Luxury & Fashion Biz News: Dec. 14th, 2010 (Social Media Takes No Prisoners, Galliano Fakes the Interview, Rock & Republic is DOA and Lagerfeld Annoints His Successor)

1.) The Hope and Curse of Playing with the Social Media Strategy Fire:
“‘Social networks, such as Facebook with its 600 million users, will have a dramatic impact on how affluent consumers make their decisions,’ Klara Glowczewska, editor of Conde Nast Traveler, told a conference at the (annual ILTM trade fair) event.”

And this has always been the siren call of social media: those hundreds of millions of users — how can a brand successfully tap into that innate desire for personal connection and wring some cash out of it? Ten thousand PR firms would like to know!

Well, there’s always the option of taking the time to interact with consumers through blogging. For instance, Krista Peck at Fashionably Marketing notes that Saks Fifth Avenue just clambered aboard the Retailer Blog train (following Barneys, Bergdorf Goodman and Nordstrom) with their SaksPOV website, ” a mix of insider information, branding and editorial-style writing” — but while Peck praises Saks for finally joining the online media fray and embracing dialogue with its customers (Saks opened their e-commerce site to customer reviews just this November), she criticizes Saks for not being terribly creative or individual in its blogging approach.

Says Peck: “We wonder why Saks store events, store locations and online shopping areas are so poorly integrated into this design. We also wonder why Saks followed Bergdorf’s lead in disabling comments on their blog. While you can share information via Twitter and Facebook, it appears that they don’t want to be bothered by readers’ comments (which starkly contrasts with the goals of customer service and social media).”

But to be fair to Saks, opening oneself up to the slings and arrows of public opinion (i.e. blog trolls) is a nerve-wracking step. The Wall Street Journal published a comment from Bud Konheim, chief executive of the Nicole Miller brand, who said that when he saw his first negative review of a Nicole Miller dress on the Nordstrom website, he was furious: “At first, I thought, ‘Let’s go find and kill that woman,’ he said. But as he thought about what the customer was saying, he had a change of heart. The commentator ‘was tapping into something we are well aware of: Our clothes do not fit everybody universally.'”

Which is an obvious point to any bystander, but a touchy subject for any fashion, beauty or retail outlet whose business it is to sell to as wide a consumer group as possible — yet the benefits of opening up to one’s buying public are hard to ignore. Marketing Charts reports that “65% of consumers who read customer reviews ‘always’ or ‘most of the time’ prior to making a decision to purchase a product are dubbed Social Researchers . . . (and that) Social Researchers are 76% more likely to shop on a retailer’s website that offered social navigation rather than a competitor’s that didn’t.”

“Shoppers trust and use the opinions of others in making choices about products and brands,” said Brett Hurt, founder and CEO of Bazaarvoice. “As consumers head to the web to research online and offline purchases, companies have a tremendous opportunity to provide them with the authentic user-generated content that is proven to build confidence, increase satisfaction, and drive sales.”

Luxury Daily writes that: “Brands that employ Facebook, Twitter, interactive Web sites and mobile devices to connect with their consumers are more likely to drive sales and reach an expanded customer base.”

And Jeffrey Grau, author of the consumer report “Customer Product Reviews: The Next Generation”, states that “For many purchases, shoppers find the best advice comes not from family and close friends but from strangers who have similar interests or who embody a lifestyle the shopper aspires to achieve.”

So when an e-commerce or online service site doesn’t have a blog with feedback, or a place for customers to review its products and its customer service, then the brand, shop or chain is at a distinct disadvantage to its competitors. Because even the wealthy consumer cares about user reviews. Says Olivier Chavy, a senior luxury and lifestyle executive at the Conrad and Waldorf Astoria hotels: “A single bad review on a popular travel website can destroy a reputation for luxury that has taken years to build up.”

*NOTE 1: Wealthy shoppers have internet connections, too. Or at least their personal assistants do.

Every customer with access to an internet connection is a potential critic, so it’s no wonder luxury brands and retail chains are smarting over the pressure to include customer feedback. One disgruntled sales assistant or poorly slapped together pair of shoes can cause a shock-wave if there aren’t enough positive voices of feedback to balance that one negative voice crying out, in perpetuity, online, so everybody (from mass to luxury) has to step up the way they play their game.

Though not every high-end brand treats blogging, Facebook and Twitter like a marathon across six miles of thin ice. Women’s Wear Daily calls Oscar de la Renta’s very active Twitter presence, OscarPRGirl, “a celebrity in the fashion Twitterverse”, and the constant stream of chatty fashion talk (plus oh so casually placed links to de la Renta merchandise) has given the somewhat staid brand a needed facelift for the 21st century.

Speaking of staid brands and needed facelifts, Cartier has been doing its homework. Realizing that there’s nothing with more enduring popularity than a kitten video on YouTube, they’ve offered up their own version of the cuddly kitty vid for a holiday advertising campaign:

It’s a cute, cuddly, fluffy . . . uh . . . beast!

