Wednesday, 31 March 2010

Swatch Is Not In Talks To Buy Bulgari – 31/3/10

Swatch are tripping over themselves to back away from the 'rumour' of a takeover let alone a hostile one... (see yesterday’s MO Down for details). It's got many a radar up and also a share price rise for Bulgari, not a bad result. Should Bulgari consider?

A Reuters article revealed that Bulgari says that the “controlling family is not keen to sell.” Swatch’s CEO, Nick Hayek, said, "The Swatch Group has not expressed any desire to acquire Bulgari, and Bulgari has not expressed either the desire to be bought by Swatch Group."

What is interesting to note is that "Bulgari shares rose as much as 5 percent on Monday after Swatch Group chief executive Nick Hayek told the German magazine Focus he regarded the Italian jeweller as a potential big brand that could be developed." The power of Swatch it seems does represent additional value to existing and future shareholders.

Image courtesy of

Core Profits Improved For Prada In 2009 – 31/3/10

We have positive news from the house of Prada. They have announced that their 2009 ‘core’ profit rose 2.8 percent to 290 million euros (AU $424 million), boosted by a rise in more profitable retail sales even as its wholesale business declined.

Prada told Reuters that “its strategy of developing a direct distribution channel had paid off with retail sales rising 14 percent in the year.” The company also said the results were particularly good when taking into acount the global economic crisis.

Image courtesy of

Tuesday, 30 March 2010

Swatch To Buy Bulgari? – 30/3/10

We don’t have a definite “yes” to that question, but a Reuters article has evidence that the Swatch Group “had signalled interest in Italy’s luxury watchmaker Bulgari.”

Swatch’s CEO, Nick Hayek (pictured), said, "I do not deny that there are interesting big brands that have potential to develop," and he cited Bulgari as "an example."

We find this development most interesting. It wasn’t that long ago that we were wondering if LVMH were interested in buying Bulgari (see our 16 February report).

Still on the luxury watch industry, a WWD Baselworld round-up has suggested “the mood is brighter” at Baselworld.

Hayek was also causing waves at Baselworld, with WWD suggesting:
"In many cases, brands had a hidden agenda for showcasing their expertise. Swatch Group CEO Nick Hayek has threatened to stop supplying the rest of the industry with movements and components, and the issue of who makes the parts that go into the engine of a watch has become a hot topic. Most brands rely on Swatch to supply them with movements, although other suppliers exist, namely in Asia. Hayek warned that the Swiss watch sector faces a crisis unless there is more innovation and investment."...

Image credit:

Monday, 29 March 2010

Luxury News In Brief – 29/3/10

Hermes has reported a rise in operating profit for 2009. We read that "Hermes shares are trading on a price to earnings ratio of more than 34 times on this year's forecasts while the European luxury sector average is trading on 15-18 times."

By comparison, the world's biggest luxury goods group, LVMH, reported an 8 percent drop in profit in February from recurring operations last year, on revenue down 4 percent on a like-for-like basis. Click here to read more at Reuters.

J.P. Morgan Securities has raised shares of Coach to "overweight." Analysts also predicted “the company's full-price stores could post their first positive comparable sales since the first quarter of 2008." Click here to read more.

Richemont has named Richard Lepeu as Deputy CEO, as the company seeks to strengthen its management after last year’s slump in demand for luxury goods. Click here to read more at Business Week.

Image credit: Hermes’ store in Washington, courtesy of

Friday, 26 March 2010

U.S. Mystery Shoppers Have Spoken: Louis Vuitton And Burberry Perform At Customer Service – 26/3/10

High-end customers prefer Louis Vuitton and Burberry for the best “in-store customer experiences,” according to a survey conducted by the Luxury Institute, an impartial, independent and objective ratings and research organization based in New York city, that is the global voice of the high net-worth consumer.

This survey used 78 hand-picked mystery shoppers and is based on 240 visits to luxury department stores in New York. We read at that merchandise, service and store atmosphere were the top criteria the mystery shoppers used to judge a store.

