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Venmo Partnership Proves Abercrombie & Fitch's Millennial Focus

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It was just 2016 when Abercrombie & Fitch Co. (ANF - Free Report) was proclaimed the “most hated retailer in the U.S” and looked to be on the brink of death. At the end of that year, shares of A&F were trading at around $12 per share, a far cry from the $60 to $70 stock price seen in 2011.

Fast forward to present times, and things couldn’t look more different.

A&F today announced it is partnering with Paypal’s (PYPL - Free Report) Venmo to be the first specialty retailer to let customers purchase products directly through their Venmo accounts. Mobile shoppers will now be able to use Venmo in both the Abercrombie & Fitch and Hollister apps to purchase products quicker than ever on their phones.

The stock has surged 2.25% through late-afternoon hours on reports of the news. The day’s price jump continues the impressive performance so far this year, as shares have risen by over 50%.

The retailer has been able to achieve this momentum by catering to Millennials and younger customers through expanding its mobile presence, improving its direct-to-consumer (DTC) business, and other youth-focused initiatives.

This is evident from the fact that more than two-thirds of digital traffic in the first quarter came from mobile for Abercrombie & Fitch. Further, the DTC business accounted for nearly 27% of net sales, recording a 14% increase in comparable sales.

The efforts have led A&F Co. to not only remove its “most hated retailer” image, but actually outpace the “Retail - Apparel and Shoes” industry in 2018.

 

 

Teaming up with Venmo is a strategic move that will keep A&F heading in the direction of modernization and youth, which has clearly been successful. Joanne Crevoiserat, Chief Operating Officer of A&F, made that mission clear, stating, We are excited about our Venmo integration, as we know Venmo is an increasingly popular payment option among our millennial and Gen Z customer bases.”

Ultimately, the partnership with Venmo is another significant step towards A&F proving that it is no longer a store of the past.

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