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American Eagle Outfitters (NYSE: AEO) is an American clothing and accessories retailer based in Pittsburgh, Pennsylvania. It was founded in 1977 by Mark and Jerry Silverman as a subsidiary of Retail Ventures, Inc., a company which also owned and operated Silverman's Menswear. The Silvermans sold their ownership interests in 1991.[1] American Eagle (also known as Am. Eagle, A.E., æ and A.E. Outfitters) targets older teens and young adults.[2] Some of the best selling products of American Eagle Outfitters are Low-rise jeans, Polo Shirts, Graphic T-shirts (with the AE logo and year established), and swimwear.[citation needed]
DevelopmentWhen the Silvermans first opened an American Eagle Outfitters store in 1977, they were looking to diversify their menswear business. As the term "outfitters" implies, the merchandise was tailored to an outdoor lifestyle. Stores were set up in shopping malls and a catalog was established. The chain grew for much of the 1980s. In 1989, the owners decided to refocus their business on American Eagle Outfitters, selling their other retail chains. At this time, there were 137 American Eagle Outfitters stores in 37 states. Despite the plans for quick growth after the reorganization, American Eagle Outfitters opened only sixteen new stores by 1991 and the company was losing money. Now the Schottensteins, who had been 50% owners of the chain since 1980, bought out the founding Silverman family's interest. This change in leadership caused American Eagle to find its present niche: casual clothing for men and women selling private label clothes. When the company began trading on the NASDAQ stock exchange in the second quarter of 1994, it had 167 stores and a healthy cash flow. With the cash infusion from the IPO, the company opened more than ninety new stores within the next year. Several new executives joined the company in 1995 and '96, leading to another change in the target demographic. The company now wanted to reach more women and focus on people between 16 and 35. The strategy worked, and over the next five years revenues quintupled to $1bn by 2000.[3] American Eagle claimed 1101 stores across three brands (American Eagle Outfitters, Aerie, and Martin + Osa) in November 2008 and $3bn in revenues for the most recent fiscal year.[4] Other brandsIn addition to its namesake brand, the company has developed and announced plans for several new brand and concept initiatives poised to drive new growth as the brand nears saturation in current markets.[citation needed] The company's second stand-alone lifestyle concept, Martin + Osa, launched in the fall of 2006, targets men and women from 28 to 40 years of age. It features Cashmere sweaters and casual clothing for a much older target audience. They also sell products by Fred Perry, Adidas, Onitsuka Tiger and HOBO International. [5] In 1999, the company acquired a Canada-based retail concept called Bluenotes, which has approximately 100 stores averaging 3,300 square feet. The concept targeted a slightly younger demographic, ages 12-25, and was positioned as a denim-driven urban/suburban lifestyle brand. Due largely to poor performance, the Bluenotes business was sold to YM Inc. in 2001. [6] 
aerieThe aerie intimates sub-brand was announced in February 2006, targeting American's 15 to 25 year old female demographic segment. In addition to intimates such as brassiere, bras and undies, it also sells dormwear, active apparel, loungewear and sleepwear. These are sold in a stand alone store or through its website. [7] 77 kidsAmerican Eagle released plans in January 2008, to launch "77 kids," a line of clothing aimed at children from infant to 10 years. Online shopping is currently the only way to purchase 77 kids merchandise, but there are plans to open retail stores in the future. [8] ControversiesStrikeIn 2007, textile and apparel workers union UNITE HERE launched the "American Vulture" back-to-school boycott of American Eagle [9] in protest of alleged workers' rights violations at the company's Canadian distribution contractor National Logistics Services (NLS). On the 2007 second quarter conference call[10], CEO James O'Donnell clarified the American Eagle's relationship with NLS and its effect on business. He explained, "We owned NLS with the acquisition of Braemar back in 2000 and we subsequently sold off NLS in 2006, and we are currently a customer of NLS... We have really no involvement at all with Unite Here and NLS. Our only involvement with NLS is basically as a customer and there have been some allegations made I think to some of, to the public about it affecting our business. I can tell you right now it has not affected our business." Abercrombie & Fitch LawsuitsSince 1998, Abercrombie and Fitch has sued American Eagle Outfitters at least three times for copying its designs and advertisements. Every time, American Eagle has prevailed, with courts telling Abercrombie that its designs are not able to be copyrighted. [11] Judges generally ruled that giving Abercrombie exclusive rights to market its clothing in a certain way "would be anticompetitive." [12] Company growthAmerican Eagle expanded internationally by entering into Canada. A second store is open in the White Oaks Mall in London, Ontario, after acquiring some Dylex divisions in 2000 (Thrifty's, Braemar, & National Logistics). There are now American Eagle stores open all across Canada. In 2006, 42 new American Eagle stores opened and 65 remodels were completed. Together with five new MARTIN + OSA stores and three new aerie stand-alone test stores, total gross square footage increased 8% for the year. In 2007, the company plans to open 45 to 50 more American Eagle, at least 15 aerie stand-alone, and approximately 12 new MARTIN + OSA stores. Additionally, approximately 45 American Eagle store remodels are planned which, combined with new store openings, will generate total 2007 square footage growth of approximately 10%.[13] References
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