Societal Responsibility of Abercrombie & Fitch

Table of Contents Case Background. 2 Issues Faced. 2 Should Jeffries respond?. 3 Ethical Challenges. 3 Societal Responsibility. 5 References. 5  
Case Background
What started out in 1898 as a small Manhattan based shop supplying outdoor gear has since turned into a massive American retailer focused on providing casual luxury clothing styles. After an innovate merger with Ezra Fitch, David Abercrombie rebranded the company to Abercrombie & Fitch (A&F) which stood strong for many years before struggling in the later 1980s. This struggle resulted in its acquisition by L Brands who turned the company to the solely apparel-based company that it is known for today. Abercrombie and Fitch is represented by three subsidiary stores worldwide: Abercrombie, Hollister Co., and A&F. Each subsidiary segments different target markets; middle school students, high school students, and college students. The portfolio spans a target market from ages 12 to 22 years old.
Issues Faced
After recording losses of $25 million spanning 36 different stores, Michael Jeffries was hired as the chief executive officer with hopes of leading the company into a profitable market leader. Jeffries believed he could do this by “…reinventing the brand and a strategic plan to establish a segmented target market.” (Abercrombie & Fitch: Is it Unethical to be Exclusive, Page 1) With incredibly specific and provocative segmentation strategies, Jeffries was able to build an iconic brand with over 1,000 global retail locations with annual sales of around $4.5 billion dollars. For 52 straight quarters, Jeffries had successfully delivered an increase in earnings by building products and brands that directly targeted a very specific segmentation. This very specific segmentation has since created a negative reputation for A&F brands which is negatively affecting the company. Through the course of this case analysis, it is hoped the reader is able to better understand if Jeffries should respond to the current controversies, the ethical challenges of target/niche marketing and the societal responsibilities of companies as it relates to their targeting strategies.
Should Jeffries respond?
Should Jeffries respond to the current controversy by adding more sizes to the company’s clothing line?
Should he stick to the status quo?
Ethical Challenges
It is important for any strong brand to understand their target market to best build strong advertising strategies that can better reach their intended customer. Now although this is not inherently a bad strategy, if at its success it is effectively actively excluding others not directly within the scope of the intended target market then the company may face an ethical dilemma. It is also a challenge knowing which marketing tactics/ segmentation tactics are ethical as they can differ between industries. For example, many of the segmentation and marketing tactics that used in the gambling industry may not be able to translate well to the alcohol or children’s book industry. To ensure that a target marketing strategy adheres the confines of ethical practices, it is important to understand what some ethical challenges are. Ethical challenges include but are not...