Jeremy Scott for Longchamp

French luxurious luggage label Longchamp announces the collaboration with enfant terrible Jeremy Scott. Having worked with Karl Lagerfeld, the American fashion designer comes with a limited edition collection called ‘This Is Not Your Bag'. For the AW07 collection, Jeremy Scott recreated the design of the Pilage bag into a ‘Poodle Pilage'. A pink poodle is sitting on top of the world - a purple planet in Scott's creation. One hundred editions shall be decorated with the provocative print.

It's not the first time the established bag company Longchamp teams up with an Avant Garde artist. The brand is known for nurturing and supporting young talent. Previously Tracey Emin, Martin Margiela and super model Kate Moss designed a series of limited edition bags. ‘This Is Not Your Bag' will be available from the end of August at the Longchamp boutique at Rue Saint Honouré and Col ette in Paris and the flagship store La Maison Unique Longchamp based on Spring Street in New York.

www.longchamp.com
22 August 2007

Liberty controllers taking bids

Luxury boutique Liberty may find itself in another bidding frenzy. The store is currently controlled by Marylebone Warwick Balfour, the property group run by Richard Balfour-Lynn. The group is breaking up and returning cash to shareholders. A Liberty spokesman insisted it was not being marketed since it was not yet profitable nor a global luxury brand. The spokesman added that MWB had not decided whether to sell outright or place its 68 per cent stake.

It is understood that Baugur, owner of House of Fraser, may be working on a formal bid. A private equity firm is also thought to be eyeing the Aim-listed store. US investment fund Oaktree Asset Management tried to buy Liberty for £80m two years ago, according to the Observer.

www.liberty.co.uk
15 August 2007

Luxury brands should focus on older consumer

In an era of volatile economies, rising interest rates and slowdown in consumer spending, luxury goods companies seem to remain largely unaffected.

The simple reason being that affluent consumers continue to spend. Whereas the average citizen may find a tight squeeze on outgoings when the mortgage goes up, the wealthy consumer will shop as before. Luxury goods are said to have high income elasticity of demand: as people become more wealthy, they will buy more and more of the luxury good.

Even value retailers such as Argos are targeting the more affluent shopper, having introduced a range of goods that will appeal more to the middle-class shopper who has greater expenditure and would typically shop in John Lewis than BHS.

This is a sensible strategy, according to The Retail Bulletin, and one that could work equally well for other retailers as attracting senior shoppers are less effected by changing economies and rising rates. Older shoppers have been a forgotten demographic for retailers over the years but in tougher times this could change - especially with the number of older people predicted to grow rapidly around the world.

According to the IGD the number of over 65-year-olds will grow by 153 per cent in the UK between now and 2050 and will have serious spending power.

1st August 2007

The new luxury

Each fashion season will come with its own must-have status pieces. Last season's Fendi Spy bag springs to mind, or YSL's tower wedges, whatever the item, they come with a hefty price tag. But this season a pair of expensive shoes or designer handbag doesn't cut it for those seeking true luxury.

In fact, A-listers don't want to be seen with anything costing less than £2,500, according to a recent report. It's no secret that luxury sales have been booming over the past six years. But at a time when the average wage-earner is grudging extortionate housing prices, high taxes and a meagre pay-packet, ostentatious splurging by the wealthy has risen to gaudy proportions as the super rich seek new heights in pampering, price tags and one-of-a-kind items that set them apart.

The over-the-top splurging has surpassed the days where a pair of designer jeans cost £100 and fabulous heels £200. The prices on luxury goods are scarily rising as stores do not see any consumer resistance to uber costly items. Missoni cashmere coats at £3000 fly off the shelves the week they get delivered. And Hermes Birkin bags having waiting lists of eager women wanting to spend £15,000, for the ultimate status piece. And so you won't be shocked to learn that £10,000 handbags and £900 pair of shoes (this season's Balenciaga's cyber sandal) is not unheard of. In fact, you can see them in glossy magazines such as Vogue and Tatler, staring at you from the page, screaming your name.

Even food items are becoming a luxury for discerning consumers. Where once Waitrose' steak tartare had your guests cooing at the dinner table, these days its hand-massaged Japanese Kobe beef served with heaps of truffle. And champagne? Only vintage from exclusive French chateaux bought at auction.

Better start saving now, dahling.

28 June 2007

Barneys sold to Dubai investment firm

Luxury department store Barneys New York will definitely be acquired by Istithmar, the invesmtnent firm of the Dubai government. At a sale price of $825 million, Barneys is now worth more than double what it was when current owner, Jones Apparel Group, purchased the company in December 2004. Jones expects the deal to be finalized in the third quarter of this year.

“We are very pleased to enter into this transaction, which realizes significant value for our investment in Barneys and provides us with the opportunity to use the net proceeds to enhance shareholder value,” Peter Boneparth, president and chief executive of Barneys, said in a statement. He added that the proceeds from the sale – which the company expects to be about $770 million after tax and transaction costs, but with tax benefits - will be re-invested into the company's existing portfolio of brands, including Nine West, Anne Klein and Evan-Picone.

The sale is believed to be a coup for Boneparth, who unsuccessfully tried to offload the luxury company last year. Jones could definitely use the cash injection from this sale to improve its less than stellar stock price and slow sales. Boneparth also repeated his intention of selling some of the group's moderate-priced apparel businesses, which have suffered as a result of consolidation in the department store industry.

For Istithmar, who has been aggressively buying companies in the consumer, industrial and financial services sectors since it was founded three years ago, the acquisition of Barneys signals its first foray into luxury goods. “This investment will further our continued focus on the retail sector,” Istithmar chief executive David Jackson said in a statement. “We believe that we will be able to accelerate the growth of Barneys' business by leveraging our experience in the sector and other investments worldwide.”

www.baryneys.com
25 June 2007

Luxury goods piracy spark international combat

The abundant availability of counterfeit fashion goods has executives from some of the world's most powerful companies lobbying governments for global enforcement agencies to support efforts to counter the multi-billion pound piracy of goods, according to a Women's Wear Daily US report. Experts at the third Global Congress Combating Counterfeiting & Piracy said the problem, which once only affected music chart artists and luxury accessories has inundated every sector of the worldwide economy — from textiles, clothing and footwear to autoparts and medicines.

