Cambridge Analytica, a data and software company, identified the most popular retail brands with shoppers, breaking out its findings by moms, dads, and millennials, and what it found is surprising. Among the most popular brands with millennials in Middle America: Urban Outfitters, Charlotte Russe, and … Hot Topic?
Drawing from a database of more than 220 million people, the firm analyzed demographic, consumer, and lifestyle preferences, according to WWD, which first reported the story.
While the beginning of the end of the American shopping mall as we know it seems nigh, the top three stores have been cornerstones for teens in America’s heartland since the beginning of the millennium.
It’s less surprising that in 2017, Urban Outfitters would be included among the most popular mall brands with Middle American millennial shoppers. Within the last year, the store has cashed in by stocking popular activewear brands like Adidas and Calvin Klein and has lowered its primary price points to reach more shoppers. But how is it that a niche store like Hot Topic — whose heyday seems long over — has fared so well?
Emo and goth kids of the early aughts favored Hot Topic, flocking to it as a place to get Warped Tour band T-shirts or black nail polish and studded belts adorned with skulls. Its persona as a retail haven for morose teens scrolling through their My Chemical Romance iPod playlists was so pervasive that South Park mocked it in a memorable 2008 episode.
It’s true that Hot Topic was in deep financial trouble before Sycamore Partners, a private equity firm, acquired it in 2013 for $600 million, adding it to a portfolio worth more than $3.5 billion, replete with other struggling mall retailers like those under the Jones Group. (Today Hot Topic operates more than 650 retail locations across the U.S. and Canada, according to Sycamore Partners’ website.)
Yet somehow the store has enjoyed a lucky streak of resurgent popularity. In a somewhat serendipitous turn, “goth vibes” were popular on 2016 runways like those of Alexander Wang and cult design house Vetements. But it would be complacent to think that trickle-down fashion is the only reason for the comeback.
First, Hot Topic was always a go-to for music merchandise and band T-shirts in the early 2000s, so the year of celeb merch (aka 2016) was a sure-fire way for the store to make money. While Hot Topic is known for stocking alternative and rock band T-shirts, it also carries pop star merch like that from the Weeknd.
Katie Smith, senior analyst for retail analytics firm Edited, said millennials are more likely than their parents to identify with each other based on their taste in music or hobbies, and then wear those identities on their sleeves — putting Hot Topic in “prime position” to seize sales.
Also, the store wasn’t inclusive only for the alt kids in high school, but also for the plus-size teens. Hot Topic was ahead of the curve when it came to stocking plus sizes in everything from leggings to cosplay costumes. Catering to that woefully underserved segment of the retail market is a move that has evidently paid off — and will continue to do so as the $20 billion plus-size market continues to grow. To boot, lucrative licensing agreements with big-name movies like Beauty and the Beast and Harry Potter could easily pad the store’s bottom line.
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Alexandra Mondalek is a writer for Yahoo Style + Beauty. Follow her on Twitter @amondalek.