Luxury & Fashion Biz News: April 20th, 2012 (The Price of Celebrity, What does being a British brand really mean, and the future of luxury is the relationship)

1.) The High Price of Celebrity Perfume:
“A New York judge Friday ordered pop star Prince to pay $3.95 million to a perfume maker for failing to promote the 3121 line of scents. Prince was sued by Revelations Perfume and Cosmetics in 2008 for failing to promote the perfume, which was supposedly inspired by his 2006 album, 3121. The company said it spent millions of dollars in out-of-pocket expenses in reliance upon Prince’s commitment to promote, and when the matter went before a special referee, the estimation of actual damage was accepted. Now, a New York Supreme Court judge has confirmed the award.”

Allegedly, Prince refused to allow his image to be used on the packaging, wouldn’t promote the perfume or give away samples at his concerts, and wouldn’t engage in any promotional tours, interviews or other activities . . . which makes me wonder why in the world he signed the contract for a celebrity perfume in the first place, since personally promoting a celebrity perfume is the only sure-fire way to get anyone interested enough to buy it.

I mean, Madonna is from the same pop-culture era as Prince and has been *all over* the place chatting-up her just released celebrity perfume, her face is in the print ads, her commercial was risqué and controversial and she’s already talking about developing a second perfume for men.

When “too racy” is just what the marketing department ordered

As a consequence, Madonna stands to earn millions from her celebrity perfume deals while strangely media-shy Prince has to pay out millions as a result of refusing to play the fame-game.

*RELATED: The ultimate fame game, however, might be the Apple Computer Macbook Pro perfume developed as a project for an art exhibition in Melbourne, Australia: “Have you ever opened an Apple MacBook Pro box, inhaled and thought, ‘If I only I could smell like the inside of this box, I’d be the coolest person ever’? If so, your (frankly disturbing) dreams are about to come true with a new fragrance by Air Aroma, based on the smell of unboxing a new MacBook Pro. Rather than the more traditional scents of sandalwood, rose or ylang ylang, Air Aroma acquired “samples of fragrances with the aroma of glue, plastic, rubber and paper” from the South of France to create the Apple-based perfume.”

There was no intention of distributing the scent on the commercial market, but interest level is so high across the web that I wouldn’t be surprised if something like this actually winds up for sale at some point in the future.

And then we’d be entering a whole new era of digital age perfumery as we rush to smell like our favorite computer products and virtual characters — could a ‘Marcus Fenix‘ cologne be a possibility?

After all, Prada has already teamed up with ‘Final Fantasy’ to promote its Spring 2012 menswear collection, and with a stunningly realistic holographic version of late rap-star Tupac Shakur making a much-talked about appearance at the Coachella arts and music festival, perhaps a brave new future of virtual celebrity merchandising is just around the corner.

Brave new merchandising opportunities — fully programmable and fully cooperative

Because why risk an international Sharon Stone incident or a Prince-sized lawsuit when a brand can just license its own virtual representative that will do and say exactly what they need.

*UPDATE: Speaking of virtual technology: Now, try on sunglasses without stepping inside the store!“American department store Bloomingdale has introduced a new store-window technology that lets passers-by see how they look in a variety of designer sunglasses . . . There are six interactive windows in place through May 7, each showing four women’s frames by a different designer . . . The “Virtual Style Bar” windows work by aligning your eyes with ovals on the glass. Once you’re in the right place, it takes a few seconds for the sunglasses to appear on your face on a 42-inch HD flat screen. Users can try on all four pairs in each window by tapping different icons on the screen.”

Who knows? Soon we’ll all be trying on entire virtual outfits without having to enter a store, and probably purchasing items by simply tapping digital icons on street-facing shop windows as holographic celebrities sing and dance their programmed encouragement.

*Other (and scent) related: Fragrance blogger Barbara Herman of the site ‘Yesterday’s Perfume’ just announced a book deal with Lyons Press to publish “Scent and Subversion: A Century of Provocative Perfume.” Make sure you stop by her site and give her a congratulatory clap on the back.

2.) Big Fashion Brand News:

*Drowning, not waving: British heritage brand Aquascutum (founded in 1851) goes bankrupt, administrators move to close its sole UK factory: “Aquascutum is to shut its factory in Corby where the company has had a presence for more than 100 years, making 115 staff redundant. The clothing retailer, which has dressed Winston Churchill and the Queen Mother, collapsed into administration on Tuesday after making ‘significant losses’ despite efforts made by owner Harold Tillman to turn it around.”

Harold Tillman also owned British brand Jaeger, but just sold off the majority of his stake in Jaeger to Better Capital, a private equity firm owned by British venture capitalist Jon Moulton.

The quick sale of Jaeger is rumored to have been a necessity in order to settle its debts and prevent the brand from going down with the Aquascutum ship.

Jaeger Spring 2012 — in debt and out of fashion

An article by Luke Leitch in The Telegraph — “Our fashion labels: coming apart at the seams” — suggests that distinctly British brands like Aquascutum and Jaeger are in trouble while brands like Burberry and Mulberry thrive is because Burberry and Mulberry know how to court the global consumer; to be just British enough to charm foreign buyers while still appealing to international trends and sensibilities.

