China is the first chapter in the playbook being created by Levi Strauss Co to help it manage recovery from the impact of the coronavirus lockdowns around the world.

“We’re trying to learn as much as we can in China,” said Chip Bergh, the apparel manufacturer’s chief executive, on a conference call with investors.

But he also acknowledged that “China may not be a perfect model for everything that we might expect to see in the West”. (For more details, read WARC’s report: How lessons from China are informing Levi’s COVID-19 strategy.)

“It’s quite possible here in the West [that] we’re going to see a much bigger economic impact [and] more job losses,” he said. Given the range of uncertainty, he added: “We just have to see how this situation unfolds.”

As such, it is important for the brand to develop replicable best practices as it continues “to play to our strengths and learn from China, and as other markets in Western Europe begin to come back; learn from Western Europe; and just keep building our playbook as we go”.

Harmit Singh, Levi’s EVP/chief financial officer, noted that the company had been seeking to transform its Chinese business over the last couple of years, shifting away from discounting on platforms like Tmall and moving the brand into a premium positioning.

“Before COVID-19 hit, our turnaround strategies were really gaining traction as double-digit revenue growth was eclipsing our internal expectations there,” Singh said.

Although the brand’s momentum has been disrupted by the coronavirus, he expressed confidence about its prospects in China, and the broader value of knowledge gleaned from that market as it bounces back from the pandemic.

“We are encouraged by the progress we have seen in China, and we are using artificial intelligence and consumer insights to inform the playbook we’ll use for other markets as we begin to recover,” he said.

Sourced from WARC