American Eagle's Fast-Growing Mobile Channel Boosts Store Traffic

Mobile commerce sales at American Eagle Outfitters have more than tripled since last year, and the retailer is gaining added value by using mobility to strategically support its other channels, including its brick-and-mortar stores.

"Our new AE app adds greater functionality and importantly drives customers to the stores with rewards tied to in-store activities," said American Eagle CEO James O'Donnell during a recent conference call discussing the retailer's Q3 financial results. "The shopkick rewards app is a great example and has generated positive traffic and transaction growth."

The mobile app allows customers to "easily place online orders, put outfits together and grab additional information," noted O'Donnell. "It's highly functional and fully integrated with our loyalty program and promotional offerings. The AE app also features full integration with social media sites, and we have seen mobile sales more than triple over the last year."

American Eagle's strategic use of mobility is consistent with the integration of all its digital channels, which are grouped as the AEO Direct division. During Q3, online sales increased 21% over the same period last year due to increased traffic and conversion. "Direct is one of our most promising growth vehicles," noted O'Donnell. "The online business was an extension of all of our brands. As we look forward, the opportunity to build on current offerings and extend brand loyalty by leveraging mobile technology and social media outlets is really exciting."

The retailer, which includes the Aerie and 77kids brands along with American Eagle Outfitters, had a strong third quarter overall. Total sales climbed 11% to $832 million, with comp store sales rising 5% compared to the same period in 2010.

The positive results in Q3 represent a rebound in 2011. In Q1, American Eagle's total sales decreased 6% to $610 million, with a comp store sales decline of 8% compared to the same period the previous year. Q2's figures were somewhat better: sales rose 4% to $676 million, and comp store sales were flat.

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