PHOTO BY GEORGE CHINSEE J.Mendel, pages10and11. Burch, ProenzaSchoulerand Louis Vuitton (above),Tory s RESORT: Looksfrom Numbers By the specialty store doors — in August. Forspecialty store doors—inAugust. more, seepage 12. into additional distribution—about2,500 department and Lauren stores inJulybeforerolling will launch firstinRalph seductive, 3isadventurous and4isstylish.The scents to adifferent fragrancemood: 1issporty, 2is fragrance bearsalarge numberthatcorresponds shirtlineofthe same name.Each designer’s the Big Pony Collection,isinspired bythe new men’s scentquartet, ’s W Women’s Newspaper Daily •June11,2010$3.00 Wear •TheRetailers’ Daily W made by some of the industry’s top leaders during made bysome of the industry’s the recent WWD Beauty CEO Summit that drew the recent WWD Beauty CEO Summit that drew THE BEAUTY CEO SUMMIT 2010 230 top beauty-industry leaders to The Breakers leaders toThe Breakers 230 top beauty-industry hotel in Palm Beach. For more, seepages 4 to8. the worst oftimes. Fresh, innovative thinking D The best of intentions have bubbled up in The bestof intentions have bubbled up in is emerging, as evidenced by comments is emerging, as evidenced by comments F R I D

a Beauty y 2 WWD, FRIDAY, JUNE 11, 2010 WWD.COM Thurman, Karan Line Up Against Cancer By Marc Karimzadeh ity shopping weekend, meanwhile, is scheduled to take place Oct. 21 to 24. Two percent of that NEW YORK — Uma Thurman and weekend’s sales will be donated to local and WWDfriDaBeautyy are teaming to combat women’s cancer. national women’s cancer organizations and re- Saks Fifth Avenue and The Breast Cancer search centers. the season rolled on with offerings from Louis Research Foundation tapped the actress as this Since 1999, Saks has given more than $33 mil- 10s year’s ambassador to the retailer’s annual Key lion to women’s cancer research and treatment vuitton, tory burch, Proenza Schouler, J.Mendel to the Cure initiative. Karan designed the limit- and more. ed edition T-shirt that will be sold as part of the Uma Thurman in campaign and benefits a slew of organizations GENERAL the Donna Karan- devoted to the fight against cancer. the recent WWD beauty Ceo Summit drew 230 designed Key to 4 It’s a cause that Thurman and Karan take top beauty-industry leaders to the breakers hotel the Cure T-shirt. very seriously. Both have known women affect- in Palm beach to offer ideas on how to manage the ed by the disease, and Thurman was particularly changing industry landscape. inspired to step up her efforts in the fight against With his new big Pony fragrance collection, ralph it when she attended the Susan G. Komen Race 12 for the Cure in Central Park in September and Lauren is leading a quartet of scents aimed at 18- to shot the starting gun. 30-year-old men into the retail arena this summer. “It was amazing to see so many women, both Leonard Lauder hosted a dinner at Manhattan’s survivors and nonsurvivors alike, united in this 13 Guggenheim Museum Wednesday night to welcome attendees of the World Department Store Summit. This is something I want 13 A luncheon at the Pierre hotel marking the 25th “ anniversary of KiDS raised $150,000 and drew a to make the time to do, crowd of 275. something that matters a lot retail stocks locked in early gains and built on them 14 thursday, finishing with a 3 percent advance, as A looklook fromfrom the Dow Jones industrial Average hit and held the to me. Louis Vuitton.Vuitton. 10,000 mark. ” — Uma Thurman Classified Advertisements...... 15 effort,” said Thurman. “When [Key to the Cure] To e-mail reporTers and ediTors aT WWd, The address is was presented to me, I thought, ‘This is some- [email protected], using The individual’s name. WWD IS A REGISTERED TRADEMARK OF ADVANCE MAGAZINE PUBLISHERS INC. COPYRIGHT ©2010 thing I want to make the time to do, something FAIRCHILD FASHION GROUP. ALL RIGHTS RESERVED. PRINTED IN THE U.S.A. that matters a lot to me.’” VOLUME 199, NO. 122. WWD (ISSN 0149–5380) is published daily (except for Saturdays, Sundays and holidays, with one Thurman joins past celebrity ambassa- additional issue in January, May, June, October and December, two additional issues in March, April, August, September and November, and three additional issues in February) by Fairchild Fashion Group, which is a division of Advance Magazine dors including Gwyneth Paltrow, Charlize Publishers Inc. PRINCIPAL OFFICE: 750 Third Avenue, New York, NY 10017. Shared Services provided by Condé Nast: Theron, Hilary Swank, , Glenn S. I. Newhouse, Jr., Chairman; Charles H. Townsend, President/CEO; John W. Bellando, Executive Vice President/COO; Close, Renée Zellweger and Nicole Kidman. Jill Bright, Executive Vice President/Human Resources. Periodicals postage paid at New York, NY, and at additional mailing offices. Canada Post Publications Mail Agreement No. 40644503. Canadian Goods and Services Tax Registration Like them, Thurman is to appear in a nation- No. 886549096-RT0001. Canada Post: return undeliverable Canadian addresses to: P. O . Box 503, RPO West Beaver Cre, al public service announcement sporting the Rich-Hill, ON L4B 4R6 POSTMASTER: SEND ADDRESS CHANGES TO WOMEN’S WEAR DAILY, P. O . Box 15008, North Karan-designed T-shirt, which will be placed in Hollywood, CA 91615–5008. FOR SUBSCRIPTIONS, ADDRESS CHANGES, ADJUSTMENTS, OR BACK ISSUE INQUIRIES: Please write to WWD, P. O . Box 15008, North Hollywood, CA 91615-5008, call 800-289-0273, or visit www.subnow.com/wd. September and October issues of fashion and Please give both new and old addresses as printed on most recent label. Subscribers: If the Post Office alerts us that lifestyle publications. organizations in the U.S. The money benefits your magazine is undeliverable, we have no further obligation unless we receive a corrected address within one year. If during your subscription term or up to one year after the magazine becomes undeliverable, you are ever dissatisfied with “For me, it’s not just about dressing women; The Breast Cancer Research Foundation as well your subscription, let us know. You will receive a full refund on all unmailed issues. First copy of new subscription will be it’s about addressing the issues that are so im- as local charitable programs that focus on devel- mailed within four weeks after receipt of order. Address all editorial, business, and production correspondence to WOMEN’S portant to all of us,” Karan said. “I lost my oping new treatments and, ultimately, a cure for WEAR DAILY, 750 Third Avenue, New York, NY 10017. For permissions and reprint requests, please call 212-630-4274 or fax requests to 212-630-4280. Visit us online at www.wwd.com. To subscribe to other Fairchild magazines on the mentor, Anne Klein, and my best friend, Lynn women’s cancers. World Wide Web, visit www.fairchildpub.com. Occasionally, we make our subscriber list available to carefully screened Kohlman, to breast cancer. We’ve made great “Partnering with Donna Karan, The Breast companies that offer products and services that we believe would interest our readers. If you do not want to receive these strides, but we still don’t have a cure. Cancer Research Foundation and Uma Thurman offers and/or information, please advise us at P. O . Box 15008, North Hollywood, CA 91615-5008 or call 800-289-0273. WOMEN’S WEAR DAILY IS NOT RESPONSIBLE FOR THE RETURN OR LOSS O F, OR FOR DAMAGE OR ANY OTHER INJURY TO, “Who better than Uma Thurman to represent — as well as obtaining the continued support of UNSOLICITED MANUSCRIPTS, UNSOLICITED ART WORK (INCLUDING, BUT NOT LIMITED TO, DRAWINGS, PHOTOGRAPHS, AND this campaign?” she added. “She’s a mother and charities throughout the country, our clients, TRANSPARENCIES), OR ANY OTHER UNSOLICITED MATERIALS. THOSE SUBMITTING MANUSCRIPTS, PHOTOGRAPHS, ART an artist and is passionate about making a dif- vendors and associates — is a testament to Key WORK, OR OTHER MATERIALS FOR CONSIDERATION SHOULD NOT SEND ORIGINALS, UNLESS SPECIFICALLY REQUESTED TO DO SO BY WOMEN’S WEAR DAILY IN WRITING. MANUSCRIPTS, PHOTOGRAPHS, AND OTHER MATERIALS SUBMITTED ference.” to the Cure’s amazing success in uniting our MUST BE ACCOMPANIED BY A SELF-ADDRESSED STAMPED ENVELOPE. The $35 T-shirt, of which 100 percent of the communities to raise critical funds and aware- proceeds benefit the cause, will be available at ness about this cause year after year,” said Saks Fifth Avenue and Off 5th stores, as well Saks Inc. chairman and chief executive officer DAILY as on saks.com, from Oct. 1. Saks’ annual char- Stephen I. Sadove. History shows that QUOTE “the first 24 months of a recovery are when 80 percent of the most FiFi’s Tap Usher, BBW for Awards successful new ideas take root. NEW YORK — Usher walked off with the Male Fragrance of the Year, Unique Boutique: Tom Ford White Celebrity Fragrance of the Year bragging rights, Suede (unisex/women’s) — The Estée Lauder — Fabrizio Freda, president” and chief executive and Bath & Body Works nabbed Retailer of the Cos. Inc. officer of the Estée Lauder Cos. Inc. Page 4 Year honors at the FiFi Awards on Thursday at Fragrance Hall of Fame: ck one — the Downtown Armory here. Michael Kors was Cosmetics/Coty Prestige CORRECTION inducted into the FiFi Hall of Fame, his second Fragrance of the Year, Bath and Body: Couture Couture A story on pages 14 and 16 Thursday misstated the number of stores such honor this week after picking up a Lifetime by Juicy Couture — operated and planned by Calvin Klein Inc. The company operated 67 Achievement award from CFDA Monday night. Best Packaging of the Year — Women’s Popular ck Calvin Klein stores at the end of 2009, and plans to ramp up to 151 Presented by , the Appeal: Bath & Body Works Signature Collection by the end of 2012, which will include 60 in China. The numbers apply awards also lauded a long list of fragrances in- P.S. I Love You EDT — Bath & Body Works only to the ck Calvin Klein brand stores, not total company stores. troduced within the last year (detailed below). Best Packaging of the Year, Women’s Prestige: Life Threads Collection: Silver, Gold, Platinum — La 2010 FiFi Award Winners Prairie TODAY ON Best Packaging of the Year, Men’s Popular Appeal: Comme Male Celebrity Fragrance of the Year: Usher une Evidence — Yves Rocher North America Inc. Retailer of the Year: Bath & Body Works Best Packaging of the Year, Men’s Prestige: John WWD.com FiFi Hall of Fame: Michael Kors Varvatos Artisan — Beauté Prestige Fragrance of the Year, Men’s Luxe: Tom Ford Grey International • All the looks from the Louis Vuitton, Vetiver — The Estée Lauder Cos. Inc. Best Women’s Media Campaign: No.5 “No.5: Tory Burch, Proenza Schouler, J.Mendel, Fragrance of the Year, Women’s Popular Appeal: Halle by Train de nuit” — Chanel Monique Lhuillier, Jenni Kayne, Max — Coty Best Men’s Media Campaign: ck one “We Are One” — Fragrance of the Year, Women’s Luxe: Lola Calvin Klein Cosmetics, Coty Prestige Mara, Sportmax, Sonia Rykiel, Tse, Jill — Coty Prestige Best Interior Scent Collection: Scentbug Diffuser — Stuart and Ports 1961 resort collections Fragrance of the Year, Men’s Popular Appeal: Seduction Slatkin & Co./Limited Brands Inc. • Additional images from Donna in Black, Antonio Banderas — Puig USA Inc. Extraordinaire: Karan’s Urban Zen presentation Fragrance of the Year, Women’s Nouveau Niche: Bond No. Editorial Excellence in Scent features: Allure, Elle, elle. 9 Astor Place — Bond No. 9 New York com • WWD Video: Red-carpet

