How AI Could Make Levi Strauss a Great Fit for Your Portfolio

October 17, 2021

The denim apparel maker has gone all-in on this technology -- and it's getting results.

Image source: Getty Images.

Key Points

  • The maker of Levi’s 501s seems like an odd choice to embrace AI.
  • But artificial intelligence is helping the company better serve customers and manage its supply chain.
  • An in-house AI training program might help Levi Strauss sharpen its competitive advantage here.
Blue jeans icon Levi Strauss is a play on artificial intelligence. Wait, don’t laugh! Digging deeper into the company’s operations reveals that it’s serious about pursuing this technology — and its efforts in AI could help boost returns for investors.

The company’s push to incorporate AI begins with the revamping of its loyalty app, which delivers content based on user browsing and purchases. This personalization means less searching and more compelling promotions. In Levi Strauss’s third quarter, its app downloads increased by 20% compared to the first quarter, and Levi also saw increases in average order values and contribution rates for e-commerce revenues.

Levi Strauss is also using AI for its recommendation engine in Europe. Its algorithms forecast what types of products users are interested in, then suggest complementary offerings. It can even let users know about sales on products they’ve searched for in the past. According to a blog from the company, the recommendation engine “contributed to the LS&Co.’s healthy Q3 and Q4 2020 financial margins.”

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