How LV and Burberry compared
Burberry and LV scored in the high 70s across the board, with LV edging out Burberry 77 to 74 percent. The mystery shoppers reported that Burberry staffers made them feel comfortable on 94 percent of visits, while LV’s employees accomplished it only 76 percent of the time.

Making customers feel special was also a key point of the study, and, apparently, more difficult, as Burberry achieved it 52 percent of the time, while LV performed well 42 percent of the time.

We find these results very interesting. At MO Luxury, we have a Mystery Shopping Program called Covert Client, which currently works with the luxury and premium brands to measure the consumer experience from in-store, online and telephone. MO Luxury are currently in the process of analysing data from 200+ consumer experiences. Naturally we are curious as to the arms length benchmarking when compared with the US results.

Image courtesy of It shows a recent Burberry ad.

Thursday, 25 March 2010

Google vs. Louis Vuitton: Seek and You Shall Find... Well Not Only Your Brand, But Your Competitors

Yes, sadly Google has emerged victorious in its 5-year battle with Louis Vuitton over luxury goods trademarks.

This victory, in the European Court of Justice (ECJ), means the internet search engine is not liable when people (in particular counterfeiters) use the luxury goods maker's trademarks in online ads.

According to the LA Times, the ECJ said that Google is merely a provider of advertisements, not a company infringing trademark rights. It ruled that only advertisers are liable for infringing a trademark, and not the company providing a place for ads.

But Google didn't escape completely unscathed. The ECJ also ruled that if a trademark owner believes that its name is being used illegally, Google must remove the infringing ads from its service. If it doesn't, it could be liable for trademark infringement.

Click here for our earlier thoughts on this court case.

Image credit:

Luxury News In Brief – 25/3/10

Reports have emerged from the Basel World Watch Fair that the luxury watch industry is not confident that rising watch sales is a true sign of recovery.

Luc Perramond, Hermes’ watch CEO, said the Swiss watch industry could still see a double dip after showing signs of recovery. He is also worried about “a possible real-estate bubble” in China. "One has to remain cool-headed," he told Reuters.

Philippe Pascale, head of LVMH watches and jewellery, is also concerned about the sector, suggesting rising orders might have more to do with retailers than consumers.

According to the Business Financial News wire – Burberry shares have been downgraded to an add from a buy.

Image credit:

Wednesday, 24 March 2010

Tiffany & Co. And Versace Both Reveal Rising Profits – 24/3/10

Announcing their fiscal fourth quarter earnings, Tiffany & Co. has reported a higher profit, which was lower than Wall Street’s predictions.

Tiffany’s sales increased across all product categories and price points in the fourth quarter. Other big news is that the company has revealed plans for further expansion in 2010, including opening 17 stores. You can read more at The Wall Street Journal and Business Week.

After some hard luck last year (closing its Japanese stores, axing a quarter of its workers, etc), Versace believes it is on the right track to become profitable in 2010.

Versace’s CEO, Gian Giacomo Ferraris, said the brand has had a strong start to the year and he sees sales rising (between 7 and 10 percent) this year, if markets continue to recover.

He also said the fashion house had pre-sold nearly all of its next winter/autumn collection to wholesalers. Click here to read more at Reuters.

Image credit:

Tuesday, 23 March 2010

The Owners Of Fabergé Return To Profit – 23/3/10

It has been all quiet on the Fabergé front since their relaunch late last year (see the MO Down for September 17) until now, when their owners, Pallinghurst Resources, reported a return to profit in the year to December.

CEO Arne Frandsen also said “the relaunch of Faberge was well received and the brand was making further inroads from its store in Geneva.”

Click here to read more on Pallinghurst Resources (sorry, we have no more Faberge-focused facts up our sleeve … yet!)

An Update On Christian Blanckaert’s Melbourne Visit – 23/3/10

As we told you last month (see our 23 February article), former Hermes VIP Christian Blanckaert is in town for L'Oreal Melbourne Fashion Festival.

According to The Sydney Morning Herald, Blanckaert drew a crowd of hundreds at his $450-a-head business seminar, where he spilled the beans on his glory days at Hermes.

