Tuesday, 31 August 2010

Fake Goods Are Fine...Not - 31/08/10

According to a new European Union-funded report "buying designer goods can benefit consumers and the companies whose brands are being ripped off." This has definitely got us on our hand tooled soap box. "Professor David Wall, who co-authored the report and advises the government on crime, said the real cost to the industry from counterfeiting could be one-fifth of previously calculated figures." "It's probably even less," he said. "There is also evidence that it actually helps the brands, by quickening the fashion cycle and raising brand awareness." Right, we’d like to know which brands he is talking about here. What kind of brand awareness are we raising from products that are in colours the designers never developed, with different finishing details and not in the same raw materials, the list goes on. This ‘awareness’ is simply impure and incorrect.

Although we agree law enforcement has its hands full, we also believe time should be spent on counterfeiting and 'fake' anything should not be encouraged. In our book, to not take seriously a very large part of the counterfeit trade which is clothing and accessories manufacturing is sending a huge nod of encouragement to all of those operators manufacturing counterfeit goods to say it is OK. In essence the general take out from this report appears to be irresponsible and will serve to only further damage the luxury industry and encourage the counterfeiters.

It is a truism that the majority of people who purchase 'fakes' would not be able to purchase the real thing anyway, and the old adage "to be copied is the highest form of flattery", the cost to luxury brands more than anything is the erosion of their brand value. What this report seems to forget is that luxury products are rare, exclusive and unique due to their raw materials and often bespoke manufacturing methods, whereby the process is expensive and therefore only available to a specific target market. Luxury companies spend millions of dollars each year, out of their own respective monogrammed billfolds, to tackle these issues head on.

As reported in The MO Down earlier, Fakes Goods Can Equal Fake People, do we really want to encourage a growing rate of fake folk? We really don't think so. Whilst in the UK there is a crack down on people who trade fake goods, the government have turned against criminalizing those who buy into the trade- when and where can we expect a steady level of action?

Here is some food for thought: Did you know that annual sales of counterfeit goods total an estimate US$600billion worldwide, almost 7% of global trade? Whilst these figures include industries other than luxury goods, one can see the 'fake' business is incredibly lucrative. As we've said before and we would like our readers assistance in this quest, to educate friends, family and foes that Fakes really are for Frauds!

Image credit: sybarites.com

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Gucci Launches The Ultimate Online Shopping Experience - 31/08/10

Luxury brands are paving the way of the future, with the launch this week of Gucci’s new digital online space. The site was under 18 months of direction before launch and it was well worth the wait. The site integrates rich content, social media platforms and a unique shopping experience, (not to mention the experience of travelling through a real life Gucci store and exclusive online accessories collection.)

Luxury fashion brands are constantly updating their methods of sale and performance, as we saw earlier this year with Burberry (and also Armani) live streaming their runway shows for loyal followers. Burberry also launched their unique online interactive collection under the creative direction of Christopher Bailey.

Image credit: gucci.com

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Monday, 30 August 2010

Tiffany & Co Second Quarter Results - 30/08/10

Last week we brought you Tiffany & Co’s debut handbag collection launch, but the news this week focuses on the brands second quarter results. Although economic analysts forecast the results high, the company fell just shy of expectations. However, Tiffany & Co brought positive news that revenue rose to $668.8 million in the quarter which ended on July 31st (analyst forecasts were set at $690.8 million on average.)

In addition, net income “rose 19 percent to $67.7 million, or 53 cents a share”, as Tiffany fell $1.33 or 3.2 percent to $40.71 at close of business on 28th August, in the New York Stock Exchange. It’s clear that the Americas are dragging down the net for the company overall as they make up “more than half of the total at Tiffany’s, which operates more than 220 stores worldwide. In Asia however, there was a 21% increase which resulted in a staggering 19% profit gain.

However, we have faith that the new debut handbag collection should strengthen the next quarter, given it's a new product injection and curiosity amid the publicity should certainly account for some strong sales.

Image credit: tiffanyandco.com

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L'Oreal Sky High Results - 30/08/10

For leading cosmetic company L’Oreal, share results are looking largely positive as first half operating profit have beaten the estimations of analysts. Stock “climbed 2.92 euros, or 3.9 percent, to close at 78.69 euros, after earlier surging as much as 10 percent”, with a 21 percent to 1.67 billion euros ($2.12 billion) rise in profit.

The great results stem from L’Oreal focusing on higher gross margin luxury beauty and fragrance items, such as the Giorgio Armani, Ralph Lauren and Viktor and Rolf products.

