Pacsun's CEO on how the brand cracked its Gen Z strategy

0:09Pacsun CEO:Hello and welcome to the Modern Retail Podcast, our show that covers the ways the retail industry is changing and modernizing. I am senior reporter Gabby Barco. Social content and influencer culture has posed new challenges for legacy retailers when trying to capture Gen Z and the upcoming Gen Alpha. The key, it seems, is to stay relevant through both merchandise and marketing during fast trend cycles while still maintaining an authentic brand voice. Over the past several decades, Paxson has maintained a strong pulse on the evolving tastes of teens and young adults. From viral denim fits to strategic partnerships with influential icons, Paxun continues to win over both teens and parents by prioritizing affordability and authenticity.

1:00Pacsun CEO:The brand says it remains relevant through four key pillars, fashion, music, sport, and art. Paxun began as a surf shop back in 1980 and grew into a national mall chain. Despite a bankruptcy filing in 2016, it has bounced back in recent years. It had a particularly big moment on TikTok in 2023 when creator Lila Biggs made the KC Jean go viral. First off, I'm going to wear my comfy, accent, baggy jeans. These are the Astrid ones. Ready? Ready for the transition? Yeah. The jeans sold 11 ,000 pairs in the 48 hours before Black Friday. The brand estimates that the moment led to over$20 million in sales from TikTok alone.

1:47Pacsun CEO:Then in 2025, for the first time in 18 years, it opened more new stores than it closed. PacSun's Gen Z strategy consists of customer engagement and community participation. And so in 2025, the company released their first annual youth report and announced its Youth Advisory Council. These two programs are an example of PacSun leading into customer participation and what it calls consumers as co-creators. To speak to PacSun's youth strategy, we are joined this week by CEO Brie Olson. Her new book, Co-Created, The Cultural Strategy That Redefined PacSun, was released earlier this month by Simon & Schuster.

2:31Pacsun CEO:Brie, welcome to the show.

2:33Moderate Retail Podcast Host:Thank you so much for having me.

2:35Pacsun CEO:First things first, I want to ask you a little bit about some of the themes that you do cover in your new book, including, you know, basically this holy grail that every brand is trying to get to, right, which is Gen Z and actually coming up Gen Alpha, my niece who's 15. Shout out to Julie, loves Paxson. And so she's now coming into the brand via the denim route, as many do. All of this to say, in the last couple of years, you've created two new initiatives, which are the Youth Council Report and the Youth Advisory Council. And these two, to me, sort of synthesize what you've been doing in the last couple of years, right, which is this strategy that you call consumers as co-creators.

3:22Pacsun CEO:So maybe we can start by you giving us an overview on how these reflect what PacSun's been doing over the last few years.

3:31Moderate Retail Podcast Host:Yeah, sure. I think the most important question a brand needs to ask is, if your brand disappeared tomorrow, would your consumer miss you? Where would they go and why? And so for PacSun, our transformation over the last decade has really stemmed from that very basic question. and trying to give our audience and our community a true seat at the table. And so social listening is kind of a beginning point. It's a starting point, but it really requires so much more engagement from the community to really bring them in full circle. So things like the Paxson Youth Advisory Council, which is comprised of 14 young people between the age of 12 and 26 who don't come in like a focus group at PacSun.

4:21Moderate Retail Podcast Host:They come in to really weigh in on PacSun's long-term strategy on things such as our PacSun youth hub, our community hub, our new app that champions innovation, creation, co-creation, the social economy, the creator economy. And so that's one example of how we've really given them a seat at the table are amplifying their voices. Another is our work with global data and the 6 ,000 young people that we survey annually. There's a ton of research out there about Gen Z, a bit less about Gen Alpha, but the intention is not to create more research. It's really to get at the emotive why, the why these behaviors are changing.

5:02Moderate Retail Podcast Host:Why are the consumption patterns of young cohorts challenging, you know, typical norms. And so I think these are some examples of how we are weaving in the community, the consumer, and the power of co-creation across our entire operating system and really putting culture as the strategy for how we're moving forward.