He also reflected on the current state of the luxury sector, saying ''In France, we have been very good forming giant conglomerates. In Italy, there are many more smaller companies. I think we will see a period of these smaller companies being swallowed up.'' An interesting prediction indeed.

Image credit: Photo by Daniel Berehulak/Getty Images. It shows Monsieur Blanckaert.

Monday, 22 March 2010

Have you heard about MCM’s makeover? – 22/3/10

I’m sure you remember MCM. A German-based company known as Michael Cromer Munich, it epitomised glamour and was huge in the 1980s. But by 1997, the luxury brand had faded.

Now, Sung Joo Kim, a Korean business woman, is resurrecting the label, with a new name: Mode Creation Munich.

We heard about this in a Wall Street Journal article (entitled MCM’s Eastern Makeover). We recall going to the launch of MCM’s Sydney store. It opened to much fanfare in around 1993/94 from memory, but didn't last long.

We find this W.S.J. article interesting (a) because of the hope and huge amount of money that Ms Kim is investing in 'bringing the brand back'; (b) she is doing this by changing the name from the founder; (c) she is pushing the brand out from South Korea onto the Asian (first and foremost) market, US and Europe... Also, her sales were equal in 2009 to where they were at the height of the brand's original success in 2003 - it's impressive.

We believe this brand will continue to grow from strength to strength in the South Korean and Asian markets as it has 'some' heritage and has the European edge marque that consumers are nostalgic and aspirational about...

Image credit: M. Scott Brauer for The Wall Street Journal. It shows Ms Kim.

Luxury News In Brief – 22/3/10

After “reporting its first quarterly loss in 10 years” (see last week’s MO Down), Italian jeweller Bulgari has announced it wants to double the size of its accessories business over the next three to five years. CEO Francesco Trapani said, "We are not known for accessories; people think about many other brands than Bulgari for a bag...We want to change that." Click here to read more.

While Bulgari looks to accessories, Hermes is aiming to increase annual watch sales by 10 percent over the next five years, as it introduces more complex models at higher prices.

Luc Perramond, CEO of Hermes’ Swiss watch unit, says the brand plans to open 12 to 15 shops dedicated to watches and jewellery in the next three years, in locations like New York, Russia and China. He also said China will be the “main driver” for growth over the next two decades, and Hermes will introduce more jewelled and enamelled pieces that are popular in China. Click here to read more.

Lastly, still on watches. We’re glad to discover that Swiss watch exports rose 14.2 percent in February. LVMH’s watch brands, Hublot, Tag Heuer and Zenith, all said the year had started strongly and they expected double-digit revenue growth for 2010. Click here to read more.

Image credit: It shows Bulgari’s A/W ad campaign.

Friday, 19 March 2010

Luxury Brands Fail Quality Control Tests In China – 19/3/10

We are quite surprised this morning at the headlines in the China Daily newspaper, which allege “Foreign luxury retail brands fail quality control test.”

According to the Zhejiang Administration for Industry and Commerce, the issuer of these quality tests, there was evidence of too many chemicals in the garments and poor colour fastness. The brands mentioned include Versace and Hermes. Hermes was criticised for improper labelling, but have allegedly taken steps to remedy the situation.

What we would like to know is what other like-for-like tests are done in other countries for quality control (QC). The QC of the brands mentioned is usually stellar, so the question we ask; is the fact they are manufacturing in countries outside their country of origin and perhaps the more distant level of control to blame for these quality issues? Given the 'quantity' of production is ever increasing due to consumer demand in China, will this issue also get worse? One of the key criteria to a brand’s ongoing success is its quality.

As European luxury brands are highly coveted in China, a country of the finest artisans, they must ensure their QC is 120 percent regardless of where the product is manufactured. The Chinese are astute consumers and no-one should ever feel they are not getting the best....

Image credit: Liz Hong/China Daily. It shows a Versace boutique in China.

Thursday, 18 March 2010

Karl Lagerfeld Is Not Leaving Chanel – 18/3/10

Due to mounting speculation that Alber Elbaz will be replacing Lagerfeld, (see yesterday’s MO Down), the luxury label was forced to issue a press release denying the rumour.

