Lucia Marcuzzo of Levi’s says that “even at tough times like the current, a DTC strategy fosters growth”

Forging a strong direct relationship with consumers is one of the mainstays of the ‘Project Fuel’ plan drawn up by Michelle Gass, who earlier this year was appointed CEO of Levi Strauss & Co. And while Levi’s will chiefly focus on expanding its retail network in Asia, the fact that the global denim giant opened a new flagship store on the Champs-Élysées in Paris on April 25 is the clearest indication of the group’s ambitious plans for the European market.

The new, 540-square-metre store by Levi’s will boost the brand’s visibility on one of Europe’s top commercial thoroughfares, one that will be even more in the spotlight this summer, when the Olympic Games will be held in the French capital. The store’s interiors are an ode to indigo blue, and they underscore several elements designed to create an increasingly tight bond between Levi’s and its customers. It is the stated objective of Lucia Marcuzzo, managing director Europe at Levi Strauss & Co., who recently assumed a continent-wide role after a stint in charge of Levi’s in Northern Europe. Marcuzzo, a jeans aficionado who previously worked at Diesel, was of course wearing a denim total look at the flagship’s inauguration. According to Marcuzzo, the store “is much more suitable for showcasing our collections and welcoming our customers. The location is perfect. And it’s an experiential shopping venue rather than a purely transactional one.” The opening was the first major activation by Levi’s this year, allowing the brand to join in the Olympic party mood.

“[The Olympics] will attract millions of people. We really wanted to open this store for this occasion,” said Marcuzzi. “We believe that, beyond the competitions, [the Olympics] are a genuine popular culture event. It’s in the nature of [Levi’s] to be at the heart of culture, as well as music and design of course, but sport is a wonderful vehicle for bringing communities together. And such a positive event is ideal for us,” she added.

The challenge facing Levi’s as it deploys its new plan is significant: beyond a renewed focus on the brand’s denim range, Project Fuel underpins Levi’s growth goals but it also sanctions a 10% to 15% reduction in the group’s workforce worldwide, with Europe suffering its share of cuts too. The performance of CEO Michelle Gass and her staff will be closely watched. Under her predecessor [Chip Bergh], Levi’s posted steady growth over the course of a decade, and the group’s revenue increased by 50% to reach the current value of $6.2 billion.

“I joined the company 14 years ago, almost at the same time as Chip Bergh. I witnessed his efforts in transforming the company and repositioning the brand at the heart of popular culture, setting it off on an amazing trajectory. I think the results have been incredible,” said Marcuzzi. “Michelle’s mission is to bring the brand to the next level, following the strategy. She contributes her experience and expertise in retail and in establishing direct relationships with consumers, backed by a wonderful career in apparel and fashion. And this is exactly the next step for the brand. It means that the brand is at the heart of the project, that our priority is to deploy a direct-to-consumer (DTC) [strategy], and that we will also diversify,” added Marcuzzi.

Asia, a region where the Levi’s retail footprint can be improved, appears to be the focus of the group’s new retail strategy, but the plan also envisages growth in Europe. “Europe is the group’s first major market after the USA, and was worth $1.6 billion in 2023. The European market is already well developed, but there are opportunities for growth. In terms of consumer clusters, by broadening our style range we can generate additional sales, notably with womenswear customers. We are also aiming to boost our e-tail business and intensify the relationship with the 20 million members of our European loyalty programme, with France the leading market. Even at tough times like the current, a DTC [strategy] fosters growth. It’s a successful strategy in the medium term. We want to boost our omni-channel presence for our customers. We’ll continue to open our own stores, about 100 more around the world, and Europe will contribute to this expansion,” said Marcuzzi.

Monobrand stores are enabling Levi’s to strengthen its brand identity. Besides showcasing a broader product range, they give the brand the opportunity to convey its values. “Levi’s has always been openly committed to progress, to positive development. [Monobrand stores] allow us to express our DNA. The Champs-Élysées flagship is the best testament to our evolution. Of course, not all stores are flagships, but having a monobrand network is crucial for our strategy, as is e-tail. Most of our investments are focused on our DTC strategy, as we open new stores and renovate and expand existing ones introducing our new concept. Most of the elements of this Next Gen concept will be deployed across the entire network, though with a different emphasis in the case of traditional stores,” said Marcuzzi.

France to benefit from special focus

In recent years, Levi’s has also relied on its multibrand partners to grow. It is therefore reluctant to concentrate exclusively on e-tail and on its 3,200 monobrand stores and other directly operated outlets. “We’re continuing to work with wholesale partners as a complement to direct retail, since they allow us to stay in touch with customers in various key segments. Ours isn’t a uniquely DTC strategy,” said Marcuzzi.

In this respect, France, one of Levi’s main European markets, will continue to be a focus of special attention well beyond the Olympics. “We are France’s market share leader in denim for both menswear and womenswear. And I believe you must expand where you are strongest. We will invest more in France. Germany is another major market where we still have a lot of growth potential. And the fashion capitals, London, Milan and Paris, are key cities for us. We want to position Levi’s at the heart of culture and fashion. We have also identified Copenhagen as a major city,” said Marcuzzi. Levi’s is set to have a much greater presence at the next European fashion weeks.

Product-wise, Levi’s has emphasised the decision to put denim centre-stage, as well as garments typical of denim culture. At the brand’s new flagship, and in most Levi’s stores in future, denim products will account for the lion’s share of the range, and especially the more visible part of it. “Our stores showcase the entire Levi’s range. But we want to make sure that when customers look at a product, whether a pair of jeans or something else, they think ‘it’s Levi’s!’ We don’t want to sell denim alone, but Levi’s products will always be clearly identifiable, by their details, the way they are made, their concept. And I’m extremely satisfied because our stores’ assortment is clearly resonating with consumers, despite the tough economic climate,” said Marcuzzi.

A major advantage Levi Strauss & Co. can tap in deploying its plan – whose third key element is diversifying the clientèle, by introducing new product categories and establishing a presence in new commercial regions, notably in Asia – is the renewed interest shown by consumers in all things denim. “The fact that denim is making a come-back is understandable. Denim outfits are eminently democratic, they can be worn by CEOs and workers alike,” said Marcuzzi. “What makes denim so interesting is that it can be functional as well as directional. Denim is now back on the runways, with designers reinterpreting denim looks. That’s what denim is like, in my opinion. It may experience some lows, but it always comes back, and can be constantly reinvented. I also feel that its current revival is linked to the international situation, because denim is associated with a certain idea of independence and freedom. Wearing clothes that symbolise strong values can be another important way of expressing ideas,” she added.

Clearly, Levi’s is making sure it is offering consumers a range of denim outfits that is ideal for responding to this trend.