How CEO Michelle Gass Plans to Turn Levi’s into a $10 Billion Company

How+CEO+Michelle+Gass+Plans+to+Turn+Levi%26%238217%3Bs+into+a+%2410+Billion+Company
Levi’s Commitment to Sustainability and Women’s FashionLevi’s Commitment to Sustainability and Women’s Fashion Levi’s is doubling down on local product development in China, aiming to create lighter denim styles for warmer climates. The company plans to establish a local product engine to offer more premium items and expand into tops. Despite these product advancements, Levi’s faces challenges in addressing denim’s environmental impact. The industry remains water-intensive and uses harmful dyeing processes. In response, Levi’s has prioritized sustainability with a focus on climate, consumption, and community. It aims to achieve net zero by 2050. Emphasizing women’s fashion, Levi’s sees it as a major growth opportunity. The brand aims to make it easier for women to find Western trends and offers a wider range of denim and non-denim items. The company’s elevation strategy includes unifying its premium offerings with a blue tab and launching fashion collaborations. The current Western trend, fueled by celebrities like Pharrell Williams and Beyoncé, has contributed to the brand’s success. Levi’s has seen a 40 percent increase in sales of its Western shirts and believes the trend is on the rise. In other fashion industry news, Givenchy has appointed a new CEO, Richemont has made changes at Cartier and Van Cleef & Arpels, and key takeaways have emerged from Fall 2024 Couture Week.

Levi’s will do a lot more local product development in China, including lighter denim styles for warmer climates. “Consumers want a very premium experience and they want to see changes in our offering more often. Based on those learnings, we’re building a local product engine in the market. We’ll have more premium items, but also things like tops,” she says.

However, all of these product developments face some major challenges when it comes to addressing denim’s environmental impact. The industry is known as one of the dirtiest categories in apparel production, largely due to its water-intensive production and environmentally damaging dyeing processes. Despite progress, many of the basic problems remain.

In 2021, Levi’s announced that it would focus its sustainability efforts on three core pillars: climate, consumption and community, starting with climate. In May 2024, it said its goal of reaching net zero by 2050 had been validated by the Science Based Targets initiative (SBTi).

“Just as we are a leader in denim, we need to be a leader in sustainability,” Gass says. “Denim is a product that consumers want, so what we need to do is invest in innovative products and technology to reduce our impact on the environment.” The company will release its 2023 sustainability update in September.

The opportunity for women’s fashion

Womenswear is “absolutely instrumental” to the global strategy, says Gass, who is dressed in a Levi’s denim jumpsuit when we meet. “We’ve historically been known as a men’s brand. And we’ve made huge strides in women’s. We’re going to continue to amplify that strategy as we look forward,” she says. “We see it as an even bigger opportunity to really own a head-to-toe denim lifestyle. For women, that’s jumpsuits like the ones I’m wearing today that are really on trend now, but it’s also denim dresses, denim skirts… Womenswear is about a third of our business today and it should be at least half, and all our research suggests that if we can capture the female consumer, she’ll buy the male consumer as well.”

There are also non-denim products, chinos and the non-denim Tech pants, which are geared toward performance and activity. “It’s more of a part of the wardrobe that extends beyond denim pants,” Gass notes. As part of the elevation strategy, the brand will unify its premium offerings with a blue tab instead of the traditional red on the back pocket. It will continue to launch about six to eight fashion collaborations per year.

Is the Western trend, fueled by Pharrell Williams and Beyoncé, helping to drive business? “What’s helping us are our core strategies, but to get back to your point, there’s a lot of buzz in denim and in Western right now and we’re excited to capitalize on that,” Gass says. “You can look at some of the proof points, like our Western shirts as an example, and those are up 40 percent year-over-year. We’ve been doing marketing on our website, making it easier for consumers to find those Western trends. Western is definitely on the rise. Levi’s is on the rise.”

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