Wednesday, 24 November 2010

Can Luxury Brands Tame Social/Online Media?…. The Jury is Still Out... 24/11/10


We’ve spoken at length about the relative reluctance of luxury brands to embrace social/online media. Luxury brands pride themselves on being at the pinnacle of innovation and cutting edge, but have lagged far behind the cutting edge of using social and online media to publicise their brands. Some have said ‘luxury are above that sort of thing.’ This is both ridiculous and untrue. There is no brand so exclusive it can afford not to publicise itself at all. Different courses for different horses, sure. Some prefer more traditional avenues, and that is fine. But we caution brands against shunning ‘new media’ and online marketing, these are increasingly becoming the first port of call, particularly for younger consumers.


It has been interesting to watch many brands jump at the launch of the iPad, with an array of different apps, and a varied rate of success. Brands like Burberry seem to have their social networking down pat. Others are flailing. Here at the MO Down, we are curious as to what impact the success/failure of these apps will have on the success/failure of different luxury brands’ popularity. Will big brands like Chanel and Juicy Couture be able to keep shoppers engaged, and loyally within their branded apps? Luxury shoppers will use the Internet, and they will use social media. The question is, can brands find a way to use this to their advantage. Customers want something that will give them what they want directly, and save them weeding through the mass of information online. Can brands provide this? Will fashion shoppers take to fashion-only aggregators like Asos? Or will they default to searching with Google and ebay? As far as we are concerned, the jury is still out.

Image credit: www.brandbuildsell.com

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Tuesday, 23 November 2010

Karl Who?... More Like, Haider Who? 23/11/10


Rumour has it, Karl Lagerfeld is already contemplating his successor at the house of Chanel. He has a contract for life, thank goodness, so it’s at his own discretion that he will select a suitable candidate to succeed his throne. ‘At the moment, I’d say it would be Haider Ackermann’, says Lagerfeld. The crowd goes wild. Ackermann currently resides in Belgium. He is of Colombian origin, and started his line in 2001. He has dressed Penelope Cruz, and Tilda Swinton and we have an inkling he’s about to get a whole lot more attention. For those of you not familiar with his designs, check out his latest collection here! Looks like there are some great things to come for this talented individual…

Image credit: 212dressingroom.com

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Burberry’s CEO 16 in Fortune’s Business Person of the Year 23/11/10


Last Thursday, we wrote about Burberry, and how they seem to be experiencing a golden era at the moment. Figures are up, and CEO Angela Ahrendts received two Walpole awards. Well, things are only getting better. She is also 16th out of 50 on Fortune’s Business Person of the Year list. How did Ahrendts and 49 others get there? According to Fortune, ‘we searched for leaders who didn’t just crawl from the wreckage of the GFC, but sprinted from it.’ And this is exactly what Burberry has done. Achieving incredible growth during a difficult time over the past 24 plus months, it just goes to show that true talent will prosper no matter how dire things seem. Burberry has employed deep tissue strategy. They know their customers, and they engage them. In return? They’ve won loyalty. With 3 million facebook users ‘liking’ the brand as of last week, they’re certainly reading the mood right now, so very right.

Image credit: www.money.cnn.com

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Monday, 22 November 2010

Lanvin for H&M Revealed! 22/11/10


The MO Down has impatiently awaited the revelation of the Lanvin for H&M collection. As previously reported, we have a certain opinion on these collaborations. Clever? Yes. Strategic? Yes. Broadening the (luxury) brand’s audience? Yes. Therefore broadening the (luxury) brand’s awareness? Yes. The one box we hesitate to check is status. Luxury brands work hard to maintain their status. They invest in sourcing the world’s finest materials, in ensuring unrivalled quality and excellence. Mass-produced fashion can be stylish. It serves a purpose, and it’s accessible. But there is a difference between luxury and mainstream, and if there weren’t, we would be out of a job.

We agree with Jean-Jacques Picart’s comment in an AFP article, that for couturiers, whose exclusivity is a vital asset, there is danger involved in associating with the high-street. For Picart, ‘high-street tie-ups make most sense for diverse luxury brands that sell everything from couture to lipstick’– like Lanvin, who are betting on strong perfume sales during this year’s holiday season. ‘If you don’t have any spin-off products then there isn’t much point,’ he said. The fragrance gives aspiring luxury consumers an entry price point.

Realistically, those who shop at H&M or Top Shop or Target are unlikely to wander in and purchase a ready-to-wear item from Lanvin anytime soon. But we are strong believers in aspiration and perhaps sales of Lanvin accessories will spike, as a result of the voracious appetite for the Lanvin for H&M collection.

