American Eagle creates ‘dormwear’

Joan Verdon, MCT Campus

HACKENSACK, N.J. — Teen apparel chain American Eagle Outfitters Inc. has a strategy for tapping into the lucrative lingerie market — create a clothing category called “dormwear” and build a store around it.

American Eagle named the new concept Aerie — spelled all lowercase on signs, ads and shopping bags — and opened the first store a year ago in Greenville, S.C. The company is moving rapidly to build the brand. It opened its 15th Aerie store this week at Westfield Garden State Plaza in Paramus, N.J., and it plans to have 40 stores nationwide by the end of this year.

With Aerie, American Eagle is taking a different approach to the lingerie market. It is creating a store that combines casual clothing and sleepwear with bras and undergarments, rather than going the route of rivals such as Victoria’s Secret or Gap Body and creating a lingerie-only shop.

“I think it’s a brilliant, distinctive presentation,” said Candace Corlett, a partner in WSL Strategic Retail, a consulting firm based in Manhattan. She praised American Eagle executives for not just opening another lingerie store. “Why go head to head when you can do an end-run?” Corlett said. “There isn’t anyone out there that has a focus on this new category of dormwear. They’ve created a new retail niche.”

Victoria’s Secret recently has branched into dormwear as well, with its Pink brand of sweatpants, sweatshirts and pajamas, but bras and thongs still have center stage in their stores. American Eagle executives say the look Aerie is trying for is “sweetly sexy,” rather than the more blatant sex appeal of the competition.

Dormwear was inspired by female college students who began wearing flannel pajama bottoms and sweatpants to class about 10 years ago. The category now includes items such as leggings, camisoles and baby-doll nightgowns worn with shorts or pants as long tops. Prices range from $5 undies to $15 T-shirts and $29 pajama pants and hooded sweatshirts.

The intimate apparel and sleepwear market for women and girls ages 13 to 24 is expanding. Sales increased 7.8 percent in 2005 and 9 percent in 2006, topping $4 billion last year, according to market research firm The NPD Group.

“We actually have been selling underwear and some dormwear in our stores for some years now, but we’ve never broken it out this far,” Carmen Blanco, East Zone vice president for American Eagle, said Thursday as she helped open the Paramus store.

Aerie’s merchandise is designed to appeal to “Katie” — the prototypical customer American Eagle executives created to define the store. “She’s 15 to 25 years old. She’s a high school or college student and enjoys her friends. She has hobbies and enjoys sports. She’s an active, fun-loving girl,” Blanco said.

Nina Gallo of Wyckoff, N.J., one of the first shoppers in the Paramus store, predicted the new concept would be a hit with her granddaughters and other young women. “The merchandise is well put together and it looks comfy,” she said. “And,” added her sister-in-law, Fran DeVita of Wyckoff, “it’s all within the girls’ price range.”