Latest / Building Brands with Fexingo: Identity, Reputation, and Long-Term Business Equity / How Levi Strauss Built a Brand on American Denim
Transcript
- Lucas: A pair of blue jeans that has been around for over 150 years, worn by gold miners, rock stars, and pretty much everyone in between — that's the story of Levi Strauss. Luna: And it's a story that feels almost too perfect for a branding podcast. But the interesting part is how close the brand came to losing its identity in the 1980s and 90s. Lucas: Exactly. Today we're looking at Levi Strauss & Co. — a company that essentially created the market for denim jeans, then nearly let that market slip away. And then engineered a pretty remarkable comeback. Luna: So let's start at the beginning. Levi Strauss was a Bavarian immigrant who opened a dry goods store in San Francisco in 1853, during the Gold Rush. He sold tents, wagon covers, and other supplies. Lucas: Right. And the story goes that a tailor named Jacob Davis approached Strauss in 1872 with an idea: reinforce the pockets of work pants with copper rivets. Strauss saw the potential, they patented the design in 1873, and the 501 jean was born. Luna: So from the very beginning, the product was solving a real problem — durability for miners and laborers. That functional origin is a big part of the brand's authenticity. Lucas: For decades that was the core identity: rugged American workwear. But then something shifted in the 1950s. Jeans got adopted by teenagers — Marlon Brando in 'The Wild One', James Dean in 'Rebel Without a Cause'. Suddenly denim was countercultural. Luna: And Levi's rode that wave. They became the uniform of rebellion, but also just the default casual pant for a generation. By the 1970s, they were selling over 200 million pairs a year. Lucas: That's the peak. But then came the 80s and 90s, and things got complicated. You had the rise of designer jeans — Calvin Klein, Guess — pulling premium customers away. And at the lower end, private labels and discount brands were eating market share. Luna: Levi's was squeezed in the middle. And on top of that, they made some missteps. They tried to chase trends — remember the 'Dockers' khakis boom? That was Levi's, but it diluted the core brand. Lucas: They also lost control of distribution. By the late 1990s, you could find Levi's at Walmart and Target, which undercut the brand's cachet. Revenue dropped from $7.1 billion in 1996 to about $4 billion in 2002. Luna: So that's the low point. How do you turn that around? Especially when the brand you're trying to save is over a century old. Lucas: The turnaround really starts in 2011, when Chip Bergh becomes CEO. He came from Procter & Gamble, so he had a consumer-goods mindset. And his first big move surprised a lot of people: he told the company to stop chasing fashion and get back to denim. Luna: Which sounds obvious, but it meant killing underperforming product lines and refocusing marketing on the 501 and other core styles. Lucas: And he did something very smart with the brand's heritage. In 2014, Levi's launched a campaign called 'Live in Levi's' — not a tagline about rebellion or youth, but about the lived-in nature of the product. It was about authenticity itself. Luna: They also started telling stories about the people who actually wore Levi's: a farmer in Nebraska, a mechanic in Chicago. Not models. Lucas: Exactly. And that's when they also got serious about sustainability. In 2011, they introduced 'Water<Less' finishing techniques, which reduce water usage in the finishing process by up to 96 percent. By 2020, they had saved over 4 billion liters of water. Luna: Was that a genuine environmental move, or a marketing play? Because sustainability is a huge brand lever now. Lucas: I think it's both, and that's not necessarily a criticism. For a company that uses a lot of water and chemicals to make jeans, reducing impact is real. But it also gives the brand a story that resonates with younger consumers. Levi's has been very transparent: they publish their sustainability reports, they talk openly about the challenges. Luna: And that transparency builds trust. It's the opposite of the 'greenwashing' we see in some other industries. Lucas: Right. And it ties back to that core authenticity. The brand is saying: we've been making jeans for 150 years, and we want to keep making them for another 150. To do that, we have to change how we operate. Luna: If today's episode is giving you a new way to think about brand longevity, that's exactly what we hope to do here. This show stays ad-free because of listeners who find value in it and want to support that. You can find us at buy me a coffee dot com slash fexingo. Lucas: Yeah, and that kind of direct support means we keep the conversation focused on the ideas, not on selling you something. So thanks for being part of that. Luna: Alright, back to Levi's. One thing that really stands out is how they managed to become a global brand without losing their American roots. Lucas: That's a key tension. Today, about 55 percent of Levi's revenue comes from outside the Americas. And they've had to adapt — different fits for Asian markets, different marketing for European consumers. But the core product, the 501, is the same. Luna: So the brand acts as a kind of anchor. You can localize around the edges, but the center holds. Lucas: Exactly. And that global scale has been important for growth. In fiscal 2025, Levi Strauss reported $6.4 billion in revenue, up from $5.8 billion in 2022. The company went public again in 2019 — it had been private for 34 years. Luna: So the turnaround worked financially. But there's still a challenge: how do you keep a heritage brand relevant when trends move so fast? Lucas: Levi's approach has been to lean into the heritage as a strength, not a liability. They've opened 'Tailor Shops' in some stores where you can customize and repair your jeans — that reinforces the idea that these are things you keep for years. Luna: And they've collaborated with contemporary designers — Vetements, Supreme, even Google for the Commuter Trucker Jacket with touch-sensitive fabric. So they stay in the conversation without changing their essence. Lucas: Another thing: they're very disciplined about pricing. Levi's doesn't discount heavily. They'd rather sell fewer pairs at full price than train customers to wait for sales. That protects the brand's perceived value. Luna: Compare that to, say, Gap or J.Crew, which have run sales so often that customers rarely pay full price. Levi's has avoided that trap. Lucas: It helps that denim is a category where fit really matters. Once you find a Levi's cut that works for you, you tend to stick with it. That's a built-in switching cost. Luna: And they've invested in technology to make that fit even better. In 2024, they launched a pilot program using body scanners in stores to recommend the perfect size and cut. Lucas: So it's not just a nostalgia play. They're using data and tech to improve the core product experience. That's how you stay relevant for another 150 years. Luna: But there's a risk, isn't there? Could Levi's become too dependent on its heritage, and miss the next big shift? Like the rise of athleisure — that's eaten into denim's share of the apparel market. Lucas: It has. Denim's share of the global apparel market has fallen from about 7 percent in 2005 to around 5 percent today. But that still represents a huge market — roughly $90 billion in sales. Levi's doesn't need to be everything to everyone. Luna: Plus, they've expanded into other categories: tops, jackets, even shoes. But denim is still 90 percent of revenue. Lucas: I think the real lesson from Levi's is about brand discipline. They have a clear sense of who they are: the original denim brand. They don't try to be cool in a fleeting way. They don't chase every trend. Luna: And they've proven that authenticity can be a growth strategy. When you know your story, you can tell it consistently across generations. Lucas: So the question for any brand leader is: what's your equivalent of the 501? What's the product or idea that defines you, and are you protecting it as fiercely as Levi's protects its jeans? Luna: That's a great note to end on. For Fexingo's Building Brands, I'm Luna. Lucas: And I'm Lucas. We'll be back with another brand story soon.