Levi's ties recovery plan to fall ad spending blitz

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By his own admission, Philip Marineau is no "garmento," rag trade lingo for a fashion maven. But the president-CEO of Levi Strauss & Co. insists the tattered Levi's brand can be salvaged and that he's the right person to do that.

Mr. Marineau, a longtime food-industry executive who took control of Levi Strauss 10 months ago, said new marketing, product and retail initiatives are the centerpiece of his plan to reverse the declines in sales and earnings that have plagued the company. The interview came as Levi's unveiled an ambitious fall ad campaign for its jeans brand that carries the theme line, "Make them your own."

"We're an icon brand," said Mr. Marineau, who added the turnaround will take 18 to 24 months. "We will really establish a very strong retail brand."

Despite his optimism, some industry observers said it's too late for Levi's. "If it isn't over, it's getting closer and closer," said Kurt Barnard, president of Barnard's Retail Trend Report.

Harry Bernard, chief marketing officer at retail consultant Colton Bernard, said, "Levi's is not going to be a fashion leader again."

EROSION CONTINUES

Evidence of the brand's erosion among its core youth target continues to mount. The most recent private tracking study from NPD Group indicated Levi's share of men's jeans has continued to drop, while its women's business is holding, with larger sizes outperforming the juniors business. Meanwhile for the same period, VF Corp.'s Lee jeans posted double-digit share gains.

Zandl Group, which tracks youth trends, recently asked a panel of 13 teens and young adults to name their favorite jeans brands. Of the males, only 11% named Levi's, down from 17% last year and 36% in 1994.

Even Chuck McBride, executive creative director at Levi's agency TBWA/Chiat/Day, San Francisco, acknowledged that brands "can't stay hot forever," adding, "sometimes a brand has to recede to grow."

Levi's said spending on the fall campaign will be at the highest level in recent years. The company spent $72 million to advertise Levi's jeans in 1999, according to Competitive Media Reporting.

"One of the things I believe in is we need to be advertising and marketing," Mr. Marineau said.

The first "Make them your own" spot made its debut on the Web this month and will move to cable TV Aug. 14 before migrating to the broadcast networks. The spot, directed by Spike Jonze, gives a security-camera view of male and female models trying on jeans in a store's dressing room while they groove to the music of Marvin Gaye. Levi Strauss said that spot was filmed before the commercial actors strike began. A second spot, filmed in London this month, shows a jeans-clad building superintendent eagerly sought after by female tenants.

The campaign also consists of online advertising, outdoor and print elements, including a 52-page "Women to Watch" insert in the August issue of Vogue.

PROMOTIONS

On the promotional front, Levi Strauss will send a "Make them your own" trailer to department stores and concerts it's backing, including a Christina Aguilera tour co-sponsored by the apparel company and Sears, Roebuck & Co.

Levi's troubles began in the 1990s as it missed out on key fashion trends and was upstaged by private-label jeans, designer brands and specialty stores such as Abercrombie & Fitch. For the six months ended May 28, Levi Strauss reported net sales dropped 11% to $2.23 billion.

Mr. Marineau said marketing is a key part of the plan to turn the business around by telling consumers how the company has changed.

EXPLAINING WHAT'S NEW

"People need to know what news is out there. It's hard for them to find out for themselves," he said. "Great marketing is consistent, presenting relevant news to consumers."

Mr. Marineau said the marketer also is moving ahead with retail initiatives designed to raise Levi's visibility in stores, adding he said he sees "huge opportunities" to increase sales at traditional department stores such as J.C. Penney Co. and Sears.

In the short term, Mr. Marineau said his goal is to reduce Levi Strauss' $2.3 billion debt load, a result of the Hass family's leveraged buyout. Levi Strauss will stick with its three prime brands -- Levi's, Dockers and Slates -- and won't look to acquire other apparel companies.

Long term, it remains to be seen whether Mr. Marineau can make "Make them your own" his own. "If it's not working," he said, "we'll find something that does."

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