5:23Pacsun CEO:Yeah, I want to talk a little bit about the Youth Council and who it's comprised of, if you don't mind giving us an idea. And we thought the age range was really interesting too, right? Because technically 12 is a little bit younger than maybe your customer base range. So yeah, who are they? And tell us a little bit about the membership and why you feel like they are reflective of your customer base's voice versus just, you know, kind of just telling you what they like personally.

5:57Moderate Retail Podcast Host:Yeah, I think when we were trying to create this community and group, we really wanted to have enough diversity and include a variety of voices, those that could inform a future state and those that could speak to a present state. And so the decision to bring in a 12 and 13 year old was really based off of, let's get some early gen office statistics and data and insights, and also have a real comparison of understanding these insights versus a typical Gen Z. So it's about, you know, 40 % male, 60 % female. There wasn't a real intention of that. Our business is about a 50-50 split. So we wanted to be reflective of that.

6:43Moderate Retail Podcast Host:We have people from across the country. So four of them are based in New York. A few are based in the Midwest. Some are based across California. We've got two sisters who attend Stanford and are in their first year, their freshman year of college. So we have a nice range of people who are in high school, college, and then kind of the emerging consumer coming through middle school. As we go into our next cohort, it's going to be quite different. We are going to create a program where people are having the ability to interview and select themselves into the process that is much more inclusive. So we will open the program up across the United States and include anyone who has any interest in being a part of this program as last year was our pilot year.

7:29Hmm.

7:31Pacsun CEO:And correct me if I'm wrong, but I believe some of the current members, I guess, consider themselves creators at this point. Does that, I don't know if that matters much, but obviously they have a very different view than maybe just a student who's going, you know, about their day to day and purchasing their products themselves at the mall.

7:52Moderate Retail Podcast Host:Yeah, you know, one of the things that we have discovered through a lot of our deep research, both with global data, but also with our brand ambassadors in the stores and in our community engagement and outreach is that Gen Z and Gen Alpha consider themselves the greatest storytellers in their lives. And so whether you are a, you know, creator and have, you know, 5 million followers or you have 500 or you have 50, young people want to tell stories and they want to be a part of a brand that is encouraging them to tell stories. So I would say that the large majority of our youth council also considers themselves storytellers in some way.

8:36Moderate Retail Podcast Host:And some have very small followings on social, some have large followings. But that is really the beauty and the inclusivity of what our Paxson youth community have. And this overarching group of young people having a voice at the table is really all about.

8:53Pacsun CEO:Yeah, that makes sense. I'd love to hear, I know it's been less than a year, right, since you've launched it. But what are some of your takeaways? Like, are there any initiatives or any R &D or anything that's been influenced by the council so far that you can share?

9:11Moderate Retail Podcast Host:Yeah, I would say from a technology standpoint, they have probably been the most influential. They really had a heavy voice and a heavy hand in building this new app, which merges the concept of the open creator platform. It integrates platforms such as TikTok, YouTube, IG, and also allows them to have more participation. And so that was something that we felt was very important to have the actual users, intended users of the future app, really kind of beta testing it along the way. And I know for our head of IT, our CTIO, she really enjoyed the opportunity to work closely with them on this. We're also working very closely with the Youth Advisory Council on our future philanthropy and community pieces.

10:05Moderate Retail Podcast Host:So initiatives that we have had in the past, such as Selena Gomez's rare denim in our store that gives back to youth mental health advocacy and those groups, future ideas of how we can continue to further engage our brand partners and participate more meaningfully in giving back to the community. They have been an important voice. And most recently they did a competitive store walkthrough in the malls for us and they took photos and they did a very great comparison. We jumped on our virtual call. I was included, almost our entire leadership team joined and our leadership team from the field trying to understand what makes the best experience for a consumer in the mall.

10:47Moderate Retail Podcast Host:And so I would say that was another real lifetime example of how this group is working together and how we're gleaming insights and generating new ways of engaging and thinking.

