s MEN’S: Brooks FINANCIAL: s Brothers unveils smaller Cost cutting BEAUTY: store format, page 9. boosts retailers Mariah from Wal-Mart Carey’s FASHION: A record to Urban new number of shows at Outfitters, Forever s Copenhagen Fashion page 3. fragrance, s Week, page 13. page 4. Women’s Wear Daily • The Retailers’ Daily Newspaper • August 14, 2009 • $3.00 WwDFRIdAYBeauty Channel Surfing Lines continue to blur in the beauty world as beauty’s $1 billion brand, Cover Girl, builds out the Blast franchise with Blast Boutique, a collection of color cosmetics targeting the department store fashionista. Meanwhile, beauty’s former indie star, Hard Candy, reinvents itself for the masses with exclusive distribution to Wal-Mart. Each looks to generate $50 million in first-year sales. For more, see page 6. Brighter Look for B’way: Bloomingdale’s Revamps Main Floor of Flagship By David Moin and Pete Born Amid the nation’s deepest slump since The Great Depression, Bloomingdale’s has come up with a bold response — rebuilding the entire 60,000-square-foot main floor of the Manhattan flagship. The department store is just two months from completing the project and unleashing a barrage of advertising and events touting 59th Street as “the biggest makeover in NYC.” There will be 525 events in cosmetics alone through December. According to sources, the renovation cost $45 million to $55 million including vendor contributions, and vendors are hoping for 10 to 20 percent sales gains as a result. “It’s a game-changer,” said Michael Gould, Bloomingdale’s chairman and chief See Bloomingdale’s, Page10 PHOTO BY GEORGE CHINSEE; STYLED BY DANILO MATZ DANILO GEORGE CHINSEE; STYLED BY PHOTO BY 2 WWD, FRIDAY, AUGUST 14, 2009 WWD.COM Lauder Net Drops Due to Retooling By Molly Prior tional growth, gaining 9 percent to $1.3 billion. The firm continues to eye international ex- FOR A COMPANY IN THE BUSINESS OF pansion, noting that MAC Cosmetics is slated WWDFRIDAYBeauty offering newness, the Estée Lauder Cos. Inc. to open some 50 doors globally and Origins will GENERAL ushered in a windfall of change in fiscal 2009, enter China in March. Bobbi Brown is gearing Bloomingdale’s is undergoing “the biggest introducing a new management team and a reor- up to launch in Poland next year. International s 1 makeover in NYC” by totally rebuilding the entire ganized company structure and culture. sales reached 59 percent of revenue in the quar- 60,000-square-foot main floor of the flagship in The latter two efforts stem from the beauty ter, boosted by softness in the U.S. market. firm’s four-year restructuring plan designed to Freda reiterated that Lauder will focus on time for an October opening. jump-start profitable growth and extend its glob- “fewer, bigger ideas in high-priority areas,” add- Five retailers filing second-quarter results al reach. Charges related to the restructuring ing the company has expanded its research-and- 3 Thursday all exceeded or met analysts’ expecta- contributed to a loss in the fourth quarter, but development efforts in its Paris-based “innova- tions despite declines in their same-store sales. the company remained profitable for the year. tion center,” and plans to do the same in Asia. Nanette by Nanette Lepore will be available at For the quarter ended June 30, losses totaled The beauty firm also is fine-tuning its con- 4 $17.9 million, or 9 cents a diluted share, com- sumer research, which Freda said will help di- fragrance counters in about 650 specialty store pared with year-ago earnings of $120.2 million, rect R&D and marketing decisions. doors, including Neiman Marcus, Nordstrom and or 61 cents a share. Excluding restructuring At the same time, Lauder has begun to do Sephora, next month. charges, earnings per share were on par with the heavy lifting to improve underperforming 5 Parfums Lolita Lempicka will introduce its first the 20 cents Wall Street expected. Sales for the segments of the business. For instance, Freda spicy floral women’s scent, Si Lolita, beginning three months fell 16.4 percent to $1.68 billion said the company has cut Aramis and Designer this summer. from $2.01 billion. Fragrances’ number of stockkeeping units by 50 Elizabeth Arden will roll out Mariah Carey’s percent from fiscal 2007 levels. 