The Business of Fashion

BoF Recommends | Valentino, the last Emperor

In the Summer of 2007,  around the time when Valentino Garavani finally resigned from his own label after months of speculation, I would have done anything to be a fly on the wall. What, with the planning of a 45th anniversary celebration in Rome, the controversy surrounding Permira's battle with the Carlyle Group for control of the House, the never-ending will he-won't he leave debate, and the ensuing rumours about potential successors (Giambattista Valli, Zac Posen, Proenza Schouler), there was a veritable tornado of activity going on in the Italian fashion house.

Today, 18 months later, I got my wish. I caught an afternoon press screening of  Matt Tyrnauer's film, Valentino - The Last Emperor, in New York City. The film happened to focus on Valentino and his partner, Giancarlo Giammetti, at precisely this time. And while there was scant mention of the business issues of the day, it was still an engaging film that focused on the uninterrupted partnership of these two legendary men of a bygone era in la moda Italiana.

New York Fashion Week | Playing it safe

New York already has the reputation of being the most commercial of the fashion capitals, but this New York Fashion Week has taken that stereotype to new levels. With economic uncertainty swirling through the city (Lehman Brothers is the latest Wall Street Bank whose future is in question) and footfall at department stores dropping precipitously, the mantra of the week seems to have been 'Play it Safe!"

Over and over again this week, young designers have told me that the big buyers are sticking to proven silhouettes in basic colours, veering away from the fashion items. While the basics and staples of designer collections will always be important part of the product assortment, it seems to me that precisely because times are so tough, buyers should be making an effort to give consumers a reason to buy. And, that is not accomplished with a series of little black dresses.

New York Fashion Week | Marc Bouwer's online experiment

While the rest of New York Fashion Week was caught up in its regular Bryant Park frenzy today, designer Marc Bouwer was busy blazing his own fashion trail, exclusively showing his S/S 2009 collection on his website, thereby giving everyone a front row view.

Of course, we have seen other designers, notably Stefano Pilati for YSL (first with menswear, and most recently women's resort) and Husein Chalayan, create videos to showcase their collections. And, Giorgio Armani made history when he streamed his Armani Prive couture collection for Spring 2007 online, gaining kudos for democratising the storied world of haute couture. Net-a-Porter also innovated by putting up Roland Mouret's RM19 collection in an online video and commerce site mere hours after showing during Paris Couture.

But Bouwer's approach is a first for an independent designer without the clout of a YSL or Armani, nor the support of a major online retailer. So, how well did his experiment work?

Breaking News | Is Barneys about to become a basket case?

News has been trickling in all week about confusion around the strategic direction being taken by Barneys and today, the New York Times is reporting that its highly respected CEO Howard Socol will resign next week. This is an abrupt change of tone in the buzz around Barneys, which is arguably the most influential and forward thinking luxury and fashion department store chain in America today.

Bergdorf Goodman, of course is a venerable store in its own right, but it only has one location in New York and  its sister company, Neiman Marcus, based in Dallas, is far removed from the New York fashion hub. Yes, Neimans serves an unequaled luxury customer, but it just does not have the fashion cred that Barneys has managed to build in recent years.  Barneys' affable Fashion Director, Julie Gilhart, has been a champion of emerging talent and amongst others, is credited with recognising the talent of the Proenza Schouler boys, buying their graduate collection from Parsons.

But, is Barneys about to become a basket case?

New York Fashion Week | Celebrity is the new haute couture

Yesterday at Phillip Lim I heard a videographer complaining "There's no one here, and whenever someone does show up, they bring them out at the last minute so I can't shoot them."

Many fashion brands may have been built on the dreams created by out-of-this world haute couture collections, but today, for many brands, this desire is built on the image of celebrity, which can arguably reach more people than the Haute Couture shows ever will. Celebrity is the new Haute Couture. Or, better said, celebrity now plays the dream-weaving and marketing role that Haute Couture has played in the past.

However, in a week when the front rows were supposed to be dripping with celebrities, the paparazzi at New York's fashion shows were left wanting. Yes, pop star Rihanna made several appearances, as did Angie Harmon, but it seemed the biggest A-list stars had given New York Fashion Week a wide berth.

Until yesterday.