Fragrance of the Year, Men’s Nouveau Niche: Bond No. 9 Technological Breakthrough, Packaging Technology & hner coverage of the FiFi Awards C i Brooklyn — Bond No. 9 New York Delivery Systems: Victorinox Swiss Unlimited rub- e • Comprehensive coverage Fragrance of the Year, Women’s Private Label/Direct Sell: ber bottle — Victorinox Swiss Army

Steve of the WWD Beauty Summit Love Rocks — Victoria’s Secret Technological Breakthrough, Fragrance Creation & • More images from the Whitney Fragrance of the Year, Men’s Private Label/Direct Sell: Formulation: Miriad 2.0 — Fragrances Byrdie Bell

Patrick Dempsey 2 — Avon Products Inc. Corp. Photo by art party and the FiFi Awards © 2010 Estée Lauder Inc. DNA damageandskinaging. over itthanyouthink. Now youhavemorecontrol New ForEyes reduction inthelookoffinelines,wrinkles,dark proven repairofour#1Serum. Advanced NightRepairEye.Now,withallthe dramatic reductioninthevisiblesignsofaging. repair theappearanceofpastdamagefora of womencan’tlivewithout.Helpscontinuously research, it’stherevolutionaryformulamillions Inspired by25yearsofgroundbreakingDNA Advanced NightRepair esteelauder.com Comprehensive anti-aginglike nootherformula. Estée Lauder’s AdvancedNightRepair. 20 PatentsWorldwide. circles, dryness,puffinessandunevenskintone. New You’ll seea

4 WWD, FRIDAY, JUNE 11, 2010 THE BEAUTY CEO SUMMIT 2010 A crowd of 230 beauty industry leaders gathered for three days of intense discussion and expert analysis aimed at inspiring a renaissance of the global business.

FREDA’S FRESH VISION Fabrizio Freda FABRIZIO FREDA, PRESIDENT AND CHIEF executive officer of the Estée Lauder Cos. Inc., kicked off the WWD Beauty CEO Summit held May 10 - 12 at The Breakers hotel in Palm Beach, Fla., with a history lesson rooted in the title of the conference itself: A Fresh Start. Showing a slide of The Breakers, Freda noted that the hotel has twice burned down, in 1903 and again in 1925. Both times, however, it was able to re- build and reestablish itself as a bastion of luxury. “As our sector emerges from recession, our job as leaders is preserving the best of our past as we Gina Drosos, Jory des make the needed changes toward a brighter fu- Jardins, Fred Mossler, ture,” he said. “How do we do that? How do we Kevin Kells and turn change into progress?” DIGITAL DIRECTIVE B. Bonin Bough. That question has been top of mind for Freda for the past two years, since he joined the company as president and chief operating offi cer from Procter ONE OF THE MOST HIGHLY ANTICIPATED AND PENETRAT- & Gamble Co. Despite the impact of the recession, ing presentations at the summit was a panel discussion on digital the fundamentals of the beauty business are “strong marketing led by Virginia C. Drosos, president of global beauty of and getting stronger,” Freda noted, ticking off inher- P&G Beauty & Grooming at the Procter & Gamble Co. ent consumer demand, growing consumer wealth, The discussion was fueled by experts from different aspects longer life spans and women’s needs for some “me of the digital world with well-honed insights, including B. Bonin time” as examples of why he’s bullish on beauty. Bough, global director of digital and social media at PepsiCo; At the same time, though, the recession has Jory des Jardins, president, strategic alliances, and co-founder of fundamentally changed consumer behavior, BlogHer Inc.; Kevin Kells, national industry director of consumer which, coupled with a younger, more multiethnic consumer base and the continued evolution of packaged goods at Google Inc., and Fred Mossler of Zappos.com. distribution channels, has companies like Lauder reassessing every aspect of its business. “History Drosos set the stage for the wide-ranging talk by outlining how shows that the fi rst 24 months of a recovery are when 80 percent of the most successful new ideas digital is redefi ning how business is being pursued and brands take root. The next two to three years are when we should be creating the future we want to see,” are being built. She boiled it down to fi ve C’s — consumer, cred- he said. ibility, content, customized scale and culture. Freda, detailed four ideas. “Creativity will drive our success — today, tomorrow, forever,” he “A recent blog post tracker revealed that there are 126 million said. What is new, however, is deepening the connection between creativity and consumer insight. blogs on the Internet today,” Drosos said, “and 84 percent of so- “By using more in-depth consumer insights to inspire our intuition, we can focus our talents on the cial networking sites are dominated by female members — a lot greatest opportunities and produce greater breakthroughs.” of opportunity to engage.” Freda also emphasized Lauder’s commitment to fostering innovation around the world, not just Des Jardins drove home the point that companies need to interact in its home market. “We want to get closer to our most demanding consumers wherever they hap- with bloggers by presenting their products in ways they can relate to pen to be, ” he said. “We call this being creatively driven, consumer inspired. It’s about capturing in their daily lives, and companies should court bloggers with a large what consumers can’t imagine today, but cannot live without tomorrow.” following and ample credibility, even if they don’t specialize in that Creativity goes beyond just product development, however. fi rm’s product category. To lure women, Michelin portrayed tires as It extends to service as well, leading to Freda’s second tenant: shoes for cars, and GM provided autos for carpoolers. Creativity will drive high touch. Noting that the 50 percent of women want to be But the example that the panelists turned to was PepsiCo’s “ educated about product benefi ts but not in a pushy manner, Refresh project, in which the company gives away $20 million to our success — today, while another 45 percent shop mainly to replenish, Freda said sponsor community projects that are advocated by highly moti- that the traditional “push” models in department stores, par- vated individuals, not organizations. The aim is to build relevance tomorrow, forever. ticularly the U.S., must evolve into one that “pulls and adds in the eyes of the consumer and promote the health of its brand. — Fabrizio ”Freda value.” “We have pushed the push model too far,” he said. Bough observed, “When people are having conversations about our For its part, Lauder is creating new multitiered retail for- brand online, are they mentioning these attributes — a brand that I mats, as with its Clinique counters at Bloomingdale’s in New York and Selfridges in London, where can’t live without, a brand that I know supports my passions?” consumers can replenish at an express counter, receive a full consultation with a sales associate, He continued, “What it was really about was, can the brand use a computer for DIY diagnosis or browse uninterrupted. stand for something, can we remind people that a soda can make Still, the industry needs to do a better job of communicating the value of service, and using it as a a difference and, even more, that your choice makes a difference? key differentiator from different channels, Freda said. “Have we all been so focused on battling over Kells of Google added, “Relevancy is tied to effectiveness. That’s products and promotions that we’ve overlooked the treasure inherent in the experience prestige where I think in the next decade, the conversation has to switch.” cosmetics offer?” he asked. He added that the industry has been too hung up on effi ciency. The The third pillar of Lauder’s strategy focuses on localizing its global business, particularly as emerg- best way to grow the top line, he asserted, “is to be more effective. ing markets mature. “To develop our sector worldwide, we need to listen and learn, so we can customize The way to do that is to be more relevant at the right moment for and tailor our global brands’ offerings and make them locally relevant,” said Freda, noting that prestige the right outcome.” sales in China soared to more than $22 billion last year and in 10 years could equal those of the U.S. Mossler from Zappos agreed that brand evangelists can come from “For too long, globalization meant standardization,” he said. “This approach was misguided a unexpected places. That is why his company puts a lot of effort into decade ago. It’s dangerously myopic today.” He referenced the well-known fact that Asian women’s dealing with customers who return merchandise — by defi nition, the primary skin concern is clarity and whitening, but then revealed that in China, local research showed least profi table clients. “They may be your biggest brand mavens,” women are actually more concerned with a dull, dry appearance to their skin. Mossler said. “They may be out singing the song of how easy you are Another high-growth area for Lauder is the e-commerce sector, which Freda said grew 25 per- to work with and how wonderful your customer service is.” cent last year. He said that since 2007, average monthly visits to beauty related Web sites grew 94 Discussing the various brand diagnostics, Kells of Google said percent and topped 60 million per month. “The digital world means storytelling, allowing consum- there’s more to look at than sales and profi ts. “The hidden beauty

ers to add their own storylines and illustrations,” Freda said. “It requires different skills and much of online is brand building as well as transactional,” he said. “Too BILT HARVEY

greater understanding of consumer dreams and aspirations,” he continued, “so that we can make many people think of it as ‘I can go buy something online.’ But the BY the emotional connection on which loyalty and trust depend.” brand building is the thing that is at the heart of most digital stuff.”

— Jenny B. Fine — Pete Born PHOTOS

Don Loftus, Lynne Green Beauty industry leaders discuss the Sonia Kashuk and and Allen Burke. state of business at the CEO Summit Stephan Kanlian in Palm Beach.

