In the Spirit

GLOBAL GOING LUXE REACH THE BELLEVUE COLLECTION AS PROFITS AT PLOTS A $1.2 BILLION ERMENEGILDO ZEGNA RISE EXPANSION TO RAISE THE 13 PERCENT, THE BRAND LUXURY QUOTIENT IN SEATTLE. PLANS MORE RETAIL EXPANSION. PAGE 2 PAGE 12 BANGLADESH TRAGEDY Retailers, Groups Vow Compensation By MAYU SAINI WHO IS GOING TO PAY and how much? That is among the questions being asked as the death toll from the collapse of the apparel factory building in Savar, near Dhaka, Bangladesh, rose to 430 on Thursday, with more than 520 injured, out of which 100 amputations have been estimated. FRIDAY, MAY 3, 2013 ■ WOMEN’S WEAR DAILY ■ $3.00 The rest of the rescued workers will also need WWD new jobs, as well as immediate payments. Hundreds of workers are still missing, and eight days after the eight-story building collapsed, bodies are still being recovered from the debris. The building, Rana Plaza, housed fi ve garment fac- tories, with more than 3,000 workers in the building at the time of the collapse. The incident is being described by authorities as the worst industrial accident in the garment industry in Bangladesh and the world. “The total compensation fi gure is likely to be over $30 million in addition to the cost of emergency treatment,” the Clean Clothes Campaign said last week, when the death toll was known to be 300. In the But a presentation by the Bangladesh Garment Manufacturers & Exports Association earlier this week noted a vastly different number, stating that the amount needed for “compensation, rehabilitation and long-term treatment was estimated at $12 million.” The organization also noted that an amount of 125 Spirit million Bangladesh taka, or $1.6 million at current ex- change rates, had already been spent on rescue activi- The Estée Lauder brand will ties and treatment. Treatment has been provided free of charge to all introduce Modern Muse, its fi rst of the injured, offi cials said. major women’s fragrance in a Talking about the range of estimates, a senior decade, in September. The scent economist in the government told WWD that would vary widely, depending on who was paying. is designed as an olfactive ode to “Living standards are experienced in substantially the dynamic self-confi dence of the different ways in an emerging economy. On the other modern woman. Expectations are hand, the expectation also goes up substantially when the money is coming from a global brand or retailer,” running high, with industry sources he said, while explaining that although $38 a month, speculating that the volume target the minimum wage that is paid to the garment workers is as high as $95 million in retail in Bangladesh, appears paltry, it is substantially higher sales globally for the fi rst full year. SEE PAGE 3 For more, see page 6. Beauty Grows at Mass By FAYE BROOKMAN PALM BEACH, Fla. — With customers returning to mass-market cosmetics departments with open wallets, retailers at the 80th edition of National Association of Chain Drug Stores Annual Meeting charged beauty companies to bring them fresh and relevant items. And, many want assortments custom- ized for their own stores to differentiate them from the competition. Color cosmetics sales in the mass market are up a healthy 5.4 percent for the fi rst quarter, ended March 30, according to Nielsen data. The catalyst is the nail category, with gains in the high-double digits across some brands. However, just as clouds threatened to drive pool- side gatherings of high-level execs inside at The Breakers hotel last week, there was fear economic uncertainty could dampen results for the second half of the year. Much of the industry’s success hinges on consumers’ unrelenting interest in nail-care products, coupled with retailers’ ability to achieve sales goals. To drive that growth, the 60-plus retail companies that attended the meeting — ranging from Wal-Mart to Ulta — asked the 20 beauty companies present for in- novation, support of loyalty programs and items that build basket transactions. Nails were ubiquitous at the event, including at Revlon’s opening reception, hosted by brand ambas- sador Olivia Wilde, where partygoers were treated to PHOTO BY JOHN AQUINO; STYLED BY TYLER RESTY nail-art application, and at the Wet ‘n’ Wild’s suite at SEE PAGE 7 2 WWD FRIDAY, MAY 3, 2013 Zegna Posts 13% Profit Increase THE BRIEFING BOX Zegna pointed to a slowdown and Saks Fifth Avenue, where IN TODAY’S WWD By LUISA ZARGANI in Greater China in the last quar- corners are also being renovated. ter of 2012 and in the first quarter Last year, global retail gener- D MILAN — Exports that increased of this year, which he described ated 78 percent of sales, showing margins and were more balanced as “strange,” and will need to be a 16 percentage point growth