Image credit: giorgioarmanibeauty.com

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Friday, 27 August 2010

Sky Blue Moment As Tiffany & Co Handbag Collection Launches - 27/08/10

It’s the moment Tiffany & Co lovers have all been waiting for- the launch of their debut handbag line. We previously brought you pre-launch info on the exclusive line, and now the designs are out on the market for all to see. Although “roughly 90% of the luxury chain's sales remain in jewellery”, the new handbag collection features a range of stylish designs starting at US$395 and leading up to a luxury large crocodile skin handbag (priced at US$17,500)

Whilst Tiffany & Co’s signature jewellery designs range from entry price point of US$200 for sterling silver to an average bridal piece of US$3,300, the handbags seem well priced and in line with the pricing strategy of the brand for existing products.

With the market showing grand signs of renewed retail life after the recession, we think the Tiffany & Co handbag line will prove popular, and we have to say they look pretty fabulous! We have our eye on the Manhattan satchel in violet glazed crocodile (with Tiffany blue accents on the hardware of course) but aahh that would be one of the more expensive!

We look forward to seeing the new designs in Australia and we are happy to offer assistance in removing some of that table ware in order to display this cleverly put together and 'in and on themed Tiffany range' by designers, Richard Lambertson and John Truex.

Image credit: online.wsj.com

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Battle Continues Between Former Prada Manager And The Brand - 27/08/10

The tennis match between Prada and former employee Rina Bovrisse in Japan goes for another round this week. Prada Japan will be launching “a countersuit claiming defamation against a former employee who is suing the company for alleged sexual harassment and unfair dismissal.” We covered the allegations from Bovrisse earlier this year and Prada Japan are now demanding that the former store manager pay 33 million yen ($390,000 dollars) for their troubles. It's a David and Goliath situation really and we look forward to hearing how the law decides to judge this case.

Image credit: prada.com

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Thursday, 26 August 2010

Fashion's Night Out Branches Over The World - 26/08/10

Fashion’s Night Out is always a grand affair, with some of the world’s leading luxury brands bringing their latest X factor to the world. This year FNO will expand over a number of the world’s fashion capitals including New York, Milan, London, Paris and Sydney. Kicking off in Paris on Sept 7, labels including Louis Vuitton and Chanel will provide entertainment for guests, with Louis Vuitton providing a unique photo studio where guests can be featured on mock covers of French Vogue.

The following day will see FNO venture to London, where cocktails may be sipped at the Emporio Armani store on New Bond Street alongside fashion royalty like British Vogue editor, Alexandra Shulman. Over at Burberry, live entertainment will be shown via an acoustic set (with the artist yet to be confirmed.)

In Milan on September 9th, the new Bulgari fragrance will be launched and Bally will host a cocktail party. Yet the highlight for us occurs on the same day in Sydney, where Kirstie Clements, Vogue’s editor in Chief and Lord Mayor Clover Moore will launch Sydney’s own Fashion’s Night Out, including a large array of luxury labels. Covering a huge 448 retailers, FNO will highlight unique activities including Vogue editor tips and limited edition products with brands including Louis Vuitton, Prada, Chanel and Burberry.

The MO Down's insider knowledge has it on very good authority that some of the participating luxury brands will really be putting on a very fine treat for customers. It's a great initiative and the first for Sydney, so this is the time for consumers that may feel a tad shy about walking into a luxury brand, to take up the challenge and drop in to see what's on offer on the 9th September. Remember, luxury is about the product as much as it is about the experience!

Check out The MO Down’s thoughts on last years Fashion's Night Out.

Image credit: Fashion's Night Out

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Wednesday, 25 August 2010

Earn Your Stripes In Luxury At International University Of Monaco - 25/08/10

So, you want to know all there is to know about luxury but don’t know where to learn? Well, here is your chance…Monaco anyone? The International University of Monaco is now offering an MLUX – a Master’s Degree in Luxury, and this isn’t just any other course. Students will have the opportunity to learn from the best including Gucci, Ralph Lauren and Salvatore Ferragamo.

Given the growth of the luxury sector in traditional markets and the incredibly voracious appetite from the emerging markets, a Masters Degree in Luxury comes after the success of the MBA in International Luxury Brand Management from ESSEC in France. There are nuances indeed in the luxury business and a greater depth of knowledge in the specifics will ensure greater custodians of these brands in the future.

Image credit: Diamond Emporium

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Barney's Welcomes New CEO Mark Lee - 25/08/10

Luxury department store Barney’s, are welcoming a new and treasured member to their team this week, with Mark Lee stepping up to CEO. The company have been on the hunt for the perfect candidate for two years, and Lee’s prestigious and accomplished background at Gucci makes him ideal for the job at hand.

After leaving Gucci, Lee kept a low profile, which had us questioning just where he was. But the new fit between Barney’s and Lee seems like the perfect match, with Lee stating of the new move “I am confident that together with the strong Barneys team we can take the company to even greater prominence.”

