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American Eagle Outfitters bets big on Indian market; to open 25 outlets in three years

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US-based mid-to-premium denim wear brand, entered India in the summer of 2018 through a licensing agreement with Aditya Birla Fashion and Retail Ltd. The brand expects India will be its top three international markets in the next five years.

American Eagle Outfitters bets big on Indian market; to open 25 outlets in three years
US-based mid-to-premium denim wear brand, American Eagle Outfitters entered India in the summer of 2018 through a licensing agreement with Aditya Birla Fashion and Retail Ltd

In an interview with IMAGES Retail, , Vice-President, International and Business Development, American Eagle Outfitters says, “Our brand has been in India for the past few months and it has been performing well. We are learning a lot about the Indian consumer as we plan to expand within the market and as we will get these learnings under our belt, it will help us grow and offer the right products to consumers.”

Target Customers

American Eagle Outfitters is a leading global specialty retailer offering high-quality, on-trend clothing, accessories and personal care products at affordable prices.

The brand is betting big on Generation Z, who are between the age group of 15-25-year-old.

“India’s rapidly developing and vibrant economy, anchored by the world’s largest youth population, provides an exciting growth opportunity for our brands and expanding our global reach,” says La Rosa.

Category Mix

The category mix of American Eagle Outfitters comprises of jeans, shorts, joggers, t-shirts, tops, woven shirts, sweatshirts, jackets and hoodies along with accessories like shoes, socks and belts.

Elaborating on this, La Rosa says, “The breadth of our assortment is global; however, the category mix varies from location to location. For example, in DLF Promenade, the penetration is around 60 percent men and 40 percent women products whereas in Mall of India, it is 50-50.”

In the Indian market, Denim is the Number 1 category for both men and women followed by other categories like woven shirts, polo shirts, fleece and sweaters.

“In India, there have been a lot of learnings for us, like in the women’s category, the customer prefers more of bootcut whereas outside India it is more about skinny and super skinny. Skinny and super skinny is little bit slower than what we had anticipated. Similarly, in the men’s category, slim and skinny are very important globally whereas here in India it is more of slim and straight denim. It seems like here in India the customer wants more clean-cut denims. We will continue with what the consumer wants as we grow,” he adds.

Decoding the Store

The average size of the American Eagle Outfitters’ store spans across 2,500-3,500 sq. ft. in India.

According to La Rosa, the store size of the brand in India is smaller as compared to that in the US. “In the US the store size ranges from 4,500 sq. ft. to 10,000 sq. ft.,” he says.

Despite the smaller spaces, the brand is hoping to launch more stores in more cities soon. Apart from this, the brand will also launch bigger flagship outlets.

“We are looking forward to opening more flagship stores in key cities like Delhi, Mumbai and Bengaluru and these stores will be bigger than the average store. In addition to this, after the launch of Aerie in India, we expect to have bigger stores,” he adds.

Aerie is a lingerie retailer and intimate apparel sub-brand owned by American Eagle Outfitters. In the US, Aerie targets the 15- to 25-year-old female demographic.

Expansion Plans

At present, the brand has three operational stores spread across Delhi-NCR and Chandigarh. Apart from this, it is available through its own website and also on fashion portal Myntra.

“By this year-end, we are looking to open six to nine more outlets. In the next three years, we are looking at a total of 25 locations. For some of the new stores, we have got locations in Hyderabad, Chennai, Pune, Mumbai, Delhi and we are also exploring other options,” La Rosa reveals.

“We are not here to be in every single mall and exploit the brand. We want to be very meticulous and calculative in the partnerships that we have with malls. We will be launching the Mumbai outlet in the upcoming months,” he adds.

The brand may also look at having a presence through multi-brand stores and in Tier II markets in the future. It will also open Aerie stores across India in partnership with the Aditya Birla Group.

“We believe that in the next five years India could emerge as the top three markets outside the US,” La Rosa asserts.

American Eagle Outfitters merchandise also is available at more than 190 international locations operated by licensees in 24 countries.