While many of the mall brands that were popular among high schoolers a decade ago have struggled or failed, American Eagle is one of the few brands from that era that has managed to remain successful and relatively stable throughout the years. Now, American Eagle is looking for new avenues to rethink how it relates to its customers.
At the top of the list is American Eagle’s surprise decision to open a yearlong pop-up sneaker resale shop on Saturday inside its SoHo store in New York City.The pop-up is an extension of Las Vegas-based sneaker reseller Urban Necessities. Simultaneous with the launch, American Eagle also made a significant undisclosed investment into the company.
For American Eagle, the move toward a more streetwear-oriented customer is one it’s been trying to make for a while but was never able to get quite right.
“We wanted to get into the sneaker space, but we hadn’t been able to make the right connection or find the right collaborator,” said Chad Kessler, global brand president at American Eagle. “We think collaborations are great and exciting, but we wanted to do more than just one shoe or one season drop. [Sneakers] are something that can become an ongoing thing for our customers to engage with and be excited about.”
Kessler said, rather than compete with sneaker brands, American Eagle wants to instead focus on the things it does well as a companion to sneakers. For example, he said — according to Jaysee Lopez, the founder of Urban Necessities — American Eagle denim has been popular among the streetwear crowd. Lopez sought out American Eagle because of its popularity with Urban Necessities’ customer. With the Urban Necessities collaboration, American Eagle wants to highlight its jeans as the perfect complement to the sneakers it’s now selling.
“We are trying to make it a one-stop shop for jeans and sneakers together. Jaysee can attract a broader audience to American Eagle looking for sneakers, and we can introduce new people to our jeans.”
Like other crossovers between the streetwear world and mainstream fashion, both stand to gain from the cross-pollination of their audiences. The streetwear heads who will be attracted by the Urban Necessities shop will hopefully be swayed into buying American Eagle clothes, particularly denim, and vice versa.
American Eagle has been booming recently, with revenues last year nearing $4 billion, in part thanks to the monumental success of the brand’s Aerie line of underwear.
“This may be an unexpected move — but it’s a smart one,” said Jared Tomlinson, executive creative director at creative agency Standard Black. “The streetwear culture is typically styled from the shoes up. Your sneakers are the foundation to your entire look. Simple American Eagle denim, at an affordable price, and a pair of hard-to-get sneakers is a combo that’s not new; Shopping for them all in one place is.”
Kessler said American Eagle’s interest in streetwear is for the long term. Now that the brand has a solid, long-term base in the category, it is planning more traditional collaborations and smaller streetwear projects to be announced in the future.
“There’s a lot of excitement around streetwear brands,” Kessler said. “In some ways, it is the new coveted item. And resale is the new way that people are shopping. So this is a great way to tap into both of those exciting trends. There’s just so much happening in both of those spaces.”
But brands have to do more than just make surface-level appeals to the streetwear crowd in order to make it feel authentic. As streetwear’s popularity has grown, there has been an increase in the term “streetwear” being tossed around to attract new customers.
“To compete, both Urban Necessities and American Eagle will have to kick up the energy in their environment and make it unique, accessible and surprising, or the pop-up will appear to be a distraction,” said Chris Paradysz, global chief growth officer of brand performance agency ForwardPMX. “As a top brand for this generation, why not have its emotional and diversity beliefs connect in a fresh way? Kicks are just another way to do it. American Eagle was super smart about [this investment], not unlike Foot Locker making an investment in GOAT.”
To American Eagle’s credit, the brand has bought a stake in Urban Necessities, giving the smaller reseller a boost with investment so that it can grow. Kessler said he views American Eagle’s relationship with Urban Necessities as a long-term project. Additionally, he said alternative business models like resale or its Style Drop rental service (a program launched last month, where customers can pay a monthly fee to rent three items of clothing, with unlimited exchanges) are all key parts of how the company is evolving.
“We’ve always been focused on the same age range and customer, so we aren’t shifting there,” Kessler said. “What we are trying to do is make sure we are as true as possible to our values. As that jeans business continues to grow, we want other product categories like sneakers that can reinforce the same customer. So it’s not about a new message but about making the same message we’ve always had even clearer.”