"This is a global phenomenon which requires global action," said Kamil Idris, chief of the World Intellectual Property Organization. "Counterfeiters and pirates are thwarting economic development and endangering health and safety. Their methods are sophisticated, their reach is far and their crimes claim victims every day." In terms of figures, the U.S. last year made 15,000 seizures by customs agents, up 83 percent compared with 2005, and that the same trends are being observed in the European Union.

“The scale of the problem is massive ... In the space of a few weeks, almost 200 containers, mostly filled with counterfeit versions of a well-known U.S. footwear brand, were intercepted at two major European ports, giving a total weight of almost 6,000 tons of fake goods flooding in," an expert stated. A survey by 48 companies in 27 product categories found that China was responsible for two-thirds of all counterfeit goods impounded in the European Union, followed by Russia, Ukraine, Chile and Turkey.

1 st February 2007

Exchange rates hit Richemont

Although sales for the third quarter rose 10 percent, luxury goods group Compagnie Financière Richemont said revenues would have gained 15 percent had exchange rates remained constant. A weakening dollar and yen cut into results, although adjusted gains were in line with analysts' expectations.

The Swiss group, which counts Cartier, Van Cleef & Arpels, IWC, Chloé and Panerai among its stable of brands, posted a rise in retail sales of 14 percent, while wholesale sales increased 7 percent. All geographic regions enjoyed double-digit growth, with Japan being a notable exception. Sales in the region fell 2 percent at actual exchange reates, while European sales slowed compared with the first half, at 13 percent at actual exchange rates. An excellent first half in Japan caused tough comparables, while the further weakening of the yen dented sales. Nevertheless, Richemont pointed out that specialist watchmakers and Montblanc excelled in the region and underlying sales continued to grow. Meanwhile, China contributed significantly to 13 percent growth in the Asia Pacific region. Cartier and Van Cleef & Arpels performed particularly well in the Americas , where the weakening dollar bit into otherwise strong sales growth of 18 percent (13 percent at actual exchange rates).

Growth at all the company's product divisions was in evidence, with specialist watchmakers and writing instruments showing the best results with 13 percent growth each. Leather and accessories gained 1 percent at actual exchange rates, while the jewellery division saw revenue rise 8 percent. The division enjoyed the strongest results in the Americas and the Asia Pacific region. In other businesses, fashion house Chloé realized sales growth of 60 percent, a slowdown compared with the first half caused by tough comparisons with the corresponding quarter the year before.

The Alfred Dunhill brand performed strongly in key Asian markets, achieving double-digit growth, thanks to the integration of retail activities in China . Its results in Japan were, however, minimal. The Lancel brand posted sales growth of 3 percent for the quarter.

www.richemont.com
25 January 2007

Luxury brands eye Budapest

Gucci Group, Burberry and Starbucks are amongst retailers planning to open their first stores in Hungary this year. Other companies that may enter the market include Arcadia Group billionaire Philip Green's Top Shop, Guess, Claire's Stores and Body Shop International.

Luxury brands are looking for rental property on Budapest's Andrássy Avenue, home of the State Opera House, where Louis Vuitton opened its store last year, Napi said. High street retailers are more likely to open stores on Váci Street or in shopping malls. With healthy economic growth and a demand for luxury brands, East European cities such as Budapest, Bucharest and Ljubljana are quickly becoming shopping meccas, like Paris, Milan and London.

3 January 2007

Moschino to open hotel in Milan

Like many a luxury company before it, Moschino is planning on opening a hotel in 2008. Together with Mobygest, a leading Italian hotel chain, Moschino will launch its first hotel in Milan . “We want to create a different hotel from what is the typical scene, one that will reflect Moschino's philosophy and whimsical image,” chief executive of Aeffe, the company that controls Moschino, told WWD. The hotel is being designed by Moschino's creative director Rossella Jardini and her design team. Located on the trendy shopping avenue Corso Como, the hotel will provide a perfect blend of fashion and hospitality. Badioli revealed that if the project is a success, other hotel in other cities will follow.

Further to this, the brand is introducing a new home collection. “We had previously produced one-off products for our boutiques, but we are now studying new prototypes for a larger production and a full-fledged home collection,” Badioli said. Moschino joins the ranks of Giorgio Armani, Versace, Ferragamo, Bulagri, Diesel and Missoni in the hotel business.

www.moschino.com
29 December 2006

Luxury firms fight counterfeiters

For anyone looking to purchase the last Louis Vuitton styles at rock-bottom counterfeit prices, Canal Street in New York is the shopping destination of choice. The situation may be about to change, however, as luxury firms are joining forces to fight counterfeiters. Louis Vuitton Malletier, Burberry Limited UK, Burberry Limited US, Marc Jacobs Trademarks, Givenchy, Loewe SA, Celine Sa and Kenzo SA have sued a Chinatown landlord for trademark counterfeiting and infringement. The landlord, a Vincent Terranova, owns a series of properties on Canal Street where alleged counterfeit goods are traded. According to the lawsuit, the landlord and his management company had been previously warned about the illegal trading but had failed to tackle the issue. The firms are seeking a permanent injunction against the landlord and the maximum penalty permitted for each counterfeit infringement. They are also demanding that the leases be declared void and the tenants to be evicted from the premises.

4 December 2006

Luxury continues to profit

Purveyors of luxury goods have enjoyed a profitable year as emerging markets boomed. Luxury department store group Harvey Nichols is no exception. It saw its pre-tax profits almost double to £6 million over the year to 1 April 2006 despite costs of £1 million related to the opening of a new store in Dublin . Sales rose to £151 million, up from £147 million the year before. Like-for-like sales gained 10 percent. The privately-held group said that profits had been considerable despite the dip in sales at its Knightsbridge store following the London terrorist attacks in July last year. The group's regional stores in Leeds, Manchester and Edinburgh saw profits rise £1 million to £25 million on sales of £51.7 million. Staff number in the division had increased from 743 to 755, causing wages to rise to £8.9 million from £8.6 million.

