With consumers enthusiastic about breaking out of covid restrictions and embracing hybrid lifestyles, PVH Corp. saw consumers dressing for occasions in the third quarter of 2021. The style, however, is still anchored in a casual lifestyle that suits both its Calvin Klein and Tommy Hilfiger brands, according to PVH CEO Stefan Larsson .
During the quarter, PVH recorded continued strength in key essential product categories such as underwear, t-shirts, polo shirts, hoodies, active sneakers and growing demand for denim. “We continue to build on the strength of our essential products and key heroes,” Larsson said during the earnings call Tuesday.
Thanks to this work, the company observed an improvement in AUR (average unit retail) during the quarter. It also reduced unproductive SKUs and relied more on data to take a more demand-driven approach to product development.
The company, however, is also navigating a millennial-driven retail landscape that calls for both new and nostalgic designs.
This quarter, Calvin Klein will release a second chapter of its collaboration with Heron Preston, covering denim, underwear and other “wardrobe essentials.” The company anticipates a repeat of the success of the first collaboration. Preston’s first April collection with Calvin Klein yielded one of the highest AURs and average orders the brand has ever seen.
Looking ahead, Larsson said the brand will continue to develop its collaborative strategy, “connecting Calvin Klein’s iconic strength with designers and brands around the world to express their unique take on the brand.” This includes the second installment of his underwear collaboration with Kith, which has helped Calvin Klein harness the purchasing power of Gen Z consumers.
Retro designs are where Tommy Hilfiger finds its rhythm.
“As we focus on Tommy Jean’s growth potential with younger consumers, we continue to drive the brand through successful capsules,” said Larsson. A strong push for nostalgic products, including licensed T-shirts and sweatshirts featuring millennial musicians like TLC and Britney Spears and SpongeBob SquarePants characters, has sparked strong engagement and sales, a- he added.
The brand has also launched collaborations that have amplified its efforts to increase the opportunities and visibility of under-represented communities within the fashion and apparel industries. In July, Tommy Hilfiger launched the first collaboration with a gender-neutral capsule starring Indya Moore, Larsson noted. The brand also launched a capsule with emerging Brooklyn designer Romeo Hunte, following his mentorship with Tommy Hilfiger. In the capsule, Hunt reinvented Tommy’s classics like colorful puffer jackets, contrasting color trench coats and oxford shirts.
In general, Larsson said “goal-oriented” products continue to resonate with consumers.
He added that more than 50 percent of the global pre-fall collection was sustainable, an achievement that matches the heritage brand’s commitment to more circular and sustainable designs. By 2025, 50% of the brand’s denim pieces will use low-impact fabrics.
These victories lead PVH to forecast a 27 to 28% increase in its turnover in 2021 compared to 2020.
“Our heightened focus on winning with the consumer through our two global power brands, Calvin Klein and Tommy Hilfiger, is delivering results,” said Larsson. “We are still only at the beginning of building our next chapter of growth, and I continue to be very optimistic for the future as we focus further on our fast-recovery priorities, building on our core strength and continuously following the consumer to position PVH for a long term. profitable growth over time.