in around the world helped the “followed carefully.” Additionally, four years. Ermenegildo Zegna Group close the negative trend in the global At the end of 2012, the com- 2012 with a 13 percent increase economy may impact the luxury pany had 543 stores, of which 303 in profits. Further gains and industry, he continued. were directly operated. An ad- more investments in its retail “It’s not easy to make forecasts ditional 30 openings are sched- network are expected in 2013. but we are well equipped. We re- uled for 2013, including stores “We have been saving for a main positive, we are confident in Geneva, London, Cancun, Abu rainy day,” chief executive officer that we can generate positive fi- Dhabi, Kuwait City, Singapore, Gildo Zegna told·· WWD. “We gen- nancial results, and we hope this Hanoi, Brisbane and a number of erated good margins, because we is a transition,” the ceo said. Chinese cities, including Beijing have been very careful to avoid Zegna expects to grow in and Shanghai. heavy discounting both at retail 2013, although “not along the “In 2013, we will continue to and wholesale — also in the U.S.” same lines as last year.” That invest in Europe, the U.S., Mexico, EICHNER The executive also cited more said, he underscored the compa- People’s Republic of China, Katy Perry at the Delete homogenous growth around the ny will invest more in 2013 than Australia and Singapore and in Blood Cancer DKMS Gala. STEVE world compared with past years, in 2012, although he declined to new markets, such as Nigeria and For more, see WWD.com BY when sales were largely chan- provide details. Investments will Vietnam, to expand our retail net- PHOTO neled through Greater China. be mainly aimed at improving work,” said Zegna. Just back from In the 12 months ended Dec. and expanding the group’s retail a two-day event in Sydney to cel- 31, the Italian men’s wear group network, and in communication ebrate the 50th anniversary of Compensation to the victims has become a highly discussed saw net profits climb to 130 mil- and advertisement. the Ermenegildo Zegna Extrafine topic in the aftermath of apparel factory building collapse near Wool Trophy, the executive Dhaka, Bangladesh. PAGE 1 said he expects Australia to become one of the “top 10” We generated good margins, because countries for the group. Retailers at the National Association of Chain Drug Stores Annual Meeting charged beauty companies to bring them fresh Asked about the men’s PAGE 1 we have been very careful to avoid heavy wear market today, Zegna said and relevant items. he feels this is “a good mo- discounting both at retail and wholesale. ment” for the category, noting President Obama on Thursday nominated Michael Froman that two areas in particular for U.S. Trade Representative and Penny Pritzker as — GILDO ZEGNA, ERMENEGILDO ZEGNA GROUP are “growing strongly, luxury Commerce Secretary. PAGE 3 sportswear and accessories,” in addition to Su Misura, or Some 90 looks paraded down the runway Wednesday night lion euros, or $166.4 million, “The brand is well-positioned, made-to-measure tailoring, which at the Fashion Institute of Technology end-of the-year runway compared with 115.1 million but we continue to relocate to can be further developed. show. PAGE 4 euros, or $160 million, in 2011. bigger spaces and renew stores In 2013, the company will un- Earnings before interest, with [architect] Peter Marino. Our veil the first collections overseen Narciso Rodriguez is in expansion mode, this week unveiling taxes, depreciation and amortiza- customers travel and we want to by Stefano Pilati. He started Jan. 1 a revamped Web site and e-commerce capabilities for the tion reached 250.2 million euros, offer the same freshness and mo- as creative director of the group’s first time. PAGE 5 or $320.2 million — 19.8 percent dernity everywhere around the Agnona women’s line and head of sales — up 7.5 percent from world, not only in new and emerg- of design at Ermenegildo Zegna, The Estée Lauder brand aims to reclaim with its fragrance 233 million euros, or $323.9 mil- ing countries,” said Zegna, add- with responsibility for that brand’s heritage this fall with the introduction of Modern Muse. PAGE 6 lion, the previous year. ing that about 70 percent of group fashion show as well as for the Sales increased 11.9 percent stores have been renovated over Ermenegildo Zegna Couture col- ·· Sheri McCoy was praised by Avon Products Inc. stockholders to 1.26 billion, or $1.61 billion, the past two years. lection. Zegna declined to provide as she took charge of her first annual meeting as the compared with 1.13 billion euros, “We are renewing and extend- a peek into the designer’s work, PAGE 8 or $1.57 billion.

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