FUND BIG IS BETTER HOLT RENFREW AIMS TO ENHANCE ITS LUXURY NICHE RAISER GOING BY FOCUSING ON ITS LARGER STORES. PAGE 8 E-COMMERCE SITE WEARABLE JUST FAB RAISES AN ADDITIONAL $85 MILLION TO HELP FUEL GLOBAL REBECCA MINKOFF GETS SET TO EXPANSION. PAGE 9 LAUNCH A COLLECTION OF ACCESSORIES WITH WEARABLE TECHNOLOGY. PAGE 3

PICKY TEENS A &F Changes Strategy As Logos Lose Allure

By VICKI M. YOUNG

LOGOS ARE LOSING some of their consumer appeal — and nowhere is that more evident than at teen re- WWD tailers like Abercrombie & Fitch Co. Abercrombie revealed Thursday it is moving away from the logo business, and will eventually exit the FRIDAY, AUGUST 29, 2014 Q $3.00 Q WOMEN’S WEAR DAILY category entirely in its North American stores. That’s a major change from the company’s heritage, and the days when the three As — Abercrombie, American Eagle Outfitters and Aéropostale — dominated the mall corridors competing against each other with their logos front and center in store windows and on display tables. To be sure, brands in general have been relying The less on logos, particularly in the accessories sector where companies from Coach to Gucci have been de- emphasizing their logo products. The move by Abercrombie is also a nod to how the teen consumer has changed over the years and why teen retailers have seen pressure in the last few quarters. Color of In the case of Abercrombie, the female con- sumer has been more oriented toward fast fashion. And while logo product has been decreasing at the A&F brand, it hasn’t been moving out as fast at the Hollister brand, which typically has a higher percent- Money age of logo offerings. That was evidenced by the steep second-quarter comparable-store sales decline of 10 The ever-ubiquitous percent at Hollister compared with a dip of 1 percent at the core A&F branded stores. Kardashian clan is known Michael Jeffries, chief executive officer, said in a for many things, but one conference call to Wall Street analysts, “In the spring season, we’re looking to take the North American logo in particular is its ability business to practically nothing, but protect logo in in- to generate mountains ternational stores.” of cash. The latest Jonathan Ramsden, chief operating officer, said in a telephone interview, “Our consumer is less logo- example is Kim, Khloé oriented. They are [no longer] walking billboards.” and Kourtney’s venture Ramsden explained that for now, the company will with Farouk Systems support the logo category in its overseas stores because to market a collection SEE PAGE 9 of hair tools and styling products in salon and mass-market distribution. Macy’s New Bronx Store: “I am going for a billion [dollars],” Localization in Action exulted Farouk Shami, executive chairman and By DAVID MOIN founder of the company. NEW YORK — Macy’s Inc. might be thinking global, Although he qualified eyeing China and the Middle East for stores, yet it his grandiose vision as still acts local. That’s evident in the Bronx, where the retailer this a long-term effort, he month opened a three-level, 160,000-square-foot store nevertheless predicted in the Mall at Bay Plaza in Baychester, at the foot of Co-op City. It’s the first new store to be built by Macy’s the Kardashian Beauty in New York City in 40 years — the last time was on hair-product line would Queens Boulevard in Queens — and is a case study generate more than of how the company taps an urban market and micro- manages the merchandising of the big national brands $200 million in retail and private brands it carries throughout the chain. sales in the first year. Macy’s has opened several city doors through take- For more, see page 4. overs of existing boxes like Abraham & Straus and Stern’s, but the new enclosed 780,000-square-foot Mall at Bay Plaza, developed by Prestige Properties, en- abled the 850-unit, $28 billion department store group to build from the ground up. “As big as we are, we feel small. We feel connect- ed,” said Randy Scalise, senior vice president and re- gional director of stores for Macy’s Northeast region, and a 33-year veteran of the company. On the selling floor, Scalise talks demographics and how Macy’s homes in, as part of its My Macy’s localization program. The Bronx store has a clean, crisp look, with ceramic white tiling and overhead LED lighting, but the distinction is in the merchandis- ing. While the labels are predictable — tried and true PHOTO BY JOHN AQUINO, STYLED BY SHARON BER brands like Michael Michael Kors, Tommy Hilfiger, SEE PAGE 8 2 WWD FRIDAY, AUGUST 29, 2014

Sales Rise, Profits Ebb at Ferragamo DIGITAL BRIEFING BOX cent of sales. “China has a differ- change rates. The region was pe- FOR MORE COVERAGE, FIND US ON WWD.COM, SOCIAL AND MOBILE. By LUISA ZARGANI ent speed for different cities,” said nalized by a 4 percent decrease Norsa. Hong Kong and Macau are in the second quarter due to an MILAN — Salvatore Ferragamo “still growing,” he said. While ac- expected slowdown following the SpA’s net profit in the first half knowledging a slowdown there, he consumer tax increase. Norsa ex- ON FACEBOOK of the year dropped 3 percent, said Hong Kong had a “very strong” pects low-single-digit growth for to 78 million euros, or $106.8 first half of August and expressed a the year in the country. million, compared with 81 mil- positive outlook in the medium to Revenues in Central and lion euros, or $106.1 million, long term. Greater China is “over- South America climbed 16.7 per- in the same period last year. performing,” said Norsa, who was cent, thanks to the area’s distri- However, if the capital gain “still very positive” on China, es- bution reorganization and repre- derived from last year’s sale of pecially in second- and third-tier senting 4.4 percent of the total. the Florence-based firm’s stake in cities. Two new stores are expected The region is “built on a strong ZeFer to the Ermenegildo Zegna to open in China in the second half. Mexico base,” and Brazil is grow- Group were excluded, profits He said Taiwan was very positive ing with a new store, opened in would have increased 14 percent. after two years of not being so, and the period, said Norsa. Net profit in the six months South Korea “performed well and During the call, chief financial ended June 30 — including a mi- extremely well at duty-free, driven officer Ernesto Greco described nority interest of 4 million euros, by Chinese travelers.” as “reasonable” the consensus of or $5.4 million — reached 82 mil- year-end revenues of between 1.33 lion euros, or $112.3 million, down and 1.35 billion euros, or $1.82 bil- 6 percent compared with the first lion and $1.84 billion. He also said half of last year but, excluding the $106.8M the gross margin forecast for the full capital gain, up 10 percent. year was “very similar” to that of Buoyed by the performance of FIRST-HALF NET PROFIT AT 2013 and that the earnings before in- its handbags, leather goods and SALVATORE FERRAGAMO. terest, taxes, depreciation and amor- Most Liked: footwear collections as well as tization margin could be expected Lady Gaga and Tony Bennett are set to appear in its solid growth in the Americas, to be slightly above 21 percent, al- H&M’s television commercial making its debut globally at the Europe and the Asia-Pacific re- Europe, despite the geo-political though it is “very difficult to read end of November, and in print, outdoor and online ads, too. gion, revenues rose 6 percent, to tensions that negatively impacted and predict the geopolitical future.” 659 million euros, or $902.8 mil- global tourist flows, posted a 9 per- Dollar amounts are converted lion, compared with 625 million cent sales rise and represented 27.6 at average exchange for the peri- euros, or $818.7 million, last year. percent of the total. Norsa said tour- ods to which they refer. ON INSTAGRAM At constant exchange, revenues ism is growing while “domestic con- Sales of handbags and leather would have grown 8 percent. sumption is stagnating” and lament- accessories climbed 13.3 percent Chief executive officer Michele ed the fact that Russian tourism had and footwear was up 3.5 percent, Norsa addressed the “unstable, been affected in the second quarter. together representing more than volatile and unclear geopoliti- North America was up 5 per- 78 percent of the group’s total rev- cal picture” in a conference call cent, accelerating in the second enue. Norsa cited an improvement with analysts on Thursday, citing quarter after a first quarter that in leather goods as women’s bags Russia, Ukraine and the Middle was strongly impacted by unfavor- were positioned at a higher price East as “major areas of concern.” able weather conditions. “There range. The performance of fragranc- The Asia-Pacific region was are good opportunities for the sec- es, which was penalized in the first once again the group’s main mar- ond part of the year,” said Norsa, quarter by shipping issues in Russia, ket, showing a 3.6 percent gain; that citing a significant number of Ukraine and China, recovered and market was lifted by the company’s Asian travelers to the West Coast. accelerated in the second quarter, Back-to-School: Dancing broke out behind the scenes at Greater China retail channel, The Japanese market edged resulting in a 5 percent increase in our photo shoot on first-day style. Show WWD a great first- which accelerated in the second down 0.4 percent but would have the first half, said Greco. Sales of ap- day look by posting a picture with #WWDBacktoSchool. quarter and accounted for 37.8 per- risen 6.4 percent at constant ex- parel dropped 8.1 percent.

