Fashion Industry News Roundup: 04/24/09

1.) More Designers Fish for Revenue Down the Retail Chain:
Rachel Roy launches at Macy's: "Jones Apparel Group, which has a 50% stake in designer Rachel Roy, said it's launching a contemporary line called Rachel Rachel Roy to be sold exclusively at Macy's . . . Jones also plans to lower the designer's luxury label price by 15% to 20% as upscale shoppers pared back and retailers including Saks Inc. have said they will introduce lower-priced entry-level designer products."

Plus, J.C. Penney to market Joseph Abboud line: "JA Apparel, which owns the Joseph Abboud brand, will be moving its midpriced JOE Joseph Abboud line from Macy's to J.C. Penney."

So now we can add Rachel by Rachel Roy to Marc by Marc Jacobs, Michael by Michael Kors, Kors by Michael Kors, See by Chloe, Jacobs by Marc by Marc Jacobs (I wish I were kidding), Coming Soon by Yohji Yamamoto, T by Alexander Wang, McQ by Alexander McQueen . . . it would take me all day to write out the full list. No wonder retailers are glutted with merchandise, every designer has a second (and sometimes third) line and they're all pushing the merchandise as fast as they can.

Speaking of which -- what's with the rash of "20% off Friends and Family Sales" I'm seeing lately? Saks, Macy's, Net-a-Porter, Bloomingdales . . . it's as if the big retailers are chomping at the bit to move the glut of merchandise that's stalled on their shelves, but they're terrified of infuriating the designers again (designers were reportedly angry with Saks for jumping the gun last year and slashing prices to crazy-low levels before the holiday shopping season had even begun). Newsflash for the retailers: 20% off isn't worth the bother -- you may as well admit the ugly truth and start the slashing now.

And just when I thought it was only the retailers that had it bad: Eating Out Is a Top Luxury Americans Are Willing To Give Up": "an overwhelming 82% said that dining out would be easy to abandon. While the National Restaurant Association in Washington, D.C., forecasts that Americans will spend $566 billion eating out in 2009, a 2.5% increase over 2008, discounted menus at mid- to high-end restaurants suggest otherwise." That's got to throw pitchers of ice-water all over a lot of hopes and dreams.

Which leads us to Ten Things Consumers are Sacrificing in the Recession: dining out, concerts and shows, shopping for new wardrobes, vacations, hobbies and more.

2.) Clorox Blue:
"The setting is a mysterious bathroom, featuring a mystery character, suffering, pain, provocation... It´s a visual experience full of glamour created by one of the top names in fashion photography."

There's more mention of art and David Lynch, but really, they lost me at "the setting is a mysterious bathroom" . . .

3.) New Coco Chanel Poster Banned in Paris:
"'Absurdly zealous', 'ridiculous' and 'revisionist' -- these were some of the words used to describe the decision to ban posters in Paris of the Hollywood star Audrey Tautou ... as Coco Chanel because she's smoking a cigarette . . . Coco Chanel smoked 50 cigarettes a day. It is almost impossible to find a photo of her without one in her hand or mouth ... But Metrobus, which runs advertising on Paris' trains and buses, chose to ban it and forced the producers to provide an insipid alternative of her standing next to the male lead."

A Reuters photo below showing the offending poster:

Fine, we get it -- smoking is baaaaaad, but is a movie poster going to suddenly undo common sense? I mean, what's next? A Where the Wild Things Are movie poster without any wild things?

Also, charges that the Coco Chanel film whitewashes Ms. Chanel's anti-semitism and Nazi collaboration: "It was often said that she was prepared to sleep with the right people to get ahead and, after the Germans occupied France in 1940, Chanel conducted an affair with the Nazi officer Hans Gunther von Dincklage at Paris's Ritz hotel, thus becoming one of France's notorious 'horizontal collaborators'."

4.) LVMH Rumored to Sell the MH:
"Diageo is reported to be planning a €12bn bid for LMVH's 66% stake in its wine and spirits division Moet Hennessy, which includes champagne labels Moet & Chandon, Krug and Dom Perignon . . . The high profile deal would see Diageo, which owns brands including Guinness, Smirnoff and Baileys, adding the wine and spirits empire of LVMH chairman Bernard Arnault to its stable."

LVMH denies that negotiations are taking place, but the above article states that talks have not yet begun, only that the idea is being floated by Diegeo for consideration. Once LVMH begins releasing further (and likely dismal, if the continuing plunge in retail sales is any indication) earnings reports for 2009, shareholders will recall that Diego made noises about purchasing Moët Hennessy and will put the screws on the LVMH board to accept the offer.

But there's more -- luxury giant PPR is fighting off rumors of its own: "The Group PPR announces that it has requested the AMF to open an investigation into the unfounded rumors and diffusion of false information relating to, firstly, the possible sale of the Gucci Group and, secondly, a tender offer for the remaining outstanding PUMA shares. PPR categorically denies both of these rumors."

