Anthropologie -The Drag on Urban

Urban Outfitters recently released fourth quarter 2011 earnings that fell by 47.8%, as they were cutting prices to clear slow-moving holiday merchandise. Returning CEO Richard Hayne (former CEO Glen Senk has moved on to David Yurman) has pledged to get the ailing retail superstar back on track.

Admittedly, women’s apparel has been the problem. There has been weakness in women’s apparel at the younger Urban Outfitters division, but more dramatically at Anthroplogie, which targets a 30+ clientele.

An example of Anthropologie's stellar visual merchandising.

An example of Anthropologie's stellar visual merchandising.

Anthropolgie gets kudos for creating an iconic and unique brand experience in their stores. Their creative visual merchandising is second-to-none in women’s specialty retail. The daring use of unusual materials and space devoted to non-revenue producing theater is of legend. For me, the staged ingenuity has become the reason to visit the store and the merchandise is secondary. Visual merchandising is supposed to create excitement and drive traffic, and it accomplishes that. Their dark stores, filled with hand crafted products have a bazaar like quality, more “tourist attraction” than fashion purveyor. Mannequins are overly styled with pieces that may be very wearable in less fussy combinations. It is a treasure hunt through odd spaces filled with vintage inspired home furnishings, special gifts and arbitrary racks of apparel. It is more Green Movement, than fashion moment. Is visual merchandising dominating the fashion?

Anthropolgie has created an apparel marketplace for confident and avant-garde women. I applaud them for being risk takers in a copy-cat industry. They have created a big brand personality, but the difficulty of shopping the store and styling challenges the customer. She has to want an eclectic statement or be forced to sort thru cavernous spaces to find a pretty skirt, top or trend-right jean. Most women don’t have the time or confidence to do it, not to mention that fashion has gotten cleaner, slicker and more colorful lately. This division may have gotten bigger than the audience for its textural, third-world styling.

The complex styling of this dress makes it less salable.

The complex styling of this dress makes it less salable.

Free People stores performed better. Their stores are smaller and brighter than Anthroplogie and they benefit from their wholesale presence in fashion leaders such as Nordstrom and Bloomingdale’s. The stores are eclectic, but have some stand-out fashion items, in a more conventional, approachable space. Urban Outfitters may be suffering from the highly competitive youth market and growth of competitors such as Forever 21. Their college age customers are laden with debt and short on cash.

The collective combination of these pieces is very avant-garde.

The collective combination of these pieces is very avant-garde.

I think this retail luminary has the ability to glow again. Feminine, lady-like fashion, is trending now and plays to their forehand. They don’t need to compromise their identity. They just need to clean it up and simplify the message.

Dix&Pond is the blog of Dix and Pond consulting.

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