Miguel G. Krigsner, Artur Grynbaum and Nicolas Mirzayante. Ingred Jackel and Carmen Bauza Evelyn Lauder and David Guliteanu Poolside at The Breakers. WWD, FRIDAY, JUNE 11, 2010 5 WWD.COM

SHIRLEY SHOWS HIS TEAM SPIRIT Moderator Jenny B. Fine, Mindy Grossman, Mary J. ED SHIRLEY’S COMPETITIVE STREAK MAY HAVE PROPELLED HIM TO THE TOP RANKS Blige and Steve Stoute. of corporate America, but he proved he’s a team player while delivering a keynote speech with the theme Rising Tides. Shirley, who is the vice chair of beauty and grooming at Procter & Gamble Co., sounded a clarion call for the industry to work together. Shirley outlined three areas in which the industry can collectively reignite growth: regimen- based skin care, particularly in the men’s market; fragrances, and customer engagement. “This is where we are going to focus our energy,” Shirley said, “and I invite you to think about how you might play like this in the future as well.” In terms of regimen-based skin care, Shirley revealed P&G’s game plan for converting men from a soap-and-water routine to more involved treatment regimens. “I know the idea of regi- men is almost as old as the beauty industry itself,” he laughed. “However, it’s still a fairly new concept for the other 50 percent of the population — men.” To that end, P&G is focusing much of its efforts behind Gillette, its powerhouse shaving brand. “Shaving is the anchor event in most men’s daily ritual,” he said, adding that market- ers must keep the message simple. P&G will leverage the step-by-step approach pioneered by its recently acquired Art of Shaving brand for its global offerings, Shirley said, including Olay MARY J. BLIGE ON Men’s Solutions in China, Gillette Skin Care in Western Europe and Gillette’s ProGlide Series skin care, launching in North America. NONTRADITIONAL MARKETING As part of its efforts to entice more men to skin care, P&G has focused on improving the shopping experience. “We need to help men more easily fi nd the products they need, as well MARY J. BLIGE IS SET TO TURN THE TRADITIONAL FRAGRANCE as what’s new,” Shirley said. “Men get confused at the shelf. They want to get in and out as distribution model on its ear this summer with her first fragrance, quickly as possible.” Thus, P&G has been working with retailers to create a “man cave” within My Life. the store, an environment where men will feel comfortable. The approach has paid off, said Not only will the entertainer launch the scent exclusively on Shirley, with double-digit category growth in many cases. HSN on July 31, she has an ownership stake in Carol’s Daughter, Shirley also tackled the declining fragrance business in the U.S., noting the market in the beauty company launching her scent — both representing major Western Europe is almost two-and-a-half times the size of North America. “Is it because men departures for the prestige fragrance industry, which traditionally and women in Europe are sexier? Are they smarter?” he quipped, quickly turning serious as he licenses celebrity names and sells the products in department and noted that retailers are losing patience with the category and considering cutting back space. specialty stores. The fix? Decreasing “I stand behind my music confi dently and I stand behind this the number of fragrance product confi dently because I’m in it,” Blige told attendees at the Ed Shirley launches and enhancing Summit, where she appeared on a panel with Steve Stoute, chairman those that are brought to and lead investor of Carol’s Daughter, and Mindy Grossman, chief market. “I understand executive offi cer of HSN. “I will not put my face behind anything I that the barrier to entry don’t believe in or my name. I’d rather have my good name instead of is low,” Shirley said, “but your money, and my goal is to show women we are in this together.” what’s up with the num- Even the name is signifi cant to the artist, who has won 10 ber of launch-and-leave Grammys and sold more than 40 million albums worldwide. “The celebrity fragrances in- whole reason for the perfume being named My Life is because that troduced each year?” was the album that I began to call on women for help,” said Blige. The sheer prolifera- “So the title, the album and my entire movement in my career has tion is driving consum- everything to do with why this perfume is called My Life. My en- ers away, Shirley assert- tire movement has been about women rising up from the ashes like ed. “Our research shows phoenixes and giving their life, giving themselves a shot and not that with a 25 percent re- beating themselves up.” Each bottle sold will mean a $1 donation to duction in stockkeeping the Foundation for the Advancement of Women Now (FFAWN), the units, shoppers actually charity Blige founded with Stoute. give retailers credit for “When Steve came to me and then I had the incredible honor of having a broader assort- meeting Mary and hearing her story, this was like nothing we had Sure, we can steal share, and we’re not ment and an increase in done,” said Grossman. “It was emotional, it was real, it was authen- “ purchase intent.” tic, it spoke to women, it could really use our platform in a very dif- bad at that,” he continued, “but it will be That insight has led ferent way. And we’re redefi ning a channel for an entire business.” P&G to take a less-is- With $3 billion in sales, broadcast to 94 million homes and a high- a lot more rewarding for everyone if we more approach that cen- ly traffi cked Web site, HSN was the right partner, said Stoute. ters on its classic brands, “The blurring lines of shopping channel has changed — the brand grow the size of the pie. particularly Gucci and has to defi ne itself, not be defi ned by the channel that you buy it in,” Dolce & Gabbana, and he said. And, he noted, the traditional creation model is also differ- ” — Ed Shirley one that emphasizes con- ent here. “It’s not the endorsement aspect of it, it’s the authorship sumer education. that you have to provide the artist and that’s what I like the best The company is also looking at diverse distribution models. “I fi nd myself often engaged about this model,” he said. about where fi ne fragrance should be carried and merchandised,” Shirley said. “My belief is “[You might ask] why would [consumers] buy a fragrance if they there’s room for both prestige channel and mass distribution with the appropriate and differ- can’t smell it?” said Stoute. “And then you start realizing well they’re entiated lineups,” he continued, noting that today’s teenager who uses scented body spray is buying the fragrance because of storytelling.” tomorrow’s prime prospect to trade up to prestige fragrances. Noted Grossman, “We’re looking at it as a 360-degree experience. Adding that the mass fragrance environment is “often a hodgepodge of mass and diverted We sat back and said, ‘What are all the assets that we have that we can prestige products displayed under lock and key without any consultation, education or inspira- bring to life? What can we work with Steve, with Mary, with Carol’s tion,” he continued, “we’re all going to have to fi gure out how to do this in developing markets, Daughter on? And now can we, in the most immersive way, bring this so we might as well relearn how to do it in developed markets and enjoy the benefi ts. to life?’” That will include a mini-documentary of Blige’s life, com- “By our calculations,” he added, “raising the North American fragrance shares to Western mercials on other channels, a presence at the Essence Music Festival, European levels would result in $6 billion of incremental sales.” mobile preordering, direct mail to more than 30 million women — Shirley’s third pillar for driving growth centered around engaging the new consumer. He and, of course, Blige herself on HSN promoting her fragrance. “We’re cited the development of Olay’s Pro-X brand, which broke price barriers at mass and garnered using our Internet and community assets to literally envelope and cre- a 5 percent market share in its fi rst year, despite the recession. P&G had the confi dence to stay ate the experience around My Life,” said Grossman. the course, Shirley emphasized, because consumer research showed that the brand proposi- Grossman believes Blige’s story will resonate with consumers, tion — dermatologist developed and recommended products available in an everyday shopping particularly her passion about her charity. “I think getting that mes- environment — was a resonant one. sage across not just of the fragrance but the philosophy behind it Shirley concluded by reiterating his message of collective growth. “We have all of the prod- and FFAWN, the belief and empowerment, is important to women,” ucts, brands, retail stores and communication vehicles we need to make a difference,” he said. said Grossman. “And we know that our customer loves the fact that “Sure, we can steal share, and we’re not bad at that,” he continued, “but it will be a lot more re- if somebody goes, ‘Wow, you smell fabulous,’ she is now going to be warding for everyone if we grow the size of the pie. But it will take more than just P&G Beauty able to tell the entire story.” & Grooming. It will take all of us in this room.” — Julie Naughton — J.B.F.

Don Loftus, Lynne Green and Allen Burke. THE BEAUTY CEO SUMMIT 2010 ON WWD.COM Additional coverage of speakers from the Summit — including those by Ulta’s Lyn Kirby, entrepreneur extraordinaire Ido Leffl er, Polish retailer Wojtek Inglot and retail guru Paco Underhill — can be found on WWD.com. Pamela Baxter and Mary J. Blige These articles also will be part of a series that Nicholas Ratut, Carole Silverman, Doug Tough Louis Desazars and Heidi Manheimer. will appear in future editions of WWD. 6 WWD, FRIDAY, JUNE 11, 2010