Here we are, believing in aspiration (and collaborations are a gateway, are they not?), yet we are still concerned about brand elasticity and musing on dilution of brand strength. If these collaborations continue, awareness and popularity aside, these brands are setting themselves up for a debate about pricing. If it costs $90 for a (collaboration) Lanvin blouse at H&M, where do they get off charging $2500 as its usual price? It may become tough to convince shoppers to pay 28 times more– whatever the reason.

Finally, as Monsieur Picart says so well the idea of a serious designer going to work for a more commercial brand is more of a marriage than a serious designer doing a one off collection, which he likens to a fling! He was, of course, referring to Uniqlo's (Japanese clothing behemoth) decision to hire top designer Jil Sander. Let' hope that it's a marriage made in heaven and not hell a la the Jil Sander, Prada fiasco...…

Image credit: www.collegefashion.net

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Friday, 19 November 2010

Bulgari’s Gem-Infused Source Defence Line Coming Soon to Stores! 19/11/10

Not quite available in Australia, but Bulgari has announced its decision to make its gem-infused facial products available in stores in the US- so it’s only a matter of time. Bulgari is known for its bold iconic jewellery, but also has an extensive skincare repertoire. Its new Source Defence line contains a blend of fine and precious stones to shield skin from environmental stressors, including antioxidants and hydrators to replenish complexions. This means, there are precious gems ground up within the products. If this isn’t luxury, we don’t know what is.

Previously, these products have only been available at Bulgari resorts in Bali and Milan, but are now available in department stores, Neiman Marcus and Bergdorf Goodman. Is this an initiative to boost sales? Bulgari has experienced some instability as of late... Treatments are designed to focus heavily on hands and décolleté, stemming from Bulagri’s rich tradition in adorning these parts of the body in jewels. These are the parts women draw attention to when wearing jewellery, and now the adornment can, quite literally, become a second skin. If this is the stuff Julianne Moore uses, then get us to the States asap!


Image credit: www.stylelist.com

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Thursday, 18 November 2010

All Eyes On Burberry... 18/11/10


Burberry has announced its unaudited results for the six months ended 30 September 2010 and things are looking good. Showing strong operating and financial performance, revenue is up 21 per cent, with profit before tax up nearly 50 per cent and comparable sales growth of 9 per cent. Nice. 20 new mainline stores opened, unsurprisingly focused in Asia Pacific, and the Americas. Emerging market sales were up 46 per cent, and we are assuming China is largely to thank for this. Representatives from Burberry have attributed the success to ‘continued focus on the brand, ongoing investment in digital, IT and retail infrastructure (especially in China).’ Good to see they have things in check.

In other good news for Burberry, CEO Angela Ahrendts has collected two Walpole awards– in the British luxury brand and online category. Check mate! It seems Burberry can do no wrong at the moment. Their clearly defined and executed strategies are wooing the world on a business to consumer and business to industry basis. Adding to the excitement is the imminent mega store Burberry flagship opening in the 1st half of 2011 in Sydney’s CBD. So much more Burberry to check out– no pun intended.

Image credit:onesourcetalent.com

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Wednesday, 17 November 2010

Bulgari Profit Down But Future Looking Bright 17/11/10


Despite revenue rising, Bulgari’s profit is down, and it has been moved from ‘neutral’ to ‘underweight’ by JPMorgan Chase & Co. Bulgari SpA (BUL IM) dropped 4.8 per cent to 7.10 euros, over the weekend- the largest drop in 8 months. Bulgari is the world’s third largest jeweller, and we find this drop surprising, given the recent overall recovery of the luxury industry. Rivals like Tiffany & Co. are experiencing enormous growth as of late, riding on China’s growth as a luxury market. The popularity of diamonds with Chinese brides has been a contributing factor.

Bulgari’s third quarter income was 16.6 million euros ($23.23 million AUD), falling short of the average 19.8 million euro average analyst estimate in a Bloomberg survey. Geographically, Bulgari’s sales were varied geographically. Sales rose by 11 per cent in Europe and dropped 7 per cent in the USA. Sales fell 1 per cent in Japan, increased 15 per cent across Asia as a whole and fell 2 per cent in the Middle East. Sales rose 24 per cent in greater China, which is not surprising.

Despite financial inconsistencies, Bulgari shows promise to pick its stock-self back up again, with new product launches, and exciting campaigns. The new Julianne Moore campaign certainly got us very excited. Fingers crossed for a successful Christmas season!


Image credit:www.greenwichmeantime.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