State College

PacSun location to close in State College

Dude. Gnarly waves are harder to find.

At least in State College and the fashion industry. Pacific Sunwear of California Inc., or PacSun, is closing its Nittany Mall location by the end of January, an employee said. PacSun district management declined comment, and would not confirm the January closing date.

A sign outside the Nittany Mall location said the store is closing.

PacSun hit a crest about a decade ago when surf brands Hurley, Roxy and Billabong left high schools awash in board shorts and skater chic.

But the wave crashed in April when the company filed for Chapter 11 bankruptcy protection, citing failed expansion plans and pools of debt. According to court papers, the California-based retailer owed creditors about $305 million, Bloomberg reported. In September, the company secured court approval to exit bankruptcy after cutting debt and reorganizing.

Like many other retailers, PacSun has seen storefront and mall-based sales recede as e-commerce has gained ground. Culturally, the store’s target demographic has also shifted quickly, with millennial tastes trending away from the beach and toward the runway.

Some point to technology as the culprit. A decade ago, Facebook was still in its relative infancy. Now trends materialize in the crucible of social media, modeled by musicians, actors and other celebrities — many of whom have their own fashion lines, and regularly sport haute couture designs across Instagram and Snapchat. Their millions of followers, meanwhile, keep tapping the “like” icon.

But while 86 percent of people aged 18 to 29 own a smart phone, according to a Pew Research Center survey, the brick-and-mortar store is sticking around — at least for now. Surveys by Accenture and Advantage Solutions found millennials prefer shopping in malls and department stores over online retailers.

Consumers, though, continue to spend more time online: According to a Nielsen study, the number of mobile shoppers increased from about 120 million in the fourth quarter of 2013 to more than 137 million a year later. In December 2014, they spent about three hours combined shopping through the internet and mobile applications, the study found.

Futhermore, the playing field remains fierce. “Fast-fashion” retailers, which feature cheaper facsimiles of the looks seen on runways and celebrities, have edged out other brands, analysts say, and with their au courant styles, it’s hard for others to stay competitive.

H&M and Urban Outfitters, for instance, reported increased sales in the second quarter compared to last year.

Both retailers have locations in downtown State College. The H&M group plans to introduce up to two new brands in 2017, according to a company release, and launch online markets in Canada and South Korea this fall. Urban Outfitters, Inc., meanwhile, reported total company net sales of about $1 billion in last year’s fourth quarter. Millennials, at least at the moment, are eating fast-fashion up.

But tastes are like the tides. With a shift in strategy and a little luck, PacSun and other retailers may be able to turn them in their favor.

Roger Van Scyoc: 814-231-4698, @rogervanscy

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