Coty Trims Fourth-Quarter Loss ON WWD.COM Global consensus forecast of earnings He noted that the company Stock By VICKI M. YOUNG of 5 cents a share. Net revenue drove product development to Tracker: fell 1.6 percent to $1.04 billion better meet the needs of its con- Check for COTY INC.’S fourth-quarter results from $1.06 billion, which was also sumers by culture and tastes, with updates disappointed Wall Street as inves- below analysts’ forecast of $1.06 Arabian fragrances for the Middle on fashion tors sent its shares down 3.4 percent. billion in revenue for the quarter. East, skin care with specific tex- highs and Even though Coty narrowed For the year, the net loss was ture and light filters for Asia and lows from its fourth-quarter loss from a $97.4 million, or 26 cents a share, light-concentration fragrances for around year ago, it also fell short of Wall against net income of $168 mil- Latin America. The ceo also said Street’s earnings per share fore- lion, or 42 cents, a year ago. the company was making progress the world. cast as well as revenue expecta- Revenue fell 2.1 percent to $4.55 on its global efficiency plan, which tions for the quarter. Shares of billion from $4.65 billion. is aimed at “delivering annual Coty closed at $17.39. Michele Scannavini, chief ex- savings in excess of $200 million For the three months ended ecutive officer, said during a con- within the next three fiscal years.” June 30, the net loss was $20.1 ference call to analysts, “Fiscal According to the ceo, the com- million, or 5 cents a diluted share, 2013 was a challenging year for pany’s fiscal-year 2015 objective is versus a net loss of $62.3 million, Coty....The revenue decline was to return to revenue growth and or 16 cents, a year ago. Excluding mainly due to the pressure we had Coty expects “modest growth in the onetime charges, adjusted dilut- on our nail business, particularly first half of the year as we continue FOLLOW US ON SOCIAL MEDIA ed EPS was 3 cents, or flat to last in the U.S., which more than off- to see softness in our core fragranc- year. Even on an adjusted basis, set the growth we had in the fra- es and color cosmetics segments, @ WWD.com/social that still fell short of Wall Street’s grance and skin-care segments.” particularly in the mass channel.” TO E-MAIL REPORTERS AND EDITORS AT WWD, THE ADDRESS IS [email protected], USING THE INDIVIDUAL’S NAME. WWD IS A REGISTERED TRADEMARK OF ADVANCE MAGAZINE PUBLISHERS INC. COPYRIGHT ©2014 FAIRCHILD FASHION MEDIA. ALL RIGHTS RESERVED. PRINTED IN THE U.S.A. American Apparel to Add One Board Member VOLUME 208, NO. 44. FRIDAY, AUGUST 29, 2014. WWD (ISSN 0149–5380) is published daily (except Saturdays, Sundays and holidays, with one additional issue in March, April, May, June, August, October, November and December, and PRESUMING THE vetting pro- uals to the retailer’s board. Both regarding certain matters from fi- two additional issues in February and September) by Fairchild Fashion Media, which is a division of Advance Magazine cess doesn’t turn up any sur- seats have been vacant since 2011. nancial to sexual improprieties, a Publishers Inc. PRINCIPAL OFFICE: 750 Third Avenue, New York, NY 10017. Shared Services provided by Condé Nast: S.I. Newhouse, Jr., Chairman; Charles H. Townsend, Chief Executive Officer; Robert A. Sauerberg Jr., President; John W. Bellando, prises, American Apparel Inc. The addition of Mintz would bring move that triggered Lion Capital’s Chief Operating Officer & Chief Financial Officer; Jill Bright, Chief Administrative Officer. 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To subscribe to other Fairchild Fashion Media magazines on the World Wide Web, visit www.wwd.com/subscriptions. quired in December that allow it The status of founder Dov of an agreement that reconsti- Occasionally we make our subscriber list available to carefully screened companies that offer products and services that we to buy up to 24.5 million shares Charney isn’t expected to be re- tuted American Apparel’s board, believe would interest our readers. If you do not want to receive these offers and/or information, please advise us at P.O. Box 6356, Harlan, IA 51593 or call 866-401-7801. WOMEN’S WEAR DAILY IS NOT RESPONSIBLE FOR THE RETURN OR LOSS OF, OR FOR of American Apparel, or 12.3 solved until mid- to late-Septem- provided the retailer with up to DAMAGE OR ANY OTHER INJURY TO, UNSOLICITED MANUSCRIPTS, UNSOLICITED ART WORK (INCLUDING, BUT NOT LIMITED percent of the retailer’s common ber. Charney was removed from $25 million in funding and gave TO, DRAWINGS, PHOTOGRAPHS, AND TRANSPARENCIES), OR ANY OTHER UNSOLICITED MATERIALS. THOSE SUBMITTING MANUSCRIPTS, PHOTOGRAPHS, ART WORK, OR OTHER MATERIALS FOR CONSIDERATION SHOULD NOT SEND ORIGINALS, stock. Those warrants gave Lion the position of chief executive Charney the temporary title of UNLESS SPECIFICALLY REQUESTED TO DO SO BY WOMEN’S WEAR DAILY IN WRITING. MANUSCRIPTS, PHOTOGRAPHS, AND the right to nominate two individ- officer pending an internal probe strategic consultant. — V.M.Y. OTHER MATERIALS SUBMITTED MUST BE ACCOMPANIED BY A SELF-ADDRESSED STAMPED ENVELOPE. WWD FRIDAY, AUGUST 29, 2014 3 WWD.COM Astley Clarke Strengthens U.S. Focus Pandora Taps Friis as CEO; By RACHEL STRUGATZ ONLINE-FIRST retailers are quickly Leighton Exits moving into the offline world, and fine jewelry is no exception. U.K.-based jewelry company Astley By PAULINA SZMYDKE Clarke — originally founded as a multi- brand jewelry e-commerce site in 2006 PARIS — Danish jewelry group — is turning its focus to the U.S. market Pandora said Anders Colding Friis is to with a joint retail and online strategy. become its new chief executive officer. “We have our U.S. Web site that does He will succeed Allan Leighton, well, but it can do much better if we’re who is returning to the group’s board able to offer customers the chance to as co-deputy chairman in the spring, shop some whenever or wherever, on- after releasing the company’s full- line or offline, at their favorite retail- year results for 2014. ers,” said Bec Astley Clarke, the com- Friis joins Pandora from the pany’s founder and executive chairman. Scandinavian Tobacco Group, billed “I hope that our customers will become as the world’s largest manufacturer of more multichannel, as we are doing as cigars and pipe tobacco, where he most a brand. Having the brand alive [physi- recently held the position of group ceo. cally] in the U.S. helps.” “In Anders, we have found exactly The brand is on target to approach that rare combination of strong lead- $10 million in sales this year. While its ership skills and thorough business core business remains e-commerce, understanding we have been looking Clarke said the company will be in 40 Astley Clarke recently relaunched its U.S. e-commerce site. Its two core collections for to take the company to the next doors in the U.S. by the end of the of bracelets have seen strong growth year-to-date. stage,” said Leighton. year, including Neiman Marcus The fast-growing jewelry brand, as of this week. Year-to-date Biography collections are followed by concessions and wholesale. whose net profits jumped 53.6 percent sales are up 30 percent, now sold at 11 Neiman The company has evolved into a very in the second quarter, said it would also and the two core collec- Marcus doors nationwide different business than when Clarke name a new chairman of the board. tions — Muse, a dainty (and at neimanmarcus. founded it eight years ago. The site was Peder Tuborgh, ceo of Arla Foods, selection of white, com next week), as well dedicated, initially, almost entirely to billed as one of the strongest players yellow and rose gold as in Saks Fifth Avenue selling other designers’ pieces. There in the international dairy arena, is with diamonds, and and Ylang 23 stores. was a small in-house label, but it was subject to election at an extraordinary Biography, a more con- The brand also has never intended to be a meaningful por- meeting to be held in October. Tuborgh temporary range com- signed on to open holi- tion of the business — until she real- would succeed Marcello Bottoli, who prising mostly beaded day pop-up shops in 67 ized it sold quite well. So, she set up is to pursue “other professional com- bracelets intended Nordstrom units and a design studio at the company head- mitments,” the company said. for stacking — have on nordstrom.com. quarters five years ago and brought on The reshuffling comes on the heels seen upward growth Clarke said that, a creative director and a design team. of a turbulent period in the jewelry of 150 percent and 64 in order to succeed, Within one year, jewelry produced in- brand’s history. Friis will be the com- percent, respectively. a brand needs online house became 30 percent of sales, and, pany’s fifth ceo since it went public The brand re- and offline equally. today, the in-house label commands in fall 2010, which was followed by a cently relaunched “There was a over 90 percent of overall sales (astleyc- significant downgrade of the brand’s its U.S. e-commerce time when having a larke.com still sells a handful of other sales projections, causing its shares to site, which drives 12 Web site was the dif- designers, too). plummet 65.4 percent in a single trad- percent of all its on- ferentiator, but now “Today, we’re a multichannel brand,” ing day in 2011. line sales. Clarke con- we’re beyond that. It’s Astley Clarke said of the transition. “We Pandora was recently sued by a tended that growing about great product and very much are a brand in our own right.” group of investors claiming the profit the American online brands, and the Web The brand’s first-ever off-line pres- warning came too late. business is important, is a great route to mar- ence was a concession in Harrods in The 2011 downgrade caused but replicating what the ket — but so is being in 2012, followed by openings in Selfridges the departure of then-ceo Mikkel brand did in the U.K. is the world’s best depart- and Liberty. In the past 18 months, these Vendelin Olesen. He was temporar- key: starting online, then ment store,” she said. The key London locations have tripled in ily succeeded by Bottoli, then Bjørn bringing the product to brand’s online and direct space, Astley Clarke said, adding that Gulden, who left for Puma, and fi- the physical world through business in the U.S. and the there’s also a stand-alone London bou- nally Leighton, who had originally wholesale. The Muse and U.K. drives 50 percent of sales, tique attached to the company’s offices. served as the group’s chairman. Rebecca Minkoff’’ to Unveil Wearable Tech Accessories NEW YORK — Rebecca Minkoff is the cludes a compact mobile charger, iPhone ing a meeting or dinner. “There are a latest designer to launch wearable cases and a wristlet that come in vary- few people that a woman, for emergency tech accessories. ing colorways and retail from $40 purposes, has to have some connection Wearables that double as jewelry to $80. The product will go on with,” Minkoff said, explaining that she will launch at the designer’s spring sale at rebeccaminkoff.com and can still be in touch and have her phone The lightning cable and wearable runway show next week, including a Nordstrom in September, with put away, but if it’s one of those few peo- notification bracelets. gold chain-link bracelet with a silver some pieces rolling out closer to ple trying to reach her, she can take it bar and pyramid studs that’s actually year’s end. The product will also out and it’s acceptable. a wearable notification bracelet. The The fashion community has been eager $120 accessory, which will go on sale to embrace wearable technology. Ralph during the holiday season, Lauren introduced a smart shirt at the U.S. alerts the wearer to calls Open earlier this week and Tory Burch and texts via a Bluetooth Health is covered [in the launched a series of corresponding pairing with her mobile de- accessories to up fitness tracker vice. A $60 lightning cable Fitbit’s fashion profile. Diane von bracelet, hitting stores in wearable space] but at the Furstenberg worked with Google early November, connects Glass to create a collection of opti- to a USB cable to sync or end of the day, our customer cal and sunglasses for Net-a-porter charge a mobile device in June — a fitting partnership as — and also happens to be comes to us for fashion. she was the one to usher in fashion’s black leather, adorned with wearable moment with the introduc- flat gold studs and a clasp tion of Glass at her spring 2013 runway that hides connectors. — REBECCA MINKOFF show in September 2012. To the naked eye, ob- be carried in the three Rebecca Minkoff “Our girl wants to wear bracelets and servers wouldn’t know either of the [in the wearable space] but at the end of stores that will open in November and jewelry and she has this relationship bracelets contains any tecñological ca- the day, our customer comes to us for December, the first bowing in New York’s with tecñology, but for us, we’re adding pabilities — which is part of Minkoff ’s fashion — and as we look at this fashion- SoHo neighborhood on Nov. 12. function into very fashionable items she plan to reach the increasingly connect- function mix, it’s really where she’s liv- He noted that the development of would choose to buy, whether they were ed Millennial consumer. “We wanted to ing. This is a hybrid area where we think the notification bracelet resulted, in tech-enabled or not,” Minkoff said. “It’s a go after wearables in a different way,” we can have success with this customer.” part, from a backlash against a working dual-purpose thing. We’re not forcing her Uri Minkoff, chief executive officer at Created in partnership with Case- woman who had her mobile device on to have a lifestyle change, but added this Rebecca Minkoff, said. “Health is covered Mate, the five-item collection’’ also in- her at all times — often at the table dur- dual functionality.” — R.S.

