scorecardThese are the biggest sibling rivalries in the clothing business
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These are the biggest sibling rivalries in the clothing business

J.Crew and Madewell

These are the biggest sibling rivalries in the clothing business

Gap and Old Navy

Gap and Old Navy

Former J.Crew CEO Mickey Drexler, who oversaw the takeover of Madewell, was also responsible for creating another popular sister brand during his time as CEO at Gap Inc.

In 1993, Drexler set up Old Navy as a more budget-conscious store to appeal to low-income shoppers.

Old Navy has become the parent company's saving grace. While Gap Inc. has struggled in recent years, Old Navy has seen positive same-store sales growth for the past five years.

The store has a cult following of price-conscious customers who choose it over Gap because of its lower prices.

"Maybe there is a little bit of difference [in quality], but not enough that is making me feel like I need to spend more money," Dana McKay, a 39-year-old mother of two who does all her shopping at Old Navy and has done so since her college days, told Business Insider in May 2017.

Old Navy is better at jumping on trends than its sister brand Gap.

"I wouldn't call it fast fashion but they are replenishing the merchandise more frequently. You are constantly getting new stuff into the store and it tends to be what the consumer is craving," Bridget Weishaar, an analyst at Morningstar, told Business Insider.

Old Navy also has an efficient system in place whereby it can trial products in smaller batches in order to see how successful they are before rolling them out on a larger scale, a spokesperson for the brand told Business Insider. This helps the brand to gauge what sells well.

Gap Inc. did not immediately respond to Business Insider's request for comment.

American Eagle and Aerie

American Eagle and Aerie

American Eagle's sister brand Aerie has taken the underwear market by storm, winning over the hearts of millennial shoppers with its body-positive ad campaigns.

In the fiscal year of 2016, American Eagle's same-store sales grew by a modest 1%, while Aerie was up 23% in the same period.

This growth gap defined 2017 as well. Same-store sales at Aerie were up 25%, 26%, and 19% in the first, second, and third quarters of the year. Meanwhile, at American Eagle, same-store sales grew by 1%, 0%, and 1% in the same period.

Aerie's decision to nix airbrushed ads has paid off and helped sales to skyrocket in the past four years. It's been an effective way to appeal to customers who favor authenticity over anything else.

Meanwhile, American Eagle has fallen out of favor as there is greater competition among teen and low-cost fashion retailers such as H&M and Forever 21.

American Eagle did not immediately respond to Business Insider's request for comment.

H&M and Cos

H&M and Cos

The H&M group has several brands on its roster, but its second-largest by store count (as H&M does not break out the individual sales numbers of its sister stores) is Cos, which markets itself as offering higher-priced and better-quality clothing.

"There is a market for a customer that wants design and quality for an affordable price," Cos' managing director, Marie Honda, said during the company's Capital Markets Day in February. "These are timeless products that last longer — beyond that season."

In its six-month report for the period from December 2016 to May 2017, H&M CEO Karl-Johan Persson said that Cos will reach a turnover of around $1.2 billion in 2017, and its profitability is in line with H&M despite having 95% fewer stores.

"The value of Cos today already far exceeds the amount we invested in it and this is just the beginning of the journey," Persson wrote.

In 2017, group sales slowed with a growth rate of 3%, which was below the company's expectations, and this was largely attributed to weakness at H&M itself.

"Our online sales and our newer brands performed well but the weakness was in H&M’s physical stores where the changes in customer behavior are being felt most strongly and footfall has reduced with more sales online," Persson said in the full-year report.

H&M is doubling down on its new brands. Nyden, a new affordable luxury brand, launches this year.

Abercrombie and Hollister

Abercrombie and Hollister

America's sweetheart, teen retailer Abercrombie, has fallen out of favor in recent years and been accused of losing relevance with its customers. It's been desperately trying to win them back by revamping its image, promising fewer logos and ditching its overly sexualized ad campaigns, which were not resonating well with shoppers.

But the impact of this hasn't yet been felt in its earnings, as same-store sales at the brand declined steeply throughout fiscal years 2016 and 2017.

Its lower-priced and beachy, California-themed sister brand, Hollister, has become the company's unsung hero. Since the third quarter of the fiscal year 2016, its same-store sales have grown from flat to positive. Year-to-date in fiscal 2017, same-store sales at Hollister are up 6%, while at Abercrombie, they're down 6%.

Hollister's strategy to woo back teen shoppers by remodeling stores and hiring top designers seems to be working.

Abercrombie did not immediately respond to Business Insider's request for comment.

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