At its June 1, 2022 Investor Day, Levi Strauss and Co executives laid out an aggressive strategy to propel the company toward revenues of $9 to $10 billion by 2027, by doubling down on DTC and diversifying beyond denim.
“We are emerging from the pandemic a much stronger, more profitable company than we were at the time of our IPO in 2019,” said the company’s President and CEO Chip Bergh in a statement. “We are entering this next phase of growth with strong momentum, proven execution and a bold strategy to increase profitable top-line growth annually by 6% to 8%, growing our direct-to-consumer business to 55% of revenue and nearly doubling the women’s business.”
The company reaffirmed its expectations for fiscal 2022, with revenues expected to reach $6.4 to $6.5 billion this year. To hit the $10 billion mark in the next five years, the company plans to increase DTC revenues from their current 36% of the total to 55%. This will be facilitated by 400 new stores, mostly smaller-format locations, approximately 100 of which will be in the U.S., as well as plans to triple the ecommerce business.
Levi’s also hopes to double both its women’s and tops businesses in the same time frame, a significant shift for a brand whose heritage is built on denim jeans. The company said it will focus on “elevating and strengthening” its core brands — Signature by Levi Strauss & Co., Denizen, Dockers and Beyond Yoga — with executives targeting combined revenue growth of approximately $2 to $2.5 billion for Signature and Denizen, and for the combined revenue of Dockers and Beyond Yoga to reach nearly $1 billion by 2027.
Levi’s also said it would continue to invest in its digital transformation, aiming to automate and digitize key processes to increase customer loyalty, facilitate faster speed to market and create a “simplified, productive work environment.”
This shift to a DTC-first mentality doesn’t mean the end of Levi’s wholesale relationships, however. “DTC first doesn’t mean DTC only,” Bergh said in his investor presentation. “In the last few years, we’ve been laser-focused on evolving our wholesale strategy and the evolution of our wholesale footprint and it’s fair to say you’ll continue to see this evolution.”