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President Trump gave the thumbs-up to Sydney Sweeney’s controversial ad campaign.
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American Eagle also announced a collaboration with Travis Kelce, one day after the announcement of his engagement to Taylor Swift.
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The marketing push seemed to pay off when the company reported in early September.
Shares of American Eagle Outfitters (NYSE: AEO) rallied 19.8% in August, according to data from S&P Global Market Intelligence.
American Eagle capitalized on July’s optimism regarding its new ad campaign starring actress Sydney Sweeney when President Trump endorsed the company’s campaign in early August. Then later in the month, American Eagle announced a collaboration with Kansas City Chiefs tight end and Taylor Swift fiancée Travis Kelce.
American Eagle’s stock got a bump in late July when it launched a controversial ad with actress Sydney Sweeney with the byline, “Sydney Sweeney has Great Genes Jeans.” While the stock then faded after an initial lift, President Trump weighed in in early August, writing on his social media platform Truth Social that the ad was, “the HOTTEST out there…the jeans are flying off the shelves.”
In response, investors bid up the stock, thinking the controversy might boost publicity for the brand and therefore subsequent sales.
Then later in the month, American Eagle announced a limited addition collaboration with Travis Kelce’s “Tru Colors” clothing line, which Kelce began in 2019. The new limited edition collection is to be unveiled in two “drops,” with one on Aug. 27, and another upcoming on Sept. 24. As luck would have it, the collaboration announcement came one day after Kelce announced his engagement to music star Taylor Swift.
So, American Eagle nabbed a marketing coup in both late July and into August, grabbing support from the President, as well as arguably two of the biggest celebrities in sports and entertainment.
The high-profile marketing push — both planned and unplanned – appeared to boost American Eagle’s near-term outlook. On Sept. 3, the company reported its second-quarter earnings results for the quarter ending Aug. 2, beating analyst expectations even though sales and comparable-store sales were each down 1%.
However, management said it was seeing “an uptick in customer awareness, engagement and comparable sales,” as a result of the Sweeney and Kelce campaigns, and projected comps to return to positive low single digits in both Q3 and Q4. That improvement would appear to validate the impact of the Sweeney and Kelce campaigns.
