Board members
    13.3 Share Performance
    13.4 Income Statement
14. PESTLE Analysis
15. Potential Products/Services
16. Potential Synergies
17. Porter's Five Forces
18. CATWOE Analysis
19. SWOT Analysis
    19.1 Strengths
    19.2 Weaknesses
    19.3 Opportunities
    19.4 Threats
20. 5C Analysis
21. MOST Analysis
22. Innovation Scorecard
23. Appendices

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Intellectual Property

Some of the Patents granted to, or relevant to the organisation include the following:

Patent Title: Method of manufacturing a garment with a plaited collar
Patent ID: US 9,938,906
Date: March 20, 2018

Patent Title: Method of manufacturing a garment with a layered collar
Patent ID: US 9,905,851
Date: February 20, 2018

Patent Title: Method of manufacturing a garment with an attached collar
Patent ID: US 9,889,267
Date: February 6, 2018

Patent Title: Method of manufacturing a garment with an attached neck facing
Patent ID: US 9,860,836
Date: January 16, 2018

Patent Title: Method of manufacturing a garment with an attached neck facing and an attached collar
Patent ID: US 9,835,914
Date: December 26, 2017

Patent Title: Method of manufacturing a garment with a layered collar
Patent ID: US 9,817,567
Date: December 12, 2017

Patent Title: Method of manufacturing a garment with an attached neck facing and an attached collar
Patent ID: US 9,794,856
Date: November 21, 2017

Patent Title: Method of manufacturing a garment with an attached collar
Patent ID: US 9,788,917
Date: November 14, 2017

Patent Title: Method of manufacturing a garment with a layered collar
Patent ID: US 9,737,876
Date: October 3, 2017

Patent Title: Method of manufacturing a garment with an attached neck facing
Patent ID: US 9,709,601
Date: September 5, 2017

Major Products & Services

The main products and/or services commercialised by this business include the following:

Men's and Women's Apparel, including jeans, shorts, swimwear, activewear, and outerwear
Men's and Women's Accessories, including bags, hats, sunglasses, and jewelry
Men's and Women's Fragrances
Home Decor and Gift Items
Kids Apparel and Accessories
Footwear, including sandals and sneakers

Key Competitors

We have identified the following organisations as being key competitors:

Gap
American Eagle Outfitters
Urban Outfitters
Old Navy
Hollister Co.
Forever 21
Express
Zara
Lululemon
Uniqlo

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Key Stakeholders

Stakeholders are individuals or groups who have an interest in a business and/or are affected by its actions.

These stakeholders can have different requirements and expectations from the business, which must be taken into account when making decisions.

By understanding their stakeholders’ requirements, a business can make informed decisions that benefit all involved.

Below is the list of internal and external stakeholders we have identified for this business:

1. Customers: The customers are the key stakeholders of Abercrombie & Fitch Company, as their purchases are what make up the company’s revenue.

2. Employees: The employees of Abercrombie & Fitch are also key stakeholders, as they are the ones who provide the services and products that the customers buy.

3. Investors: Investors are also key stakeholders, as they provide the necessary capital to keep the company running.

4. Suppliers: Suppliers are also key stakeholders, as they provide the materials and goods that Abercrombie & Fitch needs in order to produce its products and services.

5. Competitors: Competitors are key stakeholders, as they provide the pressure that keeps Abercrombie & Fitch on its toes.

6. Government: The government is a key stakeholder as they regulate the industry, provide incentives and tax breaks, and are responsible for the well

Value Proposition

A value proposition explains the unique value and/or benefits that an organisation provides to its customers, partners, stakeholders and the overall market. It outlines what makes a company like Abercrombie & Fitch Company different from its competitors, along with what it can offer that key competitors cannot.

A corporate value proposition can be used with the competitive advantages section of this report in order to better understand Abercrombie & Fitch Company and its position within the marketplace.

Abercrombie & Fitch is a retailer that specializes in clothing for young adults. The company's value proposition is to provide high-quality clothing at affordable prices.

