Forever 21 had filed for bankruptcy in September 2019 and is now to return with a new strategy.
A post on the company’s official Weibo account stated that the American fast-fashion brand Forever 21 plans to return to China after leaving in 2019. The company has now allowed Lasonic Limited Xusheng Co. Ltd and its subsidiaries Xusheng Electrical (Shenzhen) Co. Ltd to handle the brand’s Asian business. The brand is currently available on some electronic retail platforms such as Vipshop and Pinduoduo in China. Moreover, the company also mentioned that it plans to open new stores across China and strategically market its products through China’s e-commerce channels.
The company has left China three times till now. The latest comeback is Forever 21’s third entry into China was after opening a store in Changshu back in 2008, which closed within a year. The brand returned in 2011 and operated 11 stores around China by the time it announced its withdrawal in 2019 when it filed for bankruptcy in September 2019 and was acquired by global brand development, marketing, and entertainment company Authentic Brands Group (ABG) in February 2020.
The Reason For Failure In China
Forever 21′s failure in China has been largely attributed to its negligence and slow approach to expansion and a digital marketing strategy that left it less visible to young consumers than its high street competitors. Again, a perfect example of why brands need to reach the right audience and how the right agencies can help you with it. Rather than opting for the kick-ass digital marketing and branding strategy, the company trusted its retail strategy that focussed on huge stores in China’s most expensive shopping streets. It required a major capital investment that proved difficult to recoup.
The Brand Story
It began when Forever 21’s founders, two Korean immigrants, Do Won Chang and his wife, Jin Sook Chang, founded the first Forever 21 store in Los Angeles, California in 1984. Before opening their first store, Do Won Chang worked as a janitor at a gas station and a coffee shop hard to make ends meet. They started the chain with an aim of providing fashionable pieces at more than reasonable prices, to the kids and teens. In their first year, the company raked in USD 700,000 in sales. Now it operates over 790 stores, selling men’s and women’s clothing across the U.S, Canada, Europe, Africa, Oceania, and across Asia.