THE BEAUTY CEO SUMMIT 2010 Joe Magnacca EUROPEAN FRAME OF MIND NEW YORK IS THE EPICENTER OF THE BEAUTY IN- Mike Bloom dustry, and it’s also the place to jump-start change, said Joe Magnacca, senior vice president and chief merchan- dising offi cer of Duane Reade, a metro New York drug- store chain. “The only place to change the face of beauty is in New York. A place made famous by many and celebrated by all, there is only one New York,” Magnacca told attendees of the summit. Two years ago, Magnacca left his post at the Canadian pharmacy Shoppers Drug Mart — which has looked to Europe for inspiration to create upscale beauty boutiques within its stores and build a stand-alone luxury concept called Murale — to put his stamp on the U.S. drugstore business and attempt to elevate the mass market beauty experience. First, Magnacca and the management team at Duane Reade had to polish the image of an urban drugstore that he described as “an old, dingy, poor-serviced, overmer- CVS COMES CALLING chandised store. CVS PHARMACY HAS SPENT THE LAST EIGHT YEARS “We truly had negative brand equity in the market- readying its doors for prestige beauty brands, the chain’s place, yet we were on every second [street] corner,” said executive vice president of merchandising and supply Magnacca. “We had to make a lot of changes. We had to chain, Mike Bloom, told attendees of the Summit. widen aisles, refresh the mix, rebrand the store, redefi ne “We actually believe that we’ve earned the right to have the private brand program, rebuild the loyalty program, a seat at this prestige beauty table,” said Bloom. He introduced the audience to the retailer’s upscale beauty concept called Beauty 360, which is located adjacent to about 20 CVS stores and stocks premium price brands, MACY’S REACTS TO CHANGING CONSUMER SHOPPING HABITS ranging from Cargo cosmetics to Warren-Tricomi hair care. THE CONTINUALLY CHALLENGING ECONOMY when One Macy’s was started, back last February, “The Beauty 360 concept was actually over 10 years has forced even the largest merchants to rethink we were so confi dent that this team was onto some- in the making,” said Bloom. “We didn’t just make this their strategies — and, for Macy’s, that includes a thing great that we decided to keep a small team in decision overnight. It was a logical next step for CVS.” new beauty concept called Impulse Beauty, as well San Francisco to work with some of the California- Addressing the prestige beauty executives in the room, he as a new mobile shopping app and a program de- based vendors and to really be a center of innova- said, “Many of you here know we’ve been knocking on your signed to track down out-of-stock products. tion for us. So we took it to another nine stores, in- doors for several years. We put a lot of time, a lot of energy An assisted open-sell con- cluding Union Square.” and a lot of resources into getting it right. We listened to cept which coexists with Next, Macy’s commissioned our customers, we listened to industry experts, many of traditional beauty counters, a retail analysis. “In those three you in this room, and we continue to listen today.” Impulse Beauty is intended to pilot stores that we’ve been in He continued, “We know that we need to continue to showcase smaller brands, most business with for a year, they learn from you to perfect this model and we continue to do of whom are entering Macy’s analyzed about 4,000 house- so. After a decade of insights, it was time. It was time that distribution for the fi rst time, holds that had purchased in we launched Beauty 360 here in the U.S.” said Muriel Gonzalez, execu- these three stores,” she said. Bloom clarifi ed that CVS views Beauty 360 as an addi- tive vice president and gen- “What we learned was that 40 tional channel of distribution, not a replacement for exist- eral merchandise manager percent of those 4,000 house- ing prestige beauty channels. He noted that the company for cosmetics, fragrance and holds were Macy’s customers has found that 40 percent of Beauty 360 customers are shoes for Macy’s Inc., speaking but had not bought anything new to CVS and have not purchased beauty products at at the Summit. It was inspired, from the beauty department in the chain before shopping Beauty 360. Gonzalez said, by a similar the previous 12 months. Of the CVS, Bloom emphasized, has a lot to offer upscale concept in apparel. 60 percent of customers who beauty brands. “On the West Coast, the were already Macy’s customers Some fi ve million customers a day stream through CVS’ word ‘impulse’ was used to de- and who had already bought chain of more than 7,000 stores, which translates to 35 million scribe ready-to-wear that was beauty, they increased their a week, said Bloom. What’s more, 80 percent of the chain’s primarily California-based, a purchasing in the beauty de- customers are female and together they generate $4.5 billion little bit more contemporary, partment signifi cantly and they in beauty sales at CVS, or 900 million beauty products a year. and product that wasn’t carried increased their purchasing in “With our clear focus on health and beauty, our abil- in all the different Macy divi- total Macy’s signifi cantly.” ity to reach millions and millions of customers each and sions,” she said. “So the team As a result, another nine every day and our unparalleled real estate position makes in California at the time began opened up last fall and another Beauty 360 a natural extension to current distribution be- to say, ‘What does that custom- 40 will begin rolling out this cause it offers a controlled environment that protects your er want in beauty? She doesn’t month, said Gonzalez, includ- brand as well as offering superior customer service,” said necessarily want the tradition- ing in Jersey City, N.J., Staten Bloom. “We believe this is at minimum a $2 billion oppor- al brands that we’re carrying Muriel Gonzalez Island and Queens, N.Y., with tunity for this industry. We believe there are somewhere at Macy’s. She might want to the retailer’s Herald Square, in the neighborhood of 750 to 1,000 stores that are right for try something that’s a little bit N.Y., fl agship to get the depart- Beauty 360 throughout all the key markets in the U.S.” more niche, she might want ment in October. Bloom, a 30-year retail veteran, said CVS has been to try Laura Geller, she might [The customer ] The retailer is also currently working to improve the beauty shopping experience want to try Sue Devitt, but how “ testing shared demonstration across its doors since 2002, when it began to introduce can we do that at Macy’s?’” might want to try in 25 smaller stores. “We expect a “customer-centric” layout. Now in 4,000 doors, the lay- The solution: an open-sell that once we learn more about out includes wider aisles, lower shelving units and better environment that has beauty something that’s a how we can better staff and mo- category adjacencies. The following year, CVS began out- advisers trained on multiple tivate and train the beauty ad- fi tting its stores with beauty advisers. That same year, in lines. “So if the consumer little bit more niche. visers in the small stores, we’re select stores, CVS added the Healthy Skin Care concept, a wants to try for herself, she going to have an idea that we display of premium-price dermatological skin care brands, can, and if she wants some — Muriel Gonzalez” can roll out to over 200 stores in designed as “an intersection between health and beauty.” assistance, she’s able to get 2011,” she said. The center is now found in more than 700 doors. somebody who knows all the different products This month, Macy’s will also begin testing mo- CVS also has added beauty advisers to 850 stores. and can really help her on the product that’s right bile apps in several markets with a company called “Because of our targeted approach in selecting these stores for her,” said Gonzalez, noting the program began Shop Kick. “When I walk into Macy’s a little signal — and we’ve got 7,000 stores to choose from — our sales in a testing phase in 2009, with each space roughly let’s Shop Kick know that I’m in Macy’s and right the beauty category in stores with beauty advisers are dou- 1,000 square feet. “It started in three stores and away I get an e-mail saying, ‘We have some deals or ble those than in stores that don’t have them,” said Bloom. the initial results looked pretty good. So the team promotions for you,’” she said. — Molly Prior there at the time decided to go to another nine. And — Julie Naughton

and Serge Jureidini, Jerry Mary Van Praag Carol Hamilton and Vittoria and Marc Rey. Stefano Curti Philip Shearer

François-Xavier Kelly McPhilliamy, Joanna Fenart and Armand Mitchell and Jani Friedman. Michelle Taylor, Ann Gottlieb Jani Friedman. de Villoutreys and . WWD, FRIDAY, JUNE 11, 2010 7 WWD.COM THE BEAUTY CEO SUMMIT 2010 expand into new categories and enter into the Nichols and Selfridges, in particular — that “ap- Carmen beauty world in a way that no other drugstore peal to various lifestyles, retail stores that cut Bauza has in America.” across ages and emotionally engage all.” As part of the revamp, a handful of stores Each concept, in Magnacca’s view, shows include Look Boutique, an expansive, high- beauty can be revolutionized on U.S. soil, and in end beauty boutique — complete with brow the U.S. drugstore, where consumers are already services — manned by trained beauty advisers shopping for everyday needs. “In every visit we, who sell across the assortment. The changes as retailers and as brands, have a chance to sell attracted the attention of Walgreen Co., which, her that new lipstick shade or new fragrance that in February, announced plans to acquire the she didn’t even know she needed.” chain. As for how the retailer implemented He also had a message for niche brands swift change, he said, “It’s about vision.…It’s struggling to fi nd a home. “We know you are out deciding where you want to take a brand and there and we’re willing to work with you and then tactically going after the steps.” raise your profi le.” Just as Shoppers Drug Mart did, Duane Reade Duane Reade’s move upscale is proving success- looked to Europe when devising an upscale ful, he reported. “A Look Boutique customer spends beauty concept designed to incorporate prestige fi ve times more than what a traditional drugstore brands into its drugstore setting. “In the U.S., we customer spends,” he said, adding the company have fallen behind so many global trends. It’s expects to have 10 Look Boutiques by year’s end. CALL FOR REVOLUTIONARY CHANGE time we begin to transform beauty in the United “It’s changed the way a customer uses and thinks WAL-MART’S CARMEN BAUZA ISSUED A CHALLENGE TO States, because it’s all about [the customer], it’s of a drugstore in New York.” To the prestige beauty beauty and retail executives: Unshackle their companies from an anti- all about what she wants, not what we want. executives, Magnacca said, “Change is inevitable.… quated business model to drive growth and transform the industry. “We look to Europe to see the future,” said We need to share the customer and work together to Bauza, Wal-Mart’s vice president and divisional merchandise Magnacca, noting the plethora of retail European grow the overall category.” manager of beauty and personal care, began by quoting the words concepts — naming Marks & Spencer, Harvey — M.P. of fi nancier Warren Buffett, who said, “Chains of habit are too light to be felt until they are too heavy to be broken.” In Bauza’s view, a history of misguided promotions — particu- larly in the mass market, where “buy one, get one free” and cou- BRAZIL AS BEAUTY PARADISE pons fl ourish — are outdated and, worst of all, damaging. BRAZIL IS A BURGEONING BEAUTY MECCA, ACCORDING “As the world’s economies have found out, mortgaging tomor- to François-Xavier Fenart, president and chief executive of- row’s sales is not a growth vehicle,” she declared. ficer of L’Oréal Brazil. In illustrating the need for “radical change,” Bauza showed a During his address at the Summit, Fenart discussed the photo she snapped during a recent visit to New Yo r k City. The country and how his company has adapted its business model photo depicts the Virgin Megastore on 14th Street with “out of there. business” signs plastered across the windows and, across the Fenart reminded attendees that Brazil hasn’t long been a street, a pulsing and modern Apple Store. free market. In the Seventies, it was sealed off under military Bauza recalled that Virgin once led the music retail industry dictatorship, and, subsequently, its economy was slammed by but did not anticipate the changes in technology that would usher fi nancial instability. in online music downloads. Fast-forward to today, and Brazil has a healthy economy. “The music industry evolved from a price-driven model to a Its gross-domestic-product growth is estimated at close to 6 customer-access one, but Virgin didn’t make the transition.” percent this year. Further, Brazil’s young and ethnically di- For beauty, the Virgin story is a cautionary tale. verse population is growing quickly (as is its middle class); in “In the old world, brand plus product innovation plus custom- two decades, the country’s expected to have 20 million more er knowledge plus a single channel of distribution equaled sales. people than its current 220 million denizens. That equation is no longer delivering results. It is a new game, Brazil has the third-largest health and beauty market there are new rules,” said Bauza. “If we fail to recognize our cus- worldwide, with approximately $20 billion in sellout (exclud- François- tomer’s rapidly changing expectations, we will be chasing instead ing soap and oral care), said Fenart. It’s number two in fra- Xavier of leading the market.” grance, color and hair care, and it ranks fi rst in deodorant. Fenart In Bauza’s view, becoming customer-centric means anticipating In eight years, L’Oréal has gained almost 40 million new what the shopper wants before she knows she wants it — the credo of consumers in Brazil. It is the fourth-largest beauty player Apple’s chief executive offi cer Steve Jobs — or more simply put, staying there, 50 years after its arrival. In 2009, the company registered 15 percent growth and had 8 per- ahead of a customer who is more informed than ever before. cent market share, and in fi rst-quarter 2010 the company posted 32 percent gains in the country. As Bauza pointed out, the customer may compare prices on her “The future is today in Brazil,” said Fenart, who outlined some best practices. He said it’s key iPhone while standing in a store. The shopper’s access to infor- for executives to continually deal with the country’s fi scal complexity. Import tax can run up to 150 mation makes it more challenging for retailers to build a personal percent, for instance, and taxes can vary by state, by product and by category. connection. “Brazilian women are looking for a real, natural On a product level, certain categories have lost that connection The main preoccupation beauty,” he continued, adding beauty in Brazil is corre- as well, particularly fragrance, where the industry has turned to an lated with personal hygiene. Women in Brazil will take aggressive launch strategy that resulted in “the scent du jour.” is“ hair. It is a weapon of up to three showers daily in summertime, for example. To punctuate her point, Bauza asked attendees to raise their “We have an obsession with having white teeth hands if they remembered the 1973 launch of the Charlie fra- seduction for the Brazilian and clean nails; you don’t go out of the house if grance. A large number of hands shot up. She then asked audi- you’re not impeccable,” said Fenart. “The main pre- ence members to shout out the name of the most memorable fra- occupation is hair. It is a weapon of seduction for the grance launched within the last decade. Silence. woman. Brazilian woman.” “Fragrances have become transitory,” said Bauza. “There is no ”— François-Xavier Fenart Brazilian women wash their hair nearly daily effort to establish an emotional connection to the brand.” and use up to four to fi ve products. The second main The executive spends quite a bit of time speaking directly to beauty priority is body care, followed by skin care. He explained many Brazilians use body prod- customers during store tours, shop-alongs and in their homes, and ucts on their faces and continued that there’s a “booming” sun care market in the country. she has learned what they want. The dermacosmetics segment is growing fast in Brazil. Meanwhile, the professional category is “She wants quality in the products that she is buying, she wants fl ourishing but still only contributes 3 percent of the whole. access to the brands and products that she wants, but she is not Brazil’s numerous retail channels include food sellers, drugstores, pharmacies and door-to-door. willing to overpay for these products, and she has made it very The selective scene remains highly segmented. clear that she has many choices,” said Bauza. Part of L’Oréal’s success in Brazil stems from its creation of a laboratory (a fi rst for one of the The customer also is no longer loyal to one particular retailer company’s subsidiaries, in 2006) focusing on hair. It was a must, said Fenart, since there are a phe- or shopping channel. “Waiting for a customer to come to a single nomenal eight hair types in Brazil. Certain innovations — in both product and services — specifi - channel of distribution is allowing the world to evolve around us, cally for Brazil have been developed in that lab. without us,” she said. As for how the industry will meaningfully L’Oréal also established an active cosmetics division in Brazil in 2002, since its citizens are der- grow sales, Bauza offered a new formula to replace the “old-world” matologist enthusiasts. one. She said, “We must be customer-centric and deliver on prod- L’Oréal ranks fi rst in Brazil’s professional market, where it concentrates on color and treatment. uct innovation. Value is the price of entry and multichannel is the And to further win over the middle class, the fi rm has been introducing “accessible innovation” new portal. Information technology is the driver.…This is the new through its Garnier and Matrix brands plus some new categories. equation, this is the key to delivering double-digit growth.” — Jennifer Weil — M.P.

