Eric and Co flat out to re-invent Levi's image

Levi Strauss, the struggling jeans manufacturer, is to reinvent its approach to retail in an effort to halt the decline in sales and convince fashion-conscious teens and twenty-somethings that the brand has kept pace with youth culture.

Its flagship Regent Street store in London is to be reopened this weekend with a slick new redesign that incorporates a DJ booth, a chill-out zone, an art gallery space and a new customising area where consumers can have their jeans transformed to suit their own taste.

Over the next six months, the style of this store will be reproduced in Levi's stores throughout Europe. The brand is also using London to test-market another retail idea, a boutique-type store called Cinch which sells vintage and red-label Levis to mostly older, already brand-loyal Levi Strauss consumers. The Cinch theme will also be rolled out in key European cities during the same period. The worldwide decline in the fashion for denim has hit Levi Strauss hard. Earlier this year, the company closed 11 of its 22 manufacturing plants in North America and laid off 30 per cent of its work force.

The company is privately owned and doesn't release corporate earnings data but it admits sales are down in all of its geographic regions. The Americas were down 15.2 per cent to $3.9 billion (€3.6 billion), while Asia Pacific showed the largest proportional decline, dropping 21.1 per cent to $369 million. In Europe, demand has fallen by 33 million units between 1996 and 1998, a fall of almost 14 per cent. The decline will continue with an expected 3.9 per cent decline this year and a further 7 per cent fall by 2001.

The new Regent Street store is very much in line with current retail thinking that shopping should be a `total' experience rather than simply a quick commercial transaction. The display units have been designed so that they can be locked away in a matter of minutes so the shop can become a dance club complete with DJ booths designed by Paul Oakenfold, currently one of the hottest DJs on the club scene.

In the chill-out area, young shoppers can browse the Internet, or read books or magazines. Individual expression is very much part of youth culture and Levi Strauss hopes its customising area will make the standard jean product more attractive to the target 18-25 age group. Once a shopper buys a pair of jeans he or she can have them embroidered in the store or have a design lasered onto them. They can also be sanded down to give them the worn look.

A range of images and patterns will be available for customers to choose from or they can work with young artists employed by the shop to come up with their own design. The service costs extra. Levi Strauss has abandoned its previous attempt at customising whereby shoppers could be measured up in store and then have their jeans individually tailored to fit their specific shape and size. The service is still available in some stores in the US but it never really took off in Europe.

The new system which allows young shoppers to create their own individual look is seen to be a way of capitalising on what young people have always done with their denims.

The retail relaunch is very much in line with the brand's overall marketing strategy to boost its appeal among younger consumers. Its advertising for its Sta-Prest range of clothing which featured a yellow puppet called Flat Eric was so successful and so in tune with popular culture that it crossed over from television advertising into the charts where Flat Eric had a hit single.

It is still a long way from the heady days of the mid-1980s when the famous launderette commercial with its Marvin Gaye hit soundtrackHeard It On The Grapevine helped boost sales of 501 jeans in Europe by 800 per cent.