The official word is: "Karl Lagerfeld is the creative designer of Chanel and has a long-term contract with the company. Replacing him is not an issue."

Lagerfeld himself denied the same rumour last July. See our July 10 report for his extremely memorable rebuff.

Image of Karl is courtesy of

Wednesday, 17 March 2010

Will it be 'bienvenue' to Alber Elbaz soon at CHANEL? 17/3/10

As we've said before on many subjects, we're not big on rumours, we are focused on fact... nonetheless it would be 'rude' to you our dear readers to ignore the mounting speculation of a possible au revoir to Karl Lagerfeld and a bienvenue to Alber Elbaz. (see The MO Down 10/7/09). is reporting the rumour from the rumour reported by after they read a tweet by Tommy Ton (a fashion blogger of 'some' notoriety). What's that saying....Chinese Whispers...

The reader feedback is interesting to note on, Alber is an extremely popular consumer choice it seems thus far.
Photo: Eric Ryan/Getty Images

Bulgari Reports Its First Quarterly Loss In 10 Years – 17/3/10

We awoke to bad news this morning, with news that Bulgari has announced a first-quarter loss of 29.3 million euros (AU $43.9 million) compared with net income of 22.8 million euros (AU $34.2 million) a year ago.

This loss has been linked to reduced demand for Assioma watches and Allegra jewellery and the fact the company lost money on currency-hedging transactions.

Bulgari’s CEO, Francesco Trapani (pictured), told Bloomberg that “third-party retailers continued to cut inventories of Bulgari goods, and that a return to the company’s growth rate in the boom year of 2007 may not take place until 2012”.

The company also said it renegotiated debt with its banks and will cut costs, spending less on advertising and promotion.

“We are hoping things will be better in the second half of the year,” said Trapani. Planned new products such as Sotirio watches and Blu Due perfume may revive demand.

Click here for a reminder of Bulgari’s fourth quarter sales.

Image courtesy of

Luxury News In Brief – 17/3/10

While Bulgari struggles and plans to cut back, Richemont-owned jeweller Van Cleef & Arpels plan to double their stores in China this year. The company’s CEO, Stanislas De Quercize, called their Chinese expansion “priority number one.” Click here to read more.

Shares of Richemont rose yesterday as rumours emerged that the Swiss luxury group was planning to buy internet designer clothing retailer Net-a-Porter, which it already owns 29 percent of. Read the full story here at Reuters.

Image courtesy of

Tuesday, 16 March 2010

LVMH To Buy Bulgari? – 16/2/10

We are watching LVMH more closely than usual, with news that the luxury group’s watch sector is “confident of returning to profitable growth.”

Also, according to Reuters, the head of LVMH’s watch and jewellery unit, Philippe Pascal, is not ruling out future acquisitions.

Pascal said, “With Hublot, we showed that we can undertake purchases if the financial terms are reasonable and the brand has potential for development.”

And the answer you’re watching for:

Q: Is LVMH interested in buying Italian jeweller Bulgari?
A: Pascal said, “No comment. We'll look at interesting offers, but Bulgari is not relevant now."

This article continues LVMH’s “relatively upbeat” attitude towards its watch and fine jewellery divisions. See our article for February 8 (Business Is Improving For LVMH) for more details.

Image is courtesy of:

Monday, 15 March 2010

The Latest On Christian Lacroix’s Licensing Deals – 15/3/10

Christian Lacroix has been sadly missed at the recent Autumn/Winter Paris Fashion Week. Having been reduced to a licensing-only operation late last year (see the MO Down for December 3rd for details), the brand continues to “live on”.

According to Reuters, the brand will branch out into furniture, eyewear and upmarket stationery.

Christian Lacroix’s CEO, Nicolas Topiol, said the brand has “signed partnerships with the eyewear maker Mondottica, the U.S. stationery company Libretto, the French wall woodworks company Marotte and Designers' Guild. It is also exploring a potential licence contract with a perfume and cosmetics maker.”