Serge Jureidini, Jerry Vittoria and Marc Rey. Carsten Fischer, Guy Look and Macy Leung. Mike Indursky gets a poolside pedicure.

Ido Leffl er, Bryan Meehan and Alan Ennis.

Rob Robillard and Frédéric Jacques 8 WWD, FRIDAY, JUNE 11, 2010 WWD.COM THE BEAUTY CEO SUMMIT 2010 RUSSIA RISING ic diffi culties. Third place is occupied by Ile de RIVE GAUCHE IS THE SECOND-LARGEST per- Beauté, with 117 units. Marcia Kilgore fumery chain in Russia, with 118 stores. But that Jacques sketched the evolution of the Russian ranking will not last forever if the irrepressible market through the bearish Soviet times, when Corinne Jacques, the company’s vice president, much business was done by barter, through the has anything to say about it. perestroika period from 1992 to the fi nancial crisis Founded in Saint Petersburg in 1995 by Pavel of 1998 with the ruble devaluation to the forma- and Larissa Karaban, the chain expanded into tion of a structured market between 2000 and 2006. Moscow after Jacques joined the company as As more distributors entered the market, brands part of a national ambition. The 43 shops in Saint fought for space and more retail chains popped Petersburg now represent 46 percent of Rive up, discounting became common and certain prac- Gauche; Moscow’s 11 shops amount to 17 percent, tices were established, such as the advent of fi del- and the 64 regional stores account for the rest. Sales ity cards and self-service retailing. The consumer volume averages 11,122 euros, or $13,235 at current continued to become more knowledgeable and exchange, a square meter, ac- more demanding. cording to Jacques. Corinne Jacques Despite the Russian con- “My goal is to have one- sumer’s addiction to cosmet- HUNTING FOR THE NEXT BIG THING third of the turnover done in ics, the outbreak of discount- PALM BEACH, Fla. — Marcia Kilgore — the beauty guru who Moscow, one-third in Saint ing caused what Jacques has developed everything from face cream to fragrance to Petersburg and one-third in described as a “disorienta- footwear — is rooting for the little guy with the big idea. the regions,” Jacques said on tion” in the mind of the con- While calling on the beauty industry to nurture up- Wednesday, the third day of the sumer as to what is the real and-coming players, the London-based founder of Soap & summit. Because the chain is value of the typical product. Glory and FitFlop walked attendees at the WWD Beauty so strong in Saint Petersburg, “So Rive Gauche estab- CEO Summit through her process of taking “an idea from “sometimes suppliers consider lished a strategy of product of a little acorn into a big oak tree.” Rive Gauche a regional [fi rm], the month to really try to dis- She recalled the early days of her fi rst spa venture when which we are not. We are a na- count but to limit it,” Jacques Uma Thurman would sit on the fl oor of a one-room space as tional one,” she asserted. said. Under the program, the an answering machine clicked away in the corner. Jacques wants to expand the 17 percent of the chain and its suppliers pick one product each “It was really a small thing, but it was a gem and it was business now done in Moscow to 25 percent by the month and cut the price by as much as 50 percent. something that just needed to be polished,” she said. “And end of summer and reach one-third by the end of “We are sharing with the suppliers the loss of mar- I think that a lot of times there are a lot of gems out there. the year. “I should make it,” she said. gin and this increases sales in volume,” she said. But as an industry we tend to look only at the huge things She came to Rive Gauche in 2008 as a bit of a Rive Gauche maintains a mix of 60 percent that can bring in a lot of money immediately, rather than renaissance woman. With a background in diplo- luxury products — 64 percent in Moscow — and looking at some of the gems that need to be polished and macy — she was commercial attaché at the French 40 percent mass market brands. Of the total, fra- that can be made bigger and made into the next big things. Embassy in Moscow — Jacques became an export grance and makeup each do 35 percent of the “Maybe there is a way that as an industry we can think manager for Givenchy in 1989, then a distributor in business and skin care 20 percent. about a way to get together and try and build that new 1995 and then a part of the LVMH Group. The chain’s top three luxury women’s fra- business, because it doesn’t seem to happen,” she said. Although Rive Gauche claims the highest sales grances are Chanel’s Coco Mademoiselle, “When it gets competitive, when the chips are down, it per square meter, the market leader in number Givenchy’s Ange ou Démon Le Secret and seems like everybody goes for who’s advertising the most of units is L’Etoile, with 621 stores open this year. Chance Eau Tendre from Chanel. The best-sell- and who is out there and who’s a known entity. But that’s But Jacques maintains that Rive Gauche, which ing men’s scents are Allure Homme Sport from not going to build long-term business always.” she boasts opened the biggest perfume shop in Chanel, Dior Homme Sport from Dior and Pi When developing brands, Kilgore, who sold her Bliss Russia, is “eating” much of L’Etoile’s dominant Neo from Givenchy. spa business to LVMH Moët Hennessy Louis Vuitton in market share as the rival chain suffers econom- — Pete Born 1999, said she applies what she calls the “so what test.” “The ‘so what test’ is taking your idea or your concept or even just down to the basic product level and saying, to be a leader. Investment was funneled into the ‘So what?’” she said. “It’s brutal and you should be able to THE DOS AND THE DON’TS product, instead of the marketing. do it to yourself.” PHILIP SHEARER, CHIEF EXECUTIVE OFFI- On the bright side, makeup in the U.S. has thrived, Kilgore did just that when she created Soap & Glory, a bath, cer of the Paris-based Clarins Group, took an even- with sales jumping from $1.8 billion in 1997 to $3.1 bil- body and treatment brand, which comprises products with handed view in pointing out some industry strengths lion in 2009, according to NPD. Specifi cally, Shearer tongue-in-cheek names, including an item dubbed Glow Job. while highlighting lapses and suggesting how to put mentioned the stellar success of MAC Cosmetics, “So we’ve got humor, we’ve got budget and we’ve got some troubled categories back on track. which, he implied, was spurred by a return to basics world-class design,” she said. “And I don’t think you have Overall, he saw no reason for alarm. “The fun- of focusing “on service, focus on people. The notion of that very often all wrapped up into a package at an acces- damentals are very, very healthy,” he began. “We’ve productivity has evolved to service fi rst and produc- sible price point that really looks great.” got a population that’s growing around the world; tivity will come along.” He added, “People don’t buy Similarly, FitFlop, a footwear line said to allow wear- there are more lips to paint. The population is aging, the channel,” he said. “They buy a product and the ers to “get a workout while you walk” brought something which in general is pretty good, at least for some service that goes with it.” new to market. categories of what we sell,” he contin- Turning to Europe and zeroing in “Any new product should be remarkable, which just ued. “Purchasing power is going up. on the skin care category in France, Philip means it should be able to be easily remarked on,” she said. However, there are problems. “We in Shearer illustrated how the product Shearer “We all know that PR and press and the media are one of our the industry all have specifi c roles to category has been gradually eroded biggest friends. If you give them something funny or some- fulfi ll, a job to do, so let’s just do it,” he over the last two years in the prestige thing interesting or something remarkable to fi ll space with said in conclusion. He illustrated this channel of perfumeries. Those perfum- in their magazines, then hopefully they will write about it point with three case studies. eries, he suggested, have been eclipsed and millions of people will read about it. If you send them Two of them were minuses — fra- by pharmacies, which stepped into the yet another face cream with Retinol, hexapeptides and nia- grance in the U.S. and skin care in service gap created by the lapses of the cinamide, if it doesn’t have a clinical, who cares, right? Europe — and one big plus — make- selective channel. “The pharmacies “I think it’s very important to remember that every up in North America. took over, and what is selective just new brand has to have a voice,” she continued. “If on your Turning to the sadly familiar story of the disappeared,” Shearer noted. product — within three seconds it doesn’t communicate American fragrance market, he flashed NPD As an alternative to this, he offered another tech- to the customer what’s in it for them, why she should buy Group statistics showing that the $2.8 billion busi- nique pioneered by Clarins, which is the Clarins it, why should she like it, or why should he like it, or why ness of 1997 had shrunk by 12 percent to $2.5 bil- Skin Spas built inside department stores in the should he buy it — it’s not going to be interesting. You lion by 2009. U.K. Consumers pay for services and the transac- don’t have a chance.” Fragrances have been overpromoted, he sug- tion “enables us to demonstrate our expertise.” Kilgore also stressed the importance of offering prod- gested, while there has been more reliance on He credited the British retailers for their coopera- ucts that go above and beyond customers’ needs — for ex- advertising and cutting the cost of the product. tion. “They understood early in the game that a brand ample, putting very high sun protection in products when The result: “The product is not as good as it used is not just one thing you can do on a shelf or advertise a lower level would likely suffi ce. to be.” As one possible solution, he pointed to the hell out of,” he said. “People need to understand “It’s making people look like experts when they don’t nec- Clarins’ iconoclastic approach in launching Angel why and how they are going to apply products. That’s essarily need it, but it gives them ego gratifi cation,” she said. in 1990 with the goal of capturing only 2 percent how you create value for your consumers.” — Brid Costello of the market because that is all that was needed — P.B.

