Fashion Industry News Roundup: 10/014/08

1. Designer Edmundo Castillo Says 'Ciao' to Sergio Rossi:
"Sergio Rossi Tuesday named Francesco Russo its new creative director, confirming a Sept. 29 report by Footwear News that Edmundo Castillo is leaving the brand . . . Russo studied and trained at the Marangoni Institute in Milan and has created shoes for several Italian luxury brands, including Miu Miu and Costume National. His designs for Sergio Rossi, part of the Gucci Group, will debut for the fall '09 collections."

Photos below of Selma Hayek (then wife of PPR head François-Henri Pinault) with designer Edmundo Castillo, plus Castillo at a shoe signing at Saks Fifth Avenue in New York:

Castillo and Hayek seem chummy, so much so that Hayek was the guest of honor at a dinner party Castillo threw to celebrate the opening of the Melrose Avenue Sergio Rossi boutique in January of 2008. I can't help but wonder, then, if Hayek's recent divorce from Pinault (who heads PPR which owns Gucci Group which owns the Sergio Rossi brand) had anything to do with the subsequent departure of Castillo. Yes, I'm gossip mongering.

Here's a video that shows Castillo at work:

2. Asia's Luxury-Brand Infatuation is Under Pressure:
"Japan's retail sector has been in the doldrums for a while. Sales at department stores dropped 3.1 percent in August from the same month a year earlier, the sixth consecutive monthly decline, the Japan Department Stores Association said. Staff at one of Singapore's prime shopping districts said sales of luxury goods had slipped in recent days because of fewer tourists. Customers are buying less and some just browse . . . The number of visitors to the city state fell 7.7 percent in August compared to a year earlier."

This will probably be one of the biggest negative effects in a contracting global economy -- the decrease in worldwide tourism, resulting in a decrease of cash flowing throughout the retail system, as nobody spends quite like a tourist on holiday.

Video below of shopping in the Ginza district in Tokyo:

I don't see this dragging the luxury houses down into ruin, but the chatter about continuous brand expansion has become noticeably subdued: "'I'm not sure [emerging markets] are able to offset the weakness in other markets,' Bulgari Chief Executive Francesco Trapani said in an interview. 'Everyone is going to be affected.' He estimated only 10% of new Bulgari store projects now would be approved, compared with about 50% earlier."

In related news: "LVMH Moet Hennessy Louis Vuitton SA, which sells everything from handbags to jewelry, said Oct. 10 it's reviewing all spending plans." It's a similar story in Russia: "Russian retailers' orders for the collections shown on the Milan catwalk two weeks ago were flat compared with last year -- the first time in five years that they haven't increased, according to Sanford Bernstein luxury goods analyst Luca Solca."

There are, however, a few bright spots: Burberry sales resilient for now -- "Luxury brand Burberry has reported strong sales despite the economic downturn that has hit many retailers. The group saw a 13% rise in revenue for the six months to 30 September . . . Luxury brands have held up surprisingly well despite the economic slowdown. Last week, LVMH, the world's biggest luxury group and owner of the Louis Vuitton and Moet & Chandon brands, reported healthy sales growth."

Burberry Spring/Summer 2009 catwalk show below:

3. Honey, Does This Cologne Make Me Smell Like a Good Employee?:
"According to the Fragrance Foundation based in New York, more than 40 new men's scents are being launched in the US market alone this year. Apparently, on each male forehead, a sensory target resides, and beauty companies are constantly planning how best to hit them . . . Tony Glenville, author of Top to Toe, The Modern Man's Guide to Grooming, says that the need to look good by choosing the right skincare and fragrance products becomes even more important during a recession. 'Just as suit sales go up during a recession, so grooming products can benefit. You want to look and feel your best for a round of job interviews.'"

You know, if it's going to be all about job interviews amid a tightening economy, fragrance houses might want to rethink their advertising campaigns:

"Hire me -- I'm so very sexzee!"

4. Fashion Designers Misinterpreting the Signs of the Times:
"With the economy so bleak and the expectation that it will only become more depressed before there are any substantial improvements, it's hard to look at the brocade pajama party that the designers Domenico Dolce and Stefano Gabbana put on their runway in Milan and do much more than shake one's head in amazement. It was all quite pretty, but still, what could they possibly have been thinking? . . . Designers seem to be responding to the economic crisis as if it were any other kind of social tumult. They are proceeding under the theory that beauty, artistry and, thus, fashion will be perceived as acts of defiance in the face of assault . . . Might a $10,000 beaded Balmain blazer with linebacker shoulders be applauded as some kind of prêt-à-porter mental bailout?"

Cuz nothing says Financial Meltdown like see-through fabrics, sequins, towering platform heels and short short skirts:

5. Protecting the eBay Fools from Themselves:
"(Brian) Mottram admitted buying fake items from American and Chinese websites before advertising them on eBay as 'new and authentic' . . . a trading standards worker bought (a set of) dog tags for £21 from Mottram, which came complete with a Gucci-marked bag, box and dust cover. But the item was sent off to Gucci who confirmed the necklace, that would have retailed at £140 if genuine, was not solid silver but only 6% silver-plated and mainly copper, zinc and nickel . . . 'His profit margin wasn't that great,' said (defense attorney) Richard Williams. He said bidding began at £1 and added: 'Anybody would realistically see that a Gucci dog tag or Tiffany necklace with a starting price of £1 was never likely to be the genuine article . . . "

What's most amazing (and disturbing) to me is that the fake crap now comes complete with a host of seemingly real-deal packaing: stamped boxes, dust bags, logo wrapping. The fake packaging likely costs more than the cheap knockoff items, but since it contributes to the air of authenticity (remember when knockoffs came in cheap, obviously knockoff looking boxes, or no box at all?), counterfeiters are finding it a justifiable expense.

Watch the video below to see how counterfeit goods are big business, and that most consumers are fully aware of what they're buying:

"I think it's very inconsiderate of the NYPD to pick today to have this raid."