4 WWD FRIDAY, AUGUST 29, 2014 beauty ’’ The K Machine Gears Up for Hair

By RACHEL BROWN Kourtney, Kim and Khloé Kardashian

LOS ANGELES — We know more about them than we need to know. So it may be a challenge to take the ever-present-at-all-times Kardashian This is going to sisters seriously — except when it comes to their earning power. The cash keeps coming in with a capital K as Kim, Khloé be an empire and Kourtney pile up one commercial spin-off after another from mobile video games to book deals to fragrance. of beauty. The latest example is a venture with — FAROUK SHAMI, Farouk Systems to launch hair tools and styling products in salon and mass distri- FAROUK SYSTEMS bution. Farouk Shami, executive chair- man and founder, is all in, and he isn’t shy about his outsize sales ambitions for his deal with Kardashian Beauty, mark- ing the first time his Houston-based com- AQUINO

pany has been affiliated with celebrities. JOHN

“I like big vision. I am going for a bil- BY lion,” said Shami, speaking on the set of a photo shoot at Milk Studios here

for Kardashian Beauty ads breaking in PRODUCTS February-March magazines. “There’s ’’ no doubt in my mind it will be there in about five years, definitely. We know what SULLIVAN; FOR A SLIDESHOW OF THE we are doing. This is going to be an em- KARDASHIANS THROUGH

pire of beauty for Farouk Systems and THE YEARS, SEE STEPHEN

the Kardashians.” He added one caveat: BY “It is not going to come overnight. We are WWD.com/

looking for long-term business.” beauty-industry-news. PHOTO Attaching a brand to celebrities is not

without risks, and Shami admitted he PORTRAIT had worried about the possibility of the Kardashian star fading upon making the own family to spend doing, so it has to be main feedback that we hear is that ev- shampoo, which adds texture. Then, the deal with the sisters. Those worries have something worth it for us that we are pas- erybody wants luxury products at an af- third day, I sleek it and I straighten it, and subsided. “I see their popularity going sionate about,” she said. “Things come fordable price,” said Kim. “We’ve worked then, the fourth day, I put our oil in it, and up and up and up and up,” said Shami. all the time like this drink, this restau- really hard to accomplish that. We take I make it a really sleek look. I might do “Their name is at the top, not just in the rant, this store opening, and some things all of the tricks of the trade that we’ve a ponytail or a sleek bun. That’s my hair U.S., but worldwide. I see more growth just don’t make sense.” learned from all of our glam teams over plan, and then I start over.” with the Kardashian name still. Even if it Shami’s confidence about the success the years, take the best products and Hair selfies are definitely part of the matures in the U.S., it hasn’t matured in of Kardashian Beauty in hair tools and make them affordable.” Chiming in about hair plan. “Sometimes you do a selfie the rest of the world.” styling products is due to the wide reach the items with Farouk, Kourtney said, just to capture the hair look. If you have But even Kim, Khloé and Kourtney of the brand the Kardashians have built. “They really are salon-quality products fun braids in your hair, you want to show recognize that they might not be in front Kardashian Beauty will straddle the pro- at an affordable price.” them off or if you have a cool, slicked of the cameras forever. “We are very fessional salon and mass retail channels, Certainly, Kim, Khloé and Kourtney ponytail. I love hair selfies,” said Kim. aware that all things come to an end, and and have a considerable international could get their makeup and hair done Rizzoli New York is scheduled to release we are OK with that,” said Khloé. “We are presence. Specifically, Shami men- daily by premier makeup artists and a book filled with Kim’s selfies titled so grateful and blessed, but we are all OK tioned that a deal with LG could spread hairstylists (for the shoot, their hair was “Selfish” in April 2015. Khloé said, “I feel when that day does come. We have loved Kardashian Beauty to Macau, Vietnam, styled by Chris McMillan, Peter Savic better taking a selfie when my hair is in the ride. It is not going to come anytime South Korea, Taiwan, China, Japan and Jen Atkin into four looks: natural my face. I don’t really like taking a selfie soon, but we are not going to freak out and and more. “There, you could talk about and sexy, sleek and smooth, voluminous when my hair is up. I love a good selfie spiral when it does happen. I think that’s $500 million easily. They have their own and old Hollywood), but at least Kourtney when someone takes it from the back.” what people’s perception is.” stores. We are working on the marketing doesn’t want to. “I have my five-minute The Kardashian sisters didn’t always Out of the gate, though, Shami expects and sales there already,” he said. makeup,” she said. “Khloé and I just fin- have A-plus hair. They acknowledged the Kardashian Beauty hair product line Kim, Khloé and Kourtney emphasized ished filming our season [of ‘Kourtney some hair missteps along the way. “I had to generate more than $200 million in re- their goal is to cater to the hair-care and Khloé Take the Hamptons’], so we a Dorothy Hamill bowl,” said Kourtney. tail sales in its initial year on the market. needs of their enormous fan base. “The have six weeks off and I’m so happy. I “I actually asked for it because a friend Launching next spring, the early assort- think I have two workdays during this of mine had it and my mom took me to ment contains three hair tools — a flat- An assortment six weeks. Today is one. To not have [to get it done. It was horrendous. I thought iron, a blow-dryer and a three-in-one tool, of Kardashian be] glam every day is so exciting to me. it was so cute on her. It was just not cute all priced at $89.99 — and seven styling Beauty products. I swore I’m not going to wear heels until on me. I looked like a little ugly boy.” products priced from $14 to $17: blow-dry the end of my pregnancy. I’m just so ex- Khloé remembered, “I had a bob with cream, volume mousse, dry shampoo, dry cited to be chilling.” bangs. I looked like Pat in that movie conditioner, firm hair spray, curl cream Kim is the most done up on a regular [‘It’s Pat’] where you don’t know if it is a and Black Seed Dry Oil. basis of the three sisters. “If I could do boy or girl the whole time.” The products with Farouk Systems it every day, I would,” she said, acknowl- The force of the Kardashian name mark the debut of Kim, Khloé and edging that her beauty regimen has doesn’t preclude the Kardashian Beauty Kourtney in the hair segment, been scaled back since the arrival of hair products from having a point of dif- although the famous sisters North, her one-year-old daughter ference to woo customers. Shami stressed have sold Kardashian Beauty with Kanye West. “Ever since I had that’s essential to make a dent in the mar- makeup in partnership with the baby, there was at least four ket. He believes that the Black Seed Dry Boldface Group Inc. since months I went without makeup or Oil provides a major point of difference. 2012. Separately or together, hair products. I loved it. You can “It is so absorbent. Really, you want vol- their beauty involvements kiss your baby and you can snug- ume, you want healthy hair, you want shiny also extend to fragrance with gle. I am less on the makeup since hair, it is so important to have that oil be- Lighthouse Beauty Marketing I had a baby for sure because it cause the oil keeps moisture in,” he said. and sunless tanning with New makes it hard to kiss.” Kim has been testing the oil on North’s Sunshine LLC. Kim still seems pretty dedicated hair. “North likes to brush her own hair. The Kardashian empire to her hair-care regimen though. You start with a brush and then you have may be big, but Kim suggested Detailing several days in the life to get a second brush [for her]. Right not everything should be em- of her mane, which don’t typically when you get it all perfect, she takes the blazoned with a K. “When you include much shampooing in order brush and starts doing it herself. I just have a family of your own, it for her hair to retain its natural started using our oil because I needed to makes you really only pick the oils and strength, she said, “I start slick it [her hair] back and make it stay. I projects that you would love out the first day with a clean blow- just use a drop of it, but then she brushes to take the time out from your out. The second day, I put in dry it and likes to mess it all up.” WWD FRIDAY, AUGUST 29, 2014 5 WWD.COM Shen Beauty’s Carroll Gardens outpost.

Collagen cream from Za.

Shen Beauty Adds Spa

The 400-square-foot spa, situ- By JAYME CYK ated at the back of the shop, will consist of two rooms. The space is LATELY, IT SEEMS as if one indie painted “dove gray” with a white beauty outpost after another has border and decorated with dream dropped from the scene. From catchers and white Moroccan wed- Woodley & Bunny to Henri Bendel, ding blankets used as rugs to give niche beauty brands have lost ven- off a calming, bohemian vibe. erable launching pads. But just because Shen Beauty But at least one hope is still has added a spa doesn’t mean the standing: Indie beauty boutique product assortment will change. Shen Beauty is expanding with a Customers will still see brands such full-service spa on Thursday. as de Mamiel, Amanda Lacey and “In the very beginning, we did Su-Man Skincare, among others.

Shiseido’s Za Enters India brow and eyelash [services],” said “It’s really important to stick Jessica Richards, owner and co- with what we are,” she said. that features whitening, age-prevention and the founder of Shen Beauty, based in “What we’ve become is a launch By MAYU SAINI two-in-one foundation for our India entry,” said Carroll Gardens, Brooklyn. “Then, pad for these brands.” Salman Bukhari, marketing director, Shiseido we got a lot of requests and started Meanwhile, Richards isn’t NEW DELHI — Shiseido has raised its flag India Pvt. Ltd. “We have priced the brand in doing more waxing. Then, people stopping there. Currently, she in India. line with the prevailing market standards.” wanted facials, so we started is looking to open up a shop in

