Why American Eagle Failed In The U.K. (And Why It's Trying Again)

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Published on 18 Jan 2020, 15:00
In 2014, American Eagle Outfitters opened three stores in the United Kingdom. Just three years later, the teen retailer abandoned the market. The U.K. fashion market is notoriously tough for international retailers to break into. It's crowded, and U.S. retailers' products are often too expensive. Due to the country's small physical size and high population density, fast shipping is expected.

Retail experts say American Eagle didn't differentiate itself from the competition when it entered the British market.

"You can't just set up shop in another country as if it's your own and do exactly the same thing you would back at home," said Chana Baram, a senior retail analyst at Mintel. "You have to get to know a new customer, even between an American customer and a U.K. customer."

American Eagle doesn't break out international stores in its financial results, so it's not totally clear how the U.K. stores performed. In a March call with analysts, American Eagle's CFO said it had reduced its "loss-making businesses" in Europe.

American Eagle is trying to take on the British fashion market once again. In February 2019, the retailer announced it would expand into Europe through a partnership.

American Eagle did not respond to CNBC's requests for comment.

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Why American Eagle Failed In The U.K. (And Why It's Trying Again)
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