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To Reach The Unreachable Teen


Marketing: Retailing

To Reach the Unreachable Teen

Retailers are trying a whole-lifestyle approach to win Gen Y

David Garman, a 16-year-old from Geneva, N.Y., is no shopaholic. Garman typically buys clothes just before the start of school or over Christmas, spending little time during the rest of the year cruising the mall for fashion. But lately he has taken to reading the Skechers shoe catalog. Why? The magazine-catalog hybrid, or "magalog," combines stories on celebrities and trends--including one on feng shui, the Far Eastern art of placing buildings and furniture to facilitate harmony with nature--with the usual product information. While David already planned to order Skechers sandals, he says those stories make the catalog and brand more appealing. "It does make it more interesting," he says. "Just staring at shoes for a while gets boring."

Retailers know well how tough it can be to hang on to the attention of Generation Y. As evidenced by August's 14% sales decline in Gap Inc. stores open a year or more, even the strongest brands can slip from favor. To become more entrenched with their teen customers, retailers are pushing to expand their brands to include music, sports, books, bedroom decorations--just about every facet of the teen lifestyle. The bet: that teens will be more loyal to a brand that seems to reflect how they live and not just how they dress.

The lifestyle craze among marketers is hard to miss. Consider retailer Abercrombie & Fitch Co. It may be a clothes company, but its magalog offers everything from music reviews to advice on travel in South Africa to tips on making cheap feature films. Alloy Online Inc., a catalog and Web site operator aimed at teens, now publishes its own teen novels, poetry, and nonfiction books, all with prominent Alloy Books imprints on the covers. Even discount juggernaut Target Corp. has launched a back-to-school magalog featuring pop sensation Macy Gray on the cover and a story on life at a Hawaiian high school, as well as information on products such as neon-colored wireless phones on the inside. "The race is on to make that lifestyle connection and generate customer loyalty," says Mary Brett Whitfield, a consultant specializing in e-retail at PricewaterhouseCoopers.

For marketers that manage to bond with this generation, the payoff can be tremendous. There are 31 million kids in the U.S. between 12 and 19, according to Teenage Research Unlimited. In 1999, TRU figures they spent $153 billion, 8.5% more than in 1998. And that age group will grow to 35 million in 2010, making for the largest teen population in U.S. history.

While the potential of that market is obvious, figuring out how to win over Gen Y hasn't been. For one thing, teenagers are notoriously fickle. What is hot one month can be passe the next. At the same time, says Nancy Carruth, Target's director of advertising management, Gen Y-ers don't like a hard sell. Internal market research done in the past year and a half, for example, showed that the circulars the company ran in newspapers weren't reaching teens at all. The goal of Target's new magalog, says Carruth, is "to get the brand and merchandise in front of them without being in their face."

That's made possible by building an image that seems to be more about lifestyle than about selling clothes. American Eagle Outfitters Inc. has staged a comeback over the past six years by cultivating an active, outdoorsy image. Its magalog offers American Eagle branded snowboards and scooters as well as clothes. The magalog even recommends cool gear that American Eagle doesn't sell, such as an underwater camera and a compact guitar. By showing teens that it understands their fascination with those items, it hopes to draw them to its stores and Web site for the stuff it does sell. "The catalog is now more of a marketing tool than a selling tool," says Michael James Leedy, American Eagle's executive vice-president for marketing and e-commerce.E-MALL. It's hardly surprising that the Web is a key element for building a broad lifestyle brand. Wendy Liebmann, president of New York marketing consulting firm WSL Strategic Retail, says Gen Y-ers are heavy communicators, with access to the Internet, cell phones, and Palm Pilots. That's why Alloy, for example, has an online mall that mixes chat and entertainment with shopping. The mix has attracted big-name marketers looking to reach Gen Y: Johnson & Johnson and Procter & Gamble Co. both advertise on Alloy.

While the rush is on to create lifestyle brands, the move does pose risks. For one thing, companies may end up offering such a broad array of products that their brand image becomes diluted. And even a strong lifestyle image can become dated or too narrow. "You can go from huge profits to tremendous losses overnight," warns Howard L. Davidowitz, chairman of retail investment banking and consulting firm Davidowitz & Associates Inc., of the Gen Y crowd. To the new brand of lifestyle marketers, the trick will be to keep in step with the latest image today's teens want to try on for size.By Amy Barrett in PhiladelphiaReturn to top


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