Urban Outfitters is most certainly competing with American Apparel. I thought Urban was for that bohemian, carefree, laid back, but still trendy look. It was all about the intricacy. It's just urban. But I'm guessing they're ready for change. The thing is though, American Apparel is still cheaper and always has the same products. You know that when you're going there, there will most likely be the same product there as last time. Urban is the opposite. It's notorious for constantly getting in new apparel & accessories. So, really, unless they were changing around everything about the store they couldn't become that similar American Apparel. They're just two different vibes, so why is Urban trying to gain the AA customer. In the picture above Urban is advertising some of AA's most common product types. I go in to Urban for that unique looking piece (though it may not be that unique since billions of other people go there) and I go into American Apparel for my basic basics (which is really okay since everyone wears basic anyways).
**Pictured above is the current main picture on the Urban Outfitters website.