Whilst his confidence levels are high, Lee has a difficult task ahead of him, with Standard & Poor’s stating of the current environment of Barneys “although performance has improved recently, we remain concerned that New York-based Barneys New York Inc.'s capital structure is unsustainable”. S&P analyst David Kuntz, also reaffirmed that having Lee in this powerful position is without doubt better than having no one, but also added that for the company to rectify its current economic position “it doesn't move the needle very much.” We will wait and see…

Image credit: nypost.com

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Tuesday, 24 August 2010

Dolce & Gabbana And Selfridges Split - 24/08/10

It’s the age old rule of location, location, location this week, as Dolce & Gabbana have moved shop, and removed their diffusion line D&G from UK department store Selfridges. Location applies to any retailer, but most importantly for luxury and premium brands, who will scour cities and department stores for the ‘right’ location and the ‘right’ neighbours. The move for Dolce & Gabbana comes after reports that the company was unhappy with the move of location for two of their collections.

It just goes to show that in department stores whether you are a luxury beauty brand (where you would ideally be located on the central ground floor) or a premium brand, you still need to work the location to ensure maximum line of sight for consumers. Although it’s quite obvious Selfridges and D&G didn’t see eye to eye, this move could also be due to the recent sell-throughs from the recession, which has seen many consumers avoiding vibrant and obvious branding. Could consumers be taking the route of Jil Sander and Giorgio Armani and not the vibrancy of the flamboyant Italian duo?

Image credit: dolceandgabbana.com


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Monday, 23 August 2010

Is Bulgari's Stock of Timepieces The Issue? 23/8/10

Why is it that Bulgari Spa's stock prices (the owner of Bulgari the Roman jewellery company established in 1884) is not in line with most of the other luxury goods conglomerates such as LVMH Group, PPR SA, Richemont and Prada and Hermes? Bulgari, the world’s third-largest jeweller, fell 2.6 percent to 5.72 euros, the stock’s lowest price in almost three months. According to a Bloomberg.com article Standard & Poor’s Equity Research reiterated a “sell” recommendation on the stock, saying in a note that “we fear that a relatively slower-than-peers business recovery could disappoint investors betting on Bulgari’s late- cyclicality and leveraged operating profile.” Bulgari's peers have been tracking ahead of forecasts mostly consecutively over the past four quarters ensuring positive news stories and commensurate positive stock prices for those listed brands.

As reported in The MO Down earlier this month "Bulgari Finding Things Tougher Than French Counterparts" Snr Trapani, the brand's CEO is certainly not sitting back, he is being pro-active and has already introduced some lower priced jewellery items in addition to increasing the prices of 'some' timepieces. The issue that seems to be handicapping Bulgari's return to stronger growth is in fact its timepieces. As reported on the Bulgari Group 29 July Press Release, "during the half year in question, all product categories, with the sole exception of watches, contributed positively to growth. Jewellery rose by 10.5% at comparable exchange rates (+14.8% at current exchange rates)." However, watch (timepiece) sales decreased by 4.6% (-1.2% at current exchange rates).

The company goes on to say if sales of Roth and Genta brand watches were eliminated and sales of the watches exhibited at Basel which at that time were delivered in the second quarter - the watch category actually grew by 14%. The next quarter and half year results will ensure this comment is justified and cleansing some other branded inventory timepieces within their portfolio should ensure Bulgari Spa has a cleaner slate and will commence to operate in line with its luxury stable mates. With timepieces representing 24% of the revenue it is the second and most significant product category.

Image credit: www.bulgari.com (Bulgari moon-phase watch for ladies)

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Friday, 20 August 2010

Versace Launch New Multi Media Phone - 20/08/10

Versace has just launched their latest multi media phone, the Versace Unique. But the collaboration with LG comes years after Prada and LG worked together on a fashion forward phone, so we beg to question, are Versace really being unique in this new move?

The phone features touch screen and is made from high tech ceramic, framed with a luxury 18k yellow gold finish. This is definitely a phone for those who love to draw attention!

Image credit: versacemodelabs.com

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David Jones Q4 Like-For-Like Sales Are Positive - 20/08/10

David Jones have posted their fourth quarter sales results ahead of forecasts, and the results speak for themselves. The company announced their like-for-like sales rose 1.7 percent. In the quarter up to 31st July, total sales rose to 7.3 % to $497 million. Although David Jones have just experienced the now famous $37 million law suit concerning their former Chief Executive Mark McInnes, Australia’s premium end department store is looking positive, but not so much for Myer.