New York Fashion Week | Gucci's finishing touches

On the corner of 57th and 5th in New York, in the Trump Tower space that used to house the failed Asprey flagship, the scaffolding and covering have been removed from the new 46,000 square foot Gucci flagship.  The shelves have been stocked and the windows are already proclaiming Gucci's love for New York, in hopes that New York will love Gucci back - to the tune of an estimated $100m a year.

As we walked by the location of the brand new flagship store yesterday afternoon, an army of workmen was putting the finishing touches on what will be one of the largest luxury stores on 5th Avenue and is expected to rake in as much cash as the phenomenally successful Abercrombie and Fitch flagship across the street.

Today, WWD wondered whether 5th Avenue might become the new Ginza, referring to the Tokyo quartier which has seen a veritable frenzy of building by luxury brands eager to make their mark on the neighbourhood and in the psyche of the all-important Japanese shopper. Likewise, this huge New York store is as much about sustaining and building Gucci's brand image as it is about dollars and cents.

New York Fashion Week | Furry optimism at Oscar, Peter Som and Proenza Schouler

The day before Super Tuesday in the American primary elections might be called Mega Monday at New York Fashion Week, with established heavyweights like Oscar de la Renta showing alongside the city's new establishment of Proenza Schouler and Peter Som. Young or old, a newfound fancy for fur (and its premium pricepoints) was a common thread, even in these recessionary times.

But, Oscar is no old-fogey. His collection came out to the sweet sounds of Regina Spektor, the young hip pianist. During the show, I had the good fortune to be seated next to the company’s CEO, Alex Bolen, who also happens to be Oscar’s son-in-law. It was a great opportunity to have a pre-show chat. Before I could even ask, Alex told me that Oscar de la Renta has not seen any impact of the economic slowdown on their business at all. Not a blip in sight.

New York Fashion Week | Iqons, Rodnik and a Manifesto for change

On Sunday night, Rodnik and Iqons teamed up for a buzzing party in New York to celebrate the launch of the first ever Iqons magazine and Rich and Phil'€™s continued creative collaboration in music and fashion. Even the big guns from Vogue (Andre Leon Talley) and the New York Times (Cathy Horyn) were squeezed into the tiny cabaret space at The Box to catch the latest installment of the Rich and Phil show, which included a capsule of looks from their A/W collection to be shown in its entirety during London Fashion Week.

It's a good thing that Rich and Phil made the trans-Atlantic trip, because Sarah Mower reported in The Observer on Sunday that that after the global stock markets sank in January, the British Fashion Council began to receive calls from American buyers canceling their trips to London.  Is last season's rebound of London Fashion Week under threat?

New York Fashion Week | Let the circus begin

It's that time of year again when the curious caravan of editors, models, photographers, buyers, fashion icons and celebrities (and their hangers-on) make the rounds of over 400 fashion shows over the next four weeks across four of the world's fashion capitals. First up is New York Fashion Week, known for its commercially-driven collections, slick PR and strategic celebrity appearances. But this year is shaping up to be a humdinger in New York that could make this a fashion week unlike any other in the recent past.

First, many young American Contemporary designers may have a real chance at finally cracking the European market. Historically, they have had a hard time convincing European buyers to take on their collections. But, with the low US dollar and a highly-developed Contemporary business in the USA offering runway looks at mid-range prices, the designers have a very compelling value proposition for European buyers, who themselves are bracing for a possible economic slowdown. The Contemporary brands can offer great value to those customers who need to rein in spending as they ride out the recession.

Fashion arbitrage: The US Dollar conundrum

In economics, arbitrage is the practice of taking advantage of a price differential between two or more markets by buying something for a lower price in one market and selling it for a higher price in another market, preferably instantaneously, to avoid the risk that price gap will close.

With the plummeting US dollar, many European brands have decided to take a hit on margins instead of lifting prices to reflect the current exchange rate. They want to stay competitive with their American counterparts and don't want to turn off American consumers with astronomical prices.  But the resulting lower US prices have led to an opportunity for some seriously lucrative fashion arbitrage. For example, a New York Times article published this week reveals that the Yves Saint Laurent Downtown bag costs $1495 at Bergdorf Goodman in New York, but costs £910, about $1796, at Harvey Nichols in London.

Savvy consumers can make money by buying bags and other fashion products in the US and then flogging them in Europe and Asia -- at prices higher than in the US, but lower than the International price.