As a former Merchant myself, I think this guy thought he was just playing to his target customer, which, bottom line is what drives business. If you wore A&F, you probably secretly loved hearing someone refer to you as "cool and popular". As a parent of a teen, I find his comments odious and disgusting, and I'm very glad my "fit, attractive, cool" boy never cared about labels and would happily wear whatever, as long as it's comfortable and he liked it.
Also as a parent, I think that kind of crap feeds into the whole "mean kid" philosophy that seems to dominate today's youth, and I find it pretty pathetic an adult, even one who runs a successful company, would say something like that