The Tokyo-based company has orchestrat- Prices range from 349 rupees ($5.73 at current doing mini facials. Now, we’re Williamsburg, Brooklyn. ed its first launch, Za cosmetics, in the coun- exchange) to 1,399 rupees ($23). booking appointments two weeks “I’ve always wanted to open try, under the auspices of Shiseido India Bukhari said makeup would be launched later, in advance for brows and facials.” more stores, and I was never Private Ltd., the subsidiary it established after the company has a grasp on the treatment Richards, who just split with going to do Williamsburg because here in July 2013. market. Za plans to have a widespread geographi- her business partner and cofound- Woodley & Bunny was there,” she The 11-piece line started rolling out in cal footprint in India, and is looking at a variety er Jules Stringer, is now the sole said, adding that the new loca- April in Mumbai,’’ New Delhi and Bangalore. of formats, including department stores and owner and plans on offering full fa- tion would be smaller but still in- Currently in about 100 doors, it’s on track to multibrand beauty outlets in modern trade and cials, waxing, microdermabrasion, clude a spa. “[Williamsburg] has a reach its target of 250 doors by yearend; dis- traditional trade. “Mumbai and Delhi are cer- gommage, massages and acupunc- younger clientele so socioeconom- tribution includes department stores like tainly the cities that we are growing this year, and ture, ranging from $15 for a lip wax ic things are different over there Shoppers Stop and Central, as well as in beau- Bangalore. For a brand that speaks the language to $250 for an oxygen facial. [compared to Carroll Gardens].” ty specialty stores such as New U and smaller, of metropolitan women, we want to ensure that Za The facials will be done with While Richards declined to more traditional beauty formats. is present in these key metro [areas],” he said. any in-store product the customer comment on projected sales, “India is a strategic market for the company. The target customer base is 20- to 35-year- prefers, or Shen Beauty’s facial- industry sources estimate the Having been present since 2001, Shiseido aims to olds, young women who are looking for quick ists will use what they think is best spa could do about $360,000 to further strengthen its foothold with the entry of solutions. The whitening range, in particular, suited to the customer’s skin. $480,000 during its first year. Za,” said Yu Okazawa, corporate executive offi- plays into a key segment in India — fairness cer and director of the board at Shiseido Co. Ltd. products have led the market for years, with Hindustan Unilever’s Fair & Lovely holding IT, Ulta Team for Brush Line more than 40 percent India is a strategic market for the market share. IT COSMETICS is making a rate private-label operation. The Indian beauty sweep at Ulta Beauty as the com- The collection consists of company. Having been present since market — estimated pany launches a makeup-brush 56 brushes in three collec- at approximately $1 collection of 65 stockkeeping tions, plus nine brush sets. billion in sales — has units in a co-branding venture Price points range from $12 to 2001, Shiseido aims to further strengthen been growing at 15 with the 700-door retail chain. $54 for individual brushes and to 20 percent a year. Housed in 12 feet of mer- up to $98 for the sets. The most its foothold with the entry of Za. The mass segment is chandising space, the new expensive brush is a deluxe expected to grow at collection, called IT Brushes for version that contains 100,000 — YU OKAZAWA, SHISEIDO CO. LTD. more than 20 percent Ulta, is being rolled out to 500 Ulta microfine hairs. for the next five years, doors, with the full distribution ex- IT bills itself as the number- according to industry pected to be completed by Sunday. one-selling color-cosmetics brand “Za is one of the key drivers of our growth analysts. The country’s middle-class population In the remaining units, the 12 most on QVC, and the company proj- in the region,” agreed Tsutomu Benjamin has grown to 400 million people, with balloon- popular must-have brushes will be ects its total retail sales for 2014 Suzuki, managing director of Shiseido India. ing disposable income and an aspiration for merchandised on three-foot end- as in excess of $150 million. That Za’s lower prices and target age positioning grooming as more women enter the workforce. caps. In addition, for each month of volume estimate includes the have made it more viable to introduce than Although many global beauty brands, in- the year, one of the 12 brushes will brand’s entire universe, includ- Shiseido’s more premium ranges. The Shiseido cluding Estée Lauder and The Body Shop, be displayed at the ing Ulta, QVC and the Sephora brand, for instance, has been in India since have entered India over the last decade, cash-wrap counter. store it plans to enter in Sydney, 2001 and is in 30 doors, mostly department Bukhari believes the timing is right for Za. The brush as- in the fourth quarter. stores. It is marketed through Baccarose, one “We are a bit late,” he admits, but added that sortment will oc- Janet Taake, of India’s largest prestige beauty distributors. it was’’ better in some ways as “customers are cupy a stand-alone Some of the chief merchan- Suzuki acknowledged Baccarose’s work already more educated.” counter configura- brushes. dising officer of to increase Shiseido’s brand awareness Unlike in many other Asian countries, tion, which is sepa- Ulta Beauty, and sales growth. “Over the years, they many prominent Japanese beauty brands are rate from the color- said, “Ulta [Baccarose] have grown not only our brand’s still unavailable in India. Historically, India cosmetics brand’s Beauty’s presence and awareness, but also that of has been considered hard to scale because of regular 9 feet of sell- collabora- the entire luxury beauty category. Our re- its vast geography and bureaucracies. India, ing space it occupies tion with IT lationship is very strong and we intend to long known as a fragrance market, has begun throughout the chain, Cosmetics is continue to nurture it even going forward,” to change dramatically over the last few years. according to Jamie a best-in-class he said, when asked whether the subsidiary Skin care and makeup are fast-growing seg- Kern Lima, cofounder example of our would take over the prestige brand. ments and consumers are showing themselves of IT Cosmetics. This commitment to When it came to the launch of Za, Shiseido more willing to experiment. venture represents the partnering with the did its homework, researching the market for “We aim to be a global player, representing first time Ulta has en- top beauty brands to three years before moving forward. Its primary Asia with origins in Japan,” Suzuki said. “Such tered into a co-brand- deliver our custom- competitors include L’Oréal, Garnier, Pond’s, a vision must include one of Asia’s most dy- ing partnership with a ers innovative and Nivea, Neutrogena and Lakmé. “Although Za namic economies — India. We have very high vendor in the prestige exclusive products has an extensive catalogue of makeup and skin expectations for this market, especially as Za category, she added. only we can offer.” care, we have selected our skin-care lineup is in the masstige category.” The store has a sepa- — PETER BORN 6 WWD FRIDAY, AUGUST 29, 2014 WWD.COM

FOR MORE IMAGES, SEE WWD.com/ beauty beauty-industry-news. NACDS Goers Look for Indie Beauty Brands

BOSTON — Buoyed by a slight spend on advertising like the big programs included Pacific World, uptick in mass cosmetics sales, Attendees players, they can get their mes- Swissco and Paris Presents. retailers scrambled to find fresh at NACDS. sage across via bloggers, Facebook, Another big opportunity is eyes, merchandise at the National Twitter, Instagram and YouTube. buyers said, with initiatives from Association of Chain Drug Stores’ Paul Murphy, president L’Oréal for brows and color pal- Total Store Expo this week at the and general manager for ettes from Wet ‘n’ Wild. Retailers Boston Convention Center. SinfulColors, agreed that social are still buzzing over the growth The show offered a chance media has fueled demand for of appliances and praised the for buyers to sift through the the on-trend nail color line. The new Kiss curling wand called aisles for unique, value-priced SinfulColors mission is to bring Instawave, priced at $59.99. items to wake consumers from its consumer the color she craves Other news included: their shopping slumber. Early at a price she loves, and she can’t ■ Skin care for pregnant and indicators are promising with resist buying two to three bottles postpartum women from Clio Nielsen data showing the 3 per- and sharing her nail artwork called Mumsie. cent declines in color cosmetics with her friends online. ■ Toodaloo, a mass odor neu- registered earlier this year have Retailers remain confident on tralizer inspired by the up- shrunk to a 1.2 percent deficit the nail business, despite a down- scale Poopouri, from Advanced for the 52 weeks ended July 26. turn in dollar sales. They are look- Beauty Systems. “We’re looking for up-and- coming brands that offer some- cosmetics is the cornerstone of thing the competitors don’t the entire beauty and personal- Color cosmetics from have,” said Jim Devine, president care business. Bill Bergin, group Eddie Funkhouser. vice president, health and beauty at Rite Aid, said color has a “ho- CRITICAL listic” impact on the entire store. Upgrades to the color cosmetics MASS assortment are credited with lift- BY FAYE BROOKMAN ing total volume at chains includ- ing Rite Aid and Walgreens’ Look Boutiques. He also cited the syn- of the Chain Drug Marketing ergy between wellness and beau- Association, representing region- ty. Candace Corlett, president of al and independent pharmacies. WSL Strategic Retail, added, “If Underscoring the vibrancy we are rested and healthy, we look Love & Toast body-care items. of the industry was record- better, and if we don’t look good, breaking attendance exceeding we don’t feel healthy. People are 6,000 executives, a 5 percent making the connection.” gaining traction at Rite Aid. ing at items such as nail treatment ■ Bee Bald Men Care Products gain over last year’s 5,700 at- The confluence of two fac- Funkhouser showed his assort- to offset color declines. One top are skin care for men without tendees. To cap it off, former tors fuel expansion of small ment of prestige-inspired items executive flashed her long talons, hair — both their head and face. Federal Reserve chairman Ben beauty companies, buyers said. priced between $10 and $65. “I which she credited to a nail repair ■ No Text Red, a limited pro- Bernanke predicted economic “I’m forced to look for smaller want to bring quality products to product from Vitry, a company gram from Sinful Colors, de- growth because of America’s brands with more profit poten- everyone,” he explained. from Paris that is looking for U.S. signed to halt texting while strong and free markets, its en- tial because the big companies Other exhibitors attracting in- growth. MBA Beauty is also get- driving. The concept is to paint trepreneurial spirit and diverse are eliminating direct ship- terest for unique items included ting big attention for its Dr. Marvey thumbs with red nail color to re- and growing workforce. ments for those with smaller German power Cosnova, which brand of treatments as well as mind drivers not to text. Those latter two points struck volume,” said one source. But is extending its U.S. distribution its water-based colors called NACDS president and home with poignancy for many of even more crucial was the ur- for Essence and Catrice color col- Color Well. Red Carpet Manicure chief executive officer Steven those at the meeting, which was gent need for buyers to find lections. Others hoping to gain showed a new 30-second light to Anderson captured the bright- a hotbed of upstart, indie beau- brands that distinguish their as- footage included Bellapierre cure its at-home gel nails. ening mood of the market. “The ty companies as well as more sortments from competitors, be Cosmetics, a natural mineral line, Accessories were also a cat- opportunity is greater right now products, aimed at multicultur- it others in their channel or the and Clio’s Mwah, a new natural egory several chains said they than ever before,” he said. “If al shoppers. There was also a migration to value stores. lip line in packaging designed to wanted to expand, especially as this moment in time cannot be healthy dose of beauty products Garnering a great deal of at- appeal to Millennials. products cross over from salon called a renaissance of health, with wellness attributes. tention was Eddie Funkhouser, Social media is viewed as the to retail requiring applicators, wellness and consumer-focused With sales exceeding $6 billion who was on hand to demon- great equalizer in the cosmetics sponges and brushes for applica- retailing, then no time in our his- in all mass retail outlets, color strate his namesake brand category. While these firms can’t tion. Companies with new retail tory will ever bear that name.” Hard Candy’s Dineh Mohajer’s New Nail Venture in a circular glass bottle and “Five to 10 percent of sales for Smith & Cult By JAYME CYK topped with a silver dented cap, us come from department stores,” nail lacquers. is inspired by and representa- said Tev Finger, chief executive of- IN 1994, EVERY “Clueless”- tive of the experiences depicted ficer of Luxury Brand Partners. “It obsessed teen could be seen by a woman in her diary entries. kind of anchors the brand in lux- wearing Hard Candy nail polish Every shade includes a quirky ury [and] we try to cross over and and the rubber ring that came name and unique narrative. For not be seen as just a salon brand.” hooked around the cap. example Dirty Baby, a metallic According to Finger, 40 Today, Dineh Mohajer, who black that features silver glitter, percent of the salons that the founded the Nineties nail phe- tells the story of girl who wore company deals with actually nomenon at 21 and sold it to a black Ann Demeulemeester perform nail services and 70 LVMH Moët Hennessy Louis dress to a wedding in a sea of percent of them sell nail polish. Vuitton in 1999, has returned salmon colored gowns. While Essie and OPI domi- at 41 with a new nail venture To go along with the collec- nate salons, Smith & Cult is called Smith & Cult, a 30-shade tion, Mohajer art-directed, creat- looking to offer something a bit lacquer collection including a ed and illustrated a journal titled more luxurious. top and base coat. “Diary of a Beauty Junkie.” The “The cool thing about [the “Smith is the elegant ver- booklet tells an individual anec- nail polish] is that hairstylists ERICKSEN

sion and that’s autobiographi- dote about six of the 30 shades. really do love stories,” said KYLE cal based on my partner [Jeanne “[The line] is based on being a Finger. If you look at R+Co and BY Chavez] because she’s really el- beauty junkie and having diaries Oribe, these rich stories have egant and she’s such a lady,” said that come in and out and are ev- really served us well within the PHOTO Mohajer. “And I’m so not a lady er-evolving,” added Mohajer. “It salon channel. It’s something The complete collection, be available at Space NK. and I’m so clumsy and need a keeps the freshness of the line.” stylists can talk to the client which had a soft launch in about Finger declined to discuss muzzle on my mouth or at least The Luxury Brand Partners- about and get excited about it.” 20 salons in August, will be sold in sales projections, but industry an edit button. Together, those owned Smith & Cult will mainly Finger added that Smith & about 250 salons in October and sources estimate Smith & Cult things make what we create.” be distributed in salons. The dia- Cult will introduce new nail that will double by the end of 2015. could do upward of $2 million at “Creative” is definitely a word ries, which are not for sale, will shades quarterly and will Additionally, it will be distributed retail globally in its first year on to describe the new line. Each be available for consumers to launch a line of lip gloss in the at Net-a-porter and C.O. Bigelow. counter. Industry sources also pre- $18 nail lacquer, which is housed read while receiving a service. summer of 2015. Internationally, Smith & Cult will dict sales will double next year. Honoring Today’s Achievers. Supporting Tomorrow’s Leaders.

