Small labels are pushing into the shops, giving jeans a touch of luxury and uniqueness -- fresh, unconventional and cool.
In order to keep pace, the established brands grouped around Levis need a new strategy.
It's been a long time since Levi's jeans commercials held a cult status around the world. A glimpse of the tanned muscular stomach of a guy in the laundromat, the slow unbuttoning of a fly on 501 jeans -- blue jean advertisements once were miniature works of art sensually filmed by Hollywood directors. But now the veteran brands Levi Strauss, Wrangler and Lee appear to have lost their sex appeal.
The companies are noticing it in their profits. recorded a loss of $4 million in the second quarter of the business year. Revenue is sinking dramatically. At the beginning of the year earnings already had slipped by half. Wrangler and Lee, which belong to the US apparel company VF Corporation, saw revenue sink in the second quarter.
The jeans market desperately needs a "dose of excitement", said analyst Katrin Magnussen of the US market research institute Mintel. Particularly in an economic crisis, customers need an incentive.
"This currently is being created either by designer jeans or by inexpensive jeans available at warehouse-style stores," Magnussen said. Brands like Levi's, Wrangler, Lee and Diesel occupy the middle of the market and therefore lose out.
"They have to create more excitement over their brands," Magnussen said. They can either start making cheaper products, which risks devaluing their names, or start selling premium products, which could mean they lose their core customers.
"The big brands are tired," said Patrick Kuhnert of Fourteen Ounce, an affiliate of a Berlin fashion trade show organiser. "Diesel, Reply and Levi's are having problems with their standing," he said.
Trend-setters currently aren't buying 501 jeans. Instead they are choosing PRPS, an abbreviation for product with a purpose.
An example is pants made from African cotton costing between 300 and 500 euros ($424 and $706). Kuhnert noted dryly that they aren't exactly mainstream garments.
But not only premium brands are getting traction in the current market. The Scandinavian brands Acne and Cheap Monday are targeted at young, very fashion-conscious buyers with little money to spend.
Another example is the French label April 77, backed by former musician Brice Partouche. Its jeans sell for 50 to 80 euros.
One rule applies to all: The more individual, the better. The Swedish brand Nudie advertises with "naked facts", telling buyers to wear the jeans for six months before washing them. The result is a unique pair of jeans with various washed out patches.
"The established, large brands have to constantly recharge their image to maintain interest," said Nina Piatscheck of a German textile trade magazine. Levi Strauss also has to keep pace and it is trying to do so by reflecting on its roots with the slogan "Go forth."
In the economic crisis Levi's is seeking to tap into a new American pioneering spirit with these words: "Looking forward, never back. No longer content to wait for better times. I will make better times."
Thus, the cowboy images are back along with the prairie dust. This is what Levi's hopes will again lure a generation that wasn't even born when the old advertisements first came out -- the 18- to 34-year-olds -- to buy its jeans. Levi's aims to be the uniform of the post-economic crisis.
Garment industry experts doubt it will bring much success in the highly competitive jeans market. In the trade publication Advertising Age, Bob Garfield, a marketing specialist, recently wrote that Levi's biggest marketing problem is its image as a discount store jean "amid premium-denim hipsters".
He said the ads were "too cleverly manufactured, too pompous, too precise", adding that he expected them to generate "little more than a rolling of eyes on a mass scale".
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