The group's international division, with stores in Dublin , Riyadh , Hong Kong, Dubai and Istanbul , also experienced considerable growth. The Dublin and Istanbul stores are the most recent additions, with Istanbul having been opened in October. Last year, Harvey Nichols announced its plans to increase the number of UK stores to six with an opening in Bristol in the pipeline for 2008.

www.harveynichols.co.uk
20 November 2006

Longchamp launches capsule collection

Luxury leather brand Longchamp launches a 30-piece mix-and-match capsule collection which will be available from January 2007. Created with frequent travelers in mind, the range was initially trialled in the New York store and due to its success rolls out across the UK and Europe . Prices range from £40 for a t-shirt to £570 for a trench coat. The house of Longchamp dates back to 1948 and was set up by Jean Cassegrain. In its early days it worked only with leather, used mainly for covering pipes. By 1950, however, this activity developed into the production of other articles, including connoisseur tobacco products and from 1955 it branched out into small leather goods.

Longchamp is one of those rare companies that is still family-run, the president, Philipe Cassegrain, is the son of the founder. This season, Longchamp has introduced one of its most luxurious bags to date, called ‘Rival.' The oversized bag is recognizable by its metal zippers, rivets and modern look.

www.longchamp.com
1 November 2006

Russian luxury market booming

Moscow is rapidly achieving the status of luxury shopping destination attributed to cities like Paris , London and New York . Like China , the Russian market is booming and foreign luxury companies are increasingly jumping at the opportunity to establish a presence there. Last week, Ralph Lauren announced it was to open a flagship and second store in Moscow in spring 2007 and Christian Dior opened a 3,650 square foot flagship in the GUM shopping centre on the Red Square last Thursday.

“Luxury is really booming in Moscow ,” said Dior president Sidney Toledano. “The market is becoming more and more sophisticated.” He hinted that there might be more store openings in that market over the next 18 months. Meanwhile, the company's existing Dior store in central Moscow will now be operated by a subsidiary. The company is choosing to take direct control of its retail outlets. Other companies to enter the market with directly controlled stores include Louis Vuitton and Chanel.

Sales of fur coats, diamond jewellery and luxury handbags are selling particularly well. According to research by Renaissance Capital, Russian retail growth has risen 9.1 percent, indicating the enormous economic growth in the country. Russia is the second largest developing luxury market, representing 3 percent of total sales of luxury goods. Only China tops the list with a 6 percent of sales, according to Eric Gerritse of MeesPierson. The country even has its own fashion week, which is currently being held in Moscow 's famous Gorky Park . This year, Moscow Fashion Week enters its fifth year with shows by local fashion designers including Olga Romina and Svetlana Tegin.

Like their Chinese and Japanese counterparts, Russia 's elite are enamoured with logos and expressions of wealth, making them an attractive target for companies like Christian Dior. Toledano said that Russia and Eastern Europe are “one of the key markets” for the company over the next three years.

The new Dior store in GUM mixes the traditional with the modern, like it does in its flagship store on the Avenue Montaigne in Paris . It encompasses three floors, offering ready-to-wear, jewellery, shoes, handbags and small leather goods, fragrances and cosmetics and beauty treatments.

www.christiandior.com
24 October 2006

English Eccentrics launches on the web

After a five year hiatus, English Eccentrics is back with a fashion and interiors collection entitled Fairytale of London. The label, which launched its website this week, is famed for hand-printed pieces and aims to design luxury goods based on surface design and colour. The label identifies itself as creating for individuals, or rather a society of individuals. ‘We are not a large label; we are designer-makers who produce very special things, often in limited editions,' rings their slogan. The company further promises to be a small but influential modern British design company.

English Eccentrics have had a very creative year designing a distinctive and diverse range of products from scented candles to wash bags, from men's t-shirts to baby t-shirts, from flocked furniture to greeting cards, and their much loved fashion line in a concise range of carefully crafted womenswear, cashmere knits and scarves. The company chose Katherine Wardropper to be the brand's first collaborative designer to create the English Eccentrics' enigmatic sculpture pieces for this season's collection. English Eccentrics was apparently so impressed with the originality of her work that she was invited to be their first Young Designer.

www.englisheccentrics.com
12 October 2006

Walpole to draw tourists

Walpole, the luxury trade body has launched a campaign calling for coordinated efforts and more spending to attract wealthy tourists to the UK . Chief executive Julia Carrick said that although trading has recovered from the lows just after the July 7 bombings last year, some luxury brands are still finding trading difficult. Tourism figures are up 122% since 1979, but total spend by tourists has risen by just 40 per cent. Walpole said the government needs to increase its budget for tourism bodies such as VisitBritain. The figure has stagnated over the past decade at about £32 million a year. It's campaign aims to enlist the government, the Confederation o British Industry, the New West End Company and tourism groups in a coordinated research and marketing programme. Members of Walpole include Harrods, Burberry, Burberry, Jimmy Choo and Alfred Dunhill.

Luring back high-spending US visitors, whose numbers have declined since 2000 is a priority. Walpole is also calling for a relaxation of visa restrictions for visitors from China as part of efforts to lure tourists from emerging markets such as Russia and the Far East . Walpole use their combined marketing and commercial skills to promote British excellence as exemplified by the highest standards of quality, style, craftsmanship, creativity, service and innovation. Their aim is provide a collective voice on behalf of British goods and services in promoting the values represented by Walpole as well as to develop a strategy in which Walpole can collectively represent its members to Government on crucial issues which affect members.

www.thewalpole.co.uk
7 September 2006

Barneys comes to London

Luxury department store Barneys New York is coming to West London . Trendy Londoners can now look forward to shopping in this mecca of chic, cutting-edge fashion that has featured in a number of popular television shows. The department store will be located in the new White City shopping centre, which is being developed by Australian property group Westfield . According to the Financial Times, this Barneys will be the anchor of a mini-mall within the shopping centre, called the West Village . This section will be devoted to designer labels and high-end products. James Olley of the Brunswick Group, which handles Westfield 's pr, declined to comment on the news. He dismissed the report on the grounds that, were any negotiations taking place, a lease has not been signed, contrary to the FT's report that they had been signed.