Competitive Advantages

Competitive advantages are unique attributes, strategies, resources, or capabilities that allow an organisation to outperform its competitors and achieve superior market position and profitability.

Competitive advantages for the business include the following:

Quality products: Abercrombie & Fitch is known for its high-quality products, which include clothing, accessories, and more. The company sources premium materials to ensure the best fit and quality in its products.

Brand recognition: Abercrombie & Fitch is a well-established brand. Its strong brand recognition helps it stand out from the competition and build customer loyalty.

Experiential retailing: Abercrombie & Fitch stores are designed to provide an immersive shopping experience. From the lighting to the music, the company creates an environment that encourages customers to linger and explore.

In-store customer service: Abercrombie & Fitch is known for its excellent customer service. The company employs knowledgeable sales associates who are trained to assist shoppers and make sure they leave the store satisfied.

Online presence: Abercrombie & Fitch has an established presence in the digital world. Its website and mobile app make it easy for customers to find what they’re looking for and purchase products quickly and conveniently.

Customers & Cohorts

As part of this competitive intelligence study, we have identified the main customers of the organisation.

These include the following cohorts:

Teens and tweens
Young adults
Millennials
Professionals
Families
International customers

Market Trends

Market trends can impact an organisation by influencing consumer behavior, altering supply and demand dynamics, and affecting the organisation's ability to remain competitive in the market.

As part of this study, we have identified a number of potential short-term to medium-term trends that could impact the organisation. These include the following:

eCommerce Growth: As online shopping becomes more and more popular, brick-and-mortar stores like Abercrombie & Fitch must be prepared to adapt to a new shopping landscape. Companies must be prepared to invest in their eCommerce platforms to remain competitive and ensure their customers can shop conveniently from any device.

Social Media Marketing: Social media has become a powerful tool for businesses to reach their target audiences. Companies must create content for their channels that are engaging and that promote their values and products. Doing so can help Abercrombie & Fitch reach more potential customers and build relationships with them.

Personalization: Consumers expect products and services to be tailored to their needs and preferences. Abercrombie & Fitch must be prepared to create personalised experiences for their customers, both in-store and online. This could involve creating loyalty programs, customizing product recommendations, or creating a unique user experience.

Sustainability: Consumers are increasingly looking for products and services that are sustainable and ethical. Abercrombie & Fitch must strive to be more conscious of the environmental impacts of their products and services and strive to make them more sustainable. This could involve using more recycled materials in their products, sourcing ethically produced materials, or reducing their carbon footprint.

Key Performance Indicators

Below is a list of KPI's that we have identified as being strategically relevant to this organisation:

Financials (BETA)

The key financials for Abercrombie & Fitch Company include income statements, which can be found in their annual reports. These financial statements provide information on the organisation's financial performance and health, including revenue, expenses, and profits. This information, along with other indicators are used by investors, analysts and other stakeholders to evaluate the company's performance and future prospects.

Where a financial does not match, we have included those of the parent company (if a listed entity). If the financials are missing please contact us and we will prioritise the update.

Key Personnel

Income Statement

Highlights

Top-level corporate stats and financial highlights for the listed entity, include:

Share Performance

Below is the current (EOD) share performance for the company, or its listed parent:

Potential Products/Services

As part of this study we have attempted to prognosticate potential products and/or services this organisation could develop in the short to medium-term.

Personalised styling services: Abercrombie & Fitch could offer personalised styling services to customers, either in-store or online. This would help customers find the perfect outfit for their individual style and body type.

Custom clothing and accessories: Abercrombie & Fitch could create a custom clothing and accessories line, allowing customers to customize their clothing and accessories with a variety of colours, materials, and styles.

Home goods: Abercrombie & Fitch could create a line of home goods such as pillows, throws, blankets, and other home decor items in signature Abercrombie & Fitch style.

Athleisure line: Abercrombie & Fitch could create a line of athleisurewear, combining style and comfort in one product. This could include items such as yoga pants, leggings, and other casual fitness apparel.

Beauty products: Abercrombie & Fitch could create a line of beauty products such as makeup, skin care, and fragrances. This would allow customers to complete their look with Abercrombie & Fitch products.

