This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (October 24, 2017).
Chip Bergh, Levi Strauss's CEO, says the company wants to see
what new functions consumers want. But the possibilities are
endless.
Levi Strauss & Co. has 164 years of history behind it -- and
the challenge of remaining competitive in the digital age ahead of
it. The company is addressing that challenge in part by using big
data to better understand its customers and cater to them. But it's
also taking a higher-profile tack with cutting-edge wearable
technology, an internet-connected jacket it developed with Alphabet
Inc.'s Google unit.
The Wall Street Journal's deputy technology editor, Christina
Passariello, sat down with Chip Bergh, Levi's president and chief
executive, to discuss high-tech clothing, the blending of Levi's
and Google's work cultures, and the pros and cons of working with
Amazon.com Inc. Edited excerpts follow.
Wearing the internet
MS. PASSARIELLO: Levi's just unveiled its first connected item
of clothing, this $350 jacket that you're wearing. How are
consumers starting to use it?
MR. BERGH: We have a line of product called Commuter, which
really is for bike riders. It's a little bit niche, but getting
more mainstream. So we decided to use the Commuter line. This
allows cyclists to get directions, listen to their music, change
their playlist without ever needing to look at their phone.
MS. PASSARIELLO: How do you see the use of the product
evolving?
MR. BERGH: Where this specific product goes and how much more
functionality we build into this is one question. The other big
question is where does wearable technology go?
Right now devices kind of control our life, and the picture for
the future is that technology is embedded in our life, into the
clothing that we wear, perhaps into the sheets in our bed at home,
and anything that's a fabric will be able to have conductive fiber
in it that can do just about anything.
MS. PASSARIELLO: Do you plan to roll this fabric out across many
other products in your lineup?
MR. BERGH: Yeah. We have a lot to learn from the consumer. What
other kinds of functionality do they want built into this? And then
we'll go there. We're already working with Google on 2.0.
MS. PASSARIELLO: What do you have in mind already for 2.0?
MR. BERGH: If you think about all the different ways or times
you need to take your phone out to use an app, imagine replacing
more of that. Scroll through your phone and look at the apps and
say, "Do I really need to look at the screen for this?" And if not,
if I can control it with a swipe, it's something that we're going
to be able to build in from a functionality standpoint.
Learning from Google
MS. PASSARIELLO: Tell us about working with Google. Different
cultures. What's it like to go through this innovation process with
them?
MR. BERGH: We're perfectionists. Everything we sell has got to
have quality embedded in it. It's got to be perfect before we
launch something. When we launch a new fit, the team travels around
the world to make sure it fits all the different body types around
the world.
We really focus on perfection and really failure is not an
option. Google embraces mistakes.
We had one instance where the sleeve actually caught fire.
That's not a good thing for a consumer, right? But they loved it.
They were like, "That gives us a problem to solve." And so it was
two very, very different cultures coming together trying to solve a
common problem. And I think we learned a lot from it. We're now
embracing failure a lot more readily, willing to fail fast, fail
early, but just keep moving forward because there's no such thing
as a real failure. It's just an opportunity to learn.
Working with Amazon
MS. PASSARIELLO: You've had an official supplier relationship
between Levi's and Amazon for several years. What do you gain from
having Amazon as an official supplier?
MR. BERGH: They've got enormous scale in the online space. They
attract the most eyeballs for consumers who are shopping.
We do have our own website. We do work with our other wholesale
customers like Macy's, like J.C. Penney, like Kohl's on their
e-commerce sites.
We're trying to innovate in the e-commerce space, so we just
launched a chat bot that is a virtual stylist. If you go to
levi.com, you can experience that.
As we develop these capabilities and prove them out, we're
willing to share them with all of our online partners. But Amazon's
one of our biggest customers globally. They're one of our
fastest-growing customers.
MS. PASSARIELLO: Amazon gathers a lot of information about how
Levi sells. Do you get access to that data?
MR. BERGH: Some of it. I'm sure we don't get all of it. But we
try to have a productive working relationship, and not just with
Amazon here in the U.S. I met with Alibaba this morning. We're
working with Wal-Mart as well. All of these e-commerce players are
collecting a lot of data, and I think we can partner together to do
a better job of targeting consumers.
MS. PASSARIELLO: Amazon has launched a lot of its own lines to
compete with others, and now they have all this data about how well
they sell your product. When do you expect them to go head-to-head
with you with their own denim line?
MR. BERGH: I would be the first to argue that they shouldn't go
there, but a lot of our customers have their own private label and
we've been dealing with this for 30 years. I don't want to say it's
inevitable, because they're really happy with our business and
they've got other brands as well. But if they launch a private
label, competition's a good thing. It will make us take our game up
to the next level.
(END) Dow Jones Newswires
October 24, 2017 02:47 ET (06:47 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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