Entrepreneurship Lessons from Abercrombie & Fitch

May 24, 2013

4:00 pm

You’ve probably heard about the Twitter hashtag #FitchTheHomeless. A Los Angeles-based writer Greg Karber launched a campaign against Abercrombie & Fitch. You can learn about the campaign in this YouTube video.

This blog post is not to validate or criticize the campaign or A&F, but to glean a very important entrepreneurial insight from how A&F operates.

A&F does not sell to overweight women and has no XL or XXL clothing in its stores. In fact, I could not fit into a lot of their men’s clothing, myself being on the bit-more-than-healthier side of the curve.

As a business – one would think – why not make XL and XXL to widen your prospects? However, A&F decided to narrow down their audience only to skinny people. So what does that mean?

BRAND MESSAGING

A&F has answers to a lot of questions simply by narrowing down their audience. They know that their entire brand messaging is for skinny people. So they hire skinny people to do their selling to ensure their brand is visualized as skinny and the messaging can be such, too.

REDUCE OPERATIONAL HASSLES & COST

Since they have to maintain fewer categories in the inventory, the company reduces its operational tasks to only maintain inventory for skinny people. This also means that A&F can have more variety for skinny people rather than trying to trade off on having more sizes.

BETTER TREND-SETTING

Their purchase decisions and trend-setting decisions are now governed by skinny people. As their focus is narrowed down, it makes it much easier for them to make those decisions. The quality of what they bring in to their stores, from a fashion perspective, is remarkable.

REDUCE COST PER CUSTOMER ACQUISITION

When skinny people walk into a store that is customized for them, they can find something they like more easily, and that directly impacts the top line. The time they spend in the store is more dedicated toward choosing what they want rather than trying to search the aisle for the right size.

ENABLE TRIBES

Marketing guru Seth Godin has a book dedicated to Tribes. Since A&F only talks to skinny people, it enables them to form a tribe. A tribe is the best salesforce a company can ask for. Your customers are not just referring you when they belong to a tribe, but walking the extra mile to sell for you. That is the power of a tribe, and narrowing down your audience is one of the vital steps in building one.

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Jinesh Parekh is the CEO of a Ruby on Rails consulting boutique, Idyllic. Idyllic focusses on building web and mobile solutions led by user experience design that solves real business problems.
You can reach out to Jinesh at jparekh [at] idyllic [dot] co.

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