Tuesday, November 13, 2007

J. Crew moving into designer jeans?

In J. Crew's (NYSE:JCG) most recent catalog, a pair of designer jeans were featured in a significantly higher price range than usual. This brings up a serious question about how consumers treat "all-in-one" brands like J. Crew and Abercrombie (NYSE:ANF) (who has done this in the past with the Ezra Fitch label) in comparison with specialized jeans like True Religion (NASDAQ: TRLG) and Citizens of Humanity.

My opinion is that most consumers who shop in the J. Crew price range probably purchase their denim elsewhere -from an upscale retailer like Nordstrom (NYSE:JWN), Saks (NYSE:SKS), or Barneys. The J. Crew retailer will always have a difficult time fitting into the high end denim space due to the fact that their lifestyle branding is so broad in comparison with the very specific branding associated with denim (ie. Specific stitching, Pockets, cut, wash).

When dealing with established luxury goods like high-end denim, consumers are not willing to risk entry into new brands without major marketing support like celebrity and blog endorsement. True Religion, Paige, Seven for All Mankind (NYSE:VFC), Citizens of Humanity, Rock and Republic, and others have all spent massively on brand-building rather than designing a full line of clothing as their foundation.

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