Urban Outfitters, a young adult retailer known for its alternative styles, is undergoing a turnaround after admitting it failed to market to its core demographic of young people. The company faced a decline in sales in the second quarter of 2024, while its competitors like Abercrombie & Fitch and American Eagle saw sales soar. Urban Outfitters is now refocusing on its target customer, which includes suburban teenagers, college students, and post-college young adults.
Abercrombie & Fitch, a successful turnaround story, shifted its focus from dressing teens to versatile adult wear and overhauled its core values. While both companies are attempting turnarounds, Abercrombie took more drastic action by changing its advertising and product offerings. Urban Outfitters, however, has not made significant changes to its marketing strategies and target demographic. Despite this, Urban Outfitters does not have the same legacy of discrimination and harassment lawsuits that Abercrombie faces.
Urban Outfitters outlined five pillars for its brand recovery strategy, which include identifying its target customer, marketing specifically to them, and expanding into different customer demographics. The company is moving away from its purely alternative aesthetic to appeal to a wider range of customers. Changes are also being made to the in-store experience, with plans to close underperforming stores and resize others to cater to its target demographic.
One visible change is the reduced prices on many staple items on the Urban Outfitters website, in an attempt to appeal to price-conscious Gen Z consumers. While some have pointed out that the prices may not have actually decreased, Urban Outfitters is focusing on the marketing aspect to create an illusion of lowering prices. The company is striving to adapt to the changing preferences and behaviors of the Gen Z demographic, which includes a focus on inclusivity, diversity, and a wider range of sizes and styles.
Despite the challenges faced by Urban Outfitters in the highly competitive retail market, the company remains optimistic about its ambition to become the definitive brand for young adults. By recognizing the shifts in consumer behavior and preferences, as well as making strategic changes to its marketing and product offerings, Urban Outfitters is aiming to regain its position and appeal to a new generation of customers.
