I have this hunch that American Apparel is reinventing how it sells clothing. It appears that the company is transitioning its marketing from a more traditional approach to an approach located at the intersection of:
- Visual Social Media (Instagram).
- Retail level, as close as possible to the customer.
- Employees' own photo shoots.
- Sell them a product they want to talk about and share images. Amplify the social media discussion.
This approach increases the engagement between American Apparel and its customers on platforms where the youth customers are highly active. This visual social media, mobile and customer centric strategy is resonating with customers by judging from the company's success on Instagram. For employees, it makes the job at the store level much more creative and fulfilling and it builds on the company photographic heritage.
No other company that I can think of has been so successful at empowering employees and customers to create free advertising on social media. And this is the key piece because social media is only meaningful if it comes from friends and connections, not from a company promoting a product. Because American Apparel is so open to customers and employees taking artistic license with their products, the social aspect of social media works in their favor.
(Images Source: Instagram).
What do you think?
Written by Michael Bigger.
Disclaimer: Bigger Capital, LLC, Bigger Capital Fund, LP, Bachelier, LLC and the Bigger family own more than 3.27 million shares of American Apparel. American Apparel is a highly distressed situation and it is not suitable for the majority of investors. The likely outcome of an investment is a loss of principal. In other words, the probability of losing all your investment in this situation is very high. We have been purchasing American Apparel since May of 2011 and we have nothing to show for it. Take our opinions with a grain of salt and do your homework. None of the Bigger entities individually or in aggregate have an obligation to file its position with the SEC at the time this article was published.