But commenters to his article disagree and point out that Burberry and Mulberry gave up everything that was British about them years ago as they chased after global consumers with the usual perfume, scarves and keychains trifecta while abandoning British manufacturing and textiles, the only two things that made them “British” in the first place.

Which begs the question: What’s British (or Italian, or American, or French) about fashion brands that manufacture in Poland, Romania, Turkey, China and India? What does being British (Italian, American, French) mean in the fashion industry if both labor and materials are outsourced to other non-British (etc.) countries?

*RELATED: Billion-pound Burberry: Brand is only British fashion label to reach £1bn sales“Thanks to its revamped image, the company has reported record sales of £1.3 billion in six months, the only British fashion brand to achieve such a feat in retail history . . . Paris-based Luca Solca, global head of European research at investment bank Crédit Agricole’s Chevreux brokerage arm, told the Evening Standard: ‘It has graduated to mega-brand status, in the same league as Vuitton, Gucci and Prada.'”

Burberry Fall 2012 — the billion dollar British brand not made in Britain

*EVEN MORE RELATED: The fashion & leather goods segment of French luxury conglomerate LVMH reported revenue growth of 12% for the first quarter of 2012, perfume & cosmetics grew by 9%, and watches & jewelry notched the biggest revenue growth rate of 17%.

It was noted that “Celine in particular” notched very strong growth in the fashion & leather goods segment, which is important when you recall that LVMH CEO Bernard Arnault considers Celine to be the blueprint for the future of his fashion empire, including mega-brand Dior.

*Grow baby, grow!: Armani enters franchise relationship for India expansion“Armani will sign a franchisee deal with Genesis Luxury, which has a joint venture with Burberry in India and represents brands such as Canali, Jimmy Choo and Bottega Veneta in the country . . . (Genesis Luxury) plans to open 20 more Armani stores over the next four-five years and take Emporio Armani, Giorgio Armani and Armani Jeans brands to cities such as Chennai, Bangalore and Kolkata . . . Armani recently tied up with designer Suneet Varma to bring in its kidswear brand Armani Junior into the country.”

Indian luxury spending is forecast to more than double by the year 2015, so there’s a lot of renegotiating and repositioning happening in that particular market with global brands like Gucci, Jimmy Choo, Bottega Veneta and now Armani entering into new partnerships and shifting away from old alliances that weren’t bringing them up to speed as fast as they had hoped.

3.) But What Does It All Mean?

This Is Why You Fall in Love With Brands“We can use the same labels for brand relationship constructs that describe interpersonal relationships when appropriate, such as flings, committed partnerships, best friends, or we can come up with labels that are unique to marketing relationships like best-customer relationships. But labeling does not reduce this phenomenon to a simple metaphoric exercise.”

Which brings us to:

‘It’s Not You, It’s Me,’ We Tell Our Clothes“In a retail climate overrun by new labels, with design teams frequently changing direction to remain competitive, the days when a customer would stick to, say, Brooks Brothers or Talbots for life might be over. And severing ties with a brand, for whatever reason, can come at an emotional cost.”

But I sometimes wonder if contemporary consumers are having a hard time with their brand relationships because the relationship is mostly one-sided? Consumers may love the brands, but the brands don’t love consumers back, they only love the way that consumers love them.

As Rob Walker writes in “Buying In: What We Buy and Who We Are“, the dialog that the majority of brands have with their customers amounts to little more than, “But enough about me — what do you think of me?” and this is not a healthy foundation for any long-term relationship.

I received an email a couple of days ago from California artisan Basil Racuk and he mentioned an article he was working on that addresses this same theme — the relationship consumers have with brands, and especially luxury brands, and how the idea of 21st century luxury has progressed beyond mere notions of expensive bling to embrace, instead, a ready and willing access to product designers, and a personal relationship with the laborers who actually create the merchandise.

Without this access, without the personal relationships forged between, say, Basil and his customers (or even Etsy shoppers and Etsy shop owners), what we choose to purchase is merely the end-result of convenience and marketing — and we all know how relationships of convenience are ultimately static and unsatisfying.

This is why we’re seeing global brands like Louis Vuitton, Fendi and Hermes throw open their normally secret process to let customers in. They understand the power of the personal relationship.

Fendi sends its artisans into the world to meet consumers and craftsmen

*Speaking of Etsy: The online handcrafting site is taking its reputation seriously and cracking down on sellers that offer factory goods instead of the personal handmade items that are what Etsy’s supposed to be all about.

But why bother? you might think. Because Etsy understands that without that personal connection between producer and consumer, an Etsy shopper may as well be trawling a Wa-Mart or Macy’s website, and that’s not enough to keep people coming back for more.

Money quote: “Tania Ginoza says she shops for items like vintage glassware, jewelry, art and letter press stationery about once a month from Etsy. ‘It’s a really good feeling to support someone who may just be starting out with crafting and jewelry making,’ says the 43-year-old financial comptroller in Maui, Hawaii. ‘When you correspond with a seller a lot of times you are talking directly to an artist,’ she says. ‘That’s pretty cool because you can develop a relationship with an artist.'”

And this relationship with the artist is what Basil Racuk means by “access”, and how the future of luxury will be defined by the quality of interaction between producer and consumer instead of the number of Swarovski crystals sewn onto a handbag flap.


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