Barneys is a purveyor of luxury labels including Lanvin, Balenciaga, Christian Louboutin and Etro and is famous for its striking window displays. Founded in 1923, the retailer was acquired in 2004 by fashion group Jones Apparel for $97.3 million. It now counts 29 department stores and other outlets across the US . These include its Barneys Co-op stores, where the selection is youthful and concentrates on cutting-edge designers. Barneys recently opened a store in Boston and is planning others for San Francisco and Dallas . Meanwhile, the White City development is set for completion by 2008.

www.barneysnewyork.com
4 September 2006

Lucien Pellat-Finet launches Flintstones cashmere

Warner Brothers Consumer Products last week announced is has entered into a deal with luxurious fashion company, Lucien Pellat-Finet, awarding them worldwide rights to develop men's and women's cashmere sweaters and scarves inspired by the look and feel of characters from the world's most famous modern Stone Age family, The Flintstones. Beginning Fall-Winter 2006, Lucien Pellat-Finet will launch a complete line of Flintstones-themed cashmere clothing. This luxury street wear collection will feature images and artwork from several of the classic Flintstones characters including Bam Bam, Pebbles, and Dino. The characters will be featured on scarves, as well as men's, women's and children's sweaters.

“Lucien Pellat-Finet is synonymous with high-end fashion and we are excited to pair the luxury and elegance of their brand with the familiarity and charm of our Flintstones characters,” says Jordan Sollitto, Executive Vice President of New Business Initiatives and International Licensing, Warner Bros. Consumer Products. “Lucien's global appeal enables us to bring character-themed, fashion forward products to a worldwide consumer demographic.”

“Warner Bros. Consumer Products has successfully established The Flintstones as one of the most widely recognized cartoon character families and as a unique franchise that everyone knows and loves,” says, the designer, Lucien Pellat-Finet. “We are thrilled to partner with them to incorporate this superstar modern Stone Age family into our exclusive fashion collections.” The Flintstones-themed apparel products will be available in over 200 major retail outlets worldwide, as well as in the four Lucien Pellat-Finet worldwide boutiques, located in Paris , New York , Tokyo and Kobe . Individual collection pieces will retail between £900-1500.

www.lucienpellat-finet.com
31 August 2006

British luxury brands launch image campaign

A group of high-profile British luxury goods companies including Burberry, Harrods and Fortnum & Mason will this week launch a major campaign aimed at boosting the image of the luxury goods sector and increasing the spend of overseas visitors to the UK. The "Great Britain: Great Brands" campaign will call for increased government funding to support the industry, the establishment of a "luxury goods" task force and an easing of visa restrictions for visitors from emerging markets such as India and China.

The campaign is being organised by Walpole, the luxury goods group that represents more than 70 British luxury brands. It argues that Britain is losing out to locations such as Paris and Milan as a destination for high-spending tourists. With the London 2012 Olympics approaching, executives in the sector are concerned that potential sales will be lost.

They argue that the number of tourists visiting Britain annually has risen by 122 per cent to 29m since 1979, but tourist spending has increased by only 40 per cent to £13bn. What is more, tourists are making shorter visits.In 2004 British residents travelling overseas spent £2.30 overseas for every £1 spent by -visitors to Britain. Walpole wants this imbalance addressed. "We are potentially losing an industry that is worth £75bn a year. Do we want it to go down to £50bn or up to £75bn?" said Peter Lederer, the managing director of the Gleneagles hotel.

"Tourism forms a major component of our economy but it seems odd that they are not spending as they once did. Something needs to be done to fix it," said Mark Henderson, the managing director of Gieves & Hawkes, the tailor. Lord March, the owner of the Goodwood estate, which comprises car and horse race tracks and a golf course, said the UK luxury goods sector was "in danger" of seeing spending fall further unless there was more promotion overseas. "Great Britain: Great Brands" will call for the Government to reduce "restrictive" inbound visa requirements for tourists from markets such as India and China. Current rules stipulate that a visitor from these countries can zigzag most of mainland Europe on one visa, but needs a separate one to enter the UK.

20 August 2006

Richemont sells Old England

Swiss luxury group Richemont is selling its subsidiary Old England to holding company Tercade SA. The group declined to reveal details of the sale but said that the transaction will have no material impact on its balance sheet, cash flow or results. Old England, which sells clothing and accessories of English design, is based in Paris and operates a flagship department store on the Boulevard des Capucines as well as in Lyon and Toulouse. The store also has sales points in Japan. The transaction follows last year's sale of Hackett, another English brand. Richemont owns luxury brand names including Cartier, Chloé, Van Cleef & Arpels, Montblanc and Piaget.

www.richemont.com
22 March 2006

Balenciaga turns a profit

Luxury fashion brand Balenciaga has reached profitability two years before its target date. According to WWD the brand, which is owned by Gucci Group, achieved triple-digit sales growth across the board, surpassing all expectations. “We went from being a niche brand to now a future big band,” said the brand's designer Nicolas Ghesquière to WWD. “The whole perception of the brand is changing. Balenciaga is starting to define a new kind of luxury house.”

Having achieved its target far ahead of schedule, the Gucci Group is now investing more in Balenciaga's growth and development. “This is a business that has the potential to do about €200 million,” Balenciaga chief executive James McArthur told WWD. McArthur is also executive vice president and director of strategy and acquisition for the Gucci Group, and also overseas Alexander McQueen and Stella McCartney.