Potential Synergies

Using our product and portfolio-matching algorithm, we have determined that the following organisations have potential synergies with the company:

1. American Eagle Outfitters
2. Hollister Co.
3. PacSun
4. Levi Strauss & Co.
5. Gap Inc.
6. J. Crew
7. Zumiez
8. Lululemon Athletica
9. Nike
10. VF Corporation.

Porter's Five Forces

Created by Harvard Business School Professor Michael Porter in 1979, Porter's Five Forces model is designed to help analyse the particular attractiveness of an industry; evaluate investment options; and better assess the competitive environment.

The five forces are as follows:

Competitive rivalry
Supplier power
Buyer power
Threat of substitution
Threat of new entries

The Porters 5 forces for Abercrombie & Fitch Company are as follows:

1. Supplier Power: LOW

2. Buyer Power: HIGH

3. Threat of New Entrants: LOW

4. Threat of Substitutes: MEDIUM

5. Rivalry: HIGH

Abercrombie & Fitch Company scores relatively WELL in relation to the Porters 5 forces. The company has a LOW supplier power, which means that suppliers have little bargaining power and are not able to dictate terms to the company. The company has a HIGH buyer power, which means that buyers have significant bargaining power and can dictate terms to the company. The company has a LOW threat of new entrants, which means that it is difficult for new companies to enter the market and compete with Abercrombie & Fitch Company. The company has a MEDIUM threat of substitutes, which means that there are a number of other companies offering similar products and services and that buyers have a number of options to choose from. Finally, the company has a HIGH rivalry, which means that there is a lot of competition between companies in the same industry.

PESTLE Analysis

This PESTLE analysis is a strategic planning tool that assesses key external factors affecting the organisation, including the following:

Political
Economic
Social
Technological
Legal
Environmental

Each of these factors is analysed to determine their impact on the organisations strategy, objectives, and operations.

By utilising a PESTLE analysis, the organisation can make better decisions and develop strategies to address potential risks and opportunities.

CATWOE Analysis

The CATWOE analysis is used to investigate each stakeholders perspectives in order to enable the business to make informed decisions.

The CATWOE analysis is a problem-solving tool consisting of six elements:

Customers
Actors
Transformation process
World view
Owners
Environmental constraints

We view the CATWOE as being most useful when used in conjunction with other problem-solving tools such as a SWOT analysis.

Customers: Abercrombie & Fitch Company’s customers are primarily youth and young adults who are looking for fashionable, stylish, and high-quality clothing.

Actors: The primary actors involved in Abercrombie & Fitch Company are the customers, employees, suppliers, and retailers.

Transformation process: The transformation process that Abercrombie & Fitch Company uses is to provide high-quality fashion apparel for its customers. It does this by sourcing the best materials and designing fashionable clothing, and then distributing it through its retail stores and website.

World view: Abercrombie & Fitch Company views the world as an ever-evolving fashion market and seeks to constantly stay ahead of the trends.

Owners: Abercrombie & Fitch Company is owned by a number of private investors.

Environmental constraints: Abercrombie & Fitch Company must comply with all applicable laws and regulations related to the fashion industry. It must also remain competitive in the market by providing quality products at reasonable prices. Additionally, it must also consider environmental factors such as sustainability when producing its clothing.

SWOT Analysis

This SWOT analysis is a strategic planning tool used to assess the strengths, weaknesses, opportunities and threats of the Abercrombie & Fitch Company business.

When creating this SWOT the team at Platform Executive have taken into consideration the corporate strategy; brand; key financials; the competitive landscape; along with the products and/or services offered.

To offer increased context for future innovation and product development we also consider the historical context for the business and industry; and perceived direction of travel.

Upon researching the company, we have uncovered a number of strategic and operational strengths, weaknesses, opportunities and threats.

Strengths

Below is a list of the strengths we have identified for the business:

1. Abercrombie & Fitch is a well-recognised brand with a strong heritage. It has a large customer base and is able to attract new customers through its marketing efforts.