Image credit: David Jones

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Thursday, 19 August 2010

Jewellery Raid At De Beers And Omega: London - 19/08/10

The criminals are out in force, as De Beers and Omega stores were targeted in raids in London, last weekend. The thieves took an estimated value of goods worth $596,000. Police and the stores have suspected four men who arrived and left in a red BMW. Whilst De Beers are working closely with the police, they have assured their clientele that their 3 other stores will remain open for business.

Image credit: debeerseu.com

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Burberry Sues Boutique Store Over Counterfeited Merchandise - 19/08/10

This is definitely a week of Fake vs Genuine, as counterfeiters are striking luxury labels all around the world. Earlier we brought you news surrounding Coach counterfeited goods and the latest addition to the bag involves Burberry, who are now suing a luxury boutique chain store Variazoni, for selling fake merchandise. The lawsuit is sitting at $2 million, and it’s not the first time the store has been caught out selling counterfeit items- last year in June they were busted for selling 86 Burberry fakes, and clearly they can’t keep a promise after signing a contract saying they would never do it again!

Image credit: burberry.com

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Wednesday, 18 August 2010

Luxury News In Brief - 18/08/10

Last week we brought you news of ‘Operation Turnlock’ run by Coach, who were focusing their efforts on busting the counterfeiters on the Ocean City Boardwalk in Baltimore, US. It seems Coach are on their way to victory, as two shop owners were arrested early this week for allegedly counterfeiting luxury labels including Prada, Coach and Louis Vuitton. One of the charged men Michael S. Miller, has denied the allegations, with his attorney stating “we deny the allegation that he [Michael] was knowingly selling any counterfeit merchandise.” With emblems found at the stores, which would be used to make the fake luxury labels, we find Miller’s denial hard to believe…

Tiffany & Co will be releasing their quarterly numbers on August 27th, and many analysts are already placing their bets on the expected outcome. Analysts, on average are expecting Tiffany & Co to report earnings of $0.53 per share on sales of $694 million. The company is also expected to post EPS of $2.59- there isn’t long to wait now until the true results are revealed.

Whilst Chanel has battled claims they are a ‘dusty brand’ this week, the company have lost faith in Apple, due to the restrictive control that Apple has resided over Chanel in their upcoming iAd campaign. Chanel were signed up to run an advertising campaign with Apple’s latest iPhone invention- the iAd, which has seen other companies like J.C Penney, Walt Disney Co, and Nissan involved. However, due to the apparent tight control from Apple over the creative process, and the alleged slow actions of Apple, Chanel have decided to pull out of the latest ad campaign all together.

Image credit: tiffanyandco.com

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Tuesday, 17 August 2010

Counterfeiters Strike In Egypt - Remember, Fakes Are For Frauds! - 17/08/10

The focus is in Egypt today as more news has reached us of a vast criminal counterfeiting community. The poor in Egypt are being granted ‘luxury’ goods, with a genuine Cartier ring priced at only $8, hold on, who are they kidding…

As elitist as it sounds, luxury is not for everybody, and that is a reality. Whilst people may one day aspire to own a Cartier, Bulgari or Chanel piece, like the millions others who want the same, it might not be possible, in this lifetime at least.

For manufacturers and distributors of counterfeit goods they are feeding a vulnerable and not so vulnerable audience to buy into the dream of luxury. But what dream we ask? One of fake gold, incorrect logos and packaging (if there even is packaging), and of course the list goes on.

The affordable imitation of precious metal being sold in Egypt is called ‘Chinese gold’, but as the real gold in Egypt is becoming more expensive for the vast majority of people, this new ‘Chinese gold’ is too. But what is really happening behind the counterfeiting industry? The money earned from the sale of such goods as the Cartier ring, is feeding criminal industries including drugs, weapons and prostitution. Unfortunately the majority of people buying into this industry (especially Egypt where 40% of the population earn less than US$2.00 per day), are unaware, or worse, choose to ignore this growing issue.

For counterfeiters to make a successful entry into Egypt with its population of 80 million is to line the pockets of the unsavoury business people operating in this ever growing, hard to control industry. It’s sad but true. So what is the answer? Education, education, education!

What we need is for everyone, from Egypt to Australia and the world over, to think that their 'counterfeit' product purchase 'does' count and it is fuelling this evil business. It is simple- think and act. Just don't do it, you are adding to the problem, no matter how small or inexpensive your purchase. It all counts.

Image credit: Cartier

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Monday, 16 August 2010

Chanel A 'Dusty' Brand? We Think Not - 16/08/10

Mark Ritson is an associate professor of marketing, an award-winning columnist and a consultant to some of the world’s biggest brands, yet his latest statement about CHANEL being a ‘dusty’ brand has got us in disagreement, with the focus of Ritson’s argument claiming that CHANEL clientele are growing older every day.