Claudia Poccia and Terry Darland George Cleary and Ed Shirley Marcia Kilgore and Muriel Gonzalez

For coverage of more speakers, see WWD.com. Steve Stoute with Mary J. Blige Gina Drosos and Cathy Leonhardt

10 WWD, FRIDAY, JUNE 11, 2010

Louis Vuitton Louis Vuitton Proenza Schouler

HappyBold colors,Travels rich-looking details and graphic motifs are among the distinctive, upbeat elements of the pieces to pack as the resort season continues. WWD, FRIDAY, JUNE 11, 2010 11 WWD.COM

Proenza Schouler Tor y Burch J.Mendel

For more looks from the collections, see WWD.com. MITRA ERICKSEN AND ROBERT KYLE CHINSEE, GEORGE BY PHOTOS

Louis Vuitton: “A little bit Lolita” was how Louis Vuitton what their Proenza Schouler girl needs for resort tunics and printed harem pants for the Rajasthan set, style director Julie de Libran described Marc Jacobs’ — which went beyond the expected saris and rich and printed puffy parks and ski suits for the Saint resort lineup. That means retro, ultrafeminine clothes, embellishments. So they chose to use Bandhani tie- Moritz crowd. with prints of fruit vines and peonies worked onto dyeing techniques and sweet tie closures rather than fl ouncy skirts, and bows adorning cinch-waisted shorts buttons and hardware. The cool tie-dye looks range J.Mendel: Gilles Mendel presented a stunning array and trousers. It isn’t all fl ou and frou, however: There from easy Ts to lightweight dresses, while textured of ballet-inspired dresses for cruise. A hydrangea is louche glamour in the cool striped silk blouses and gold dresses are rich and luxe. And beachy Baja tops blue silk chiffon dress with a pleated bodice and solid suede jackets, and a chic ease to the dresses, and tailored coats make the perfect toppers. a nude silk organza one with a jewelled strap and particularly a pale pink and cream-trimmed bouclé pleated peplum set the tone for the subtle touches number with a gentle full skirt. Tor y Burch: With resort’s vacation roots in mind, Tory that characterize the collection. “These dresses have Burch imagined her customer traveling to various many details in the cut and construction, but they Happy Travels Proenza Schouler: After a recent trip to India, Jack locations. Her eclectic collection is full of bright don’t overpower; it’s about sophistication, fl uidity and McCollough and Lazaro Hernandez thought about colors and ethnic references, including tasseled lightness,” the designer explains. 12 WWD, FRIDAY, JUNE 11, 2010 WWD.COM

A Difference of Opinion Lauren’s Big Pony Scents I beg to dIffer. WIth rodriguez, Isaac Mizrahi my crabby colleagues about and Anna Sui old guard, with Ta rget Younger Men the CfdA Awards on Monday two Lifetime Achievement night. After reading their Award winners in their midst, WIth hIS NeW bIg PoNy fougère by givaudan and is in- coverage on Wednesday, I felt they’re not the young ones fragrance collection, ralph tended to represent the game as if I’d been at a different anymore. Maybe they held Lauren is making a departure of seduction, said de Lesquen. event. onto the youth distinction and leading a quartet of scents top notes are of red saffron Long ceremony? the show for so long because of the aimed at young, hip men into and cardamom seed, the heart itself was over by 9:30 or so. dearth, prior to the current the retail arena this summer. is of dark chocolate and musk Speeches and videos that happy explosion that dates Intended for men 18 to 30 and the base is of patchouli dragged on? doling out X more or less to the arrival of years old, the collection takes and benzoin laos. Its bottle is number of awards takes X the Proenza Schouler boys, of inspiration from the design- red with a yellow polo player amount of time. further multiple contenders for next- er’s big Pony shirts, ready-to- icon and green number two. tightening would require generation star status. wear polos embroidered with the adventurous fragrance, eliminating anything • • • an oversize version of ralph 3, a fougère woody by Iff, is remotely celebratory in I WAS feeLINg A LIttLe Lauren’s signature polo-player intended to address the game favor of a terse reading of crabby myself thursday logo. And if all goes according of adventure. It has top notes nominees and winners. morning while heading to to plan, the profits will be big of cactus and ginger, a heart of As for the films, having donna Karan’s greenwich as well: Industry sources esti- sage and spearmint and a dry- been involved in one two Street studio, even if the mated that the quartet could down of vetiver, cedar complex years ago and thus knowing final destination was her do as much as $40 million at and fig. It is in a green bottle the work and time invested, spectacular rooftop paradise. retail in the U.S. in their first with an orange polo player and this may be biased. but most the occasion: a presentation year on counter. blue number three. were terrific. At the top of the of Urban Zen, including the “our Polo ralph Lauren the stylish fragrance, 4, list: the women’s clothes on launch of the brand’s new fragrances have a history in is a woody fruity juice by the bridge, and (in the opinion furniture collection, a boldly the classic tradition and heri- firmenich intended to repre- of someone with limited geometric teak and white- tage of the sport of polo,” the sent the game of style. It has tolerance for random prop cushion affair made in bali. designer told WWd. “the big top notes of bergamot and usage of kids and puppies) (Until now, the tree-trunk Pony Collection is inspired mandarin, a heart of sage and tables and other with that tradition and sensibil- pear and a drydown of kyara- such earthy fare ity in mind but is geared toward wood and amber, and is in an have been one- a new generation of young men orange bottle with a blue polo of-a-kind items.) who are fans of the big Pony player and a red number four. this was not just Polo shirts that we create in a each scent will be avail- any presentation, variety of fun, colorful styles. able in a 75-ml. fashion but the kind for We want him to choose his for $50. they will bow in July which donna has shirt and scent to accompany exclusively on ralphlauren. long advocated: his mood and personal style. It com, and then will roll into one featuring is all about choice.” bricks-and-mortar distribu- current-season the four fragrances are tion — about 2,500 department merch. When intended to represent the and specialty store doors in front asked why invite key passions of young men, the U.S. — in August. At that by Bridget Foley the magazines who noted guillaume de Lesquen, Ralph time, a coffret set containing can’t do anything worldwide president of ralph Lauren 15-ml. bottles of all four fra- the delightful children’s with it, donna noted that Lauren fragrances: sport, se- grances will bow, retailing for accessories scavenger hunt. she’s perfectly content with duction, adventure and style. $45. for holiday, the brand Where were the parents of coverage on their Web sites. the number four has additional significance, will offer 125-ml. sizes of the scents for $65 each. said scavengers? Come on, (that’s a cue: for more on the as it is the number of players on a polo team. Internationally, the brand will be in about 16,000 guys. Maybe at lunch with collection, see WWd.com.) “the brand message is, ‘get in the game,’ ” said doors in 80 markets. “the Cat in the hat” parents. donna’s point that clothes de Lesquen. And having an assortment was im- All four fragrances will be scented in multipage I was hungry. do a Scarlett should get press at the time portant to the success of this launch, he added. national print advertising beginning in September o’hara: eat before. At past of their retail availability has “this customer likes choice — he may start out men’s and women’s books, said Leslie Marino, gen- ceremonies with a seated merit — there’s much that with one fragrance, go to another and then back eral manager of the designer fragrance division dinner, we complained about appeals about falling in love to the first one. We are targeting a new genera- at L’oréal USA. “this is one of our biggest invest- how long in between courses. with a look online and being tion, and it is very important with this market to ments ever for a men’s brand,” she said, noting Such snippiness detracted able to buy it right now — but give those options.” that the plans include 10-page and six-page scent- from the motif of genuine that horse is too far out of the Lauren’s iconic Polo scent assortment is geared ed ads designed to disseminate more than 100 mil- gratitude that pervaded barn to rein back. thus, the at a more mature audience, he said, with the aver- lion scented strips. While she refused to discuss the room and that WWd’s only way to put the concept age age of its user 30-plus. spending, industry sources estimated that ralph coverage did, in fact, . in play on a larger scale is the sporty fragrance, 1, is intended to repre- Lauren fragrances will spend upward of $10 mil- one felt comfort in the sense to establish a second set of sent the challenge of performance and is a cit- lion to $15 million on advertising and promotion of community intrinsic and shows each season — present rus aromatic concocted by International flavors in the U.S. in the scents’ first year on counter. necessary to this industry, spring to the press and fall & fragrances. It has top notes of grapefruit and Marino noted that social media will also be but that often gets lost in to consumers. hence my lime, a heart of cucumber and violet and a dry- a large part of the awareness campaign, with competition and playful irritation. the working week, down of tonka bean and musk. It is packaged in a facebook and twitter part of the digital plan. (or not so) fashion bitchery. which, during collections is blue bottle with a green polo player molded into College bookstores will also be part of the campaign, true, Kim hastreiter came seven days long, allows for the glass on one side and a bold yellow number with about 15 college bookstores that already carry off as caustic, her remarks only so many rounds of shows. one on the other. the designer’s big Pony shirts to get the scents. indicating admiration for Nevertheless, donna the seductive fragrance, 2, is an oriental — Julie Naughton lots of designers, just not dared to experiment. beyond most of those assembled the fact that 10 percent of in the room who’d voted to the store’s sales go to her honor her. but everyone Urban Zen foundation, FASHION SCOOPS else held back the nasties, exactly how the clothes speak whether it was richard to what their designer calls HAVING THE SHOULDERS?: Does Thierry Mugler have its Gaping at the number of Chai and Christopher bailey an “evolved state of being” eye on Gareth Pugh? According to sources, the Paris- cigarette-wielding diners, thanking former employers is unclear. More concrete is based fashion and fragrance house has held talks with “Inglourious Basterds” baddie donna Karan (both) and Marc that the clothes are fabulous. the London-based wunderkind, known for his out-of-this- Daniel Brühl, who’ll soon Jacobs (Chai), or the quietly the mostly undone, draped- world silhouettes and theatrical shows. It is understood be heading to Milan for the brilliant tonne goodman here, tucked-there t-shirt Mugler is mulling a change in fashion direction and has Ermenegildo Zegna show, said nodding to all who make a dresses can swing artsy- approached several potential candidates. The Mugler he’s in town shooting a Stéphane shoot work: photographers, cool-disaffected youth as fashion line, shuttered in 2003 by owner Groupe Clarins, Robelin-directed French-language models, hairdressers and convincingly as chic grown- was revived in 2008 under artistic director Rosemary film with Jane Fonda. “She’s makeup artists. And more up in casual mode. Rodriguez, who is still under contract. amazing. She asked me if I like Ashley Smith humorously, Iman, who fabulous enough, worn on modern music and I’m thinking, with André. thanked “my mother and pretty, Zen girls meandering ROCK STARS: He has a mighty hefty workload doing Well, there’s [quite an age gap] father for giving me a neck.” through a lush Zen garden catwalk shows, but that hasn’t stopped Alexandre de between us. Then she asked if I’d entwined with the obvious in the sky, for a guest who Betak from squeezing in a small side project. At a party like to join her for dinner with the appreciation was the theme arrived in non-Zen mode to Wednesday night for the launch of the Jalouse Rocks Scissor Sisters,” laughed Brühl. of change. While one can (temporarily, at least) release Paris Festival at André’s Hotel Amour, de Betak said he’s Fluttering among the tables, hardly consider the likes her pique about the nascent been busy working on a personal “rocks and technology” gap-toothed one-to-watch Texan Feugere of Michael Kors, prospect of yet another round project in Spain, where he’s building a house. “It’s a model Ashley Smith said she’s just tephane s

