The cold, hard truth of teen retail is that teens don't have a lot of money at their beck and call. Much of what they can spend is overseen by parents, who historically don't even seem to care that you're not wearing what Jenny is wearing and now how are you going to get a prom date? Over the last year, the parental purse-strings have tightened like a noose around the necks of many retailers. Reading down the hard-hit list, you don't have to go too far to find Aeropostale (NASDAQOTH:AROPQ).

Aeropostale's focus on basics and its generally weak brand have led to decimation. The company's stock has fallen 65% over the last 12 months and 44% year to date. With other companies taking the limelight -- and thus the lion's share of the market -- is there any reason investors should consider Aeropostale?

Aeropostale's branding
Aeropostale wants to be perceived as "a leading teen brand that makes a meaningful connection to [its] customer's life." The problem for the business is that the demands of its customers are changing at a pace it can't keep up with. In part, Aeropostale has relied too heavily on the value of its brand instead of working on the quality of its presentation.

Until recently, Aeropostale had relied on its name to sell products. It's clear that's no longer a good setup, as revenue and comparable-store sales have fallen. Instead, companies like Urban Outfitters (NASDAQ:URBN) have stepped in with new looks to attract customers. Specifically its Anthropologie and Free People brands have resonated with teens.

That's led to an increase in sales at those brands, though its main Urban Outfitters brand has languished. That dichotomy highlights the trouble with teen brands -- they are really hard to read consistently. It seems like a company that can make two of its three big brands successful should be able to crack it with the third brand as well. That it can't says something about the whole sector, I think.

Where can Aeropostale go from here?
Aeropostale's fall hasn't ben subtle. Revenue for the last fiscal year was basically flat, but income has plummeted. That's a result of the company's gross margin falling almost 7 percentage points, down to 13%. To try to right the ship, Aeropostale has enlisted the help of Sycamore Partners, opening a $150 million term loan. That money is going to be spent diversifying the brands, getting them away from the basic line that's provided the company with such lackluster results.

Aeropostale's future looks bleak. There's a solution, but the amount of work and luck required to make it a long-term solution seems very risky to bank on. The teen apparel space is going to have fluctuations with winners and losers, but many of the sometimes-losers can be sometimes-winners. With its recent failures, Aeropostale looks like a perennial loser.

Andrew Marder has no position in any stocks mentioned. The Motley Fool recommends Urban Outfitters. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.