Respecting Mark's pedigree, we have to disagree largely to his comments given CHANEL is a true luxury brand and therefore is not available in every city, region, town or country. To compare CHANEL to Louis Vuitton in terms of distribution is not comparing apples with apples. Louis Vuitton has always been the pioneering brand, yet they are certainly more commercial than CHANEL.

CHANEL has been very considered in their growth and don't necessarily want to keep up with the Jones'. Whilst we're on the 'fence' about comments discussing whether the CHANEL store at Bondi Junction is right for the brands image, the eastern suburbs of Sydney certainly does stay in line with the company's profile.

Ritson’s comments are ‘global' with Australia being part of the Asia Pacific region and with China not far away, yet the age of CHANEL consumers in this part of the world would certainly not fit into his statement of “the clientele looks older to me on each visit.” We think his opinion may change should he spend some time in a CHANEL store in Australia, where the clientele are a mix of cultures and ages.

CHANEL works with artisans and takes a bespoke approach to a lot of its manufacturing processes and whilst the prices are not inexpensive, it makes sense that more ‘mature clientele’ are loyal followers of the brand, having more money as they have more experience. This success over the years lends itself to the average shopper being between 38-42* years old.

*MO Luxury Client Fulfilment Ranking Report 2010- research report May 2010.

Image credit: chanel.com

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Louis Vuitton Fakes Strike Again - 16/08/10

Whilst Louis Vuitton has adopted a zero tolerance policy against counterfeiting, they can’t control every fake representation out there, despite their huge efforts. The latest case has seen Idol judge Mara Louw, wearing a fake Louis Vuitton outfit at the new Idol auditions. Whilst the TV star was backed by PR who claim Mara “has fine taste in clothing and detests counterfeits”, an upside down LV logo screams an obvious fake. We stand by our belief that Fakes are for Frauds. Whether you are a singer, or not, famous or not, just don’t do it.

Image credit: louisvuitton.com

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Friday, 13 August 2010

Melbourne Retail Giants Battle For Top Fashion Rank - 13/08/10

The retail giants of Australia are going head to head once again. Myer have reported positive performance this week (albeit mildly) as full year sales “rose 0.7 per cent to $3.28 billion for the year to July 24.” Myer chose to cut prices of their higher margin private label products, and it seems the move has worked well with total sales (not including the Myer Melbourne refurbishment) up 1.3 %.

In the opposing corner, we have David Jones, who have just launched their new Bourke Street Melbourne store renovation. Whilst Myer is also going through renovations in their Bourke Street flagship, the David Jones store will increase their selling space by 30% and will come in close to the same size as Myer. Melbourne is definitely hot, hot, hot right now with retail expansion. The city is now leading Australia with the largest number of luxury retail stores. Within David Jones, new international luxury concessions are under way, and for Myer high end international fashion labels will be coming on board.

Melbourne is quickly regaining its reputation as Australia’s most fashionable city, and now it seems, also the best to shop in.

Image credit: abc.net

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Burberry Are Keeping It In The Family - 13/08/10

How has Burberry suddenly raised $5.3 million? It seems through the clever tactics of CEO Angela Ahrendts after she cashed in some of her company shares. Ahrendts sold about 400,000 shares which were priced between $13.44 and $13.58 leading her to pay roughly $1.28 million in taxes. The shares were sold to help raise capital for Burberry, and Ahrendts seemed determine to keep it in the family. As they say, what you sow you reap (or rather you reap what you sow.)

Image credit: Burberry.com

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Thursday, 12 August 2010

Japanese Experience Extreme Price Differences On Luxury Goods - 12/08/10

The Japanese are known for their quirky, unique style and love for fashion, so it hardly seems justifiable that they are paying much more for luxury goods. Luxury goods are being sold to the Japanese for much higher prices than that of the US, or Europe. From MO Luxury’s experience in the past, the Japanese market would have had up to a 30% differential in terms of a higher pricing strategy, but now it is sitting at 50-60% for imported luxury items.

McKinsey & Co principle Brian Salsberg, stated of the traditional practice of Japanese luxury shopping “Some manufacturers choose to charge more for their products in Japan simply because they can. Historically, they have been able to get away with it, due to a relative lack of price sensitivity and transparency and a disproportionate focus on the quality of the item and the shopping experience over the price.” But now, the Japanese are slowing down on their luxury shopping, and are more aware of the price differences between countries.

It comes at no surprise that the Japanese are choosing to shop elsewhere when travelling, or via online stores. It is no longer justifiable for them to shop at marked up prices, when the average consumer has many more choices.
Image credit: luxuo.com

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Coach Lay Down The Law On Counterfeiters - 12/08/10

As the counterfeiters are becoming sneakier, designer labels are becoming fiercer in their methods to bust illegal counterfeit sales. A prime example this week has occurred in Baltimore, USA, where “Operation Turnlock” is not taking any prisoners. “Operation Turnlock” is Coach’s anti-counterfeiting campaign, and the company have been busy this week, as they are filing lawsuits against thirteen shops on the Ocean City Boardwalk.