Topiol told Reuters, "Of course there is a risk for the brand's image. But all the controls will be put in place, on the products, on the distribution and everything that has to do with the image of the product."

Licensing is a hot topic on the MO Down. If done well, it can expand the brand’s market presence. We discussed this very issue in detail earlier in the year (see the MO Down on 16 June: Licensing Still Has Its Place In The Luxury Industry).

Image courtesy of the Daily Mail. It shows Christian Lacroix on the catwalk with Lily Cole who models one of his designs.

Friday, 12 March 2010

How Fashion And History Go Together For Luxury Brands – 12/3/10

In yesterday’s MO Down, we discussed the YSL retrospective being held in Paris. Now, we’d like to draw your attention to a Financial Times article, which makes some interesting points on YSL’s retrospective and current collection, and on the topic of now vs. the past.

The article’s opening paragraph raises an interesting argument, suggesting “Fashion and history are antagonistic bedfellows: on the one hand, fashion is predicated on refuting the past of only a season ago; on the other hand, it finds nothing quite so attractive as an archive – the older the better.”

What so often makes a luxury brand successful, apart from quality and rarity, is the history. Therefore, a new brand finds it difficult to become a 'luxury' brand even if they indulge in the same artisan craftsmanship, rare and exclusive fabrics and adornments. So at what point does a 'new' brand become a luxury brand? There are actually a few turning points, but the path is a difficult one…

Luxury News In Brief – 12/3/10

Better than expected profit at Inter Parfums
Fragrance maker Inter Parfums Inc, whose brands include Van Cleef & Arpels, Burberry and Christian Lacroix, reported an adjusted fourth-quarter profit that topped Wall Street’s expectations. Revenue rose 13 percent. Oh, the sweet smell of success! Click here to read more.

Burberry has launched a trademark lawsuit against the parent company of TK Maxx, TJX Cos. Inc. Burberry is claiming multiple counterfeit breaches, and is seeking an injunction, the destruction of any unauthorised goods, a court order forcing TJX to run corrective advertisements, legal fees and unspecified damages. You have to fight to the death to protect your trademark… Click here for more info.

Quick quiz
Q: What does Australasia's wealthiest man, Graeme Hart, have in common with Giorgio Armani, the iconic fashion designer of his own luxury goods empire?

A: Mr Hart is on par with Mr Armani – as they both rank number 144 on Forbes’ rich list. Click here for the facts (including that the number of female billionaires has grown since last year.)

Thursday, 11 March 2010

A Well-Timed Yves Saint Laurent Retrospective Opens In Paris – 11/3/10

Around the same time the Yves Saint Laurent Autumn/Winter collection was being applauded at Paris Fashion Week, a YSL retrospective was previewed at the Petit Palais in Paris.

This exhibition – which we thought was well timed and planned to coincide with Fashion Week - features 307 pieces from the designer's collection, both haute couture and ready-to-wear, from his start in 1958 with Christian Dior to his final collection in 2002. It also shows photos of Yves Saint Laurent.

If you can’t make the next plane to Paris, click here for photos of the exhibition.

Cautious Optimism for YSL in 2010
Although the buzz around YSL is positive, the brand’s CEO, Valerie Hermann, told Reuters she thinks it is too early to be optimistic despite growing signs of increased consumer spending.

"We have all been very affected by the year 2009, so we are very careful. It is true that there is more optimism than in mid-2009, but I think we have to wait, to be reasonable and draw lessons of what happened in 2009." Hermann said.

Luxury News In Brief – 11/3/10

The Fashion Week Buzz-O-Meter is back (see last Thursday’s MO Down for more details) and the trinity, Balenciaga, Louis Vuitton and Yves Saint Laurent, are receiving the biggest ‘online buzz’; with YSL leading LV. Click here for more info.