FRidaY, ocTobeR 17, 2014 waldoRF asToRia new YoRk Honoring

leonaRd a. laudeR In celebration of CEW’s 60th Anniversary, CEW will honor The Estée Lauder Companies Inc. Leonard A. Lauder with a Lifetime Achievement Award for his LifEtimE achiEvEmENt awaRD dedication to the advancement of women in the beauty industry.

laura geller allI WeBB Jane WurWand Wende zomnIr sIssel tolaas Laura Geller Beauty Drybar Dermalogica, The Urban Decay Cosmetics RE_searchLab International Dermal gREat iDEa awaRD Institute, FITE fOR fRagRaNcE iNNOvatiON Presented by iff ReseRve YouR Tables and TickeTs now aT cew.oRg/achieveR

SPONSORED BY 8 WwD FRIDAY, AUGUST 29, 2014 Macy’s Bronx Shows Store’s Localization {Continued from page one} they’re going to seek out easy-to- In bottoms, “Here, there isn’t a Alfani, Calvin Klein, INC, Bar carry accessories and comfort big twill customer. They’re big on III and Charter Club, among shoes as well as stretch, to help denim, stretch and comfort. If you others, seen across a range of make for a more pleasant com- were in Connecticut, you would categories — the styles, silhou- mute. The customer is also like- probably see a lot more twill.” ettes and colors culled from the ly to want “signature products,” Macy’s at Bay Plaza is also collections are what’s more site meaning those with obvious betting on dark-colored inner- specific. The assortment will be branding and big logos. Within wear, which goes with the Latina continually tweaked as selling the area’s diverse ethnic popu- complexion, as well leopard pat- data and reads from selling as- lation, “We have more Latina terns, more full-figure sizes, and, sociates and managers accumu- customers,” Scalise observed, so as Scalise said, “shapewear to late over time. For the launch, brights, jewel tones, as well as neutralize some of her concerns. existing data from other urban grays and leopard prints, should Latinas tend to be shorter and stores, market research and old- be very available. “It’s a bet. I bigger around the waist.” fashioned merchant intuition in- could be wrong. We will know in Another of what’s termed form how the store gets stocked. a week. Our job is to push it a “distortions” in the assortment “Here you are going to see an step further, to test the hypoth- is functional and fashion active- assortment variation that speaks esis. More is not necessarily bet- wear, so, for example, Macy’s has to the individual,” Scalise said. ter. A tight productive store like ample offerings of long Nike bas- “It’s more of a casual customer, this forces us to get that clarity.” ketball shorts and long pull-up Those attending the ribbon cutting included New York City councilman younger with a little less dis- Andy King, New York State Assemblyman Michael Benedetto, Bronx Borough posable income. Someone who President Ruben Diaz Jr. and Gerard Guichard and Randy Scalise of Macy’s. commutes. They’re avid public transportation users and it’s Through the store, there are that the workers all get contain- typically a young family that 164 items deemed “customer ing phone numbers for manag- moves pretty often as the fam- favorites’’ based on their sell- ers, loss prevention and differ- ily grows, which creates more ing record at other locations. ent departments in the store to of a demand for home products, They’re limited distribution or better service customers. comfort shoes, athletic sneak- exclusive products to Macy’s. “Are you psyched?” Scalise calls ers, tote bags, lightweight hand- Among the items flagged as fa- out. “We couldn’t have done this bags. We’ve got a great menu.” vorites: Tommy Hilfiger V-necks, without you. Normally it takes four For Macy’s urban sites, priced $49.98, and Levi’s weeks to put in the fixtures, the vi- Scalise stressed it’s not one-size- straight-leg jeans, priced $39.99. suals, the signs, dress every manne- fits-all. “We don’t have an urban “Limited distribution and ex- quin — we did it in nine days — 40 strategy.” Before the opening, clusives resonate trucks in four days. for example, Scalise said Macy’s with the customer,” Randy We have the A-team checked the area for schools that Scalise said. Scalise here. We are going require uniforms. “In Brooklyn, Macy’s has to blow it away. You a lot of schools require uniforms. one other store feel it. Talk to the Not so much here. Here, all the in the Bronx, a customer. Find out kids dress up for their family 171,000-square foot what they like and photos.…We micromanage to the unit in Parkchester what they don’t like. Macy’s private brand Bar III at detail. You are only new once. to the south, and You are empowered the Bay Plaza store in the Bronx. We take it very seriously and we to the north is a to do whatever you have lots to learn.” 355,000-square-foot want to do. Make Scalise, who supervises 92 Over in jewelry, it’s about socks and Adidas jogging jackets. location in the Cross new friends, but also stores in his region, shows he hoops, hoops and more hoop In the home area, “Cookware County Shopping make new clients.” has a handle on the Bay Plaza earrings “Our customer in city is very important for this custom- Center in Yonkers. Then Scalise assortment and its nuances. As doors prefer metal,” metal hoop er, they celebrate their ethnicity “There might be a resumes the tour, he moves into the outerwear earrings that is, and there is a through cooking,” Scalise noted. little pinch from the saying, “It’s invigo- section, he said customers opt lineup of floor towers selling “We sell bigger stock pots, more other two stores, but there are rating. My job is to get everyone for, or at least he expects them Giani Bernini, Charter Club and frying pans, pressure cookers. 50,000 residents of Co-op City, excited, impart our goals and to opt for, “long down coats ver- Touch of Silver in a variety of col- Our city stores do more in blend- right next door to the mall. This do lots of recognition. There sus fleece, to make the wait for ors and silhouettes. There’s also ers and juicers than coffeemak- is Macy’s country. Macy’s is in- is nothing more exciting than a bus in the winter more toler- a watch area that’s larger than ers.” For the bedroom, the com- grained in the culture and fabric opening a new store. You have able.” They’re taking city buses usual and with plenty of bling. fort factor is key, with Memory of the community.” a brand new culture, the lat- and subways to get to work, and In fragrance, Scalise points out Foam products representing an- At the morning employee est thinking, the best and the generally not driving. “the big play with Paco Rabanne other key item. The assortment rally, Scalise is joined by vice brightest,” with some staffers He said that half of the cus- — we’ll overpenetrate.” In beauty, highlights such labels as Charter president and store manager recruited from different Macy’s tomer base is under age 40; half “there’s a great range in founda- Club, INC, Tommy Hilfiger and Gerard Guichard to address locations around the country. are casual or casual-work dress- tions, with more darker shades” Martha Stewart — all Macy’s about half of the store’s 372 “This store is close to Macy’s Xxxxxx Xxxxxx ers, and 20 percent commute for the ethnic population. “Here’s private brands and exclusives, employees present for the first central headquarters,” on 34th to Manhattan for work. That’s a key item — the Clarisonic,” an while the more expensive Hotel shift. Guichard gets up and Street in Manhattan, Scalise important because it means exfoliating scrubber. in-house brand is not displayed. brandishes “the survival guide” said. “It will be watched closely.” Xxxxxx Xxxxxx By David Moin

NEW YORK — Macy’s Inc. might be thinking global, pansion, is considered the prototype. eyeing China and the Middle East for stores, yet it Yorkdale is also the birthplace for still acts local. Holt Renfrew Expands on Revamp Plans The Apartment, a special setting for That’s evident in the Bronx, where the retailer this wardrobing, personal styling, trunk month opened a three-level, 160,000-square-foot store Two smaller stores, each 35,000 square Off 5th outlet chains are also coming to shows and parties. The 1,000-square- in the Mall at Bay Plaza in Baychester, at the foot of By David Moin feet, in Ottawa and Quebec City, will Canada, with dozens of sites expected. foot residence-in-the-store, designed by Co-op City. It’s the first new store to be built by Macy’s close at the end of January. The Ottawa With the changing landscape, “We Janson Goldstein, has a living room, a in New York City in 40 years — the last time was on Holt Renfrew, seeking to strengthen store has 72 employees; the Quebec City are focused on Holt Renfrew’s unique kitchen and an en suite bathroom, and Queens Boulevard in Queens — and is a case study its luxury niche in advance of mounting store has 85. Holt Renfrew currently op- position as Canada’s specialty luxury re- for each booking, fresh flowers and food of how the company taps an urban market and micro- competition, is putting the focus on top erates 10 luxury stores and two off-price tailer,” said Mark Derbyshire, president. at the client’s bequest are brought in. manages the merchandising of the big national brands doors in larger markets, entering e-com- stores called hr2, and has over 2,600 em- There’s been “a comprehensive strategic Future Apartments will be based on the and private brands it carries throughout the chain. merce and closing two locations. ployees. The company said it expects analysis of the Canadian marketplace Yorkdale set up. Macy’s has opened several city doors through take- Disclosing new details of its previ- overall employment to grow through 2017 and prospects for its luxury business Other key elements of Holt’s expan- overs of existing boxes like Abraham & Straus and ously revealed $300 million program of to support the expansion. model,” he added. sion include: Stern’s, but the new enclosed 780,000-square-foot Bay n upgrades and expansion, Holt Renfrew As previously reported, the $800 mil- Asked how Holt’s business is perform- Holt’s first men’s-only store opening Plaza, developed by Prestige Properties, enabled the on Thursday said the Bloor Street flag- lion Holt Renfrew plans to grow square ing, Derbyshire told WWD: “Growth year- at 100 Bloor Street toward the end of 850-unit, $28 billion department store group to build ship in Toronto will be enlarged and footage by 40 percent, to more than 1.2 to-date versus last year is continuing at a September. from the ground up. n renovated to include a new facade, the million square feet from about 800,000. strong double-digit pace.” He didn’t spec- The opening of a 120,000-square-foot “As big as we are, we feel small. We feel connect- Apartment private shopping concept and The goal is to achieve $1 billion in reve- ify further. The ongoing enhancements to store at Square One in Mississauga, west ed,” said Randy Scalise, senior vice president and re- enhancements to the beauty, accessories nues by 2017. Holt is headed for its tough- the luxury chain “are the most signifi- of Toronto, in spring 2016. gional director of stores for Macy’s northeast region, n and footwear areas. est market share battle in its history, with cant in its 177-year history, and are fu- A new vision for Montreal where the and a 33-year veteran of the company. The Vancouver and Calgary stores will the much larger Nordstrom and Saks eled by continued strong performance,” Ogilvy store, owned by Holt, will be trans- On the selling floor, Scalise talks demographics establish Apartments, cafes and expanded Fifth Avenue chains invading Canada Derbyshire said. formed into the retailer’s largest unit, and how Macy’s homes in, as part of its My Macy’s footwear and leather goods departments. with multiple locations. Nordstrom makes Holt officials said enhancements are growing from 140,000 to 220,000 square feet. localization program. The Bronx store has a clean, The Edmonton and Montreal locations its debut in September and sees up to concentrated on “flagship markets in Holt Renfrew is part of Selfridges crisp look, with ceramic white tiling and overhead will also be getting improvements. nine full-line locations. Saks sees seven Western Canada, the Toronto area and Group Ltd., which also operates Brown LED lighting, but the distinction is in the merchandis- In addition, Holt Renfrew is devel- full-line stores and makes its debut in Montreal, and based on an elevated Thomas in Ireland; de Bijenkorf in The ing. While the labels are predictable — tried and true oping an omnichannel program includ- fall 2015 by carving out space inside the luxury flagship store model.” Holt’s Netherlands, and Selfridges in the U.K.. brands like Michael Michael Kors, Tommy Hilfiger, ing e-commerce for the first time, which Hudson’s Bay flagship on Queen Street in 120,000-square-foot Yorkdale store, which W. Galen Weston is chairman of the fami- should launch sometime next year. Toronto. The Nordstrom Rack and Saks this year completed a renovation and ex- ly-owned Selfridges Group Ltd. SEE Page XX