We love the commitment that Coach is showing, they are not just paying lip service to counterfeiters, they are also about action and with 250 lawsuits filed since the operation commenced in 2009, they are making headway.
Image credit: coach.com

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Wednesday, 11 August 2010

Record Results For Inter Parfums Second Quarter - 11/08/10

Recently we brought you the news that Inter Parfums experienced a 22% rise in sales for their second quarter. Today, it has been confirmed that their sales were record breaking, specifically in the U.S where operations rose 71% to $15.9 million, from a previous $9.2 million. The companies operating income rose 68% to $11.5 million, from a previous $6.8 million, and their net income reached a high of $5.4 million rising at 27%. Executive Vice President Russell Greenberg explains the results are due to “the strength of our existing brand portfolio” and also “the expansion of the portfolio with new high value brands.”

With a portfolio including Burberry, Christian Lacroix and more, we can see where the success comes from.

Image credit: christian-lacroix.fr

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Armani Exchange Looks To The Future With 3-D Campaign - 11/08/10

As fashion follows trends, it’s no surprise that Armani Exchange will be including 3-D elements in their advertising campaigns. Armani Exchange are leading the industry with a first for the fashion world- an interactive 3-D campaign that will be included in upcoming issues of GQ, Elle and Interview magazines, amongst many more. The campaign, titled “2020/Speed Style” will launch this month, and will encourage readers to head to the Armani website (with their complimentary 3-D glasses from each magazine), to further explore a unique 3-D page on the site with music videos and more. This is definitely fashion for the future!

Image credit: Armani Exhange

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Tuesday, 10 August 2010

The Beauty Of Pearls- Autore's Latest Ring Designs - 10/08/10

They say diamonds are a girl’s best friend, but we believe diamonds and pearls together are even better! The latest addition to the Autore family is the Doge Palace Reflection Ring, as part of the Venezia collection. The ring features a 16mm South Sea pearl, white diamonds, pink sapphires and all set in beautiful rose gold.

The rest of the collection features a range of pearl with varying diamond designs. The only issue now, is deciding what to choose!

Image credit: Autore

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Changes For The Communications Division Of Chanel Australia and New Zealand - 10/08/10

On the home front this week, Chanel has experienced a big change, as Susie Stenmark steps down from her position as General Manager of Communications at Chanel Australia and New Zealand. Susie has long been associated as the face of Chanel in Australia, but where is she off to next? We look forward to watching our own space, to find out!

As Susie resigns, the communication department of Chanel will see new changes, with Ian Clark, the general manger for fashion, taking on the responsibility of the communications for the fashion division. In other promotions, Juliet Fallowfield has become Communications Manager FBP and Corporate, for Chanel Australia and New Zealand. This new move will see an encouraged push into fragrance and beauty for the company.

Image credit: chanel.com

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Monday, 9 August 2010

Luxury Brands Target In On The Chinese Market - 09/08/10

China is hot on the radar of many luxury brands, as they look to take back control of the growth and operations of their stores. After 5-10 years of learning from their distributors, licensees and franchisees of the in’s and out’s of the local culture and market risks, luxury brands such as Burberry and Coach are sweeping in and cutting out the middle man, so to speak. As they now plan to manage the operations via their own subsidiary directly, they have essentially had a ‘try before you fully invest’ approach.

Burberry has been a key player in this new strategy who recently announced plans to buy its network of 50 China stores. This leaves the distributors in a risky situation. Whilst being a distributor in an emerging market can be wonderful in the early days with growth and market position leading to success in sales they risk losing the cream to the owners of the brand once real success starts to show.

Image credit: nomadig.com

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Sunday, 8 August 2010

Luxury Brands Take To The Sky - 09/08/10

Which helicopter would you buy between a Hermes, Versace or Mercedes-Benz? It seems the latest luxury fad is a designer helicopter, with a number of brands flying into action. Whilst the Mercedes-Benz helicopter seats 8 people, the Hermes helicopter features rich-brown calf leather seats with the design priced at $10 million. The Hermes chopper is white, and features the traditional Hermes orange in sport ribbon stripes down the side. Versace took a more traditional approach to their design, through partnering with helicopter designer Agusta Westland.

Image credit: emercedesbenz.com

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Friday, 6 August 2010

Cartier Sue Online Sale Company, HauteLook - 06/08/10

Online retail shop HauteLook are finding themselves in very deep water, as luxury brand Cartier are suing the website for the sale of damaged and second hand goods without permission. In Manhattan federal court Cartier explained of the situation, that HauteLook are “causing immediate and irreparable harm to the Cartier brand and trademark.”

