Once So Very Hip, Levi’s Has The Blues Jeans Maker Sees Its Image, Sales Sag To Cheaper, Wider In-House Brands
Time was when wearing a pair of Levi’s jeans made a kid feel cool and drove a parent crazy.
These days, it’s the parents who are wearing the red-tagged faded blues and the kids who proclaim them …
“Preppy,” says Mario Flores, an 18-year-old from San Francisco. Flores prefers a decidedly baggy brand that falls around his hips.
“Levi’s are too straight, too plain,” adds 16-year-old Irma Cruz. “None of my friends wear them.”
Preppy? Too plain? Is it possible that the jeans first worn by California gold miners and made popular in the 1950s by James Dean and Marlon Brando are now fuddy-duddy duds?
With its share of the men’s jeans market dropping from 48 percent in 1990 to an estimated 26 percent now, Levi Strauss & Co. is cutting back. It announced this week it will close 11 plants in four states, putting nearly 6,400 out of work - 34 percent of its manufacturing work force in the United States and Canada.
Levi’s survived the Jordache look in the ‘80s, and now it’s trying to regain its footing after getting knocked around by Tommy Hilfiger, Calvin Klein and even Sears.
High-end designers own an estimated 4 percent to 5 percent of the men’s market, according to Tactical Retail Monitor, an industry newsletter. And cheaper in-house brands sold by Sears, J.C. Penney and Wal-Mart have grabbed as much as 19 percent of the men’s market and 30 percent of the women’s, compared with 3 percent each in 1990.
Like Levi’s, Wal-Mart’s Faded Glory jeans, Sears’ Canyon River Blues brand, and J.C. Penney makes their jeans in the U.S. and overseas.
And Wrangler and Lee brands also have taken about $1 billion each in annual sales away from Levi’s.
Wal-Mart, in fact, on Wednesday offered to buy 1 million pairs of Levi’s to help a “a fellow American company,” a Wal-Mart spokesman said. Levi’s plans to decline, a spokesman said, noting that the company exited the lower-priced jeans market earlier this year when they sold the Britannia line.
Levi’s “is not a discount brand,” said spokesman Gavin Power.
Then there are simple fashion problems, including the fact that Levi’s “massive” jeans have legs that are 23 inches around, rather than the newly popular ones with legs that are 40 inches around - the kind, for example, that Flores likes.
Gordon Shank, president of Levi’s American division, says going after young shoppers is the first step in regaining some of those sales. And that’s where Levi’s latest ad campaign, aimed at 14- to 24-year-olds, comes in.
New TV spots play out like grungy daydreams. In one episode, a teen rolls down his windows and drives through a car wash, drenching himself and the Levi’s interior of his 1970s-vintage Gremlin.
“I think it’s probably the most unfocused ad campaign that they’ve ever had,” says Harry Bernard of Colton Bernard Inc., a San Francisco group of clothing-industry consultants. “I think they’ve lost track of who and what they are.”
Levi’s, in fact, is looking for a new ad agency.
Despite the problems with its jeans, Levi’s says it had a record $7.1 billion in worldwide sales last year. That included $4.3 billion in sales in the U.S. - about $3 billion of which was generated by Levi’s products. The rest came from the sale of Dockers brand pants, now a decade old, and the new Slates dress pants.
Those sales come, in large part, from customers like Melvin Yearby, a faithful wearer of Levi’s.
“After wearing them for 25 years, that’s the only image I know,” says Yearby, a 46-year-old from Vallejo.