Other brands dipping their toes into the online media pool: the Marc Jacobs brand has established a presence on Facebook and Twitter (as well as finally launching an e-commerce function on its own website), Burberry has been at the head of the pack in streaming its runway shows live on Facebook, and French luxury giant Louis Vuitton has embraced the new FourSquare mobile application, a social networking system that encourages users to “check-in” and let all their friends know where they are whenever they’re out on the town — whether at a bar, restaurant or, in the case of Louis Vuitton, a very spendy boutique.

FourSquare comes across as a clever way of getting the tastemakers and social pack leaders of the world to communicate their hottest hot-spots to networks of friends, fans, groupies, whatevers (you say tomato, I say “Are you crazy? That’s an open invitation to stalkers the world over!”). But I signed up to FourSquare this past week just to give the service a test run and see what the fuss is about — it might just turn out to be an invaluable tool for helping me navigate a brand new city in a brand new country.

*NOTE 2: In fact, I used FourSquare to find the cafe where I’m presently sitting and typing on my laptop. The place is uncomfortably muggy and hot, and I’m getting regularly buzzed by flies (wide open doors are the reason for both), but the food and coffee are very good — and I can hook up to a fast WiFi connection. A balance is somehow achieved.

Of course, as the old saying goes (though slightly updated for this post), “Live by the Social Media Sword, Die by the Social Media Sword“: “Coming just days after concerted attacks by Anonymous on the Web sites of credit card companies which shut down WikiLeaks fundraising accounts, the attack on makes it abundantly clear that the Web is still very much a ‘Wild West’ environment . . . The implications for online media of all types, including social media, are dire: if a popular and well-known Web site can be breached this way, is there any reason for confidence in the security measures employed by much larger sites like Facebook and Google?”

Phrases like “Wild West environment” tend to make heritage brands uneasy.

And then there’s this study that came out recently, perhaps somewhat validating the cautious, wait and see stance that many brands have taken regarding jumping onto Twitter: “Only 24% of American Twitter users check for material posted by others multiple times a day. 12% check once a day, 20% check less often than one every few weeks, and 21% never check for other material.”

So, I guess, we’re all talking but hardly anyone’s listening?

Addendum to that thought: Trends have a disconcerting habit of going stale right when everyone’s jumping aboard: Fashion PR: Fashion Blogger Burnout?“My nose is crinkling with a whiff of impending ‘fashion blogger plus fashion brand’ overkill . . . Brands are just going for the obvious choices, both in terms of the talent they choose and how they decide to work with them. Two years ago it was a risk to put a huge image of a fashion blogger in your store, now its perfunctory.”

And here I thought it was all about the money.

*NOTE 3: In the interest of full disclosure — I check my Twitter feed several times a day, and sometimes even when I wake up in the middle of the night (when it’s 2 A.M. in Auckland, it’s 8 A.M. in New York). While much that’s posted on Twitter can be classified as banal, if you carefully manage who you’re following and reading, it can be yet one more gold mine of information in a hyper-connected world.

The ultimate Social Strategy, however, still involves making customers happy, in person as well as online. For instance, Seattle based Nordstrom brought some unexpected Christmas cheer into its downtown flagship location by bringing in over five hundred trained singers to “spontaneously” break out into the Hallelujah Chorus on a crowded Saturday afternoon:

One act of popular appeal can equal a lifetime of customer good will

Customers ate it up.

2.) A VIDEO TRIBUTE TO ALEXANDER MCQUEEN, filmed by fashion photographer Nick Knight (who worked with McQueen on several projects) and with music by Bjork.

“I Would Like To Thank You For All Your Inspiration”

The fashion industry has been awash in Alexander McQueen “tributes” lately, but the focus has been on glitz, hollywood celebrities and yet one more opportunity to promote a deep-pocketed advertiser — yet this video tribute seems genuine, and genuinely moving (the exploding flower dress at 1:45 is spectacular, and exactly something that McQueen himself might have come up with).

3.) JOHN GALLIANO AND THE ART OF THE SHAM INTERVIEW: I understand the need for designers to do interviews for brand publicity, and the subsequent need to say something different or provocative in those interviews that gets readers to pay attention and thousands of bloggers to quote quote quote, but, honestly, for John Galliano, head designer for global fashion powerhouse Dior — a brand with a strong presence on Twitter, Facebook, YouTube, and nearly every fashion blogging and news site in the world — to claim that “I didn’t even know what e-commerce was until last week” just comes across as a silly (if not transparently desperate) bid for attention.

If a brand representative truly wishes to engage with the 21st century consumer — a consumer that expects transparency, access and information as a matter of course — then maybe he/she might reconsider the strategy of playing the Neo-Luddite.

The next part of the interview, where Galliano suggests that it’s a terrible idea to go shopping with one’s boyfriend or girlfriend, only makes things worse . . . to put it mildly: “They’re only thinking of themselves . . . Place your trust in the manager, the guy who knows the brand, who will tell you the story about the finish or these little loops and blah, blah, blah, blah.”

Again, way too obvious, especially with the “blah blah blah” thing. I mean, he’s the head designer for Dior and all he can think to mention is “the finish” and “the little loops” before the gears in his brain completely cock up?

I swear, it’s like the old guard is so confused and beleaguered by the rapidly changing retail landscape that they can’t even manage a shred of clever subtlety anymore. He may as well have just said, “Don’t go shopping with people you know and trust; instead, put your wallet in the hands of the one person whose sole aim is to get you to spend as much money as possible.”

That kind of brutal honesty would have at least had the advantage of sounding drily self-aware.

On a related note, Rachel Lamb writes that “Luxury brands should expect a good portion of their 2011 revenue to come from e-commerce sites . . . Luxury e-commerce is clearly on the rise and as a sector, will be important to watch in 2011 … brands that are not already offering ecommerce sites are being left behind.”

Speaking of the old guard, Karl Lagerfeld finally appoints a successor to the Chanel throne: “I have a contract for life so it all depends on who I would like to hand it to. At the moment I’d say Haider Ackermann.”

Which is the first time that Karl Lagerfeld has ever answered the “Who’s going to replace you at Chanel?” question with an actual name (he usually just swats away this question like it’s a buzzing mosquito), which makes this piece of information kind of a big deal among fashion journalists. Haider Ackermann has been fielding subsequent calls from the press for days.

Video clip below of the anointed one’s Spring 2011 collection:

The heir apparent?

But back to Dior — Helene at The Luxe Chronicles takes a look at Dior’s latest entry in the fashion movie sweepstakes, and finds it somewhat lacking: “What I fail to comprehend is why after four attempts Dior is still unable to nail the genre. No expense has been spared in terms of acting skill (Cotillard, an Academy Award winning actress has tackled far more challenging roles) and directing talent, which begs the question: Why do the films ultimately fall flat in terms of narrative?”

She is, however, decidedly more impressed with Dior’s latest foray into the mobile phone application field: “It allows users to scan a print advert of Lady Grey onto their iPhone, Blackberry or Android and simply touch the screen to be taken to Dior’s site . . . (embedding) the capture code in such a way that it is invisible to the viewer, thus permitting a pristine image free of unsightly code.”

Just don’t ask John Galliano about the brand’s mobile communications strategy. He’s still rotary dialing: “I like to feeeel the numbers, to caressss the plastic!”

*NOTE 4: So, do you think this kind of “We’re techno-savvy! No, wait — we’re Luddites!” strategy is a way of trying to please both sides? To draw in the online crowd while yet soothing the frazzled nerves of old-style shoppers who still want their shoes brushed before tea?

4.) NEW TREND I’M LOVING: More than 50% of Holiday Online Purchases Have Free Shipping.

Since I just relocated to New Zealand and everybody I know is back in the United States, I’ve had to do all my Christmas shopping online. Saks, Neiman Marcus, ShopBop, Nordstrom — they’ve all been offering free shipping. It’s a way for them to compete against brick and mortar stores that don’t stick shipping charges on the tail end of your bill, and let me tell you, it’s great.

5.) Premium Denim Brand Rock & Republic Goes Bust:
“Negotiations to pull Los Angeles denim maker Rock & Republic out of bankruptcy have crumbled . . . This means that Rock & Republic will probably be auctioned off in U.S. Bankruptcy Court in New York some time next year after several potential buyers took a look at the company and failed to make an offer.”

According to WWD, Rock & Republic founder Michael Ball was attempting to keep himself in the picture on any deal negotiated (he wanted an equity stake plus a plum creative role in any reorganized version), despite having been the one to lead the company into bankruptcy. This sent prospective buyers packing because, while they valued R&R as a salvageable brand, they didn’t value Mr. Ball, leading the company to Plan B, which meant getting cash to pay creditors . . . and getting rid of Ball.

Ball’s decision to green-light stand-alone retail stores and a full cosmetics line just as the recession was cresting over the horizon is believed to have been the downfall of the once uber-popular denim brand. Launched in 2008, the high-priced hooker line of makeup was a particularly spectacular failure. With eyeshadow and lipgloss names like “Hangover”, “Lawsuit”, “Cougar” and “Train Wreck”, the offering misfired with the newly bling-free consumer mindset and was unceremoniously booted out of Nordstrom and Neiman Marcus almost as quickly as it was welcomed in.

6.) NY Times First and Only Scent Critic Steps Down — to go work for the Museum of Art and Design:
“New York’s Museum of Arts and Design announced today that it will launch the Center of Olfactory Art, marking the first time an art museum will dedicate a department to the art of scent . . . The Center will be led by former New York Times scent critic Chandler Burr, who joins the Museum’s staff as its-and the nation’s-first Curator of Olfactory Art. Mr. Burr, whose appointment is effective immediately, is currently organizing the Museum’s fall 2011 exhibition The Art of Scent, 1889-2011.”

In related news, sensory psychologist Avery Gilbert has a lightly used Burr-O-Meter that needs a good home.