McArthur did not disclose sales figures. Gucci Group parent PPR is due to report its 2005 earnings on 9 March. However, he did emphasize that the triple-digit growth applied to all categories, including ready-to-wear. Balenciaga's sales volume is believed to exceed €60 million, more than triple its revenue in 2001 when it was bought by Gucci Group.

www.balenciaga.com
28 February 2006

Luxury ranges at Lulu Guinness

Accessory designer Lulu Guinness is adding two more higher end ranges to her luxury bag collection for autumn winter 2006. The Couture collection consists of 20 handbags made from Italian leathers, calfskin and suede, with wholesale prices ranging from £121 to £295. The Vanity collection includes leather hagboxes and snakeskin vanity cases, priced from £61 to £146.

Luxury brands win case against counterfeiter

Chanel and Prada have won a court case against a Chinese vendor of counterfeit products, reports Bloomberg. The Beijing Xiushui Haosen Clothing Market – the landlord of Beijing's Silk Street mall – and various vendors have been ordered to pay $13,000 in damages to the luxury goods companies.

The Burberry Group, LVMH Moet Hennessy Louis Vuitton and Gucci were also awarded damages from Xiushui Haosen. Luxury goods companies are increasingly fighting back against counterfeiters, and this win signifies a step in the right direction.

Loewe names new executive president

Spanish luxury goods company Loewe has appointed Albert Pujol executive president, Spanish newspaper Expansion reported on Monday. He will replace Fabien Debaecker. Prior to this appointment, Pujol was general manager of Women's Secret, the women's lingerie division of Cortefiel. Pujol will be temporarily replaced by Anselm van den Auwelant, the Cortefiel group's general manager. Pujol's appointment comes hot on the heels of LVMH's decision to improve struggling Loewe's profitability, said Expansion.

www.loewe.com
30 November 2005

Luxury goods turn to artistic advertising

Luxury brands are continually pushing the boundaries of advertising, aiming to stay at the top of the game in a market that is spoilt for choice. Brands such as Chanel, Tag Hauer, and Marc Jacobs are renowned for using actors to sell their products. These days, in order to entice consumers, the names and faces need to be known from Singapore to Shanghai and from New York to Nairobi. The super-duper luxury brands are looking toward new and innovative advertising in order compete in a laden-down market where everything is widely available to everyone. Thinking outside the creative ‘box' means prestige brands are creating some of the most exciting ad campaigns we have seen.

Take for example the new Ritz Fine Jewellery campaign. Or rather short film. Instead of taking the usual route of pretty model wearing beautiful diamonds, the campaign features none other than A-list actress Chloe Sevigny in an hommage to the French Nouvelle Vague. Shot in the The Ritz, London , the brand has pulled out all stops to raise its image and visibility amongst the jewellery cognoscenti.

But Ritz Fine Jewellery isn't alone. At renowned champagne house Dom Perignon, Karl Lagerfeld was brought on board to do their latest campaign. Lagerfeld, who's creative talent knows no end, envisaged the idea for the campaign immediately, working with the seven key qualities of the esteemed champagne: creamy, voluptuous, seamless, captivating, plump, sensuous and radiant, shooting seven different scenarios. No wonder Karl insisted on working with model Helena Christensen to be the face of Dom Perignon. She has that quality of mystery that remains in tact has much more than a supermodel. And Lagerfeld, of course, has the eye of an 18 th century art's master, and has created anything but an ordinary campaign.

Consumers know that markets are saturated; that there is too much supply, too little demand and that too many retailers are suffering. The luxury goods sector, being at the top, may remain modestly unscathed (it's usually the middle markets that suffer in economic downturn) however it isn't immune to economic malaise. And at the luxury end, there is enough product around with hefty price tags to have to differentiate itself from other brands.

So if you are truly a special company, like Chanel or Dom Perignon, you may do well to position your brand completely differently in the marketplace. Enter, as FT's Lucia van der Post states, the artistic venture. Art and the luxury goods industry have long been mutually attracted – the one (art) lends an air of gravitas and the kudos of creative endeavour to what could otherwise be perceived as a frivolous affair, while the other has always been surrounded by an enviable oomph and sexiness that the world of art would like to borrow from. Let's hope these collaborations are able to keep consumers desires alive.

5 September 2005

Bulgari sales rise

The Italian luxury Bulgari Group reported a rise in sales of 8.7 percent in the second quarter. The results were boosted by double-digit sales increases for accessories and fragrances. Sales for the second quarter, ended 30 June, rose to €209.8 million (£145 million), a slowdown from the first quarter of 11.9 percent. The company said that at a constant exchange rate sales would have risen 10.3 percent.

Bulgari CEO, Francesco Trapani, said that he was confident about the second half of the year. Despite worries about the recent terrorist attacks in London and Egypt , he is not adjusting the full-year targets yet. “Terrorism isn't helping us at all,” he said. “We are in a world that is very volatile. The atmosphere is what it is.”

www.bulgari.com
28 July 2005

Molton Brown Sold For £170m

Luxury beauty brand Molton Brown has fetched £170 million including repayment of debt from Japanese-owned Kao. It is expected that Molton Brown will continue to operate as a stand alone business within Kao's Prestige Cosmetics division. Molton Brown's business has shown consistent growth since it was acquired from administrators by the Warshaw family 15 years ago, with an annual compounded growth rate of over 30 per cent.

Originally founded in 1973, Molton Brown has become a recognised luxury brand offering lifestyle solutions through its premium bath, body, skin care and more recently leather and home accessory collections. Molton Brown's products are distributed in over 70 countries with an especially strong presence in leading department stores such as Harrods and Selfridges in the UK, Neiman Marcus and Bloomingdales in the USA and Barney's New York in Japan.

The company's recent focus has been opening stand alone emporia, located in 37 sites in the UK, USA, Europe and Asia. In addition to its retail sales channels, Molton Brown also supplies premium amenity products to the world's most prestigious hotels and has an exclusive relationship with British Airways, providing the world's largest airline with "wellbeing in the air" comfort bags and the Molton Brown Travel Spas located at London's Heathrow and New York's JFK airports.

Kao's Beauty Care business has grown outside of Japan through various strategic acquisitions in North America and Europe. With the acquisition of Molton Brown, Kao will be gaining increased access to the global health and beauty market with a specific focus on Europe and the Americas.