Jacobs, Narciso of shows. weird hybrid mix of screen, sound, movement, lights,” wrapped campaigns for Levi’s and

said de Betak, who hopes to unveil it at the end of the Sisley, adding she plans to enroll by year. The show producer also revealed he’s designing the at Parsons The New School for Daniel For CFDA and Urban Zen photos, see WWD.com. Brühl set for Mark Ronson’s fall tour. Design to study fashion design. photos WWD, FRIDAY, JUNE 11, 2010 13 WWD.COM Lauder’s Guggenheim Celebration MEMO PAD META MEDIA: “I know you guys are all Lazard, and Xavier Niel, founder of “If Leonard Lauder’s name Is on the InvItatIon, I’m goIng to come.” quiet and erudite, but come on,” Katie French Internet service provider Free, those words from macy’s Inc. chairman, chief executive officer and president terry Couric jibed The New Yorker table over to take over Le Monde SA, which Lundgren apparently rang true for more than 300 retailers and apparel industry ex- its lackluster applause for one of its owns Le Monde, weekly Télérama ecutives who were treated to a dinner by Lauder and his company in the rotunda of nominations at Thursday’s Mirror Awards and other publications, according to manhattan’s guggenheim museum Wednesday night. the beauty magnate hosted the event — i.e., a media-industry love-in — at a source familiar with the bidding. to welcome attendees of the World department store summit, which is being held in new The Plaza Hotel. Couric was like a stand- Other potential bidders are Claude York city for the first time. up comedian at the ceremony, saying of Perdriel, whose media holdings include “these are our customers and our friends,” Lauder said. one recognized article: “Personally, that the weekly Le Nouvel Observateur, The Bay’s Bonnie Brooks with “We really don’t know where business stops and friendship sounds like a buzz kill to me.” and Spanish media group Prisa, Leonard Lauder. begins. so when we learned that they were coming to new Her patter was less clunky than co- which owns a 15 percent stake in York, we thought we’d show them our city. I may not be mr. host Arianna Huffington’s, who couldn’t the company. Formal offers are due new York, but I’m pretty close, and can you think of a better stop with the jokes about the oil spill in today, but Prisa has indicated it will venue than the guggenheim?” the Gulf of Mexico. An example? “Like not be able to meet this deadline, so attendees were wowed by the venue and the hospital- BP’s ceo, you want your lives back, so this date could be pushed back. The ity of the estée Lauder cos. Inc., which Philippe houze of this is the last award,” she said as the final decision on new ownership will galeries Lafayette in Paris, said was the “common thread event approached the three-hour mark. rest with the internal shareholders between us.” She did land a few, though, not resisting who control Le Monde SA, namely the houze also embraced the opportunity to interact with a dig in unveiling the winner of the powerful journalists’ association other department store executives from around the world award for Best Single Article, Traditional SRM. — Joelle Diderich and learn about the different shopping patterns of their con- Media. “Traditional media — sounds sumers. In emerging countries, he said, department store re- sort of quaint, like the local green VOGUE’S NEW P.R. GAL: Vogue tapped tailing is a new business, while in established nations, mer- market,” she said. Megan Salt as director of public chants must find a way to reinvent themselves. “and through This was the fourth year the relations. Salt, who will start later this meetings like these, we learn how to innovate.” For more images, Newhouse School at Syracuse University month, takes over responsibilities from maurizio Borletti, who oversees La rinascente and see WWD.com. has hosted the Mirror Awards luncheon. director of communications Patrick O’ Printemps, added: “It’s very interesting to hear how things And, in a nod to honoree Twitter, winners Connell, who is to stay on through the are going around the world. In general, business is picking were encouraged to provide acceptance transition. Salt joined Vogue last year up. In europe, france is doing better than most. Italy is speeches in 140 characters or less. Biz as a special events consultant, working harder, but it’s still growing.” Stone, the star of the show as Twitter’s on the first Fashion’s Night Out, and also making an appearance to welcome the delegation to new York was mayor co-founder, seemed as surprised as continued to freelance for the magazine michael Bloomberg, who asked the attendees to spend money in the city: “We need the anyone by its success, telling the since. In addition to handling the tax revenue,” he said. on a more serious note, he pointed out that 40 percent of new crowd as he accepted the i-3 Award: magazine’s p.r., Salt will spearhead the Yorkers were actually born outside of the u.s. but “live together as a mixture. In other “Twitter isn’t a triumph of technology, organization of Fashion’s Night Out, cities, they live as a mosaic. In new York, you don’t see that.” it’s a triumph of humanity,” adding that scheduled for Sept. 10. — Jean E. Palmieri “we’re just getting started.” — Marc Karimzadeh But it was an emotional Nancy Jo Sales, accepting an award for ON THE ROAD: Pre-collection fatigue be her Vanity Fair profile, “The Unreal damned — Cynthia Rowley is bringing Rise of Jon and Kate Gosselin,” who the mountain to Mohammed this resort KIDS Event Raises $150K offered the best — and briefest — season. On Tuesday, the designer will “of the 9,135 daYs that KIds has exIst- KIds day, and keynoter silda Wall spitzer, remarks. “I find myself strangely pack her 2011 lineup, plus eight ed, I’ve been with KIds for 1,155. But who’s wife of the former new York governor, is- moved,” she said, holding back tears. models — “nine, if one drives” — counting?” said Janice Weinman, president sued a call to action by invoking the words “I’ve been doing this for a long time.” into a location van and drive right to of the Kids in distressed situations charity. of the late audrey hepburn, who helped — Amy Wicks and Nick Axelrod editors’ doorsteps (well, to the curbs of “each of those days has been a privilege to needy children around the world. “If you the Condé Nast, Hearst and Time Inc. make a difference.” ever needed a helping hand, you will find LURKING: It’s been a slow and offices) to stage mini-presentations Weinman spoke at last week’s luncheon one at the end of your arm.” relatively quiet bidding process so with her newest wares. “People have at the Pierre hotel marking the 25th anni- spitzer also quoted gandhi, stating, “You far for Newsweek, but there are a complained that the resort collections versary of KIds. the event raised $150,000, must be the change that you wish to see in few strategic suitors waiting on the are taking up so much time,” Rowley drew a crowd of 275, the world.” sidelines until later in the process, explained. “This is our way of making and honored three of “It’s easy to stand up according to industry insiders. So life easier.” (If not her own — Rowley the charity’s biggest here and accept an award, far, The Washington Post Co., owner will be fresh off a plane from Milan, supporters — elyse but it’s the people that do of the beleaguered newsweekly, where she’s celebrating the launch of Kroll, founder of this [help children in dis- has accepted bids from OpenGate her Roxy collection at 10 Corso Como enK International, tressed situations] every Capital (owners of TV Guide), with a press lunch today.) Rowley

which produces IANNACCONE single day that make a dif- Newsmax Media and money manager and Co.’s first stop will be at Condé fashion trade shows; ference, such as Janice,” Thane Ritchie. Sidney Harman, the Nast’s 4 Times Square headquarters Liz Lange, the ma- said miller. “It’s unimagi- stereo-equipment honcho, and auto at 1 p.m., followed by hour-long visits THOMAS

ternitywear design- BY nable for me to conceive entrepreneur Fred Drasner are also to Hearst Tower (at 3 p.m.) and the er, and christina of what it is like to try to reportedly interested, while some Time & Life Building (at 5 p.m.). At miller, senior vice PHOTO parent when you can’t even speculate the magazine could be each location, models will pile out president of cartoon Christina Miller, Janice Weinman, Liz Lange, provide the basic necessi- swooped up at the last minute by of the van and strut down the street network enterprises Mindy Grossman and Elyse Kroll. ties,” said Lange. an entity such as Reuters in the in front of the assembled editors. “It and turner sports In addition, sonya sarin same manner Bloomberg snapped up really is incorporating this fantasy of strategy, marketing, promotions. Karen said she formed a charity called Bottom BusinessWeek. — A.W. fashion with the reality of where it can Bromley, a founder of KIds, who chaired the Line with a goal to donate 10,000 packs of be worn,” said Rowley. Refreshments luncheon committee, was also recognized. underwear, seven pieces per pack, for needy NEW WORLD: Having financed weekly will be provided, and for those who tv journalist roz abrams hosted the boys and girls over the next year and that magazine Globe and the gay monthly can’t rip themselves away from their event and introduced a video of Weinman she is working with KIds on the project. Têtu, Pierre Bergé is bidding to computers for 15 minutes, the clothes in haiti outfitting children after the earth- since its inception, KIds has distributed save the venerable French daily Le will be back at Rowley’s Bleecker quake. John mattingly, commissioner of more than $1 billion worth of new product Monde from bankruptcy. Bergé has Street showroom for viewings on the new York city administration for to 65 million children. joined forces with Matthieu Pigasse, Wednesday and Thursday. children’s services, proclaimed June 3 — David Moin the local head of investment bank — Nick Axelrod EYE_WWD_06_10 The beauty Shopper EYE, the mall media experts, bring advertisers the latest insights into the minds of the beauty Shopper. With over 3000 directory panels in over 250 malls, EYE delivers your best customers before they step into your key doors. For more information on EYE’s Beauty Survey visit www.eyecorp.com/beauty