LVMH’s Celine is also receiving positive feedback from the Buzz-O-Meter. A Wall Street Journal article was also full of praise for the fashion label, saying it was showing signs of a major resurgence due to former Chloe designer Phoebe Philo. To us, it seems like everyone is banking on Philo to create a ‘Chloe-esque’ moment…

And if, like us, you’re still curious about why Carine Roitfeld was banned from Balenciaga’s Paris show (see our March 8 blog), there are two theories circulating: 1) possible copyright dispute, 2) a personality clash after French Vogue fired Marie Amelie Sauvé. Click here for all the details. We are working on another theory and we will come back to you with that...!

Wednesday, 10 March 2010

The Gucci Group Hopes To Win The ‘Asian Prize’ – 10/3/10

Asian expansion is on the minds of many luxury brands at the moment. The Gucci Group, in particular, is investing a lot of money (more than 60 percent of Gucci Group investment) in Asia, mainly in China.

Robert Polet, CEO of the Gucci Group, part of France’s PPR, told the Financial Times that it was clear to him when he joined the group in 2004 that “Asia Pacific was going to be the big prize to be taken”.

In his time as CEO, Polet has increased the number of Gucci stores in China from four to 30. “We have more selling square footage in mainland China built in five years than we built up in 30 years in Japan. This strategy has proven to be correct and will remain like this,” he said.

Polet also implied that the worst is probably over for the luxury goods industry. But he saw no return to the free-spending, conspicuous consumption that was common before the economic crisis. Customers are now looking for “more discreet, timeless” products, and avoiding anything that could fall out of fashion quickly. “People feel guilty about that,” he said.

For more news on the recent successes of the Gucci Group, see our earlier reports on Bottega Veneta and Balenciaga.

The Honor is All His.... Lagerfeld that is 10/3/10

News just in from WWD is that Karl Lagerfeld, the German born multi-talented Creative Director of the house of Chanel, Fendi and his own line, has just been notified by French President Nicolas Sarkozy that he is to be decorated as a commander of the French Legion of Honor.

We're impressed. We also believe he has 'added' incredible value to the French economy through his designs, particularly of note for Chanel and his overall innovative and creative approach to fashion and the arts in general...not to mention the additional business he must have created for Apple (a library of Ipods), Diet Coke... etc but that's another story.


Tuesday, 9 March 2010

Where’s Wally? At The Abu Dhabi Yacht Show – 9/3/10

The Wally/Hermes collaboration, one of the most incredible super yachts we have ever seen, was unveiled at the Abu Dhabi Yacht Show 2010.

The removal of ‘the veil’ revealed not only ‘where's Wally?,’ but ‘why you’ll love Wally’...

We first spotted ‘Wally’ last year (see the MO Down for October 2), where we learnt the yacht boasts a 2,200 square foot master-suite decorated by Hermes, an on-board salt water swimming pool, cinema and many other state-of-the-art features.

Click here for the official Wally/Hermes Yacht site. In the meantime, we’ll definitely be keeping our eyes peeled for Wally.

Monday, 8 March 2010

Politics Is In Fashion At Paris Fashion Week – 8/3/10

Back in January (see the MO Down for 28 January), the French government pledged its support for its struggling fashion artisans. And now at Christian Dior’s show at Paris Fashion Week, we’ve seen another show of support with politicians crowding the front row.

According to the Wall Street Journal, French Finance Minister, Christine Lagarde, and Industry Minister, Christian Estrosi, both had prime seats at the house’s show last Friday. Here at the MO Down, we like their support and investment in French fashion, and hope it continues.

Fragrant Deals And Fashion Show Blacklists At Balenciaga – 8/3/10

We’d like to wave an interesting article in the Financial Times in front of your nose. It’s about the January 2010 launch of Balenciaga's new fragrance (see MO Down for October 2008 for details), which will not only sweeten the wrists of consumers, but may also sweeten the revenue of the Gucci Group, which is part of PPR.

If the success of those luxury houses that ventured down the fragrant path have anything to go by, this fragrance deal could add large additional revenue to the house, especially given the incredible figures published by Euromonitor. These figures suggest prestige fragrances account for $16.54bn of the $24bn fragrance market in 2008. So it certainly seems Balenciaga is sensing the correct notes here.

