American Apparel Indulges in More Provocation Ahead of Q4 Earnings [NSFW]
After a brief flirtation with fully dressed models in proper clothing, American Apparel (APP) has returned to its old ways of featuring as much nudity as it can get away with in its ads. The company appears to be going through a period of deliberately provoking the public as it teeters on the edge of bankruptcy. (These ads are NSFW when enlarged.)
The spectacle looks like a distraction -- wouldn't you rather debate whether it's appropriate to show pubic hair in a print ad than discuss CEO Dov Charney's same-store sales? -- but the strategy is actually drawing more attention to AA's drawn-out collapse.
Virtually all of the publicity generated by the ads mentions AA's teetering financial condition. All the usual suspects weighed in on the new ads -- Styleite, AgencySpy, Fashionista -- and they all mentioned the company's downward fiscal spiral.
The company is trapped in a Catch-22: It needs an advertising device to attract attention, but the attention it attracts only reminds everyone of the company's flaws. AA has tried this sort of thing before, too. The last time it launched a set of nude ads it did so at the same time as management snapped up 9.1 percent of the company's basement-dwelling stock.
Only one thing is for sure: AA's upcoming 2010 Q4 earnings statement -- which ought to contain an update on the company's legal and accounting 
problems -- will be a lot juicier than its models.
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