Though Levi Strauss & Co. lost a reported $127 million in 2020, this year was all about gains for the heritage denim brand. By Q3 2021, the company reported its net revenue was up 41 percent compared to the same period in 2020, and up 3 percent over 2019.
To get to where it is today, the company called on its 168 years of experience navigating unprecedented challenges and devised winning business strategies like offering more convenient shopping experiences, acquiring a major active wear brand and increasing prices where it saw fit.
Despite all of the year’s hardships, the company was able to make a record-setting donation to its past and present employees and surrounding communities through its charitable nonprofit Red Tab Foundation (RTF). The organization donated a total of $2.4 million in support in 2021—more than its $1.7 million contribution last year.
The company’s penchant for offering community support in times of need was one of the reasons why it was awarded a top spot in a report from RepTrak, which ranks global companies’ reputations among consumers. In April, the Levi Strauss’ score of 76.6 earned it the No. 14 spot out of 100 on the list of the most reputable companies. The Lego Group took the No. 1 spot with an “excellent” score of 80.4.
And according to Levi’s president and CEO Chip Bergh, business is expected to grow, thanks to a renewed focus on denim.
“The casualization trends that have been accelerated by the pandemic globally are here to stay,” he told investors in October. “In the U.S., both the apparel segment and the denim category are now larger than pre-pandemic, with denim growth outpacing total apparel for the second quarter in a row. We expect these drivers will provide our business with a multi-year tailwind.”
Expansion
The year saw significant expansion, most notably through Levi’s acquisition of size-inclusive Beyond Yoga in an all-cash transaction for an undisclosed sum in August. The move complements a growing women’s category that currently represents approximately one-third of its total business, and which it vowed to turn into half of its total sales.
In February, it capitalized on the nesting trend and debuted its first-ever home decor collection of more than 100 items like selvedge-inspired dishes, bandana-print pillows and quilted blankets. Products were exclusively available on Target.com and in most Target stores, with prices ranging from $3-$150.
Beyond products, Levi’s also expanded its retail strategy, opening its first NextGen store in the Latin American market in September after identifying the Americas among regions with the greatest opportunities for growth.
Its NextGen retail concept first debuted in 2019 as a way to reposition its traditional retail stores to deliver omnichannel experiences and accommodate the rise of digital. In its Q3 2021 earnings call, Levi Strauss said that despite 10 percent of its stores being closed in the quarter, global brick-and-mortar was up 1 percent compared to 2019, fueled by growth in the Americas. Within two months of opening, the Viña del Mar store exceeded its goals and inspired the opening of a second location in the region.
Digital
Fueling its success was the companywide focus on digital innovations. In October, Levi’s announced it would launch new technology on its e-commerce site that makes it possible to use images—not words—to search for products. Called “computer vision,” the feature makes it easier for consumers to find pieces that match those from their mood boards, social media sites or photos. After uploading an image to the site, shoppers will be presented with relevant products across Levi’s assortment.
Using artificial intelligence (AI) and automation efforts, Levi’s is making online shopping a more personalized experience. The site will deliver search results tailored to the user’s previous interactions with the help of neural-network-based machine learning, making it possible for a consumer to search for “jeans” and have the site pull up products that fit the gender, color and fit of their past search results. The more a user interacts with the site, the more personalized the search results. The company is currently testing the feature in select regions and plans to expand it globally in 2022.
In July, Levi’s launched an AI bootcamp giving employees across all of its departments the chance to learn more agile thinking skills and increase the use of technology and data throughout the organization. The following month, it organized its first-ever virtual hackathon to encourage tech-fueled innovations to benefit the company and its customers.
Sustainability
In addition to its focus on digital innovations, Levi’s also made progress with its sustainable innovations in 2021. The company published a report in September pledging to improve its methods of sourcing fibers and include more hemp and organic cotton, as nearly 90 percent of its products are cotton-based. It also committed to using responsible manmade cellulosics, including viscose (rayon), modal, and lyocell, and ensuring that all of its relevant suppliers have eliminated sourcing from ancient and endangered forests.
That same month, the company tested the use of natural dyes within the Levi’s Wellthread collection, which serves as a laboratory for sustainable innovation. It also debuted a men’s and women’s collection of garments made with organic cotton and cottonized hemp fabrics dyed with a new range of sustainable, plant-based dye systems from Stony Creek Colors, a Springfield, Tenn.-based company that provides indigo plant-based color.
The inclusion helps transition the heritage denim brand away from conventional dyes, which require synthetic, petroleum-based processes that rely on toxic chemicals. The entire collection, wholly devoid of synthetic components like nylon zipper tapes, polyester labels and leather patches, is also designed for recyclability.
Women empowerment
Levi’s has a history of championing women and minorities in the workplace and beyond, and in 2021 was recognized in Forbes’ list of the world’s top female-friendly companies. To generate the list, the news outlet surveyed 85,000 women in 40 countries to rate their employers on criteria such as pay equity and parental leave, and to assess marketing messages—whether the company uses its platform to promote gender equality or perpetuate negative stereotypes—as well as representation at the board and executive levels.
Following the recognition, LS&Co. pledged its support of women refugees. The company was one of 25 companies to support the community at the virtual European Business Summit on Refugee Women conference. Organized by refugee support organization Tent and women’s employment nonprofit Catalyst, the event gathered leading European businesses to make commitments to support refugee women in Europe through mentorship programs. Levi’s pledged to mentor 50 women refugees over the next three years in Belgium, France, Italy and Spain. The program is open to refugee women, including recently arrived Afghan women, and will provide practical skills like resume writing, interviewing and networking tips to set them up for career success.
In June, the company opened its first owned-and-operated store in Pakistan that’s staffed entirely by women. The store is located in Lahore, a city within the country’s Punjab province, and helps open a new line of work for those most affected by the Covid-19 pandemic. According to Elizabeth A. Morrison, who joined Levi Strauss as chief diversity, equity and inclusion officer last year, the initiative is one of many that will diversify the San Francisco denim giant.
“[The store] builds on and challenges us to advocate for what’s right while capturing our renewed commitment to focusing on ‘our insides’ and our intention to create a company that mirrors our consumers and communities,” she said.