15 July 2005

Badgely Mischka license agreement with Groupe JS

The US luxury eveningwear brand Badgley Mischka has announced a license agreement with Groupe JS International to introduce a bridge apparel collection. The new collection is planned for spring 2006 and is aimed at a broader customer base. It will consist of evening gowns, cocktail dresses and separates priced between $ 500 and $ 1,500 (GBP 274 and GBP 822).

Badgley Mischka is a division of licensing concern, Candie's Inc. In a statement, Candie's CEO, Neil Cole, said: "We think there is a tremendous opportunity to bring red carpet luxury and glamour to a broader audience of women. This collection will raise the bar for luxury and glamour at more accessible price points. The new showroom at 550 Seventh Avenue is exciting as it will unveil a new look and feel for the Badgley Mischka brand."

President and CEO of Groupe JS International, Mitchell Hops, said: "Mark and James have dressed the most glamorous women in the world for over fifteen years and have become celebrities themselves. Their name has become synonymous with luxury and glamour to millions of women who have seen their gowns in the pages of fashion magazines and on television. This collection will bring their signature sense of elegance to a broader audience where we anticipate it will be enthusiastically embraced."

Fran Ornstein has been appointed vice president of Sales and Merchandising for the new division. Don O'Neill - who joins Groupe JS from Carmen Marc Volvo where he worked for 10 years - will work together with Mark Badgley and James Mischka as Design Director for the new collection.

Badgley and Mischka stated: "Adding the bridge collection serves two purposes. We are making the Couture collection more special, creating couture-level clothes that are available through specialized and exclusive ready-to-wear stores, which we began with the Fall 2005 season. The bridge collection lets us make Badgley Mischka's elegance and glamour available to a broader untapped market. JS Groupe has assembled an outstanding team that has passionately embraced this initiative and shares our vision."

www.candiesinc.com
www.jsgroup.com
22 June 2005

Neiman Marcus in takeover?

US luxury retailer Neiman Marcus Group Inc. is close to concluding a deal in which it will be taken over by two private equity firms, according to Reuters. The deal is reputedly valued at approximately $5 billion (GBP 2.84 billion), say sources familiar with the situation.

The Dallas-based retailer is to be bought by the Texas Pacific Group and Warburg Pincus LLC, who won the auction with a bid that valued Neiman Marcus at approximately $100 a share. The two buy-out firms beat other bidders including the consortium Bain Capital and Kohlberg, Kravis and Roberts and a third team consisting of the Blackstone Group and Thomas H. Lee.

Reuters reported that the deal has not yet been finalized and that other parties can still approach with another offer. This potential deal is one in a stream of mergers in the retail industry. Jones Apparel Group Inc. acquired Barneys New York and the Federated Department Stores Inc. agreed to purchase rival May Department Stores Inc. Last week Saks Inc. announced that it would sell two regional department stores to Belk Inc. for $622 million.

Neiman Marcus, which operates not only its namesake stores but also the more specialised Bergdorf Goodman chain, has enjoyed six consecutive quarters of sales growth at stores open longer than a year. The company announced that it expected same store revenues to rise 5 per cent to 6 per cent in the third quarter.

www.neimanmarcus.com
2 May 2005

Indulge yourselves

The women that brought you the delights of Coco Ribbon, the London luxury lifestyle shop, are now pushing the envelope with a new shop and additional services.

Alison Hample and Sophie Threapleton, founders of Coco Ribbon, are now offering the services of artist friends to decorate your homes. Nikki de Falco, creative director on the set of Moulin Rouge and interior designer for Baz Luhrman's various homes, is in-house interiors consultant, while Jeni Smit provides the shop with the best vintage fashion finds.

"We'll still stock all the best Australian designers - Collette Dinnigan, Sass & Bide and Willo - and we'll still specialise in lots of little labels so that we can still be relied on for something beautiful and unique," explained Hample. "It will be more sophisticated than the first shop, with more of a focus on high end fashion."The opening of the new shop on 133 Sloane Street will take place on 26 May.

www.cocoribbon.com
19 April 2005

Asprey & Garrard See Growth & Expansion

British luxury brand group A&G, whose brand portfolio include Asprey and Garrard, said sales in the fiscal year ending March 31 rose 59 percent to GBP 31 million from GBP 17 million.

Despite reports in the U.S. of struggles at the luxury firm, the company said in a statement Friday that it remains "committed to global expansion" and plans to open 10 Asprey stores and five Garrard stores by the end of the year. Three new Asprey stores will be located in the U.K - at Heathrow Airport's Terminal 4, the new Four Seasons Hotel in Hampshire and Harrods, Knightsbridge. New stores will also open in St. Moritz, Kuala Lumpur, Dubai, Hong Kong, Seoul and Osaka.

Garrard has recently opened two more points of sale in Japan, at Isetan Tokyo and Daimaru Osaka, and its expansion plan will continue with the first store in Moscow opening in May, followed by Kuala Lumpur and Hong Kong.
"I am optimistic - and realistic," Gianluca Brozzetti, ceo of the privately owned group told WWD. "We are in business, with bigger sales volumes than ever. In the U.S., sales are up 30 percent and our store opening program is on track."

Brozzetti added that 60 percent of sales at A&G Group are still from jewelry, watches, silver items and pens. However, sales of leather goods and accessories are also growing, as are those of ready-to-wear and shoes. He said Asprey's 50 pounds leather buckle - which allows customers to transform a scarf into a belt - has become an entry-price bestseller in New York and London. Beginning in July, Asprey will roll out 50-ml. and 100-ml. bottles of its fragrance, Purple Water, and the brand has also begun to sell at travel retail on British Airways.

18 April 2005

Molton Brown for travel

Beauty brand Molton Brown has designed a beautiful range of summer accessories, inspired by travels to Morocco and the East. Luxurious pink leather luggage and cashmere wraps take you straight to Marrakech and are set to become this summer's travel essentials. The most delectable item is the Molton Brown Nepalese Robe. It is warm, light and heavenly - perfect after a bath in the brand's Heavenly Gingerlily Shimmer oil, or sitting on your roof terrace at midnight, watching the stars.

