R3: Required Retail Reading
We’re intrigued by JNY’s new footwear license. Smells like yet another one of those moves to add business opportunity (and liability) without adding any more capacity (design/sourcing/marketing). That’s not sustainable.
OUR TAKE ON OVERNIGHT NEWS
Opinion On Tommy Hilfiger's Latest Campaign - "How can you not hate these people?" my 20-year-old son asked after surveying "Meet the Hilfigers," the family stars of "The ultimate tailgate," Tommy Hilfiger's latest campaign. The photo he saw consists of 15 blonde-ish model types wearing an assortment of rugby shirts, pleated skirts, signet rings, pinstriped suits, orange pants, duck boots, cable-knit sweaters and camel-hair everything, all arrayed around a Jeep Grand Wagoneer. The shot has a slightly off-kilter look -- Mumsy might have had one too many Bloody's and cousin Max seemingly couldn't stop playing with his hair -- so perhaps it's meant to portray an old-money family on a messier, more recession-aware day. The multimedia, multi-generational fall campaign, directed by Trey Laird and beautifully photographed by Craig McDean, is not particularly original. When it comes to classic Anglo worship and the concept of kinfolk on a journey, Ralph Lauren, of course, got there earlier. <brandweek.com>
Hedgeye Retail’s Take: I can’t outdo that description. No way, no how…!
JNY Signs Footwear Designer - Jones Apparel Group Inc. has a new name in its designer stable: hot footwear designer Brian Atwood. The company has signed a license with Atwood to manufacture, market and distribute a contemporary brand named B Brian Atwood. The deal seeks to capitalize on the designer’s rising popularity by making his products obtainable by more consumers and brings another talent to the New York-based apparel conglomerate’s brand portfolio that over the last three years has expanded to include Stuart Weitzman, Robert Rodriguez and Rachel Roy. B Brian Atwood, which will be aimed at better department stores and upscale specialty retailers, is scheduled to break for fall 2011 with shoes, followed by jewelry and handbags the year after, and sportswear and sunglasses in subsequent seasons. <wwd.com/footwear-news>
Hedgeye Retail’s Take: Beware! The question to ask JNY is what organization they will build around this license. Will they use it to fill out existing excess design/sourcing capacity on their core business? Will they use this to mitigate any inefficiencies in the Stuart Weitzman business? Either way, in typical JNY fashion, my strong sense is that they won’t grow operating assets accordingly, and this will boost near term profitability in an unsustainable way.
Adidas Collaborates with Maple Lake Ltd. to Maximize Merchandising - Adidas has signed an agreement with Maple Lake Ltd. to implement QuickAssortment, a comprehensive corporate merchandise and assortment planning application for adidas’ global retail operations. Adidas and Maple Lake are implementing QuickAssortment, an affordable, powerful assortment management approach that maximizes merchandising, localization, Open to Buy and more. It is being managed from adidas’ group headquarters in Herzogenaurach, Germany, and then rolled out to adidas retail operations centers. <sportsonesource.com>
Hedgeye Retail’s Take: Good, but not revolutionary. This has proven to be a successful platform for Lululemon, Intermix, Barney’s, Club Monaco, Cole Haan, Levi’s, and others.
H&M Snags Hot European Label Lanvin - It looks like H&M has snared one of the hottest labels in Europe — Lanvin — for its next designer collaboration. According to market sources, the Swedish fast-fashion giant will unveil a project with Lanvin and its creative director, Alber Elbaz, within the next week. On Tuesday, H&M launched a viral video campaign on its Web site and YouTube to build curiosity about its annual holiday designer tie-up. <wwd.com/retail-news>
Hedgeye Retail’s Take: It’s really tough not to love H&M. They’ve grown to own the whole ‘buy trendy apparel at a low price then wash your car with it after 3 wears’ market.
Skechers Signs Licensing Agreement for Luggage and Travel Accessories - Skechers USA, Inc. signed a licensing agreement with Olivet International for Skechers-branded luggage and travel accessories for men, women and kids. <sportsonesource.com>
Hedgeye Retail’s Take: Last I checked, you had to have a relevant brand before you can license it out to a category as ‘out there’ as luggage. I don’t see the downside for SKX, but can’t find much upside, either.
Juicy Couture Hard to Come By This Fall? - After experiencing lackluster results with the line, several major retailers have scaled back their Juicy Couture business. Some are carrying the higher-priced Bird by Juicy Couture. A spot check of stores revealed that Saks Fifth Avenue dropped the Juicy Couture line at the New York flagship for fall; Bloomingdale’s flagship cut way back on its Juicy department on the contemporary floor; Nordstrom passed on the apparel line for fall; Bergdorf Goodman no longer carries the line, and Neiman Marcus has dropped the line in several stores, such as White Plains, N.Y. and Beverly Hills. For years a fixture in contemporary departments, Juicy Couture sportswear had suffered from overexposure, quality and fit problems. In April, Juicy tapped Erin Fetherston as guest designer and creative consultant, beginning with holiday 2010 and running through 2011. The company continues to open 10 to 20 retail doors a year, and will take its e-commerce site in-house Sept. 15, which is expected to become its largest door. <wwd.com/retail-news>
Hedgeye Retail’s Take: This is not new to anyone following the LIZ story. But the characterization above is rather accurate. Textbook retail mismanagement.
URBN Showcases What its Shoppers Like - What products most please consumers who shop with apparel and home accessories retailer Urban Outfitters Inc.? Now it is easier to find out because the retailer’s web site allows consumers to sort SKUs based on what its Facebook followers have clicked that they Like. The retailer has put the Facebook Like button integration at the top of the UrbanOutfitters.com site. The retailer, with more than 313,000 followers on the social networking site, uses its Facebook page to offer Facebook follower discounts, such as 15% off orders of at least $75, highlight merchandise, and share tips on clothing care. <internetretailer.com>
Hedgeye Retail’s Take: What’s most interesting is not what URBN is doing (which makes total sense, by the way), but how easy it is for a company to leverage technology and implement these ideas. We’re not talking a massive capex plan over 2-years to get this done. But rather a couple smart Millenials who earn sub-$100k/year, an internet connection, and above average knowledge of social media tools. And yet there are many companies that will STILL be so late to the party.