w29a008a;10.indd 8 8/28/14 8:26 PM 08282014202652 WWD FRIDAY, AUGUST 29, 2014 9 WWD.COM A&F Logo Business Signet Ups Post-Zale Deal Savings Target Teams are also putting together a strategy to To Exit N.A. Stores By ARNOLD J. KARR expand outlet operations, including a test of about a half-dozen Ernest Jones outlets in the U.K. com- SHARES OF Signet Jewelers Ltd. jumped 7.7 per- mencing in the fall. {Continued from page one} cent Thursday after the jewelry retailer increased The gain in the stock, the most robust among “international is at a different stage” of that business cycle. its projections for synergies in the aftermath of its the North American retailers tracked by WWD, In the call, Jeffries also spoke about how the company was acquisition of Zale Corp. lifted Signet shares to $116.37. They established a making up the decline in the logo business in tops, a fashion- Signet, which acquired Dallas-based Zale on 52-week high of $117.42 in midday trading. related category that also has been impacted by the company’s May 30 for total consideration of about $1.46 bil- In the three months ended Aug. 2, Signet’s net in- Chase strategy. Chase involves testing product and reacting to lion, originally set a target of $100 million in syn- come dropped 14 percent to $58 million, or 72 cents what is garnering a positive response from the consumer to re- ergies in the first three calendar years following a diluted share, from $67.4 million, or 84 cents, in the ducing lead times during the production cycle. the deal, beginning in 2015. On Thursday, after re- 2013 period. Eliminating costs and charges as well as According to the ceo, “Chase represented approximately 20 porting sales and earnings that both exceeded Wall some benefits associated with the Zale acquisition, percent of the female assortment in the quarter and we expect to Street consensus estimates, the company lifted the earnings per share came to $1, which was 2 cents roughly double that figure for spring 2015. And while Chase current- figure to between $150 million and $175 million. above the consensus estimate for EPS of 98 cents. ly represents a much smaller percentage of the male assortment, we Michele Santana, chief financial officer, said that Sales grew 39.3 percent to $1.23 billion from will be looking to significantly expand its use there as well.” initially Signet expected $50 million in three-year $880.2 million in the prior-year quarter, above the Joanne Crevoiserat, chief financial officer, said the Chase strat- savings from “margin sourcing $1.19 billion expected, on aver- egy involves “chasing fashion into the assortment. It’s when we trig- opportunities,” about $30 million age, by analysts. Eliminating ger calls on product.” She explained that the company is embedding from “cross-selling and repair the $247.5 million in sales con- the strategy in its business practice and reserving the open-to-buy to service opportunities” and $20 $247.5M tributed by Zale operations dur- ensure that that happens. The cfo also said the strategy provides an million from savings on selling, ing 65 days of Signet ownership agility to get into product offerings that are working. general and administrative ex- CONTRIBUTION OF FORMER ZALE during the quarter, organic sales Abercrombie revealed its switch in strategy as it reported pense efficiencies. The additional OPERATIONS TO SIGNET’S SECOND- were $978.4 million, 11.2 percent second-quarter results. For the three months ended Aug. 2, net synergistic effect is expected to QUARTER REVENUES. above their performance in the income rose 13.3 percent to $12.9 million, or 17 cents a diluted be spread fairly proportionately 2013 period. share, from $11.4 million, or 14 cents, a year ago. Excluding charg- among those areas. While the addition of Zale es, adjusted earnings were 19 cents a share, compared with Wall The firm, based in Hamilton, Bermuda, is ac- helped the top line, it depressed both same-store Street’s expectations of 11 cents. Net sales slipped 5.8 percent to tively exploring cross-selling possibilities. The sales and margins. Comparable sales at the Sterling $890.6 million from $945.7 million, below Wall Street’s estimate Vera Wang jewelry collection, previously exclusive group, including Kay and Jared, rose 6.7 percent of $909.8 million. Overall comparable-store sales fell 11 percent. to Zales, will be tested in 50 Kay stores this fall, and those of the U.K. division were up 4.4 per- For the six months, the net loss was $10.8 million, or 15 cents a while numerous Kay brands, such as Open Hearts cent, but the former Zale nameplates, including diluted share, against net income of $4.2 million, or 5 cents, a year by Jane Seymour, will be tested at the Peoples Zales and Gordon’s, saw comps decline 0.9 percent. ago. Net sales fell 4 percent to $1.71 billion from $1.78 billion. nameplate in Canada, previously part of Zale. Comps in total rose 4.8 percent, a figure that was But even as Abercrombie scrambles to institute new strate- Michael Barnes, chief executive officer, pointed lifted to 6.3 percent when former Zale operations gies and jump-start its business, Wall Street punished the retail- to savings available as Signet explores consolidating weren’t included in tabulations. Gross margin fell er’s shares, which fell 4.8 percent to $41.87 in Big Board trading. marketing expenditures of the two onetime rivals. to 33.4 percent of sales from 35.2 percent. Without Despite beating expectations on the profits side, analysts were “And by combining our investments, we’re seeing a net the Zale margin results, which historically had disappointed over the sales decline. improvement in pricing for the entire company,” he trended lower than Signet’s, gross margin would The company said it expects full-year diluted EPS in the told analysts on a Thursday morning conference call. have been 34.8 percent. range of $2.15 to $2.35. Separately, Pacific Sunwear of California, posting results after the equity markets closed, swung to a second-quarter profit. For the three months ended Aug. 2, the company said net income was E-commerce Lifts Belk’s 2nd Qtr. $7.5 million, or 10 cents a diluted share, against a year-ago net loss of $19.2 million, or 28 cents. Net sales gained 0.8 percent to $211.7 million from $210.1 million as comps were up 0.3 percent. GAINS IN ONLINE SALES helped Belk Inc. eke sales trends improved during the quarter, with Gary H. Schoenfeld, president and ceo, said sales trends im- out small improvements in revenues, profits and July being the strongest month,” said Tim Belk, proved as the quarter progressed, led by continued growth in its margins in the second quarter. chairman and chief executive officer of the com- men’s business. In the three months ended Aug. 2, the pany. “Merchandising margins were higher than Looking to the third quarter, Schoenfeld said, “Even in the face Charlotte, N.C.-based department store opera- last year with lower inventories, which positions of a down-trending denim cycle, we are encouraged by the positive tor’s net income was up 0.3 percent to $30.6 mil- the company well for the fall season. Digital con- response to the balance of our initial fall assortments. We continue lion from $30.5 million in the year-ago period. tinues to be our fastest-growing business.” to believe that our core strategies are attracting new customers Eliminating onetime items, including property Gross margin, a metric under constant pres- and differentiating PacSun in this very competitive market.” and equipment sales and asset impairment and sure for department stores and other retailers Shares of Pacific Sunwear closed up 2.2 percent to $2.30 in exit costs, net income declined 2.9 percent to $30 during the quarter because of the promotional Nasdaq trading, but fell 4.4 percent to $2.20 in early after-market million from $30.9 million in the year-ago period. tenor of recent business, rose to 33.3 percent of trading following its report of second-quarter results. That’s be- Revenues rose 0.8 percent to $906.5 million sales from 33.1 percent a year ago. cause the company provided third-quarter guidance that projected from $899.5 million while comparable sales rose Belk said its strongest categories in the quarter a wider diluted EPS loss from continuing operations in the range 0.6 percent. Belk said online sales, up 43.1 percent were children’s shoes, women’s contemporary and of 9 cents to 4 cents than Wall Street’s projected loss of 2 cents. in the period, added 1.8 points to the comp num- better sportswear and junior and children’s apparel. ber, implying a decline of 1.2 percent in brick-and- Year-to-date net income fell 15 percent to $49.9 mortar store comps. The firm didn’t specify the million from $58.7 million in the first half of 2013. contribution of online sales. Revenues rose 0.3 percent to $1.86 billion. JustFab Raises $85 Million “While the beginning of the quarter was soft, — A.J.K.

By MARCY MEDINA

LOS ANGELES — JustFab Inc. has raised $85 million in funding to Charlier Teams With Petit Bateau enable the fashion and accessories e-commerce company’s expan- sion in Western Europe and next year’s full-scale launch into apparel. The look book was shot in a 360-degree format Led by San Francisco-based Passport Special Opportunity By JOELLE DIDERICH on a cast chosen with the help of dancer Jos Baker. Fund with participation from existing investors Matrix “Because there is this interplay of stripes, I wanted Partners, Technology Crossover Ventures and Shining Capital PARIS — Petit Bateau has tapped Cédric Charlier to play off the confrontation of bodies, the idea of a Management — which last year invested $35 million — the infu- for a capsule collection of clothes game, so I called on contempo- sion brings the total raised by JustFab to $235 million since its for women, men and girls. rary dancers,” Charlier said. launch in March 2010. Industry sources estimate the post-invest- The 10-piece collection will The Cédric Charlier collection Patrick Pergament, chief ex- ment valuation of the company at around $1 billion. go on sale on Dec. 6 at concept for Petit Bateau. ecutive officer of Petit Bateau, “As investors, they really understand retail and e-com- stores The Broken Arm in Paris said the brand was interested merce, which is sometimes a unique proposition,” said Adam and Hunting and Collecting in in working with a rising design- Goldenberg, co-chief executive officer. He noted the El Segundo, Brussels before becoming avail- er with a pragmatic approach. Calif.-based company’s priorities remain the same — strengthen- able in a selection of Petit Bateau “Petit Bateau is a cheeky ing the balance sheet and investing in newer categories such as stores and online on Dec. 13. brand, both in terms of col- the year-old Fabletics activewear (in addition to the fast-fash- Known for his modernist ors and products, and he ion division of JustFab and ShoeDazzle, there is also FabKids). tailoring, Charlier brought a managed to convey that in- Fabletics is the company’s fastest-growing brand, which sportswear feel to the line. spiration and that spirit,” he Goldenberg estimates will be 25 times the size it was in 2013 by “My inspiration is the striped said. “In periods of crisis and next year. “This investment will enable us to capitalize on that jersey. I took the brand’s signa- PIOLA hardship, people still want exploding market and go international more quickly. Active is ture stripes and worked them and need cheerful things.” the new denim; women are wearing it everywhere,” he said. into a collage, adding a hand- The pieces are priced from ALFREDO

With nearly $50 billion in sales a year shifting out of traditional re- painted stripe. I designed it like BY 50 euros to 170 euros, or $65 tail into e-commerce — the total is expected to be $54 billion this year a puzzle and I like to think of the to $228 at current exchange. and $88 billion by 2015 — Goldenberg believes JustFab is poised to resulting capsule as made for a PHOTO The line marks the first time compete with global specialty brands like Zara, H&M or Lululemon. dynamic lifestyle,” he said. Charlier has designed clothes The company has been dabbling in apparel thus far, but “They are great basics. Generally, I work on for children — a dress and a striped jersey for Goldenberg said the current 500 stockkeeping units will swell to more sophisticated pieces for my catwalk shows, girls — but not his debut in the mass-market arena: nearly 5,000 in the first quarter of next year. but I think my style is strongly recognizable in Earlier this year, the designer created a collection The company is projecting retail sales north of $500 million next year. these pieces,” the Belgian designer added. for mail-order retailer La Redoute.

