American Eagle launched Aerie as a sub-brand collection of bras, camisoles, robes and casual clothing for girls 15 to 25 in its existing stores in September 2006. It also launched side-by-side store locations for the concept. After successfully testing three Aerie stand-alone locations last fall, it is expanding to at least 15 stores this year,
"We're very excited about this store brand," O'Donnell said. "The question is how big this sub-brand can be and how much it can add to American Eagle. It could be a half-billion dollars."
The move will make the increasingly competitive intimates sector even more so. Chico's has grown its Soma intimates concept to 49 stores, and Victoria's Secret has been growing its Pink sub-brand, appealing to Aerie's target audience.
Martin + Osa, a sportswear chain for 25- to 40-year-old men and women, could be even an even larger business than Aerie. The company opened five stores last year, which are attracting shoppers older than 40; "a good thing," O'Donnell said.
Results have been mixed, he said, but the chain is in the early stages, and it will expand to 15 stores. In time, it could be a $1 billion business, he said
"I wouldn't be signing leases if I didn't think it had legs," O'Donnell said.
In addition, American Eagle will open 50 new stores and remodel 40 existing units, he added. The Warrendale, PA-based retailer operates just more than 900 stores in North America.
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