American Apparel in China: First-Tier Strategy Targets Trendy Niche

Marketing Manager Olivia Mok On The Aspirational Side of "Made In USA" American Apparel's new LAB Concept-partnered location in Hong Kong. (Fashiononymous) Few brands can claim notoriety for both marketing and labor policies like American Apparel, known in the United States for its provocative advertisements and vocal advocacy of a sweatshop-free production model. The former fastest growing retailer in America has two stores each in Beijing and Shanghai and opened its first shop-in-shop in Hong Kong last month in a partnership with Lane Crawford subsidiary LAB Concept, which is also a partner with Topshop for its upcoming June 6 Hong Kong store opening. To get the scoop on the company's Hong Kong and mainland promotional strategies and China's evolving retail market, Jing Daily reached out to American Apparel China Marketing Manager Olivia Mok on selling "Made in USA" to "the world’s factory." American Apparel recently opened a Hong Kong location in partnership with LAB Concept. Is the strategy for Hong Kong versus the mainland different? We opened our first shops in China in 2008 and are currently operating two stores each in Beijing and Shanghai. In addition to our mainland China stores, we just opened our first Hong Kong shop-in-shop in collaboration with LAB Concept this past May. Our Hong Kong and China strategies are aligned; consumer tastes differ slightly in each area but we're sensitive to this and therefore offer a tailored assortment for each store. You formerly worked for American Apparel in Japan. What are some differences between the Japanese and mainland markets? Although tastes and preferences vary from country to country, all of our consumers share the same love for the brand and partiality to high-quality basic clothing. Our styles can be easily paired with other high street brands as well as luxury brands, so American Apparel is a favorite of many different types of people. Olivia Mok. Describe the typical American Apparel customer in mainland China. We have many fans of the brand in China of different age groups and from different socioeconomic backgrounds. However, since our clothing is American made, it's heavily taxed in China, so our main consumer tends to be someone with high disposable income, who is well-educated, and usually well-traveled. We're definitely a bit of an aspirational brand in China; we represent the American dream and the brand image also communicates a certain level of openness and freedom. What is the mainland China expansion strategy? We have plans to open more stores in China, but are currently focused on developing a strong presence in first-tier cities before we execute new store openings. What is your current marketing strategy? We tend to be rather selective about our public relations strategy and we're generally pretty conservative. We don't budget out an exorbitant amount of money for traditional advertising like many high street brands do, and you won't see our billboards all over the place. Our growth has been rather organic and we'd like to keep it that way. What is the perception of "Made in USA" in China? In the U.S., locally produced carries economic and political connotations that do not necessarily translate. We've learned that there is a niche in the Chinese market that appreciates high-quality American-made goods. Of course when there's huge economic growth people generally care about what's fast and what's "now", but the Chinese market is saturated by fast and cheap fashion, and they're transitioning away from this. More and more, we're seeing that Chinese people care about where their clothing is made, how it is made, and how long it will last. There's an appreciation for quality over quantity that's developing in the market, especially considering all the recent controversy surrounding the factory fires in Bangladesh. An ad for American Apparel seen in China. (American Apparel) Who are your main competitors? We get this question a lot but it's difficult to answer because no other retailer offers what we do, which is timeless high-quality basics that are consistent season after season. Are you considered luxury? We're definitely an aspirational brand, especially in China. What is something unexpected you've learned about the China market? The Chinese economy is growing stronger, the people are getting wealthier and as a result, they're travelling more, getting a better education, and essentially becoming more cultured. They've evolved from wearing head-to-toe designer clothing to mixing and matching luxury with moderate or budget labels. This was the biggest difference I felt just by being here.

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American Apparel in China: First-Tier Strategy Targets Trendy Niche