• by Sarah Mahoney  @mahoney_sarah, August 24, 2017

Falling sales at both J. Crew and Abercrombie & Fitch show that once a brand alienates its core audience, winning them back is a hard-fought battle.

Since both J. Crew and Abercrombie have been disappointing shoppers for years, their brand images won’t be fixed anytime soon, says Robert Passikoff, founder and president of Brand Keys, a New York-based customer loyalty consultancy. “This category is crowded and noisy, and the difficulty is that consumers talk to themselves before they talk to the brand. So the brand can be out there yammering about what changes they’ve made, but consumers are more apt to listen to people in their social networks than brands themselves,” he tells Marketing Daily. “It takes time to turn the boat.”

J. Crew Group, which shook up its design team and hired a new CEO earlier this year, says second-quarter sales fell 2% to $560.9 million, while comparable-store sales sank 5%. But those results mask two stories: The first is that its Madewell stores are performing well, with sales up 19%. The second is that the flagship brand is floundering, with sales sliding 7%. And it posted a net loss of $20.7 million, compared to $8.6 million in the same quarter a year ago. 

And at Abercrombie & Fitch, sales for the second quarter fell to $779.3 million, while comparable store sales slipped 1%. (Again, strong sales at its Hollister stores, which climbed 5%, offset the sharper downturn of 7% at its flagship stores.) And losses rose to $14.6 million, compared with a loss of $12 million in the year ago period.

J. Crew was once a relatively high performer in Brand Key’s customer loyalty index, ranking No. 5 out of 18 in 2015. In 2016, it fell to No. 10, and so far this year, it’s sunk to No. 12. “It’s down on every single driver of loyalty,” he says. “That’s not good.”  Abercrombie is No. 15.

Right now, Passikoff says, fast-fashion retailer Zara leads the category, followed by Foot Locker and Old Navy. “When you have the Zaras of the world out there offering good clothes at lower prices — especially when pricing has been a strong negative for J. Crew — that makes turning perceptions around even harder.”

And Abercrombie & Fitch, ranking No. 15 out of 18, is still suffering from identity confusion among shoppers, he says. “It’s switched its look and appeal.”

He says the retail/apparel category differs from all the others it tracks because it’s driven primarily by brand buzz. “So even when good things are happening out there in stores, it takes time for this category to build impressions and for consumers to hear about those good things.”