Or contact Ellen Carucci, VP Sales at 646 871 4419, [email protected] 14 WWD, FRIDAY, JUNE 11, 2010 WWD.COM Financial For full daily stock changes and more financial news, see WWD.com / business-news. Retail Stocks Jump 3%, Industry Imports Rise Again Neiman’s Rating Raised, By Evan Clark said thursday that textile and apparel imports to the U.s. posted double-digit increases in april for the third Barneys Remains Same Retail stocks locked in eaRly gains and consecutive month. built on them thursday, finishing with a 3 percent ad- shipments of textiles and apparel to the U.s. rose By Arnold J. Karr vance, as the dow Jones industrial average hit and held 15 percent to 4.16 billion square meter equivalents in the 10,000 mark. april compared with a year earlier. apparel imports in- neiMan MaRcUs inc. got a tHUMBs-UP FRoM the s&P Retail index raced up 12.77 points to 435.02 creased 13.2 percent to 1.72 billion sMe, while textile one ratings agency thursday, while Barneys new after a flat performance on Wednesday. and the dow imports were up 16.2 percent to 2.44 billion sMe. york inc. received a less flattering assessment shot up 2.8 percent, or 273.28 points, to 10,172.53, re- the overall trade deficit inched up in april to $40.3 from another. taking the 10,000 mark and then the 10,100 plateau as billion from $40 billion in March, according to the Moody’s investors service upgraded neiman’s cor- investors took in good news commerce department. porate family rating to “B3” from “caa1” based on a on the job front, indications overall export and import “solid recovery in credit metrics,” while standard & of stronger growth in europe volumes to the U.s. declined Poor’s Ratings service took Barneys off creditWatch this year and signs of vitality slightly compared with a without changing its “ccc” rating. in chinese exports. month earlier. However, s&P lowered its issue-level rating on Retail stocks registered “export and import Barneys to “ccc-minus” from “ccc” and lowered its their third-largest percent- trends are still pointing recovery rating to 5 from 3 “based on our view that age gain of the year — behind higher, although the pace of the company’s valuation has diminished over the past only the 5.7 percent increase growth is slowing after the few years.” Barneys was placed on creditWatch with of May 10 and the 3.1 percent big bounce-back in the sec- positive implications on april 22. pickup of May 27. While still ond half of 2009,” said nigel “the negative rating outlook reflects our concern 13 percent below their 2010 gault, chief U.s. economist that Barneys’ capital structure is unsustainable and high of 499.91, reached on at iHs global insight. that some sort of restructuring is a likely outcome,” april 26, they remain 5.8 per- “While our economy contin- wrote s&P credit analyst david kuntz. He cited the cent above the 411.12 mark at ues to strengthen, we still have store’s “weak liquidity position, participation in the which they concluded 2009. a lot of work to do,” commerce narrow luxury segment, small store base, absence the uninterrupted upward secretary gary locke said. of a chief executive officer since mid-2008, highly trajectory of thursday’s per- Retail stocks recorded their third-largest percentage gain Vietnam posted the larg- leveraged capital structure and thin cash flow pro- formance stood in dramatic of the year on Thursday. est single country increase, tection measures” in his research note explaining contrast to the performance of growing shipments of tex- the action. stocks on Wednesday, when a 2.1 percent upswing in re- tiles and apparel 44.7 percent to 231 million sMe in the at s& P, “ccc” signifies that obligations are “vul- tail issues was all but erased in the last hour of trading. month. shipments of apparel rose 16.8 percent to 141 nerable to nonpayment.” among the stocks lifted by the buying tide on Walls treet million sMe, while textile imports increased 132.3 per- the Moody’s action on neiman’s follows the luxury thursday was lululemon athletica inc., whose shares rose cent to 90 million sMe. retailer’s disclosure tuesday of third-quarter results 4.4 percent to $40.83 after it reported that its first-quarter india increased its textile and apparel shipments by that included a return to profitability, a 10.5 percent earnings more than tripled on a nearly 70 percent increase 32.5 percent to 305 million sMe in april, and moved up increase in sales and a 170-basis-point leap in gross in sales. Men’s Wearhouse inc., which reported better-than- to take Vietnam’s spot as the second largest textile and margin. the move lifts the dallas-based firm’s credit expected first-quarter profits on Wednesday evening, saw apparel supplier to the U.s. after china. apparel im- rating to the low end of the family considered “sub- its shares move up 18.9 percent to $22.20. ports from india rose 11 percent to 98 million sMe, and ject to high credit risk” from the high end of the group thursday’s rally was fed by a fresh reading on first-time textile imports spiked 45.9 percent to 207 million sMe. “judged to be of poor standing and…subject to very jobless claims, which fell by 3,000 last week to a season- china’s imports increased 11.6 percent to 1.7 billion high credit risk.” ally adjusted 456,000, according to a labor department sMe. apparel imports rose 9.5 percent to 574 million in her note on neiman’s, Moody’s debt analyst report. the european central Bank also decided to hold sMe, while shipments of textiles were up 12.7 percent Maggie taylor cautioned the company continues to its key interest rates steady and boosted its outlook for the to 1.13 billion sMe. face daunting challenges, including high debt levels eurozone gdP this year to 0.7 percent to 1.3 percent. the volume of imports from Bangladesh recovered in — long-term debt stood at $2.97 billion on May 1 — european investors were feeling cheery, though, and april, as shipments increased 24.7 percent to 178 million and a “luxury goods market…constrained by tighter pushed the cac 40 up 2 percent to 3,516.64 in Paris, sMe, spurred almost entirely by an increase in apparel consumer credit” and unlikely to return to its prere- the daX ahead 1.2 percent to 6,056.59 in Frankfurt and imports. textile and apparel shipments from indonesia cession state. the Ftse 100 up 0.9 percent to 5,132.50 in london. rose 26 percent to 153 million sMe and imports from But the store’s “good liquidity, solid competitive

additionally, the euro rebounded to nearly $1.21. Pakistan advanced 21.7 percent to 256 million sMe. es position in the luxury market and solid execution G chinese exports in May increased 48.5 percent over south korea was once again the only top supplier a ability” weighed in its favor. year-ago levels, exceeding forecasts and helping to to the U.s. to post declining shipments of textiles and iM Moody’s also raised the speculative grade liquid- allay fears that uncertainty in the americas and europe apparel, as imports from the country dropped 16.2 per- ity rating on neiman’s to 1 from 2 based on expecta- a/Getty

might derail growth in asia. cent to 110 million sMe. M tions the company would maintain its “healthy cash a the nikkei 225 rose 1.1 percent to 9,542.65 in tokyo the top apparel suppliers to the U.s. in april were t balances and a sizable undrawn revolving credit and the Hang seng index inched up 0.1 percent to china, Vietnam, Bangladesh, indonesia and Honduras. facility.” neiman’s cash and cash equivalents more 19,632.70 in Hong kong. china was also the top textile supplier, followed by Mario than doubled in the 12 months trailing the end of the in another sign of improved demand in the U.s., the Pakistan, india, Mexico and south korea. third quarter, to $513.3 million from $229.4 million a

commerce department’s office of textiles & apparel — With contributions from Liza Casabona and A.J.K. Photo by year earlier.

10 BeSt PeRFoRMeRS 10 WoRSt PeRFoRMeRS

DAILY COMPANIES P/E VOLuME AMt DAILY COMPANIES P/E VOLuME AMt HIgH LOw LASt %CHANgE HIgH LOw LASt %CHANgE

1.54 1.14 American Apparel (APP) 8.4 4500941 1.54 +22.22 0.47 0.44 Phoenix Footwear (PXG) - 2925 0.45 -8.73

22.34 20.03 Men’s Wearhouse (MW) 21.7 5017520 22.20 +18.91 2.19 2.05 Bluefly (BFLY) - 1200 2.05 -6.75

2.53 2.15 New York & Co. (NWY) - 1746730 2.53 +16.06 1.45 1.38 Delia’s (DLIA) - 113792 1.39 -3.47

5.38 4.96 (LIZ) - 2006138 5.34 +9.43 79.75 76.59 Sears (SHLD) 41.1 1502013 77.69 -3.35

16.10 14.98 Brown Shoe (BWS) 23.4 578300 16.05 +9.04 15.44 15.04 Duckwall-Alco (DUCK) 20.1 2044 15.04 -2.97

4.38 4.16 Quiksilver (ZQK) - 1780474 4.37 +8.71 1.87 1.79 Parlux Fragrances (PARL) - 15043 1.79 -2.72

3.35 3.14 Pacific Sunwear (PSUN) - 1141877 3.35 +8.41 748.00 700.00 Asos * (ASC:L) 51.4 1160940 715.00 -1.79

8.87 8.16 Retail Ventures (RVI) 270.3 345075 8.79 +8.38 5.57 5.37 CCA (CAW) 9.9 17461 5.50 -0.90

41.95 39.66 Warnaco (WRC) 17.2 1438290 41.78 +8.07 16.39 15.50 Delta Apparel (DLA) 13.1 19348 15.88 -0.63

40.00 37.67 Skechers (SKX) 17.2 2049757 39.70 +8.03 31.23 29.66 Dollar General (DG) 28.8 1344967 29.98 -0.07

* Editor’s note: European stocks are quoted in the currency of their principal exchanges. Shares on the London Stock Exchange are quoted in pence, Richemont and The Swatch Group are quoted in Swiss francs and Hennes & Mauritz is quoted in Swedish kronor. All other European stocks are in euros. WWD, FRIDAY, JUNE 11, 2010 15 WWD.COM

See more party pictures Lubov Azria in at WWD.com/eyescoop. BCBG Max Azria in collaboration with Art Attack Ellen Harvey. The annual WhiTney ConTemporaries’ art party is not for wallflowers. The event, held Wednesday night in a loftlike space on mercer street (a move from the darker environs of skylight) made airy by shrubbery and inviting white banquettes and sponsored by BCBG max azria, has become a requisite social stop for fashion and art kids alike. and it seemed there were some pretty serious bidders among the crowd perusing the silent auction, whose offerings included works by Dike Blair, Cecily Brown, Roni Horn and Hunt Slonem. “What recession — everything’s presold!” said one miffed buyer. (a select few got first dibs during an auction preview earlier in the evening.) Guests such as Maggie Grace, Charlotte Ronson, Eleanor Ylvisaker, Yigal Azrouël, and co-host Lubov Azria (husband Max was absent) scanned the lots. even the celebrity contingent emphasized the art, though they readily admitted to being far from experts. “i mean, i love art, but i don’t really follow the scene,” said Christina Ricci, in town for her second new york art happening Lorenzo Martone since last week’s Marina Abramovic bash. “i know what i like and i and Prabal Gurung love going to museums and things.” Co-host Emilie de Ravin was similarly vague about her specific interests in art. referring to the Whitney’s independent study program, the main beneficiary of the evening’s Alek Wek in Edition proceeds, she said, “isp is wonderful, it’s a fun by Georges Chakra. night, it’s great to support and i suppose i also, in general, have just always really supported the arts industry in every way.” “i love art, i love being home in new york,” said Jennifer Esposito, who moved back east a year ago (she was recently diagnosed Annabelle with celiac disease and has a food line in the Dexter-Jones works to help raise awareness of it). “a new york party, an l.a. party — very different things. in new york, there really is a level of art still that sometimes gets lost in l.a. for me because a lot of it is based on money and films. it’s a business. and there’s still art in new york, which i love.” True, but the mix of girls in teeny, tiny dresses (many courtesy of hervé léger by max azria) and young guys in slick suits meant some were checking out more than just the Emilie de Ravin in BCBG paintings on the walls. Eva Amurri in Max Azria with Maggie “everyone here wants to get BCBG Max Azria Lisa Airan Grace in BCBG Max Azria in married or laid,” remarked one with Chris Benz. in Lanvin. collaboration with Ellen Harvey.

observer of the comely crowd. steve eichner photos by

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