Still on Balenciaga, we read in WWD that French Vogue Editor-in-Chief, Carine Roitfeld, was banned from Balenciaga’s recent pret-a-porter show at Paris Fashion Week. She said, “It’s too bad, it’s a beautiful house and it’s French. I hope that it’s not forever,” but won’t reveal the reason behind the rift. We’re intrigued…

Friday, 5 March 2010

Martin Scorsese Directs Chanel’s New TV Commercial – 5/3/10

We’re expecting big things from Chanel’s new TV commercial, directed by award-winning director Martin Scorsese.

The campaign, which will begin running globally in September, was filmed in New York and features French actor Gaspard Ulliel, who is the face of the new fragrance.

When talking to WWD about the collaboration, Andrea D’Avack, President of Chanel Fragrance and Beauté, said “Chanel works with movie directors because they bring depth, emotion and what we call in French ‘a supplement of soul,’ or an added dimension. In the case of Martin Scorsese, we knew we would definitely have a man’s world full of complexity that is also adrenaline-driven, and of course, amazing images.”

Let’s hope this commercial is better received than Karl Lagerfeld’s short film, Vol de Jour (click here for our thoughts and to view the film).

Still on Chanel, we’ve heard a new Coco Chanel book is in the pipeline. We don’t know much about this book deal, apart from its working title: ‘Antigone In Vogue’.

However, we wonder how many more books/films can there be about Coco Chanel, yes, she is an iconic woman, but what we want to know is what the 'difference' is with this book. What's the innovation? I suppose we’ll have to wait and see…

Thursday, 4 March 2010

The Reimanns Look To Acquire More Luxury Brands – 4/3/10

German billionaires the Reimanns are making noises to Bloomberg about further brand acquisition through their company, the Labeluxe Group.

Currently, the Reimann family own the Swiss premium brand Bally and New York based fashion label Derek Lam.

The timing seems ripe and they have many ‘cherries’ to choose from; it all comes down to the right vision, facts and figures…

We believe that Labeluxe could become a significant player on the luxury goods conglomerate chessboard by acquiring a portfolio of brands and investing in their growth and success. We’ll keep following their progress. A Subtle, Elegant Way To Promote Luxurious Living – 4/3/10

Now is the time to visit, the new LVMH backed online site.

We’ve been following it since last week and think it’s an interesting site full of whimsy, passion, archival footage and exciting and at times deep messages.

Another great thing is they have built up a lot of past content, which is very clever, before their launch.

The New York Times was also impressed. They raved, “Instead of urgent offers to buy, each video clip, artistic image and cultural commentary creates a mood and suggests that you have entered an exclusive world where you can absorb and be informed. The pleasure is measured by the time you choose to spend in this enfolding world of art laced with the fashionable.”

It appears that LVMH has backed another winner…

Giorgio Armani And Bottega Veneta Are Fashion Week Favourites – 4/3/10

After visiting LVMH’s, we recommend fashionistas head to the Fashion Week Runway Buzz-o-meter, which has measured the online buzz on various designer's runway collections.

Giorgio Armani and Bottega Veneta received the biggest and most positive buzz. Jil Sander wasn’t as well received. Click here and here for more news on this.

LVMH Sues Hyundai Over Luxury-Related Super Bowl Ad – 4/3/10

More interesting news from the LVMH camp: they’re suing Hyundai Motor Co. for showing a Louis Vuitton-style monogram in its TV ad that ran during Super Bowl XLIV.

According to WWD, the court case, filed in Manhattan, accuses Hyundai of “trademark infringement and dilution” and seeking to “benefit commercially from the fame and renown of the LVMH marks by creating a false association between Louis Vuitton and its automobiles.”

We’ll keep you posted on any developments on this case.

Wednesday, 3 March 2010

Did You Bid On A Vintage Treasure At The Chanel Auction? – 3/3/10

Last week, Chanel fans were in bargain-hunting mode as more than 800 vintage outfits, accessories and shoes were auctioned off at a two-day sale at Paris' Drouot Richelieu auction house.

