Fashion retailers are coming off a rough year.

Abercrombie & Fitch saw sales decline for the eleventh consecutive quarter — leading to the resignation of its longtime CEO Mike Jeffries. Gap’s image and sales both took a beating largely at the hands of its dud of a “dress normal” campaign, although it recovered slightly in the third quarter. Most recently, British retailer Marks & Spencer reported a slump in sales for the fourteenth consecutive quarter, with international sales down by 5.9 percent.

There is, in fact, not a single apparel retailer that’s not having a tough time, according to Sucharita Mulpuru, an analyst at Forrester. But the reason brands like Gap and Abercrombie & Fitch have taken the worst hit is because they are large, mature retailers that haven’t broken through to digital natives.

“Once you’re saturated as a brand, you’ve reached all the consumers you can reach, and you’re in all the stores you can be in, it’s very difficult to grow – unless you grow into new categories and take share away from your competitors,” she told Digiday.

The challenge these brands face is that the youngest shoppers are simply not making purchases the way previous generations do, said Doug Stephens, founder of retail advising firm Retail Prophet. “We are looking at a monumental transition taking place now demographically,” he said. “ Statistically, Americans stop buying as much apparel beyond 50 which means the Baby Boomer generation will see a decline in terms of their purchasing power.”

On the other hand, he said, the younger generation doesn’t want a Gap to tell them what to wear. Millennials look to niche brands and are influenced by trends on social and digital.

“It’s a completely new way of buying,” said Stephens. “They have a revolving door of choices and selection at their fingertips.”

In fact, many retailers may have already “fallen behind” on this front by failing to recognize the importance of having a digital presence, said Tiffany Hogan, analyst at Kantar Retail. “Anyone just starting to formulate a digital plan at this point in the game is going to be well behind an ocean of its peers that realized its value sooner,” she said.

There are competitive dynamics that disrupt retailers from quarter to quarter, says Mulpuru. And increasingly, it is the e-retailers that are digitally savvy that are chipping away from the giants’ businesses.

One such digital retailer is Francesca’s, a chic and affordable Texas-based chain with modest beginnings that grew into a network of over 500 boutiques in 45 states — due to its focus on developing its eclectic and easy-to-navigate online boutique. A number of other smaller e-retailers are also getting it right. Bib+Tuck has the requisite app and social media presence, but also does weekly news blasts and online chats with stylists online. Then, there are the fast fashion portals, like ASOS, Tobi and Nasty Gal, which make browsing and purchasing a fun digital experience.

Complicating things for the legacy retailers is the fact that consumer spending in the retail sector is down across the board. And in an era of reduced spending, the retail sector gets hit hardest in the middle tier. Cheaper brands and luxury retailers more easily navigate economic turbulence, according to Hogan.

“Dating back to the recession, people stopped spending as much on clothes,” she said. “There has been a recovery, but in discounted retailers or off-price retailers like TJ Maxx and luxury brands.”

The modern consumers are also less forgiving — so these brands must tread the marketing line carefully. That means that Abercrombie cannot afford to upset women with bigger sizes, and Gap cannot dictate what’s “normal.”

For legacy retailers looking to stay relevant, this means shifting the priority to the customer experience and demands, analysts say, and not continue to rely on what’s worked in the past, which for Abercrombie & Fitch and Gap has been logo-heavy merchandize — their bestsellers once upon a time.

“It’s the stores, visual merchandizing, its sales associates, price points—all that makes the brand,” Mulpuru said.

“The old advertising equation was that you advertise more than your competitors and bring customers to the store to buy products,” Stephens echoed. “Now, the model is completely reversed. Stores are no more the distribution points, but experiential points—points where a customer can go in and actually be blown away by the brand experience, which galvanizes the customer experience across channels.”

And how brands embrace mobile and new platforms is also important, according to Stephens.

“It’s so fragile, and there’s so much competition now, that every single aspect of a brand matters more than it ever has — The way the brand behaves on Facebook and Instagram and its effectiveness in creating a fluid and pleasant mobile experience. Digital is not an add-on to the brand experience, it’s all one thing.”

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