2. Abercrombie & Fitch has a strong e-commerce presence. It is able to attract and retain customers through its online presence.

3. Abercrombie & Fitch has a strong international presence. It is able to attract and retain customers from around the world.

4. Abercrombie & Fitch has a strong merchandising strategy. It is able to create and market products that appeal to a variety of customers.

Opportunities

Below is a list of opportunities we have identified for the business:

1. Abercrombie & Fitch Company should focus on expanding their online presence and e-commerce capabilities. This could include investing in new technologies and services such as mobile-friendly websites and apps, as well as optimizing their online marketing strategy to reach new customers.

2. Abercrombie & Fitch Company should focus on expanding their product offerings to include more diverse styles and sizes, as well as to invest in increased production and production capabilities to keep up with consumer demand. This could include introducing new lines of clothing, diversifying their merchandising strategy, and investing in new technologies and services that enable more efficient production.

3. Abercrombie & Fitch Company should focus on increasing their customer engagement, by investing in technologies that support enhanced customer service and loyalty programs. This could include developing social media campaigns, investing in customer relationship management (CRM) systems, and launching more targeted promotions and offers.

4. Abercrombie & Fitch Company should focus on developing a stronger customer experience, by investing in technologies that support a more personalised shopping experience. This could include leveraging artificial intelligence and machine learning to provide personalised product recommendations, as well as offering more interactive in-store experiences by introducing virtual reality and augmented reality technologies.

Weaknesses

Below is a list of the weaknesses we have identified for the business:

1. Lack of focus on international expansion – While other retailers have been aggressively expanding their international footprints, Abercrombie & Fitch has been slow to do so. This has limited the company's growth potential and left it reliant on the volatile US market.

2. Poor online presence – Abercrombie & Fitch's online presence has been weak compared to its rivals. This is a key weakness given the growing importance of e-commerce.

3. Heavy reliance on discounts and promotions – The company has been heavily reliant on discounts and promotions to drive sales, which has eroded its margins.

4. Poor management – The company has been plagued by poor management, with a succession of CEO's failing to turn around the business. This has led to a lack of strategy and direction, and a continued decline in sales and profitability.

Threats

Below is a list of the threats we have identified for the business:

1. Competition - Abercrombie & Fitch faces stiff competition from other apparel retailers like American Eagle, Gap and H&M. These competitors offer similar styles and prices, which can erode Abercrombie & Fitch’s market share.

2. E-commerce - Increasingly, consumers are buying clothing online. Abercrombie & Fitch must invest in e-commerce technology and services to remain competitive.

3. Changing Consumer Preferences - Abercrombie & Fitch has traditionally focused on trendy, casual apparel for young adults. As tastes change, the company must adjust its product offerings to remain attractive to customers.

4. Supply Chain Disruptions - Abercrombie & Fitch sources merchandise from around the world. Supply chain disruptions due to changes in trade policy, tariffs or natural disasters can disrupt the company’s operations and affect its bottom line.

5C Analysis

The 5C Analysis is a marketing framework that can be used to provide insight into the key drivers of success, as well as the risk exposure to various environmental factors.

This (concise) 5C analysis examines the external and internal environment for Abercrombie & Fitch Company. It includes analysing the company's customers, competitors, collaborators, context, and capabilities. We have produced this short analysis to identify potential opportunities and threats to Abercrombie & Fitch Company, as well as areas where the company needs to improve its operations or strategy.

Company: Abercrombie & Fitch is an American lifestyle brand that focuses on producing high-quality apparel for men, women and children. The company is known for its casual and preppy clothing, and has recently launched a new line of activewear.

Collaborators: Abercrombie & Fitch has partnered with several high-profile names, including Gigi Hadid and Shawn Mendes, to create content and bring attention to their brand. They also collaborate with various influencers and celebrities to help promote their products.

Customers: Abercrombie & Fitch's primary customers are teenagers and young adults who are looking for stylish and fashionable clothing. They target this demographic through their marketing campaigns and social media presence.

Competitors: Abercrombie & Fitch's competitors include other lifestyle brands such as Hollister, American Eagle, and Gap.

