American Eagle Outfitters Vs. Aéropostal Research Paper

Introduction

American Eagle Outfitters (AEO) is a well established clothing retailer with stores in various towns and cities across the world. The company was established in 1977 by Jerry and Mark Silverman. In 1991, however, an abortive expansion plan resulted in huge financial losses for the company.

This forced the Silverman family to sell their rights and thus ownership was transferred to the Schottenstein family. Change of ownership resulted in an overhaul of the company’s operations. As a result, the company managed to sustain growth in the last decade.

Currently, American Eagle Outfitters has a total of 1,086 stores. The stores mainly sell the company’s key brands namely, American eagle, Aerie, and 77 kids.

The company has stores in the United States, Canada, Central and South America, and the Middle East. American Eagle Outfitters specializes in a wide range of products including clothing, accessories, and footwear, among others. The company also runs an online store where consumers across the world can shop using their debit or credit cards. The company has a workforce of 34, 900 employees.

The company has managed to segment the market using various brands. Aerie, for example, is a brand whose target market includes females between the ages of 15 to 24. On the other hand, 77 kids targets toddlers of between 0-24 months. This strategy has ensured a continued rise in the company’s net income after the 2008 global financial crisis. For example, in 2011, American eagle net income rose to $ 151.7 million. This is a 7% increase from 2010 when the net income reported was $ 148 million (American Eagle, n. d.).

Aéropostale is one of American eagle outfitters’ main competitors. The company was established in 1987 by Bryan Alberto. The company has a total of 1,008 stores spread across North America, Central America, and the Middle East. In 2005, the company established an online store.

The venture has proved quite successful with the store reporting net sales in excess of $ 150 million. The company’s main target market mainly includes teenagers of between 14 and 17 years. In addition, the company has also launched P.S, a children’s clothing store. The store’s main target market is children between the ages of 7 and12 years.

However, the stores have expanded their focus to include products for children between the ages of 5 and 7 years. Aéropostale has 17,828 employees and prides itself in such core values such integrity, teamwork, respect and compassion.

The main aim of the report is to give an in depth comparison between American Eagle Outfitters (AEO) and Aéropostale clothing retailers. In this case, the comparison will be based on various economic aspects including selection, pricing, breadth and depth of assortment. The report further explores employees’ welfare including employee satisfaction, work, and incentive programs.

Discussion

Brands

In order to increase their bottom lines, the above companies have introduced a variety of brands.The companies’ main aim is to increase products available to customers. AEO has three major stores. Each of these stores stocks an assortment of products that is different from the other stores. AEO stores stocks clothes and accessories for both men and women between ages of 18-24 (American Eagle American, n.d).

Men’s clothing includes shirts, polo shirts, graphic t-shirts and sweat shirts. Also, the store stocks bottoms such as jeans, pants, shorts and boat shorts. Women’s clothing includes tops, graphic t-shirts and stylish tank tops. Also, the store contains swim wear whose net sales rise during the summer. The store has a wide variety of footwear and accessories.

Men’s footwear includes boots, casuals and sneakers while women footwear includes sandals, heels, flats, boots and sneakers. The accessories department has a range of products including bags, wallets, sun glasses, jewelry and hats. Aerie stores, specialize in women clothing including undergarments and other accessories. 77 Kids stores stocks a variety of children’s clothing and accessories. Products cater for toddlers up to fourteen year olds.

Aéropostale stores mainly target teenagers. The stores have products for boys and girls. Some of the products include camis, tank tops, fashion tops for girls. On the other hand, boy’s clothing includes hoodies, polos, tees and Henleys (Aeropostal Careers, n. d.). Aéropostale also introduced surfing themed collection aimed at increasing sales at the stores. P.S, a subsidiary of aéropostale stores, stocks children clothing and accessories. The store’s main target market is children between the ages of 7 and12 years.

Pricing

Pricing is an important aspect of any competitive market. Competitors ensure reduced costs so as to offer consumers the lowest prices in the market (Wilkie, 2008). Both AEO and Aéropostale have different prices for their range of products. The following table is a brief comparison of prices of both companies’ spring collection products;

Aéropostale/Item Price American Eagle/Item Price
Aero 87 So Cal Graphic T $ 9.00 AE Signature Graphic T $ 15.50
Solid a87 pique polo $26.50 AE Athletic Fit Pique $ 19.99
Western plaid shirt $ 22.00 AE Plaid Button –up shirt $ 34.99
Boot cut jean light wash $ 20.00 Boot cut jean Light wash $29.99
Floral Hentley dress $ 24.00 AE Floral Corset dress $29.99
Leopard Aviator Sunglasses $ 12.00 AE white aviator sun glasses $ 15.50
Aero 87 lace up sneakers $ 20.00 AE Lace-up sneaker $19.50
Aero nyc 1987 fragrance –large bottle $ 12.50 AE Live Roller ball for her $ 12.50

The above table offers a comparison of some of the products sold by both Aéropostale and AEO. Both stores offer discount s to their customers. Aéropostale offers customers a discount of up to 70% for its spring collection. On the other hand, American eagle offers its customers a discount of up to 50% for its spring collection buy off.

Employee welfare

Aéropostale prides itself in an organizational culture guided by its core values including integrity, teamwork, respect and compassion. The company was rated by Fortune magazine among the best companies for an individual to work for. Various incentives are offered in the company including cash awards and employee of the month awards (Aeropostal Careers, n. d.). Also, new employees are trained on aspects such as customer relations. This is important as new employees appreciate the importance of adequate of product knowledge.

Employees at AEO have the freedom to interact with customers with minimum interference from senior staff (Gurufocus, n. d.). Also, the company has a wide range of employment opportunities. Therefore, high school and college students are in a position to apply for sales associate jobs. The company has put a lot of emphasis on customer satisfaction. Therefore, the company organizes seminars and retreats for its employee to enhance product knowledge on any new products introduced at the store.

Reference List

Aeropostal Careers. (n.d.). Careers in Aéropostale. Retrieved from http://www.aeropostalecareers.com

American Eagle. (n. d.). American Eagle Outfitters. Retrieved from http://www.ae.com/web/browse/category.jsp?catId=cat180086

Gurufocus. (n.d.). American Eagle Outfitters operating results. Retrieved from http://www.gurufocus.com/news/16825/american-eagle-outfitters-inc-reports-operating-results-10k

Wilkie, W. L. (2008). Consumer behavior. New York: John Wiley & Sons, Inc.