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ON THE ROAD

GETTING JUICY

LOUIS VUITTON LAUNCHES A COLLECTION OF FOLDABLE FURNITURE AND TRAVEL ACCESSORIES. PAGE 2

WWD MONDAY, DECEMBER 3, 2012 ■ WOMEN’S WEAR DAILY ■ $3.00

That’s Rich “Shape, texture, proportion” is how Reed Krakoff summed up his pre-fall collection. Another key word? Luxurious. Many looks were high on rich surface interest, such as this top — mink in the front, cashmere in back — and hand-painted python skirt. For more on Krakoff’s collection, see wwd.com/ fashion-news. For more pre-fall, see pages 4 and 5.

PHOTO BY THOMAS IANNACCONE

PAUL BLUM JOINS JUICY COUTURE AS CHIEF EXECUTIVE OFFICER. PAGE 2

$300M ACQUISITION

J Brand Thinks Big Under Fast Retailing By EVAN CLARK and MARC KARIMZADEH GOOD BRANDS CONTINUE to find buyers willing to open their wallets wide in the M&A world. J Brand is the latest to set a high yardstick for brands to measure themselves against, with Japanese fashion giant Fast Retailing Co. Ltd. paying $290 million, plus $10 million in advisory fees, for 80.1 percent of the growing denim-cum-sportswear brand. That values the company at $362 million — or about eight to 10 times projected earnings before interest, taxes, depreciation and amortization. The price tag was broadly seen as healthy and proved to be high enough to turn off some interested private equity suitors. Jeff Rudes will continue to lead J Brand as chief executive officer and retains an ownership position. The deal is expected to close by the end of the year. This is step two for Rudes, who founded the company in 2005 and sold a controlling stake five years later to Star Avenue Capital, a collaboration of Irving Place Capital and talent agency CAA. Under Star Avenue, the company began to reach beyond its denim roots and position itself as a fashion brand with a sportswear collection. The brand has also been garnering attention for its hip collaborations with designers such as Christopher Kane and Proenza Schouler. Now J Brand will view the world through the lens of Fast Retailing, which also owns Uniqlo, Theory and Helmut Lang. “The global outreach, retail models, products.… I am very impressed by what they do,” Rudes told WWD of his future partners at Fast Retailing. “We really respect the business as well as some of the opportunities that we thought we could build, together, for J Brand.” In the short term, Rudes pointed to building the brand’s ready-to-wear business domestically and abroad, as well as the men’s wear rtw component, for SEE PAGE 12

Hispanics’ Spending Muscle By LISA LOCKWOOD THE GROWING POLITICAL power of Hispanics was exhibited in the reelection of President Obama, but it’s their economic power that is increasing even faster — and retailers and brands are rushing to keep up. As the fastest-growing demographic in the country, it’s no wonder stores, brands and consultants are trying to get a deeper understanding of the preferences of the Hispanic consumer. According to the Selig Center for Economic Growth, Hispanics’ estimated buying power will reach $1.2 trillion this year. Their spending power has risen from $212 billion in 1990 to $489 billion in 2000, to $978 billion in 2009 to an estimated $1.5 trillion in 2015. The estimated Hispanic population of the U.S. is 52 million, as of July 2011, making people of Hispanic origin the country’s largest ethnic or racial minority, according to the U.S. Census Bureau. At present, Hispanics comprise 16.7 percent of the national total population. The projected Hispanic population of the U.S. on July 1, 2050 will be 132.8 million. At this rate, Hispanics will constitute 30 percent of the nation’s population by that date, according to the Census Bureau. Apparel remains high on the Latina consumer’s shopping list. While price and value are paramount, she is also brand- and style-conscious. Hispanics represent about 15 percent of total apparel sales, spending about $29.3 billion on apparel for the 12-month period ended Sept. 30, according to The NPD Group’s Consumer Tracking Service. SEE PAGE 16