With the luxury and fashion industries struggling, watch for more financial/investment vultures to start their lazy circles in the sky.

Speaking of struggling: Coach has reported a third-quarter profit decline of 29.3%; LVMH is reporting mixed results, with overall fashion sales up 11%, but jewelry and watch sales are down 41%, perfume and cosmetics sales are down 11% and their wine and spirits holdings saw a 22% drop -- yet while the Louis Vuitton brand saw an increase in revenue across the board, their sales fell 15% in the U.S. and 18% in Japan; PPR (owner of Gucci Group) reported a near 5% drop in revenue (accounting for exchange rates), even though the Gucci brand itself saw a strong 10% sales increase; Burberry reports mixed results, with sales up in Britain (due to recent British currency devaluation), but plummeting 29% in Spain.

Video clip below of Burberry's Spring/Summer 2009 collection, which they're politely hoping all of you will please buy:

Low-cost retailer Primark is doing bang-up business, however, with a 10% operating profit for the quarter, while fast-fashion retailer H&M announced that it's still going ahead with its plans to open an additional 225 stores this year.

5.) Italy Suffers a Boom in Fake Italian Branding:
"A booming market in counterfeit goods racked up sales of 7.1 billion euros in Italy last year, undermining high-end fashion brands and prized food products that Italy's economy thrives on . . . 'The situation is disastrous, nine out of 10 agricultural products that claim to be Italian are foreign,' said Agriculture Minister Luca Zaia, promising the government would show 'zero tolerance' of counterfeiting . . . Clothing and accessories saw the most vibrant trade in fakes with 2.6 billion euros in sales."

Italian merchants and producers have a lot to worry about -- if counterfeit and fake-branded goods destroy the Italian reputation for quality, their economy will take a massive hit.

In related news, U.S. Customs seized a shipment of over 2,000 fake luxury brand goods estimated at $1.3 million: "U.S. Customs and Border Protection officers seized counterfeit designer merchandise at Chicago O'Hare International Airport . . . The merchandise was being shipped from Hong Kong to Toronto and was found in a warehouse sweep of arriving international freight shipments."

6.) Sign of the Times -- Rent a Watch:
First, it was renting high-end handbags to the type of woman who couldn't afford to buy an Hermes but just had to have one swinging on her arm anyway -- now they're renting high-end watches for men who can't count on that fat year-end bonus any longer.

Hmmm, I wonder if they have that Corum Vanitas I've been coveting for years:

And the answer is no, they don't.

Wow -- now they're even renting high-end clothing: Wear Today Gone Tomorrow. We're turning into the Rent-a-Status-Symbol Nation, which kind of defeats the whole purpose of a status symbol in the long run.

7.) Karl Lagerfeld Makes a Woman out of Emma Watson:
Lagerfeld has given his fashion blessing to Harry Potter star Emma Watson by photographing her for a French style magazine called Crash. Could this signal a seismic switch in the type of celebrity the fashion industry chooses to promote?

"I'm famous, pretty and I'm not a heroin-addicted drunk. Thanks Karl!"

I'm just happy we don't have to hear anything more about Lagerfeld's former muse Amy Winehouse. I'll take clean and in-control over the industry's previous obsession with downward-spiraling, self-destructive types any day. It's a refreshing change. I wonder if Lagerfeld is thinking the same thing?

8.) Nina Ricci Names Peter Copping as New Head Designer:
"The designer - who previously worked under the creative direction of Marc Jacobs at Louis Vuitton - replaces Olivier Theyskens, who left the Paris fashion house prematurely in March following rumours that his contract would not be renewed in October."

You can find a video interview with Peter Copping at Haute Luxe.

Rumor has it that Theyskens may be starting up his own label once again, while other gossip had him briefly considered as artistic director at Halston.

9.) Hermes Birkin 2-Year Waiting List is "Just a Marketing Ploy":
"Michael Tonello, a beautician turned fashion buyer, says he devised a system to bypass the much-talked about list and spent five years traveling between different Hermes stores to snap up Birkin bags to meet -- and profit from -- this pent-up demand . . . 'I would go into a store with a list in my Hermes Ulysse notebook and pile up scarves, shawls, bracelets, worth about $2,000. This made me seem a regular Hermes client,' Tonello told Reuters in a telephone interview. 'Once I had that pile ready to buy at the last moment I'd ask for a Birkin and they would usually produce one out of the back room. In 2005, I bought 130 Birkins in a three-month period -- and you tell me there is a waiting list?'"

Michael Tonello is the author of the book, Bringing Home the Birkin. A spokeswoman for Hermes said "the company was making no official comment on Tonello's book."

A video clip of author Michael Tonello talking about the Birkin:

Plus, a PR clip below of how an Hermes bag is manufactured: