Luxury & Fashion Biz News: March 2nd, 2012 (The ongoing saga at Dior, and getting back to basics)

Question: “What do you call a global luxury powerhouse that’s continuously engulfed in industry rumor and public media speculation season after season?” Answer: “A Beautifully Dressed Publicity Whore”

It’s become more than apparent that the executives at Dior are happy with Bill Gaytten’s work (“the brand’s management has been keen to note strong sales at full-price of the collections designed under Gaytten’s direction,” notes Imogen Fox for The Guardian). While a few members of the fashion press still sulk that Dior isn’t breaking any new boundaries or jolting them awake from their tedious job of reporting on the season’s latest color palettes and hem lengths, Gaytten trots out exactly what the suits behind the brand require of him: a visual that’s decidedly, firmly and most of all, widely recognizable as Dior.

After viewing the latest Dior collection to tumble down the Paris runways earlier today, Robin Givhan at The Daily Beast writes: “With a collection that celebrated the classic silhouettes and dove gray palette of the house, interim design director Bill Gaytten offered women quietly beautiful clothes that recalled the handcrafted femininity and gentility that so many associate with the venerable French label . . . the house was frankly all the better for not having a heat-seeking personality at the helm.”

Dior Fall 2012 — An old New Look freshened up for an Asian climate

If there was one criticism of the pre-recession rush to sell bling and handbags, it was that most fashion houses weren’t providing a visual code that set them apart from their competition. Weeks of global runways shows blurred into each other as fashion following websites gave up on any design subtext and started devoting more attention to the models walking down the runway than to the look-alike clothes they were wearing.

*NOTE 1: Former Dior Homme designer Hedi Slimane (and also rumored to be in the running to take over Stefano Pilati’s place as head designer for Yves St. Laurent) had this to say about the lack of a distinct vision in much of today’s hedge-funded fashion: “I mind the lack of a long-term vision, and the lack of sense. It has to make sense, no matter the size of a fashion house . . . Luxury houses and brands are meant to be exceptional by any means and not settle for the average. They cannot run the precise wrong race, but rather [should] stick to a strict and dignified etiquette for their fashion developments, assets, and branding . . . More means less rarity and less quality. This leads to the visual chaos of not exactly knowing what is what, if you forget your contact lenses and can’t read the label.”

*Additional Thought: If you ever wondered why there were big splashy logos printed all over designer brand accessories, it’s because it was the only way left that the average, non-Fashion Magazine Obsessed consumer could reasonably tell one brand from the other. The increasingly anonymous apparel, once a way for designers to carve out a vision and a voice for the label, became just another prop in bright and frenetic ad campaigns meant to showcase flashy, high profit margin bags:

Pre-recession Gucci and Louis Vuitton ads — Just the bags, Ma’am

The Fall 2012 shows (which are happening in Paris as I type these words) have been engulfed in news of designers getting fired (Raf Simons from Jil Sander, Stefano Pilati from YSL), designers getting hired (Jil Sander back at Jil Sander) and a flurry of rumors of other hirings (Hedi Slimane at YSL, Haider Ackermann at Dior, Christopher Kane at Dior).

It’s a virtual rumor merry-go-round. Which is just another term for “free publicity, y’all!”

*NOTE 2: The news of Pilati leaving YSL is particularly surprising considering that the label reported a dramatic growth in revenue for the third quarter of 2011: “Directly operated stores and wholesale posted vigorous growth of 40% and 46%, respectively. All product categories made solid contributions to the brand’s performance. Leather Goods posted especially strong growth of 40%, driven by carryover lines and the new Cabas Chyc bag, while Shoes soared by more than 70% on the back of the continuing success of the Tribute, TribToo and Palais lines.”

*NOTE ON NOTE 2: The legal battle between Christian Louboutin and YSL over the use of the color red for the soles of shoes is still raging, with PPR CEO François-Henri Pinault (PPR owns the YSL brand, among many others) taking exception to Louboutin’s recent public charge that YSL is plagiarizing his designs. “It will not have escaped your notice that Saint Laurent has had a certain legitimacy regarding the use of this color for many, many years,” said Pinault.

But probably the most reliable rumor I’ve heard yet is that the executives at Dior have signed Bill Gaytten (ex-Dior designer John Galliano’s right hand man for 17 years and acting interim designer for the label for the last year as they’ve struggled to find a replacement head designer) on as head designer for six more seasons: “This morning’s news suggests that Toledano has signed up Bill Gaytten for another six seasons. Although this hasn’t been confirmed, we do know the British designer has been working behind the scenes at Dior for 17 years and sales at the fashion house were up by 14% last year compared with 2010.”

While the fashion press has been slow to embrace the idea of the subdued Gaytten as Galliano’s replacement (“I like Mr. Gaytten. He’s a sweetheart, but he is not a designer,” NYTimes fashion critic Cathy Horyn condescendingly sniffed after Gaytten made the mistake of presenting a carnival/party-themed haute couture collection when the press was still in mourning over the firing of Galliano), the likes of Cathy Horyn and Suzy Menkes might just find their opinions irrelevant to the financial success and long-term health of a global fashion behemoth.

Because what Bill Gaytten has done as chief designer for Dior is exactly what LVMH CEO Bernard Arnault said that he was looking for back in July of 2011: a more intimate, Old World and artful Dior that focused more on the fashion house’s reputation for exceptional materials and craftsmanship than on some star designer’s personality wattage.

Again, a quote from Robin Givhans (who seems the only heavy-hitting fashion journalist asking the right questions about Dior): “Had the spotlight on a star like Galliano gotten so hot that everything else disappeared in the glare? Did it all become some overstuffed dream? Did the world lose sight of Dior’s history, its vaunted craftsmanship, and perhaps even of the frocks themselves?”

If the desire is to bring the brand back into a renewed focus on its own heritage, then snagging some hot, of the moment designer like Raf Simons or Haider Ackermann for the top position at Dior would be counter-productive. If you take a look at what happened at the Alexander McQueen brand after the death of McQueen, his right-hand, behind-the-scenes woman, Sarah Burton, took over as chief designer and the brand has never been more successful, with Burton even awarded the 2011 Designer of the Year trophy from the British Fashion Council.

Designer of the Year Sarah Burton’s Alexander McQueen Fall 2012 collection

And maybe that’s the new blueprint for global fashion/luxury houses — nurture the talent they have, and promote from within. If some hotshot designer wants to express his/her own singular voice within the world of high-stakes, high-risk, high-investment fashion, then he/she will just have to pull an Alexander Wang and start their own business.

Just don’t expect an official announcement from Dior chief executive Sidney Toledano resolving his label’s designer-standoff any time soon — the ongoing tension and speculation among the fashion pack have been nothing but a media boon for the brand, reviving a sense of consumer interest in an old luxury house that everyone had pretty much been taking for granted for the past ten years.

And with a push by luxury groups into Asian territories (see: LVMH targets Asia), the renewed focus on hewing closely to Dior’s stylistic heritage is especially enlightening.

Writes Suzy Menkes for the NYTimes: “The front-row stars this season were the Asian actresses Peng Lin, Siyan Huo, Xiaolu Li and Yuqi Zhang — pushing Western celebrities like Jade Jagger or Mila Kunis, the current “face” of Dior, out of focus . . . So what hit the runway (was) historic Dior, but lightened up, in the spirit of the couture show in January. The old rose colors, occasionally darkening to wine, appeared as silken dresses. In fact, there was so much silk in this winter collection that it seemed more like something for spring — unless, of course, you live in a mild Asian climate.”

In other words, if an established brand is pushing into new territories in a bid to attract additional customers, it has to have its design ethos solid and its storyline straight and true. Forget trendy pizzaz and the frisson of fashion critics, what matters is what Hedi Slimane said — a luxury brand’s design personality should be strong enough that customers can identify the label without needing to see the logo.


1.) Roberto Cavalli grouses that Giorgio Armani’s new Milan hotel looks like a psychiatric hospital: “The most embarrassing thing for Armani in the whole affair is that, now that (Cavalli) has said that, we look at pictures and go ‘You know what, it kinda does.’ But then again, it’s hardly out of place in Milan, a city whose buildings are way more severe than the flouncy terra cotta stuff you expect in the Italy of your textbooks.”

The inside of the hotel, however, isn’t quite so clinical:

Opening of Armani Hotel Milano

What surprises me the most in that video clip is how darn *short* Giorgio Armani is. The women he poses with literally tower over him.

2.) Women are buying more Ferraris while men are buying more shoes: “Luxury retailers are seeing an unexpected new shopping trend — men are shopping like ladies and the women are buying like guys. It turns out traditional gender roles are no longer trendy when it comes to luxury.”

The article notes that 10% of Ferrari buyers in North American are now women (up from just 1% only a few years ago) and female purchasers make up 30% of China’s Ferrari consumers, while typically female-centric brands like Jimmy Choo and Christian Louboutin are now producing mens shoes, and Coach has resurrected its long-dead mens line of products within the past year.

*Related News: With Wall Street Bonus Cuts, Luxury Stores Brace for Impact“It’s very likely the cutbacks on Wall Street will be felt most by the luxury markets. As a point of fact, nearly 30% of the U.S luxury markets revenues come from New York City, and most of that from Wall Street.”

I would assume that Louboutin shoes and Coach backpacks will be the first things Wall Street guys start to cut from their dwindling budgets.

Coach Men on Bleecker Street in NYC — just in time for the renewed recession

And as if that news wasn’t bad enough, the hoped-for big consumer push in India might not turn out the way everyone is hoping for: Rotten Economic News Continues to Stream Out of India“High interest rates, rising inflation, and a manufacturing sector hampered by expensive inputs and high borrowing costs mean that India is doing worse than other Asian economies, which are themselves slowing down amid global deleveraging and structural shifts.”

Not to mention that rumblings of a trade way between China and Western countries is putting everyone on edge: China to increase luxury imports from West to avert trade war“Tensions between China and its trade partners over issues from solar panel subsidies to airline emissions fees have intensified recently as the global economy slows, and US politicians sharpen their rhetoric ahead of a presidential election later this year. ‘We must prepare for a big trade war this year,’ said Wei Jianguo, a former vice commerce minister who is now a government advisor. ‘But since Chinese consumers demand western cosmetics and handbags, why can’t we greatly boost imports of such products?'”

The article goes on to state that as much as China is interested in appeasing its foreign trade partners, it has to think about its own domestic situation first, and that means keeping a priority on exports flowing out of the country in order to maintain employment levels.

Besides, I don’t think that easing heavy import taxes on handbags and jewelry is really going to make enough of a trade-balance difference to satisfy either side, especially as Chinese tourists are presently snapping up luxury goods outside of their own country. Ease the import taxes and they might spend more domestically, but wouldn’t that just decrease their need to spend as much while traveling?

*For Example: A boom time for Chinese travel“Trips abroad (for Chinese tourists) are a good time for buying brand-name goods such as bags and clothes, as these are often more expensive in China. Also, there is a cachet linked to purchases made overseas. Last month, when many went abroad for the Chinese Lunar New Year, Chinese accounted for 62% of luxury purchases in Europe and 1/3 of such spending in the US . . . According to the United Nations World Tourism Organization (UNWTO), spending overseas by Chinese tourists jumped 38% last year.”

China’s consumers are such a coveted part of a luxury brand’s marketplace that luxury online retailer Net-a-Porter just announced that it’s bringing its discount luxury website, The Outnet, into China: “In a big vote of confidence in the luxury e-commerce sector in China, the UK e-tailer Net-A-Porter has today confirmed its acquisition of a Chinese high-fashion online mall, Shouke (after hearing rumors of it yesterday). That site will soon close and then be magically transformed into the Chinese version of the company’s discount couture outlet, The Outnet. The financial terms of the deal have not been revealed. The new Chinese site will go online on March 19th at”


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