10 WWD FRIDAY, AUGUST 29, 2014 eye

Renaissance Woman ON A RECENT AUGUST high school, she pursued an successful art dealers have that, afternoon in Los Angeles, art history degree at Howard but to have a combination of all Michelle Joan Papillion’’ was University in Washington, these attributes is very special.” taking a break inside her D.C., but her real education After seven years living in sprawling, whitewashed gallery came from the people she New York, where she worked in Leimert Park. She was a encountered socially on trips to as an independent curator, few days away from finishing gallery openings in Manhattan Papillion returned to the West preparations for a new exhibit in the early Aughts. Coast in 2008 and in two years and was enjoying a rare “I was smart enough to know opened her first gallery, the moment of peace before an that I didn’t know anything and Papillion Institute of Art, in upcoming opening. I was smart enough to hang downtown Los Angeles. Papillion, in a loose-fitting out with the people who did,” When it came time to tank and skirt, hasn’t had many she says. “For me it was easy expand, she eschewed hot of those moments lately. to fall into these art circles spots such as Hollywood and Culver City and instead settled on a light-soaked spot just east of Crenshaw in Her gallery is becoming a symbol of Leimert Park Village in the historic, predominantly black the revival of the neighborhood. neighborhood. Occupying the space that once housed the Brockman Gallery — the city’s — JEFFREY DEITCH first African-American-owned commercial gallery — and later, arts patron Eileen Harris Since she opened her first of some people who were Norton’s Leimert Project, gallery four years ago, the influential. I wasn’t aware of it Papillion’s gallery has been 32-year-old has emerged as one at the moment. I just observed received as further proof of L.A.’s gallerists to watch, and watched and studied.” It that the once-troubled area thanks to her hit shows and was during that time she met is undergoing a renaissance. prominent supporters, like Deitch, the founder of Deitch “She is part of a new identity of Jeffrey Deitch and Franklin Projects who’d later become the neighborhood. Her gallery Sirmans, chief curator at the Los for a bit the director of the is becoming a symbol of the Angeles County Museum of Art. Museum of Contemporary Art, revival of the neighborhood,” “I wanted to be stimulated Los Angeles. ’’ Deitch says.

by many different things and “Michelle is one of the rare When the 2,800-square-foot KEENAN different types of people in one people who really have the gallery, called simply Papillion, space,” she says casually by way instinct to understand what’s opened in February, some 500 of explaining her rise in the art important in art. I admire her people came, among them Michelle Joan STEFANIE world. “And I know how to do for that,” says Deitch, who Deitch and Jay Jopling, the Papillion in A.L.C. BY

that through art.” now splits his time between prominent English dealer. PHOTO Papillion grew up in New York and L.A. “She’s With her downtown gallery Oakland with a deep interest got great personal style and temporarily closed until 2015, solo show by the up-and-coming vast. There is no ceiling as to in the arts, though she wasn’t she’s very good at engaging Papillion is focusing her artist Kenturah Davis. what can be done,” she says. “I quite sure what form that with people. She also has very resources on Leimert Park, “When I thought about this do believe history will be made.” interest would take. After strong motivation. A number of which on Saturday opens a new neighborhood, the potential was — LESLEY MCKENZIE

nomination from Bon Appétit for Reichl and other famous Ludo Escargots at Petit Trois. this year’s best new restaurant, foodies have also tasted the Lefebvre Dotolo and Shook run Animal roasted chicken leg smeared and Son of a Gun. What’s more, with brioche-butter paste, the they’re hashing out plans to salad of smoked haddock and squeeze a wine store, pizza oven the crunchy fries served with and pasta-maker into a new spot, a steak smothered in a classic Jon & Vinny, across the street béarnaise sauce. More are from Animal. After racking up expected to come when they accolades at L’Orangerie and introduce the frog legs entree. Bastide and crisscrossing town Dotolo promises that the wait with his pop-up restaurant for a seat won’t last longer than LudoBites, Lefebvre landed on 20 minutes. Besides, patrons television as a judge on “The can stand in front of the white Taste,” next to Nigella Lawson marbled bar to observe Danielle FOR MORE PHOTOS and Anthony Bourdain. Motor mix the spot’s signature AND A RECIPE, SEE While Lefebvre is flirting sip, dubbed Fleur de Mal, out of WWD.com/eye. with the idea of hiring French- rose petal-infused vodka, ruby speaking waiters to enhance grapefruit and lemon. Petit Trois’ ambience, the “In France, we don’t shoebox-size restaurant eat with a cocktail but

KEENAN is very L.A. Hall & Oates in America we do,” Dotolo’s focus is on the food. and Whitesnake tunes Lefebvre says. “You don’t have to ricochet off the mirrored For aspiring home STEFANIE premeditate and overthink walls and vine-patterned cooks, Lefebvre is sharing BY the food,” Dotolo says. “We’re wallpaper selected by the secret to his perfect

PHOTO not trying to be everything to Estee Stanley, a celebrity escargots — ensconced everybody. Restaurants get stylist who recently in pools of butter, parsley, confused that way. ‘I’ve got vegan moved into interior and shallots — a dish options, I’ve got Italian food, I’ve design. “There are a lot inspired by his mother got French food, I’ve got pizza.’ of detailed things that and grandmother from the Petit View Holy s--t — what are you?” she brought in,” Shook Burgundy region. “When I What Petit Trois represents says of Stanley. was growing up, I could eat is the latest move from the Since it opened last seven dozen escargots,” he LIBERTÉ, ÉGALITÉ, FRITES. are dominating restaurants team to feed Angelenos month, Petit Trois has says nostalgically. For their latest eatery in Los across the country. There are something tastier than already gathered an entourage The trick? “Make sure you Angeles, chefs Ludo Lefebvre, no small plates to share, and superfoods, all while building of Hollywood fans. One of use French butter,” he says. Jon Shook and Vinny Dotolo the molecular gastronomy tools the city’s status as a capital of Stanley’s styling clients is “French butter has more fat, are transplanting the flavors are stowed away at Trois Mec gourmands and bucking the Jessica Biel, whose husband, less water.” Bien sûr. and spirit of the neighborhood next door. Petit Trois refuses belief that bigger is better. Justin Timberlake, recently — KHANH T.L. TRAN Parisian bistro into a strip reservations, a deliberately “I want this to be small and a posted a photo of a cleaned mall (of sorts) tucked behind egalitarian policy to facilitate little bit messy,” Lefebvre says. plate and bowl of hollowed Petit Trois a gas station. With Petit Trois, some jockeying to snag one of “I don’t want anything perfect, mussels from his dinner 718 North Highland Avenue the partners behind the prix- the 21 stools, preferably right with a waiter looking at you there to the delight of 165,000 Los Angeles fixe tasting mecca known in front of the open kitchen. every 10 minutes.” of his Instagram followers. Hours: Monday through Friday, as Trois Mec are liberating But, as it always is with their In addition to Trois Mec, Chef Nancy Silverton, former noon to midnight. themselves from the trends that projects, Lefebvre, Shook and which recently garnered a Gourmet editor in chief Ruth petittrois.com WWD FRIDAY, AUGUST 29, 2014 11 WWD.COM

Q&A American market for us, we partnered difficulty, financial difficulty and with the [U.S.] Pavilion to make this Andrea Illy technical difficulty because having opportunity even bigger. Why did we so many products that deliver the become a partner of the expo? Because ultimate level of quality is not so easy. Andrea Illy it’s a onetime opportunity to celebrate There is more competition, as well. coffee and our history, and our strategy It’s challenging, but we have very is very symbiotic: We promote coffee to good opportunities for growth. More By LAUREN MCCARTHY promote Illy and vice versa. By numbers, and more, we tend to integrate coffee this event will be the largest celebration technology to make it as compelling as NEW YORK — Andrea Illy loves coffee of coffee in history. We will represent the possible for the consumer. — after all, it’s in his blood. past, future and present of coffee. In 1994, Illy became chief WWD: In terms of luxury marketing, executive officer of the espresso WWD: What does your role entail? do you look to any other brands as a company founded, in 1933, by his A.I.: Managing the pavilion, developing standard? grandfather Francesco Illy. Twenty years the content and taking responsibility A.I.: Pure luxury is a very small later, he still holds the position. Today, for everything that concerns coffee. It’s market. When we talk about luxury in Illy is available in over 140 countries a lot of responsibility. There is a lot of consumable goods, with the exception and employs more than 800 people complexity. For example, the Italian of very, very fine wines, we are talking worldwide. The company has expanded prime minister decided to make an about high-end, rather than pure luxury. beyond ground espresso, offering a invitation to the ICO [International And this is a definition that I prefer number of at-home coffeemakers and Coffee Organization] to organize a larger because luxury is a difficult world, in establishing over 200 Espressamente international conference during the terms of meaning. “High-end” is the IANNACCONE Illy coffee-bar locations worldwide. expo. It will be the first international highest possible quality, with a strong In 2013, the company had revenues of coffee forum, with delegates from all heritage and very rich experiential 373.9 million euros, or $508.5 million at over the world. During the same time, THOMAS content. It’s about beauty and taste. average exchange. there will be the first World Coffee Day, BY In terms of a business model, there

In July, Illy himself made a brief trip which is a great opportunity to give PHOTO are some similarities with the beauty to New York City in preparation for the visibility to the whole event. industry. The most interesting common brand’s current endeavor: as official to the human diet. And this goes along thread between what we are doing with partner of Expo 2015. Next year’s WWD: Why is now the right time to with a higher consumption rate. The coffee and other sectors, like fashion World’s Fair will take place between celebrate the coffee industry? compound average [growth] rate of and design, is the cultural and creative May 1 and Oct. 31 in Milan. Specifically, A.I.: Well, it’s always a good time to coffee consumption in the world has strategy. We are cultural ambassadors. the company will oversee in the U.S. celebrate coffee. But I would say that nearly doubled over the past decade, Pavilion the “Coffee Cluster,” one of now, more than ever, coffee is having a compared to the decade before. And this WWD: Describe your role as a culture nine dedicated motifs within the expo’s very good moment. As a matter of fact, is very good for the growers. We have ambassador. overall “Feeding the planet, energy for our communication strategy is based on a responsibility to make sure that the A.I.: You don’t have Piazza Venezia or the life” theme. Here, Illy — who is also the idea that coffee is good to life. There industry is healthy enough to ensure Colosseum or Venice here in New York, the chairman of Altagamma, the Italian are three virtues of coffee: pleasure, income in the growing countries. nor do you have it in São Paulo or Sydney. luxury goods industry group — talks health and sustainability. Today, high- The only representation of the Italian about the expo, Italy and how coffee end coffee is nearly 8 percent of market WWD: Is it hard to operate as a luxury culture is your bag or a nice Italian café compares to high fashion. share, and this is thanks to those virtues. brand in such a mainstream industry? or the 6,000 monobrand boutiques. This There is more pleasure, thanks to better A.I.: There’s a lot of complexity. We are network of points of sale and brands WWD: How did you get teamed with the quality and better preparations. As far now present in so many consumption and selling hundreds of millions every U.S. Pavilion? as health is concerned, there is more occasions: cafés, restaurants, homes, year, this is the most powerful cultural Andrea Illy: Illy is the official coffee scientific knowledge demonstrating that workplaces and even on the go. To ambassador of Italy. Coffee is a symbol of partner of the expo, so, as a consequence coffee prolongs our life. It is actually the maintain consistency across this scope Italian lifestyle, just like a Ferrari or an of that, considering the importance of the number-one contributor of antioxidants is complex. There is organizational Armani suit or a Bulgari watch. FASHION SCOOPS

