Following a stronger-than-expected initial public offering, Levi Strauss CEO Chip Bergh said Thursday the denim retailer has a “clear runway for growth,” as it looks to boost jeans sales to women.
“We’re creating the denim wave,” Bergh told CNBC’s “Squawk Ally” on Thursday morning. “I believe this is sustainable for the long term.”
Shares of the company surged 32 percent during its debut on the New York Stock Exchange as shares opened at $22.22.
The company’s retail strategies are working, he said. The denim brand has expanded into women’s wear and T-shirts, in an effort to broaden its reach. Last year, men’s business accounted for $4 billion of the company’s $5.6 billion revenue.
Gaining market share among women is key as many have been shifting to yoga pants and leggings from jeans, forcing companies to rethink their denim products.
“Athleisure became a throwdown moment for us,” Bergh said. “We understood what women were really telling us by wearing tights,” he said, explaining that women wanted comfortable material they could dress up or down and had a stretch to it.
Now that Levi Strauss has reimaginged its jeans, he said, the women’s market is the key to growth.
Levi Strauss has also been focusing on the online market, and Bergh said that online sales accounts for nearly a third of the company’s business. The company is also looking to international markets. Currently,only 3 percent of its revenue comes from the growing Chinese market.
Consumers buying into the denim brand are buying into the American dream.
“This brand stands for everything good about America: freedom democracy, authentic self expression,” Bergh said. “To be successful, it does come down to strong brands. Consumers love an emotional attachment with their brand.”