16 WWD MONDAY, DECEMBER 3, 2012

WWD.COM

{Continued from page one} Kenneth Cole. “It’s interesting to note According to a survey conducted by how prominent the Michael Kors brand WSL Strategic Retail of 1,950 Hispanic (her number-one choice in designer customers, Hispanic women represent brands) is in social media, which no doubt the most passionate and proactive shop- helps position the brand even further in per segment searching for deals across the acculturated Latina consumer’s mind, all retail channels. The survey found that as she overindexes on all social media Hispanic women are more actively using and digital platforms,” said Oppenheimer. mobile devices; coupons; online searches; “And of course, the Victoria’s Secret dollar stores, and deep discount retailers brand remains a brand for which she to save money, compared to other female seems to have a very high affinity. She demographics. The survey found that 60 clearly identifies with the brand’s posipercent of Hispanic women use apps to tioning — trendy, feminine, sexy and fun.” According to the survey, the top six search for the lowest price. Fifty-three percent make it a point to search online categories she had purchased were, in order: casualwear, shoes-boots, lingebefore going shopping; 53 percent are using their mobile devices in the store to rie and undergarments, dresses, jeans and accessories. find electronic coupons, sales and Macy’s, Kohl’s, Kmart, Wal-Mart and discount codes. In addition, 75 perTarget are among those retailers that cent are using traditional coupons have been aggressively courting the to get the lowest sale price; 54 perHispanic customer for years, with specent will only buy items that are on cific collections, marketing programs sale; 63 percent will travel further and ad campaigns. Brands such as to shop at a store where they can Sofia by Sofia Vergara, Jennifer save money, and 43 percent will Lopez, Daisy Fuentes and Dream buy a preowned product if it Out Loud by Selena Gomez all lets them get a brand that they cater to the Hispanic customer. couldn’t afford new. Tara Poseley, president of Candace Corlett, president Kmart Apparel and senior vice of WSL Strategic Retail, said president at Sears Holdings the Hispanic customer will Corp., said in recent years, Kmart make more trips in a week has introduced collections such than Caucasians and Africanas Dream Out Loud by Selena Americans. “The vision I get of Gomez and Sofia by Sofia Vergara her is she is so passionate, and that owe their lineage to Hispanic she’s getting the most she can style icons. “We value the authenfor her family. She will make 4.6 ticity that comes from collaborattrips to stores in a week, versus 3.9 ing with talented celebrities whose trips for Caucasians and Africansense of fashion is aspirational but Americans,” she said. Hispanics attainable. Specifically, the Sofia by are also heavy users of social media. Sofia Vergara collection rounds out a “They are passionate about reading portfolio of contemporary brands in reviews and trying to figure out what the women’s ready-to-wear category to buy and what not to buy. Finding at Kmart, designed with a young, the deal is most important,” she said. fashion-conscious customer in mind. A Latina Insights survey earlier One of the attributes we love about this year that polled 1,900 subscribSofia Vergara is that her Latina herers to Latina magazine found that itage resonates with our Hispanic the department store retailers that shoppers while her impeccable ranked highest as the “go-to” desstyle remains universally appealtination for holiday shopping last ing,” said Poseley. year were Macy’s Inc. (18 perSofia by Sofia Vergara offers cent); Target Corp. (18 percent); merchandise ranging from Kohl’s Corp. (13 percent); party dresses and printed Wal-Mart Stores Inc. (12 Kmart carries the Sofia by jeans to blazers, cardigans, percent), and J.C. Penney Sofia Vergara collection. watches, earrings, totes, comCo. Inc. (10 percent). Specialty apparel retailers that ranked forters and sheets. Poseley said Kmart atthe highest among visits over the holidays tracts the fashion customer who wants to were Victoria’s Secret (64 percent); The stretch her budget or simply shops smart Gap (31 percent); H&M (26 percent); New — whatever her ethnicity or cultural York & Co. (23 percent); American Eagle heritage. Some of Kmart’s efforts to Outfitters (20 percent), and Express (20 reach the Hispanic customer include percent). Amazon.com was the number- its weekly “looks for less,” through one online shopping destination, with 48 Hispanic-focused fashion blogs percent of respondents having shopped featuring Kmart apparel and their the site over the holidays, according to own culturally relevant style icons. Kmart also engages the the survey. And what were they buying? Clothing (82 percent), electronics-tech Hispanic customer through a products (60 percent) and toys (58 per- variety of channels, such as cent) were Hispanic women’s three top online, where information is shared frequently. “Kmart categories of purchase over the holidays. Last month, Latina Insights conducted has social channels in both another survey of 300 Hispanic women English and Spanish where that found that the acculturated Latina deals and announcements are had spent $618 over the past three months promoted. Shoppers are also alone on apparel and accessories. “In my reached through innovative soexperience, this is a very high amount cial technologies such as Shop for such a short period of time,” said Your Way, allowing them to earn Patricia Oppenheimer, marketing direc- points on purchases as well as tor of Latina Media Ventures. The top- become part of the shopping five brands she had purchased in the last community,” Poseley said. Last year, Kmart launched three months, in order, were Victoria’s Secret, Forever 21, Old Navy, H&M and Latina Smart, a social platAnn Taylor Loft. “She loves brands that form for Latinas to gather are on-trend at an affordable price,” said and share information. Oppenheimer. “Our research consistently Latina Smart is an online shows that this acculturated Latina, even community comprised of more than when ‘budget sensitive,’ likes to experi- 27,000 Facebook fans and nearly ment-switch up her look and loves to buy 1,500 Twitter followers that celfashion items seasonally,” she said. The ebrate Hispanic women. As a part next 12 were Michael Kors, New York & of the 2011 Hispanic Heritage Co., Express, Gap, Levi’s, Coach, Banana Month celebration, Latina Smart Republic, BCBG Max Azria, Guess, Calvin offered a scholarship that awarded Klein, Jones New York and Kenneth Cole. $25,000 in college funding to four That consumer also likes the status of young Latinas. This year, Latina a recognizable and established designer Smart is offering an internship brand, such as Michael Kors, Coach and program that will provide career