COVER SHOOT: Theophilus London, the operations, giving the Beverly Hills Brooklyn-based recording artist repped flagship a facelift as it celebrates its 20th by Next Management, has teamed with anniversary. It’s also opening a Fred’s Karl Lagerfeld for his second full-length restaurant in the L.A. store, and renovating album, WWD has learned. Earlier the former Co-ops at Santa Monica Place this year, Lagerfeld art-directed and and the Americana at Brand in Glendale. photographed all imagery for “Vibezz,” Naturally, this calls for a Bruce Weber as well as the cover art for the album’s extravaganza. The fall campaign is first official single, “Tribe.” titled “L.A. Stories” and features 76 “I met Karl maybe three years ago,” participants representing the broad London said, explaining that Lagerfeld spectrum of L.A. dwellers, from the had asked to photograph him for elite (Cuba Scott, artist and his book with Carine Roitfeld, “The FOR MORE Little Black Jacket: Chanel’s SCOOPS, SEE An image from Classic Revisited,” which was the “L.A. Stories” released in 2012. The two WWD.com. campaign, shot by became friendly after that initial Bruce Weber. meeting, and London wanted Lagerfeld to shoot him again — this time for his album artwork. “[My agent] called me with Karl on speaker and Karl was REACH THE like, ‘Yes, I’ll shoot your cover,’” London said. “I was freaking out, screaming. I was like a kid. I’ve always admired him. He’s FASHION INDUSTRY’S a genius in so many different ways…I wanted to just shoot for the stars.” After nearly missing his flight because TOP TALENT of a passport fiasco and a snowstorm in New York, London made it to Lagerfeld’s photo studio in Paris by the skin of his teeth. “His whole schedule is booked up for the next three years and he was only free for two hours, so we made it work. He brought all the ideas to the shoot. granddaughter of Ridley Scott) to the His handwriting is even on the cover,” everyman trying to catch a break (James London said. Liddell, a pizza delivery man and aspiring The single — which features an filmmaker). There are also various impromptu jumping shot of London in students, models, artists, businessmen a Dior jacket — will be available for and businesswomen per Weber’s casting purchase on iTunes on Tuesday, while style. The campaign will be installed in the full album, produced by Brodinski Manhattan in Barneys’ Madison Avenue and Club Cheval, will be released in windows this weekend. October. — KRISTI GARCED Additionally, Barneys commissioned WWDCAREERS.COM a short film by Melodie McDaniel PRINT & ONLINE PACKAGES AVAILABLE LALALA…: It’s all about Los Angeles for centered around Heart of Los Angeles, Contact Christen Cosmas, WWD Classifi ed/Careers Barneys New York this fall. The store is a charity dedicated to underprivileged at 212.630.3937 or [email protected] putting a lot of love into its West Coast youth in L.A. — JESSICA IREDALE 12 WWD FRIDAY, AUGUST 29, 2014 WWD.COM Code and Theory’s Brandon Ralph and Dan Gardner D.G.: I don’t think that print is dead. knew we wanted to work together. Fast- D.G.: At a brand, we deal with the By ALEXANDRA STEIGRAD There are times when it has to be forward a bit to post-Sept. 11 — nobody chief marketing officers versus on the abandoned when it isn’t working really cared about digital. I think we product side, we deal with the chief BRANDON RALPH and Dan Gardner financially for an organization. Many knew then that it was the future. product officers, chief technology are the 34-year-old cofounders of Code organizations still have revenue coming officers or even a chief executive and Theory, a digital creative agency in from print. I think the problem most WWD: Publishers are very trend-focused. officer for that matter. This is because that designs products, content and organizations have is when they are At one point everyone needed an iPad it’s the business itself versus with the campaigns across platforms. If the making money off of print — so how app; now video and mobile are the next brand, it’s content, communication, it’s company doesn’t ring a bell, its work do you change processes internally to big things to help save their companies. marketing. Because we work with both, certainly will. It has redesigned and capitalize on new opportunities without How do you view trends? we see trends. One trend is, how does a provided content solutions for most disrupting things that make money but D.G.: I think a couple years ago, there was brand work as a publisher? We’re able major media companies, including are still on the decline? How do you a lot more trend-jumping to figure out to take a lot of the publishing learning Hearst Magazines, NBC and Condé Nast, resource internally? where the savior is going to be. I think it’s and apply it to the brand. as well as for major brands from How do you make the evolved a bit from that. We work with our L’Oréal and Bottega Veneta changes? clients to come up with a monetization WWD: Is the fact that e-commerce hasn’t to Snapple and Dr. Pepper. I think it’s less strategy. Most publishers we’re seeing yet taken off for publishers a design about a binary, if are taking a more balanced approach. issue or something else? WWD: What is Code and D.G.: I think the problem is, it’s one of Theory? those experimental afterthoughts. Most Dan Gardner: We started in 2001, of these companies aren’t e-commerce so obviously it was quite a sites, they are publishers and their different landscape. Given our primary focus is content and pathing name, we focus on the intersection of to content. That’s sort of an add-on design and technology, and how to solve monetization, but it’s not a major

problems using those things. That’s still focus versus if you’re an e-commerce at the core, but we’ve expanded it to two site, you’re going to be thinking about different groups within the organization conversion all the time. Publishers — the product design group does a lot have other things that are more of the digital products that work with primary, which is why I don’t think it digital publishing and a lot with cross- has taken off.

platform content. [The other group], the brand design group, is really about WWD: What about the trend to video, the storytelling, the marketing and the which seems universal? advertising. We manage a lot of social D.G.: There is a bigger investment in media. Our core focus is around the video, but the problem is for most content delivery, the distribution and publishers, video is an afterthought. creation. ’’ They don’t have enough inventory — they can sell it — but they don’t have enough WWD: How big is your company now and to sell. And their sites aren’t designed to how has the landscape changed since you amplify video content. We have seen a started working with media companies? pretty large effort to focus on video. We D.G.: Now we’re over 200 people. are sure it’s going to continue. We have offices in New York, San Francisco. This year we launched WWD: As you’ve seen the media change,

an office in London and we have an do you think the next crop of editors office in Manila that is focused on Code and Theory cofounders need to have that digital background? scalability. Because content has been Brandon Ralph and Dan Gardner. D.G.: Having an understanding of digital a focus, we’ve spent a lot of time publishing as a writer is very important. But it’s not just about how does a writer it’s dead or not. It’s about how an It’s not one thing that saves it. For some become more digitally savvy, it’s more

organization is able to evolve. If there publishers, a subscriber model can work. about how do you culturally change I don’t think that is a decline on one side, how can you be Most publishers are designing systems a newsroom to infuse technology and innovative to carry your brand into the that allow the ad sales teams to have the design into the storytelling process. print is dead. There next phase? It’s about what’s happening most flexibility as possible. and how people consume content. WWD: What are the biggest mistakes are times when it WWD: How do you view digital ads? publishers are making? WWD: Who have been some of your D.G.: One thing w’’ e think a lot about is the D.G.: I see it more as challenges, making the publishing clients? value of the user versus the value of the internal organizational changes that they has to be abandoned Brandon Ralph: We’ve been in 53 or so page. A lot of publishers focus on how could make to execute on their visions. newsrooms in the last three years. We you can increase inventory on a page to The New York Times Innovation Report when it isn’t working are not just visiting. We are embedding make as much money from that specific is a good example. They had this report, ourselves in the newsroom for different page. One problem with that is your only it was done a long time ago, but they had financially for an periods of time depending on the scope of lever to make more money is to increase trouble executing on it. It seems like there the project. InStyle, The Daily Beast, The page views and initial visits. What we was some cultural and organizational Verge, Mashable, TechCrunch, Ebony, GQ are trying to do is to increase the value problems that prevented them from being organization. France, Vanity Fair France, Billionaire, of the user. We want to think about how a little more experimental. Oftentimes, vogue.com, The L.A. Times, all of Hearst’s can a page be constructed in a way that it’s internal organizational things that — DAN GARDNER brands. We did 24 publishing solutions for can maximize making the most amount are more the barriers, especially with Hearst. The first one was Cosmo, which publishers that come with a print with publishers. We started when we just launched, the original Interview background. It’s not a blanket statement. launched The Daily Beast in 2008. Magazine, the new Interview Magazine, That was a pivotal moment in the Art in America, the Magazine of Antiques We control more WWD: When will we see a shift from print publisher’s world. You started to see — there’s a lot. We did all of NBC’s local advertising to digital? an inverse relationship and you had to sites, 24 local sites around the country. We than 50 million fans D.G.: It’s hard to say. It depends on be more digital than print. There was a did Jason Binn’s DuJour. your rate of decline. There will be period of time when experimentation It’s not just about launching with big on social media that inflection point. I just don’t know really had to start. From 2001 to 2008, publishers with big newsrooms with when. With some publishers it’s now, it’s and really 2012, for that m’’atter, there unlimited budgets. Jason had specific from content we yesterday. Others, it’s, “We still have a wasn’t much innovation. Every Web requirements, a limited team and a very loyal consumer base, it’s a bit older, but we site basically looked the same. Every quick schedule to launch a new and should make that digital investment now.” publisher did it the same way. A lot of innovative product in the market. Same actually create and their print products — be it a magazine with Mashable. We had six weeks to design WWD: What if the content is not there? or a newspaper — had a lot of flexibility, and develop the app, which eventually manage for all these How much can you do with design to beautifully art-directed pages; if you led to the Web site and that eventually led make a successful site? were a newspaper, you had different grid to the mobile apps. With the brands, it’s a different brands. B.R.: There’s a lot of low-hanging fruit systems depending on the time of day. But really amazing high-low mix — whether that we can help with, like pathing and what we saw in that decade was really it’s Bottega Veneta, Calvin Klein, Vogue, all — BRANDON RALPH making sure all the best practices are restrictive. Everything was published the way down to Burger King, Dr. Pepper. there, or innovative ways for the user into the same template and a homepage We control more than 50 million to discover new content. But, at the was redesigned every three to four years. fans on social media from content we of money from that user in that visit. Too end of the day, they’re gonna bounce There was one template to deliver news. actually create and manage for all these much clutter, too much advertising can if the content’s not there. It’s like any Now, especially in the last few years, different brands. devalue it all. When you’re dealing with other product in the world. You can get we’ve helped redefine the thinking of aggregators, there’s a big emphasis on someone into the store, but when they’re what it means to be a digital publisher. WWD: How did you guys meet? creating a differentiated experience. there, if it’s too expensive or the price B.R.: Sleepaway camp when age six. We is not commensurate with the quality, or WWD: Do you think that, working with were friends and always in the art world WWD: How is the thinking different from it’s a bad experience when you’re in the different publishers, print will eventually together, drawing and sculpting classes. the executives on the brand side versus store, they’re not going to stay. There’s an be phased out and replaced by digital? Then computers came out. We always the executives at a media’’ company? onus on the content creator.