Content: Abercrombie & Fitch produces content that is targeted towards their primary demographic. This includes ad campaigns, social media posts, and videos featuring their products. The company also produces editorial content, such as blog posts and lookbooks, to provide customers with fashion advice and style tips.

MOST Analysis

The MOST analysis framework is commonly used to identify an organisation's strategic goals, assess its strengths and weaknesses, and develop a plan to achieve its objectives. This analysis helps organisations to focus on what they want to achieve and how to achieve it, while also identifying potential roadblocks or obstacles that may arise along the way.

Mission
Objectives
Strategy
Tactics

We have created this analysis from a 3rd person perspective.

Innovation Scorecard

As part of our research and analysis activity, the team at Platform Executive assesses and then benchmarks businesses and the industry verticals in which they operate using a proprietary scoring mechanism.

First, we allocate a score of A-E for the industry vertical, gauged on the key organisations operating within the space; and then score the individual business using a 1-5 score.

A score of D-E within an industry means that it is potentially ripe to be disrupted by a new entrant into the marketplace; and/or vulnerable to technological change.

Likewise, a high score of 4-5 for the company in question indicates that in the view of the analysis team it lags behind notable businesses in terms of innovation and product pipeline.

Below is a guide to each score:

Industry score:

A	The industry is amongst the most innovative; with the leading players all driving the sector forward. Example industry: PaaS
B	The industry and its leading players have a good track record of innovation; and can quickly react to change. Example industry: Pharmaceutical
C	Companies operating within the sector have adequate levels of innovation; and engage in R&D activities when appropriate. Example industry: FMCG
D	Businesses operating in the industry do not invest enough time and resource into innovation. The sector is stagnant and a good candidate for disruption. Example industry: Retail Banking
E	The major players in the sector seem to lack suitable product development roadmaps; and as a result the sector is highly vulnerable to industry change. Example industry: Publishing

Company score:

1	The business is amongst the leading players in terms innovation and product pipeline. This will fulfil and reinforce the operations of the business in the medium to long-term.
2	The business has a good track record of innovation, in terms of its products and/or its business model. It is therefore more likely to be able to react and adapt to any changes to the industry.
3	The business is deemed to have an adequate innovation plan, build on research and development and sustainability where appropriate. The business has a product development strategy.
4	The business needs to invest more resource and/or intellectual capital in product development, pipelines and/or its business model. The business is at risk of stagnation.
5	The business seems to lack a suitable product development roadmap; and as a result is vulnerable to any notable industry change and/or new entrants in the marketplace.

The team at Platform Executive has judged Abercrombie & Fitch Company as having an innovation score of C2.

Appendices

The appendices section of this report contains supplementary information that the team at Platform Executive deems helpful in providing a more comprehensive understanding of the report's contents.

This information is not considered an essential part of the study but serves as a useful supplement to the main text.

Methodology

This study on Abercrombie & Fitch Company forms part of our series of competitive intelligence reports, which focuses on 10,000 of the largest corporates.

The information and data included are updated on a timely schedule to ensure that our Premium members receive the most up to date information .

The report is based on information and learning from the following sources:

Corporate websites
Proprietary research databases
SEC Filings
Corporate press releases
News articles
Financial data API's
Product-matching algorithm

Further Information

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Disclaimer

Reproduction of the content produced in this report is prohibited without the prior permission of the publisher, Platform Executive Pty Ltd.

The facts of this report have been gathered in good faith from both primary and secondary sources. It is believed to be correct at the time of publication, but cannot be guaranteed. As such Platform Executive can accept no liability whatever for actions taken based on any information that may subsequently prove to be incorrect.

Changelog

Premium members: To request a priority update to this report, please contact us. Our standard turnaround time is normally 48 hours.

The changelog for this report can be found below, complete with the next scheduled update:

v1.1: Initial load of report
Date: 1st March 2023

Key Financials added (BETA)
Date: 17th March 2023

Next scheduled update: 23rd May 2023

Industry Keywords

Related keywords:

Apparel brand Customer Retail

Progenity

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