10:58Pacsun CEO:Yeah, maybe this is a good time to pause and ask what in your opinion makes PacSun a brand that, you know, Gen Z and some of the teens currently obsessed with it. You're part of this sort of, you know, bigger wave of mall-based brands as a millennial. you've been around since I was a teenager, who've kind of made a little bit of a comeback or having a renaissance, right? The mall-based brand. So from my purview, I was thinking like there is, you're sort of in this sweet spot as far as pricing goes. And then not super trend-driven, but obviously you have a lot of fits and silhouettes that are on trend right now, but love to hear your opinion on it.

11:44Yeah.

11:44Moderate Retail Podcast Host:So first of all, I'd love to give kudos to our team because I think our internal team has done such a phenomenal job of building this very meaningful relationship with the consumer. So from our brand ambassadors to those designing the product and our merchants and visual merchandisers, everyone is very engaged in connecting with the community. I would say secondly, if you imagine a PacSun store 10 years ago, when you would walk in, you would see PacSun as the label outside the door. We were a retailer, but we actually didn't carry any PacSun branded product. And flash forward 10 years forward today, we have over 50 % of our product is PacSun branded.

12:26Moderate Retail Podcast Host:The consumer's favorite pair of jeans, as you mentioned earlier, and their favorite hoodie, their favorite soft t-shirt, their favorite graphic tee, mostly carried the PacSun brand name. And so we've really weighed in on that affinity and we focus on high quality, great style and fashion, but making sure that things are you know, in a range of affordability. And so we want to make sure that we're able to engage the consumer in meaningful ways. We try to meet the consumer where they are, which is one of the reasons that we invested in TikTok as a channel so early. In 2019, we joined TikTok. 18 months later, we had 2 million fans following us on TikTok.

13:10Moderate Retail Podcast Host:And today, we're one of the top, most shop brands on TikTok shop. And we really invest in the open creator platform and fueling that aspect of the creator and community basis. And so I think meeting our consumers where they are, championing new exclusive products and partnerships, whether it be with Emma Chamberlain, Kendall and Kylie Jenner, Asap Rocky, who was our guest artistic director for several years. These are other moments that we were able to show up in a way that was different in the space than what others have been doing. Yes.

13:46Pacsun CEO:Speaking of TikTok, I feel like we have to talk about your viral genes from 2023. That was sort of like the onset of TikTok shop. You were one of the first brands to go on it. I believe the current estimate is that you've sold over a million pairs on digital. So yeah, I mean, From your book, for example, I am quoting, at the time of this writing, in the last rolling 12 months, we've generated over 40 million in sales and sold 1 million pairs of jeans on TikTok shop alone. And while that's still 10 % of your overall digital business, it is pretty significant and it's growing. So the question is, yeah, where do you go from there?

14:28Pacsun CEO:And I think sometimes we ask brands, like, is this a lightning in a bottle situation, right? Can you reverse engineer virality the way that happened sort of organically three years ago? Or can you build off of that momentum?

14:44Moderate Retail Podcast Host:Yeah, absolutely. I think we have successfully built off of the momentum. Our TikTok revenue has grown over the last three years. So 2023 marked kind of the first moment of virality there. And we've had many other moments since then. And so I think it is a building effect. I think it's a community effect as well. We're not just on TikTok or YouTube for the benefits of trying to create revenue. We're there to connect with the consumer. We're there to amplify their storytelling, and we're there to be a beacon for their self-expression. And so when the majority of our sales on the TikTok platform come through the Open Creator platform, it means those consumers, that community is picking us.

15:29Moderate Retail Podcast Host:There's no contract between us. They are saying, I'm a champion. I'm a fan of PacSun and I want to bring your brand to life in the way that I see fit. And that's also relinquishing control for a brand to be able to really lean into the community and say, you know, we empower you. We're excited for this. And it's also a way for the consumers to generate revenue, which I think is very exciting. So I think this is the beginning of a big shift in terms of the retail industry in total. I would say that it is a behavioral shift that we're really paying close attention to in those signals of them wanting to shop lives, them wanting to shop from someone's bedroom or someone that they know or someone that they know that they know and the power of the algorithm.