According to the Associated Press, estimates for the lots ranged from €20 ($AU 30) for buttons emblazoned with the label's hallmark double "C"s, to euro 10,000 (AU $45,333) for a 1923 drop-waisted dress in ivory silk. Bidders from around the world were expected to attend the auction (and participate via phone).

The story of this auction is an interesting one. The auction’s assessor, Francoise Sternbach, took a year and a half to assemble the 820 lots, which she acquired from more than 120 private sellers. Some of the vintage items were dug out of trunks or rescued from attics where they had been stored for decades.

We’re still waiting to hear how successful the auction was. We’ll keep you posted on the results.

Tuesday, 2 March 2010

Bespoke and Pure Luxury from a Belgian Handbag Brand to an Omani Royal Fragrance....

Last week, we drew your attention to Delvaux, a Belgian brand with a 180-year-old history, today another bespoke luxury brand, House of Amouage, has our undivided attention…

Amouage is one of the world’s most regal, luxury perfume brands, and it’s on “an expansion streak”, according to a report on CNN.

In the not-too-distant future, Amouage hopes to infiltrate the European and US markets. Two new stores are planned for 2010, one in Dubai and one in London.

Amouage was founded 25 years ago when the Omani royal family commissioned a leading French perfumer to create one of the finest fragrances money could buy. There was seemingly no cap on budget and “the whole thing was done with just greatness in mind.”

And, the most remarkable news is that the commitment to quality at Amouage has not dimmed due to the G.F.C. The brand’s CEO, David Crickmore, told CNN that “We search for the finest possible ingredients, the rarest ingredients. We just want the best, without worrying about the cost."

Monday, 1 March 2010

A Change Of Fortune For LVMH’s Fendi – 1/3/10

We love to start the week on a positive. And at Fendi, which is part of the LVMH group, the outlook is “VERY positive” according to its CEO, Michael Burke.

Burke said Fendi had “very strong growth” in January and “even better” sales in February. Fendi sales in Asia and the Middle East are growing faster than in other regions, while Japan and the U.S. “have stopped declining.”

Fendi also impressed global audiences at last week’s Milan show. Karl Lagerfeld, the Creative Director of Fendi, Chanel and his own line, has received more accolades for this show, compared to the past few seasons. We wonder, is the profit at Fendi growing too? We imagine it must be, given the reduction in furs for this A/W 2010 season. Vogue’s suggested “the Roman home of superdeluxe furs has indeed caught the season’s mood of restraint…”

Click here to read more on Fendi’s financial news.

Bottega Veneta’s Business Overhaul Works Wonders For Sales – 1/3/10

In our second positive story for the morning, we’re happy to report that Bottega Veneta is the rising star within PPR's stable at the moment, after overhauling their production process.

Bottega Veneta caught our attention earlier in the year (see our report: The Secret To Bottega Veneta’s Success) due to their commitment to traditional craftsmanship.

Today, however, an article in the Wall Street Journal has revealed just how successful the brand has become; "Since Gucci acquired it in 2001, Bottega's sales, which are mostly driven by bags, have grown tenfold to €402 million ($AU 611 million) last year, causing it to leapfrog over Yves Saint Laurent to become Gucci's second-largest brand in sales, behind only the namesake Gucci label."

This article also says, "With its understated design —the bags have no logos— Bottega meshes with consumers' current desire for understated luxury,” and "in terms of style, they're in sync with the market". So, unless something goes disastrously wrong at fashion week, it seems the sky is the limit for this fashion house…

Who's behind the MO DOWN

Melinda O’Rourke is the founder and Director of MO Luxury, a dynamic, Sydney-based management firm specialising in luxury brands and services. Melinda and her associates at MO work with local and international brands across prestige retail, fashion, fine jewellery, timepieces and specialised services. Melinda is well-connected, well-read, and well-versed in the demands of the luxury market and its client base. Her advice is firmly based in objectivity and ultimately, accountability. Melinda offers constructive counsel and both strategic and creative thinking and is able to draw upon a strong network of specialised talent to compliment the MO Luxury team as needed. Melinda enjoys excellent industry relationships and is regularly quoted in the business and fashion media. Read more about MO Luxury,