Struggling Hollister Plans to Become a 'Fast Fashion' Brand

Hollister, whose stores are a place for teens to hang out in dark corners and shout at each other over very loud music -- oh, and to buy clothes, presumably -- is changing its business model in a major way.
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Hollister, whose stores are a place for teens to hang out in dark corners and shout at each other over very loud music -- oh, and to buy clothes, presumably -- is changing its business model in a major way.
Queuing up outside Hollister in London. Photo: Matthew Lloyd/Getty

Queuing up outside Hollister in London. Photo: Matthew Lloyd/Getty

Hollister, whose stores are a place for teens go to hang out in dark corners and shout at each other over very loud music -- oh, and to buy clothes, presumably -- is changing its business model in a major way.

The company is attempting to stem the loss of customers, which have slowly bled out as changes in teen fashion preferences lead them to fast-fashion retailers like H&M and Zara.

As the old saying goes, if you can't beat 'em, join 'em: Hollister's new strategy involves co-opting the fast fashion business model. Newly appointed chairman Arthur Martinez tells the WSJ that the brand will work with West Coast vendors for a "a supply chain that's fast and responsive." The brand intends to lower cost and change up the offerings to help differentiate Hollister from mother brand Abercrombie & Fitch.

They're also seeking for someone with fast fashion experience to become Hollister's president. This new president could potentially replace current CEO Mike Jeffries, who has hung onto his position despite a number of controversies and the requests of investors that he vacate the role (he did, however, lose his role as chairman).

It doesn't sound like this change will come anytime soon, if Jeffries gets his way -- Martinez says that when the time comes the CEO wants to "leave on a high note."

It seems that high note may be far out of reach: In addition to these changes, Abercrombie is shuttering some 70 stores, many of them Hollister locations.

Investors seem less than impressed with the proposed changes. Engaged Capital Chief Investment Officer Glenn Welling tells WSJ, "This board doesn't have the credibility to make the determination that Hollister should be a fast-fashion retailer or that Mike Jeffries should be leading the turnaround." He adds that Hollister should consider changing up the design team rather than changing the "core brand."

Maybe it could start by installing some light fixtures. Just a thought.

We've reached out to Abercrombie & Fitch for more details, and will update when we hear back.