If you prefer travelling a little less conspicuous, opt for the limited-edition luggage in olive stone and rich cognac brown, rather than the pink. These bags are practical and beautiful - all hand-made in Tuscany. Don't forget to pack the Molton Brown beauty products, too. The best is the Crème de Mer bodylotion after a day in the sea.

9 April 2005

Liberty Reports Sales Growth

Luxury boutique Liberty has reported healthy sales growth across the second half of 2004 and into 2005 According to The Retail Bulletin Sales increased by 12 per cent to £23.7m over six months to December 31. Christmas trading improved by 14 per cent, with the 'sales momentum' continuing into the New Year and turnover in February and March 2005 showing a 'healthy' increase over the previous year.

Retail Stores, which owns Liberty, is changing it name to Liberty Plc, stated sales had been led by ladies accessories, jewellery, ladieswear and menswear.
The launch of a revamped fashion accessories offer and four new home departments in the autumn meant levels of activity in the store began to pick up from September and October.

Richard Balfour-Lynn, chairman, said: "Considerable progress is being made at Liberty, and the signs are encouraging. It is pleasing to see that Liberty continues to deliver sales growth as we re-establish the store as a luxury goods emporium.
"Early indications are that this growth will continue for the remainder of the second half, and I am confident of reporting a healthy uplift in sales at the year end."

The company is to "remove the burden of interest charges" by repaying its £50m debts through the sale of its office building, Lasenby House, and by the sale and leaseback of the Regent House building. Plans to expand the number of Liberty branded goods sold will see the current only 10 per cent of sales accounted for by Liberty lines to increase to 25 per cent over the next five years. A fully dedicated design studio has been set up, headed by recently-appointed director of design Tamara Salman. This autumn will see the launch of a range of ladies fashion accessories, travel bags and stationery designed by the studio.

Balfour-Lynn said: "Considerable progress is being made at Liberty, and the signs are encouraging. It is pleasing to see that Liberty continues to deliver sales growth, as we re-establish the store as a luxury goods emporium.
"Early indications are that this growth will continue for the remainder of the second half and I am confident of reporting a healthy uplift in sales at the year end."

29 March 2005

Record profits for Molton Brown

Record profits to be announced by luxury beauty products maker Molton Brown will add fuel to rumours that the business could soon receive a takeover approach. Molton Brown was founded as a hair studio but has become one of the most successful investments for private equity group Bridgepoint Capital, which bought a 60 per cent stake in 2003.

28 February 2005

Joseph for sale

The British luxury clothing chain Joseph was put on sale last Friday for approximately GBP 100 million, according to media reports. The group is being sold by a consortium that includes Joseph founder, Joseph Ettedgui. According to The Times newspaper, the consortium is sending information to over 20 possible buyers this week. Potential buyers are said to include venture capital firms Hicks Muse, which owns the Jimmy Choo shoe chain, and 3i, which owns the British womenswear chain Hobb's.

With 57 per cent, the majority shareholder in Joseph is Belgian investment vehicle Compagnie Nationale a Portefeuille, while Ettedgui, his brother and other investment groups own smaller percentages. Joseph operates 30 stand-alone stores and 30 concessions in the UK, Ireland, France, the US and Japan.

www.joseph.co.uk
14 February 2005

PPR plays re-shuffle board

The French luxury goods giant, Pinault Printemps Redoute (PPR), has announced last week that the founder's son, Francois-Henri Pinault, will be taking over as group chief executive from Serge Weinberg. The announcement was made following a board meeting. PPR added that the group would be switching to a single board structure, as opposed to the two-tier board of directors that it currently has.

Pinault will take over from Weinberg on 21 March. He is presently chairman of the Artemis holding company, which has a 42% stake in PPR. Weinberg will set up an investment board, which will be supported by Artemis. PPR became the world's third-largest luxury retail group when it acquired a majority stake in the Italian luxury goods company Gucci Group in September 2001.

www.ppr.com
7 February 2005

Furla opens in Russia

The Italian luxury leather goods retailer Furla SpA is to open its first store in Russia this week. The company, based in San Lazzaro di Savena, is in the midst of an enormous international expansion process. The new 70 square metre stand-alone store in Moscow is to open 10 December. The company plans to open a further seven stores in Russia over the next three years. The second store in Moscow is set to open in February next year with a third store opening in St. Petersburg later on in the year. Furthermore, Furla is in talks with potential Russian partners to offer its products at up market Russian retailers.

Furla will now have 183 stores in 64 countries. It opened a flagship store in New York in February of this year, and it will be opening up to 40 stores across the US by 2006. Furla lans to open at least 72 stores next year. The current expansion should help increase sales by 30% to EUR108 million (GBP77 million).

www.furla.com
6 December 2004

PPR focuses on luxury

Europe's largest non-food retailer, Pinault Printemps Redoute, announced yesterday that it had sold its 73.5% stake in Rexel electrical equipment. The group made the move in order to focus completely on the luxury goods market. The sale of Rexel sees PPR's net debt decline by approximately GBP3.5 billion, making this the largest European private equity deal of the year. Since October 2002, PPR has relinquished a number of non-luxury companies, thereby raising GBP5 billion in equity to focus on its ten luxury labels, spearheaded by Gucci. Once this latest sale has been completed, PPR will have concluded the sale of all its business-to-business activities, and will be able to concentrate wholly on individual customers through its luxury and retail activities, a spokesperson for the company told Reuters.

www.ppr.com
1 December 2004

Asian lap of luxury

Starting today and running for two days, the conference "Luxury 2004: the Lure of Asia" is this time being hosted in Hong Kong.

The conference is in its fourth year, but this is the first time that it is actually being hosted in Asia. It took place in Paris the first three times. The move to Asia is perceived as a significant rise in confidence in the Asian market, which has already been the world's fashion manufacturer for some time now. The International Herald Tribune's fashion editor, Suzy Menkes, explained that China is viewed as the new centre for the luxury industry. She added that 40% of the world market for luxury brand sales is represented by Asia, followed by America and Europe.