In addition, the website allegedly packaged goods incorrectly, and included out of date warranty certificates amongst other brand damaging acts. The case is currently underway, and we will keep you posted on the final verdict.

Image credit: cartier.com


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Final Battle Between Louis Vuitton and Google - 06/08/10

A huge change for Google this week, as it has been confirmed that advertisers in the majority of Europe may now buy keyword terms that are trademarked by others. The result comes after months of debate between Google and Louis Vuitton, as LVMH had taken them to court in the hopes to secure a deal which would mean only they could buy and use such trademarked terms within searches.

Now LVMH and other companies face the future prospect that other third parties can buy and use their company names within Google searches. The result will come into fruition on September 14th.

Image credit: google.com

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Prada Are Sitting More Than Comfortably - 06/08/10

The rumour mill has been in overdrive lately about a possible IPO for Prada. And as the company have released their 29% revenue increase for the first half this week, the whiff of the suspected IPO is back yet again, as they continue to evaluate the most suitable moment to jump to action. Prada experienced a whopping 41% increase in retail sales, which pushed the 29% profit result, bringing in $1.2 billion.

Whilst revenue was the only statistic reported in the statement, we can expect to see greater detail of their currently comfortable position later in September. With 30 new stores planned for this year, set to focus on the Asia-Pacific, Prada’s most dynamic region remains the Far East, where sales rose 70%.

Image credit: prada.com

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Thursday, 5 August 2010

The New Shopper: Cashed Up Bogans - 05/08/10

Do you consider yourself to be in the Partricians, Parvenus, Poseur’s or Proletarian’s? A recent study published in the latest issue of Journal of Marketing, divides these four categories to explain the four types of luxury consumers. The study shows the debate between the conspicuous vs the loud consumer, and we can see resemblance between Giorgio Armani versus Roberto Cavalli when making an analogy of the brands that suit both the Patricians and Parvenus.

What is interesting is that the study clearly details that the Patricians opt for more subtle designs in luxury goods, whilst the Parvenus choose the more vibrant ‘look at me’ designer goods. While the counterfeiters are the main people targeting these ‘loud’ luxury goods to turn them into fakes, the Poseur’s are lapping these cheaper knock off goods.

So when it comes to buying into loud and obvious luxury branding, the Parvenus in Australian terms are simply ‘cashed up bogans.'

Image credit: louisvuitton.com

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Wednesday, 4 August 2010

Counterfeiters Reach New Extremes In A War Between Designers And Fakes - 04/08/10

Counterfeiters are getting cheekier by the day, with revelations into knock offs of lower end brands being sold, amongst the well known counterfeited luxury brands. Another key indicator of the continuing recession, criminal counterfeiters are going to extremes with their copy cat antics. Whilst factories in countries like China are in desperate need of work, counterfeiters are feeding them with the production of lower priced goods for sale on the internet. Consumers buying into this scheme can be easily fooled, as the counterfeiters have created perfect examples of ‘designer’ websites, with imagery and copy stolen from straight from the original designer.

Although the act of counterfeiting a commercially priced branded product is not new, what does seem new is that consumers are contrasting the obvious knock offs (a Louis Vuitton handbag at $100 for example) with the cheaper brands, when at the end of the day, the cheaper brands are also fake!

Image credit: louisvuitton.com

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Coach To Reveal Fiscal Fourth Quarter Results - 04/08/10

Coach could help reveal that the economy is finally recovering, when the company reports fiscal fourth quarter results before the market opens up early next week. Income has risen to 34.1 percent, while sales climbed 22.2 percent. Coach have also been looking to new areas to increase sales opportunities, including a new target towards the male market.

For the coming fourth quarter, the brand seem to have estimated that consumers will be buying more lavish luxury goods like handbags, with the possibility of the brand increasing some prices in this area, after prices were lowered during the recession. Whilst we have to wait to see whether consumers will be buying into the higher end handbags that Coach are offering, Analysts polled by Thomson Reuters ‘expect earnings of 56 cents per share on revenue of $889.2 million’, for the fourth quarter. Will handbags save the day? We wait and see..

Image credit: coach.com

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Tuesday, 3 August 2010

MO Luxury's Fine Jewellery Survey - 3/8/10

MO Luxury has launched its 2010 Fine Jewellery Survey to gain insight into what consumers want with respect to service within the fine jewellery landscape. Entrants who offer the three best 25 word explanations of an ‘ultimate consumer experience’ will win either a Hayman Island Resort stay, a Suzy O’Rourke cuff or a twin pack of Nicolas Feuillatte Champagne. Click here to begin the survey - good luck!

