Inside fashion retailer Mango’s playbook for U.S. expansion
Spanish fast-fashion retailer Mango is rapidly opening stores across the U.S. in a bid to make the country one of its top three markets.
Mango was founded in Barcelona in 1984. It opened its first store in the U.S. in 2006 in the New York City neighborhood of Soho. Mango now has 30 U.S. locations, the most recent of which debuted in June in New York City’s Hudson Yards. Its other stores are in California, Georgia, Florida, New Jersey, Massachusetts, Texas, Maryland and Pennsylvania. Mango is working to build 10 more U.S. stores by the year’s end, including three in the Washington, D.C. area and two in Boston.
Mango’s U.S. expansion is a component of the company’s “4E Strategic Plan,” which it announced in March. Under this strategy, Mango aims to open more than 500 stores across various international markets by 2026. In turn, it hopes to achieve €4 billion ($4.36 billion) in revenue by 2026.
Already, Mango is making some progress toward its goals. On Monday, Mango announced that the first half of 2024 was the best in its 40-year history. It reported revenue of €1.543 billion ($1.68 billion) for the first six months of 2024, a 6.3% jump year over year. Approximately 33% of this revenue came from online sales, while the other 67% came from physical retail. Mango also opened 57 new stores worldwide in the first half of the year. It now has 2,743 stores in more than 115 markets. Its top three markets are currently Spain, France and Turkey, in that order.
While Mango is a fast-fashion player, it is more expensive than some of its competitors, including H&M and Shein. Mango typically sells women’s dresses for around $50 and men’s linen shirts for around $60, not including promotions. “It has more of a focus on classic styles and relies less on constant drops of new assortments to drive sales,” Neil Saunders, managing director for GlobalData Retail, told Modern Retail. Mango also offers clothes for kids and teens, as well as items for the home, like duvet covers, rugs and glassware. The company has a new loyalty program in the U.S., “Mango Likes You,” that gives members additional benefits and discounts.
The U.S. is Mango’s fifth-largest market, but Mango hopes to bump it to third by appealing to new customers. Mango is largely looking to digital sales to figure out where to build new locations, Shane Grenley, Mango’s international retail director for North America, told Modern Retail. First, he said, the company will use online data to understand why, how and at what price points its shoppers shop. Then, he said, “If we open a store, it’s because we really believe that our assortment, our product, our concept, can really align with the demographic that’s walking in.”
Any stores Mango builds in the U.S. will fall into its new Mediterranean-focused retail concept. This concept, which Mango is using for all worldwide stores, envisions each store as a house with different areas or rooms. The stores have mostly warm and neutral palettes and use various materials including wood, marble and esparto. In a change from the past, Mango is adding cell phone chargers and extra mirrors to its changing rooms. It’s also using RFID to monitor inventory levels. In the U.S., Mango will replenish stock using a satellite distribution center in Pennsylvania.
Grenley was careful to note that Mango’s stores are unique. Even in the U.S., he said, “something that we’ve learned is that we have to treat every state like its own country, and with that, its own city.”
“The objective for us is that when you walk in as a consumer, you’re instantly identifying with Mango from our image, but most importantly, from an individual [perspective],” he added. “We listen to the store teams on a weekly basis… to ensure that we’re placing the product and styles specifically for that customer.”
“I think Mango has found some success in the U.S., and it feels it has a formula that is working,” Saunders said. “Physical expansion is a logical way of growing the business and winning over more shoppers. That said, 10 stores is small-scale expansion in the context of the U.S., so I expect this to be the start of a more ambitious program of growth, provided the new stores deliver.”
Mango joins other European fast-fashion players who are trying to have a bigger presence in North America. Sweden’s H&M, for instance, has some 500 stores in the U.S. Zara — which, like Mango, comes from Spain — has about 100 stores in the U.S. and previously said it would open at least 10 new U.S. locations from 2023 to 2025. Compared to other fast-fashion players, though, Mango’s audience “tends to be a little more mature,” Saunders said. “The aesthetic is elegant with a mix of elevated everyday products and bold statement pieces.”
In 2023, H&M and Inditex (Zara’s parent company) reported net sales of 236 billion Swedish Krona ($22.25 billion) and €35.947 billion ($39.16 billion), respectively. H&M missed earnings targets this past quarter, however, which the company blamed on bad weather keeping shoppers at home. Inditex will report its most recent figures in September.
As Mango opens new locations worldwide, Grenley said, it wants its stores to “feel connected.” “We’re able to now [offer] a correct image of Mango so the consumer can understand where he or she is buying from, and most importantly, realize that this is not just a U.S. brand or a Barcelona brand,” he said. “This is a global brand.”