Big names in the fashion industry including Bernard Arnault, Chairman of LVHM, Ferrucio Ferragamo, CEO of Salvatore Ferragamo, Christian Blanckaert, Executive Vice President of Hermes International are attending the conference, according to Randy Weddle, Managing Director of the Asia Pacific region of the International Herald Tribune.

1 December 2004

Braccialini enters UK

The Italian luxury bag brand Braccialini has opened its first shop in the UK on Conduit Street in London. The new store encompasses 40 square metres and brings the amount of Braccialini stores to a total of fourteen. Next year, Braccialini is planning on opening three stores in Italy, Saudi Arabia and "an important city in Europe."

www.braccialini.it
30 November 2004

Diamond prices rise

The world's largest diamond retailer De Beers has predicted rising prices as production cannot keep up with demand. Based in Johannesburg, De Beers has already raised prices three times this year alone. The $57 billion diamond market saw an increase in sales of diamond rings, necklaces and other jewellery by 10% this year. This prompted De Beers and the London based Rio Tinto Group to step up their efforts in diamond mining and lead mining companies in hot pursuit of the precious stones.

Lynette Hori, a spokesperson for De Beers, said that there was no diamond shortage, only a diamond opportunity. The company told reporters that a 14% increase in prices in the first half had driven up the net income of De Beers by 26% to $341 million.A diamond industry conference is currently taking place in Antwerp, Belgium. Diamond producers, government officials, jewellers and merchants have come together for two days to discuss the industry's future. Projects such as Rio Tinto's Davik mine in Canada may not satisfy growing demand. Global sales are forecast to rise by 50% to $14 billion in 2010, according to James Picton, a consultant for the UK stockbrokerage WH Ireland Group Plc.

Chaim Evan-Zohar, a diamond industry analyst for Tacy Ltd. predicted a diamond shortage around 2007 or 2008. According to Evan-Zohar it is imperative for the industry to find new mines.With the increase in prices comes a drop in net income. The higher prices cause the margins to shrink. This is the experience of jewellers Manhattan-based Tiffany & Co, who saw their third-quarter net income fall by 26%. In this case, increased consumer spending due to a stronger economy is not necessarily an advantage. Large retailers may have to accept the fact that diamonds are a natural product with inherent limitations and can not be produced at will.Currently, the US controls the lion's share of the diamond market with a 55% share, followed by Japan.

16 November 2004

Wintle For Luxury Menswear

This winter head to Wintle, the ultimate small luxury menswear label. The brand is inspired by historical events and its collections are crafted by small, independent specialists using natural materials and antique trimmings. Wherever possible, materials are sourced in the UK. Its London salon at 2 Burlington Place can be visited by appointment only.

21 October 2004

Tiffany Shares Fall

Shares at luxury jeweller Tiffany tumbled 15 per cent (USD4.70) to USD27.10. The company saw Q2 profit fall 11 per cent, pulled down by lower sales in Japan and higher costs.

13 August 2004

Bulgari To Launch In Other Markets

Italian luxury retailer Bulgari is planning a strategy to leverage its brand in other markets. Best known for its jewellery and fine watches, Bulgari recently opened its first five-star hotel in Milan. According to the company's chief executive officer, Francesco Trapani, "customer's already have everything. The only way is to innovate and produce something different."

Perhaps Bulgari is re-defining luxury as we know it. They are currently the third largest jeweller in the world, after Cartier and Tiffany, and Trapani's determination to enhance the brand's exclusivity and to make Bulgary the number one luxury brand in the world.

16 June 2004

Touch Of Luxury?

The typical UK shopper spends an average of GBP 1,725 a year on luxury items, gadgets, accessories and memberships that they never use, according to Datamonitor. Time to re-think those visits to Bond Street.

14 June 2004

Richemont Puts Hackett On The Market

Luxury goods group Richemont is understood to be looking to sell its Hackett menswear business and has been approached by potential buyers over a deal. Richemont, which also owns Chloe, Mont Blanc, Cartier, Dunhill and others, is said to have received more than one approach for Hackett over the past few months and is now ready to sell.

Richemont acquired Hackett in 1992. It has been in the media spotlight this month because of its sponsorship of England rugby star Jonny Wilkinson and the England team during the Ruby World Cup. The latest available figures for Hackett were for the year ended March 31 2002 when turnover was GBP19.7 million, although it made a loss of GBP2.8m after restructuring costs his its bottom line. Richemont group turnover for 2002/3 was GBP2.6 billion.

29 October 2003

Smile In The Face Of Luxury

If you thought the luxury market has seen its best days, think again. The $63 billion global market is making a comeback, with fashion houses keener than ever to put the sparkle back into our ordinary lives. From New York to Milan to Paris, the big brands enticed spectators with their most desirable accessories. As Domenico De Sole, chief executive of Gucci Group, recently quipped: "The stakes for this season's big bag are very high. Whoever gets the bag gets the fashion momentum."

That would explain why Louis Vuitton prepared 300 sample bags for last Sunday's show, and why Chanel models turned their wrists on the catwalk to better show off their watches. Louis Vuitton, the world's No. 1 luxury company, sees 60 per cent of its operating profit generated from leather goods and accessories. At Gucci, this margin is even higher. Only 30 per cent of their income comes from clothing, the rest is accessories.

Recent sales of accessories have taken a leap from a slow start to the year and post-war sales slumps. Tourism, too, is beginning to recover and the pent-up demand for luxury is exercising its way to the shops. That is not to say that all is running smoothly: the market in Europe, and especially France, is still questionable, in particular due to the lack of American tourists. Similarly, the Japanese seem to have less ardour for luxury goods than in the boom years of the late 90s.

But, if the trend is anything to go by, American analysts say luxury is making a come-back, and top-end stores like Neiman Marcus and Ralph Lauren reported increases in sales for September. No wonder the world's most luxurious brands were competing for the spotlight during the shows. If single bag or pair of shoes can cause that much furore, the possibilities are endless. As are the profits…

16 October 2003