experience to five Latina Smart interns during a 10-week paid internship at Sears Holdings corporate headquarters in Hoffman Estates, Ill. Shawn Outler, group vice president, leased businesses, vendor collaboration and multicultural business development at Macy’s, runs a program called The Workshop at Macy’s, where she seeks vendors that satisfy the multicultural segment. Last year, Outler discovered a resource called Cenia Dresses, which is geared to the multicultural customer. The collection is based on different fits. “If you’re hourglass, there’s a fit for you; if you’re fuller on the bottom, there’s a fit for you. She’s built her whole dress line based on some of the challenges she’s faced as a Latino woman,” said Outler. In addition to Cenia dresses, Macy’s launched several cosmetics resources that have broad color ranges that address Latina, black and Asian customers. Macy’s runs this Workshop program once a year in May and is accepting applications. Macy’s celebrated Hispanic Heritage Month, a monthlong program that began in September with special events honoring Latino Americans. This year they had a special salute to musician and fashion designer Carlos Santana. Macy’s hosted fashion shows, had cosmetics demonstrations and panelists. Macy’s Hispanic Heritage Month events took place at stores in nine markets, including Houston; Dallas-Fort Worth;

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Our research consistently shows that this acculturated Latina, even when ‘budget sensitive,’ likes to experiment/switch up her look and loves to buy fashion items seasonally.

VERGARA PHOTO BY GUSTAVO CABALLERO/FILMMAGIC; GOMEZ BY MICHAEL SIMON/STARTRAKSPHOTO.COM

Hispanics Flex Spending Muscle

Selena Gomez checks out her latest Dream Out Loud line at Kmart last month in White Plains, N.Y. to position the department store to attract and retain customers in the Millennial generation — now the U.S.’s largest and most diverse age demographic with spending estimated at $65 billion each year. “The younger customer is very tapped into technology, and we build our marketing strategies to reflect that,” said Outler. She said tablets, Twitter and Facebook, for example, are becoming more important to Macy’s overall marketing strategy, and the Hispanic customer is very much a part of that. Macy’s largest Hispanic markets are in Puerto Rico, New Mexico, California, New York and Florida. Macy’s features bilingual signage in the Puerto Rico store. Overall, the highest concentrations of Hispanics are in Texas (38 percent), California, (38 percent), Florida (22 percent), Colorado (21 percent), Nevada (27 percent) and New Mexico (46 percent), according to Nielsen. Wal-Mart primarily targets women who are head of households. “The future growth of retail is coming from multicultural audiences,” said a Wal-Mart spokeswoman. The retailer runs bicultural commercials on TV in both Spanish and English, which began in September. It also created layaway ads in two languages, geared to the customer who speaks only Spanish, as well as those who speak English and Spanish. The company runs the ads in cities that have a heavy Hispanic audience, such as Houston and Dallas, as well as in prime time spots on shows such as “Dancing With the Stars.” “We’re making sure our advertising is culturally relevant and has authenticity,” the spokeswoman said. Each of its stores has a program called “Community Promise,” which reflects the community they’re in. For example, there will be Spanish signage in stores in Houston, Dallas or Phoenix. Wal-Mart’s two biggest categories targeting the Hispanic consumer are food and consumables (beauty products, soaps and shampoos). The Hispanic customer is looking for brand-name products at the lowest prices, she said. A Target spokeswoman said their stores “embrace cultural influences for all its guests.” In-store signage is really important, and every category has products that cater to the Hispanic woman, such as Fabuloso cleaners, Imusa cookware, Tio Nacho cosmetics and Moco de Gorila cosmetics, she said. Target tries to reach the Hispanic consumer across all channels, including digital and its partnership with Univision. For its Neiman Marcus-Target promotion, it will feature merchandise from Latin designers such as Carolina Herrera, Oscar de la Renta and Robert Rodriguez. Target said its stores with the largest Hispanic populations are in Miami, Dallas and Los Angeles.

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— PATRICIA OPPENHEIMER, LATINA MEDIA VENTURES

San Diego; Atlanta; Chicago; New York City; Orange County, Calif.; Miami, and the San Francisco Bay area. The retailer also uses its My Macy’s strategy to pinpoint the needs of various subsets within the Hispanic community. “With My Macy’s, we’ve learned a lot about the customer and some of the sizing differences and the color preferences and weight of product that help us tailor our products by location and region,” said Outler. According to a Macy’s spokesman, Macy’s captures more Hispanic fashion-conscious consumers than any other traditional department store. A large part of the Hispanic population is young. According to a Nielsen report on the Hispanic consumer, more than 60 percent of the U.S. Hispanic population is under A look age 35, and 75 percent from Cenia is under age 45. The Dresses that median age is 28. is featured “They are one at Macy’s. of the first to adopt. They like newness and freshness. That comes in many different forms. In one place it could be about a logo, and in another place it could be about prints,” said Macy’s Outler. The Hispanic customer is also an integral part of Macy’s Millennial strategy, which aims

Hispanics Tip the Fashion Vote - Women's Wear Daily (12/3/12)  

According to a survey conducted by WSL Strategic Retail of 1,950 Hispanic customers, Hispanic women represent the most passionate and proact...

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