16:14Moderate Retail Podcast Host:I think there's a lot of learnings that we can take away. And a lot of those early learnings on TikTok and our experience on TikTok shop are what helped shape our PacSun community Hub. So PS Community Hub, the new app that we have that benefits the consumers and the creators from a shopping standpoint and allow them to engage with our community and PacSun Collective in more meaningful ways, really generated from some of these early learnings that we had along the way.

16:42Pacsun CEO:Yeah, I want to talk about the app a little bit in a second, but I'm kind of curious whether you've had any other breakout, you know, success as far as items that just kind of, caught fire on TikTok following the jeans. I know your hoodies and your tees are very popular, but I'm curious if there's another example of this where a creator just kind of helped put the teens or the Gen Z onto a certain product.

17:08Moderate Retail Podcast Host:Yeah, we had a Metro Boomin' tee, so a tee that goes back to music that has sold, I think, close to 100 or 200 ,000 of this particular t-shirt. And what was most interesting was when you think about dupe culture, there were also a lot of dupes being generated on the same platform at the same time. And that actually created a halo effect for us. So as opposed to it being a deterrent, getting the authentic one from PacSun became viral in itself. And so I think that's another great example outside of the denim that we've had go viral several times and continues to be a big push is this men's graphic t-shirt, which, you know, really had legs of its own.

17:52Pacsun CEO:And then I do want to talk a little bit about stores because, you know, you have an exciting stat, which is that you are currently opening more stores than you've closed, which among retailers is very rare, as you know. So, you know, with digital, we've talked a lot about TikTok, talk, but it seems like that's actually seeping through to your physical retail strategy, right? Like people who couldn't get the jeans or the t-shirt online were kind of, you know, trying to track down the product in your stores. So yeah, tell us a little bit about that. And then I believe you're also opening international stores now.

18:29Pacsun CEO:So just overall big expansion year for you. Yeah.

18:33Moderate Retail Podcast Host:So last year we opened about 10 stores. This year we're opening another 10 and growing. and I think PacSun sits at about 300 locations today. We see white space to continue to open stores where the customer is demanding it and where it makes sense. And we have a high propensity and density of consumers that don't have that experiential retail moment in kind of their purview. And so I think opening stores has been very rewarding. We saw our store traffic last year at plus 17%. And so that was well above the industry standard. I think that's also another bet on opening new stores. The halo effect that we've seen on TikTok and on selling out on our website has created a rush to stores and people are asking for the viral TikTok gene or the Metro Booming shirt.

19:27Moderate Retail Podcast Host:And I think that concept of exclusivity and the selling out has helped create a bit of a halo. But I also think by showing up both organically and intentionally across these channels, you create an ecosystem where the customer no longer delineates digital from store, from an experiential. So if we're showing up trackside at Formula One, that is another touchpoint with the consumer and making sure that these touchpoints have consistency, but also have a surprise and delight that keeps the consumer engaged and coming back. And then lastly, for international, because I'm so excited to share, today we actually opened our first store in Dubai at Mall of Emirates.

20:08Moderate Retail Podcast Host:And this morning I was getting videos from the team, there were thousands of kids lined up. It was a huge, very exciting moment for the brand. And so really pleased to see that off on a great start.

20:23Pacsun CEO:Yeah, I'm kind of curious about whether you believe the international customer base will have any different behaviors, or do you feel like through your data, you feel like these young people in Dubai are seeking out pretty much the same thing that people stateside are?

20:42Moderate Retail Podcast Host:No, I think there's an absolute opportunity to learn and to understand as we expand internationally, what does that look like? Who should we be co-creating within that region? What collaborations or product drops should we bring to life that are specific by region, by neighborhood, by city, and really lean into the power of community? And at the same time, we're eager to see what resonates from, you know, this audience that is predominantly very well-traveled and already has a high affinity and awareness for PacSun. And so I think over the next few months, we'll certainly learn, and then our strategy will up and flow from there.