Image credit: http://www.hayman.com.au

The Gloss Goes Off Australia's Luxury Department Store - 3/8/10

Australia's luxury and oldest department store David Jones, with a seemingly unblemished history spanning 172 years, well known for their 'pied de coq' (hounds tooth) logo and the international luxury fashion they brought to Sydney post-war with Parisienne themed parades in 1947 introducing Pierre Balmain and a year later with the collection of Christian Dior's famous 'New Look', the first time Dior had ever shown outside Paris.

David Jones pride themselves on representing and nurturing local premium and contemporary fashion, accessory and beauty brands. Receiving enviable amounts of positive publicity on their celebrity dotted and beautifully orchestrated launches and the strategic 'designer exclusives' they are able to negotiate. But today, they find themselves in the news for all the wrong reasons.

Following on from the abrupt resignation on 18 June this year of Mark McInnes, David Jones' former CEO who was at the helm for a seven year period, clearly a resignation was simply not enough. In what is a landmark claim that was lodged yesterday in the Federal Court, Ms Fraser-Kirk, a 25 year old junior publicist said McInnes made unwelcome sexual advances toward her and she seeks punitive damages of 5 percent of the company’s profit and McInnes salary and benefits for the seven years he was at the helm, i.e. between 2003 and 2010. The amount comes to at least A$37 million. Any punitive damages awarded through the lawsuit would be donated to a charity helping those affected by sexual misconduct in workplaces, Fraser-Kirk said during today’s press conference.

The new CEO Mr Paul Zahra clearly affirmed the company profit forecast and the company’s strategy of targeting affluent female customers with designer fashions in cities and high-income suburbs. David Jones advised they will “defend the claims vigorously” and won’t comment while the matter is before the courts, the company said in a statement yesterday .

David Jones shares fell on this news yesterday and on the eve of their bi-annual spring/summer 2011 launch today at the flagship Elizabeth Street store, it is going to be difficult for David Jones to dodge this bullet. Affirmative action will need to be seen to be actioned by David Jones, a department store with a very strong and loyal customer base, a large portion of those being female.

Image credit: davidjones.com.au

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Monday, 2 August 2010

The Goods News Still Rolls On, Profits Up At PPR - 2/8/10

Gucci Group - the most profitable group within PPR SA's stable, which accounts for 50 per cent of the group's operating profit and whose sales represent 20 percent - their operating profit rose by 23 per cent in the first half. Overall the PPR group - which also includes Bottega Veneta, Yves Saint Laurent, Puma and Fnac retail chain (to name a few) - according to Bloomberg said "first-half profit surged 87 percent as demand for clothing and accessories in Asia offset faltering wholesale revenue at the Gucci brand in North America."

The Group headed by billionaire Fran├žois-Henri Pinault, on Friday said that it had received “significant signs of interest” in the retail businesses that generate 63 per cent of group sales. Naturally Monsieur Pinault is pleased with these results and according to an article in the Financial Times, said "interest would deepen in the businesses he plans to sell after the group reported an 87 per cent rise in first-half net profits." Now that is certainly an interesting comment given that Gucci contributes 20 per cent. Doubt the gilded cash cow will be put up for sale anytime soon! We watch, we wait, we wonder.

Image credit: Salma Hayek and her husband Francois-Henri Pinault, celebweddings.com

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Bulgari Finding Things Tougher Than French Counterparts - 2/8/10

Shares in Bulgari Spa, the world's third largest fine jewellery company, fell after quarterly profits did not achieve previous advised estimates. They fell as much as 3.6 percent in Milan after reporting second-quarter profits that missed estimates in addition that they may not meet their full-year gross-margin forecast also ensured the fall. Not great news in a compounded way given the ongoing positive announcements that have been made over recent weeks with the LVMH Group's excellent results and on Friday last, PPR SA's fine performance.

A lot of pressure lies on the shoulders of the Chief Executive Officer Francesco Trapani, his recent strategy has been to introduce lower priced jewellery and higher priced timepieces which may have a longer term benefit however according to an article in Bloomberg Trapani said "Bulgari may not reach its 63 percent-gross margin forecast because of rising gold prices and its geographic mix. The margin was 61.1 percent in the second quarter." It's going to be a tougher road ahead for the Italian brand, whilst they returned to positive revenue this year with net income at 600,000 euros compared with a loss of 11.2 million euros in previous year, the general consensus is not so optimistic hence the share price fall and overall market valuation is down.

Bulgari has a diversified production portfolio with ties, scarves, handbags, small leather goods however the lions share of revenue comes from its jewellery, followed by watches and if these crucial product categories are trading down, well the result is thus.

Image credit: Francesco Trapani, newyorktimes.com


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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, www.moluxury.com.au