8 It also plans to reemphasize second fragrance, Forever, to about 2,000 classic scents and focus on department and specialty store doors. “fewer, bigger” launches. In a 9 Sales at specialty stores rose a seasonally similar move, Lauder is refo- adjusted 0.6 percent in July compared with cusing Darphin on skin care June, while department stores fell 1.6 percent, as it pulls the brand out of the according to the Commerce Department. makeup and fragrance cat- egories. Freda said the actions 9 MEN’S: Brooks Brothers opens its first “boutique,” Lauder is taking to address a 4,000-square-foot shop in Rockefeller Center that underperforming brands and could be the first of many smaller-size stores. segments include aggressive 14 Despite weak market conditions, Hong Kong- cost cutting, exiting certain based sourcing giant Li & Fung Ltd. posted categories or countries — as double-digit profit growth in the first half. in the case of Darphin — and, Classified Advertisements.................................................................................................15 in some cases, relaunching the brand. The company maintains TO E-MAIL REPORTERS AND EDITORS AT WWD, THE ADDRESS IS [email protected], USING THE INDIVIDUAL’s NAME. it may ultimately decide to WWD IS A REGISTERED TRADEMARK OF ADVANCE MAGAZINE PUBLISHERS INC. COPYRIGHT ©2009 shed underperformers. FAIRCHILD FASHION GROUP. ALL RIGHTS RESERVED. PRINTED IN THE U.S.A. Turning to the upcoming hol- VOLUME 198, NO. 34. WWD (ISSN 0149–5380) is published daily (except Saturdays, Sundays and holidays, with one iday selling season, the company additional issue in January, May, October, November and December, two additional issues in March, April, June and William Lauder said it anticipates sales to be flat August, and three additional issues in February and September) by Fairchild Fashion Group, which is a division of Advance and Fabrizio Freda Magazine Publishers Inc. PRINCIPAL OFFICE: 750 Third Avenue, New York, NY 10017. Shared Services provided by Condé in comparison with last year. Nast Publications: S. I. Newhouse, Jr., Chairman; Charles H. Townsend, President/CEO; John W. Bellando, Executive Vice Lauder will continue to at- President/COO; Jill Bright, Executive Vice President/Human Resources. Periodicals postage paid at New York, NY, and at additional mailing offices. Canada Post Publications Mail Agreement No. 40644503. Canadian Goods and Services For the year, earnings dropped 53.9 percent to tempt to cater to the shopper’s preoccupation Tax Registration No. 886549096-RT0001. Canada Post: return undeliverable Canadian addresses to: P.O. Box 503, RPO $218.4 million, or $1.10 a diluted share, on sales with value. “The consumer is actively respond- West Beaver Cre, Rich-Hill, ON L4B 4R6 POSTMASTER: SEND ADDRESS CHANGES TO WOMEN’S WEAR DAILY, P.O. Box that declined 7.4 percent to $7.32 billion. ing to value messages,” said William Lauder. “Is 15008, North Hollywood, CA 91615–5008. FOR SUBSCRIPTIONS, ADDRESS CHANGES, ADJUSTMENTS, OR BACK ISSUE INQUIRIES: Please write to WWD, P.O. Box 15008, North Hollywood, CA 91615-5008, call 800-289-0273, or Shares of the beauty firm gained 16 cents, an there one magic price point? No. But, there are visit www.subnow.com/wd. Please give both new and old addresses as printed on most recent label. Subscribers: If the increase of 0.4 percent, to $37.80 in New York magical price levels, which we are continuing to Post Office alerts us that your magazine is undeliverable, we have no further obligation unless we receive a corrected focus on and making sure consumers have access address within one year. If during your subscription term or up to one year after the magazine becomes undeliverable, Stock Exchange trading Thursday. you are ever dissatisfied with your subscription, let us know. You will receive a full refund on all unmailed issues. First copy The company continued its belt-tightening, to price points under $30, under $50, under $75. of new subscription will be mailed within four weeks after receipt of order. Address all editorial, business, and production squeezing out $250 million in costs this year as it “We are seeing some caution from the con- correspondence to WOMEN’S WEAR DAILY, 750 Third Avenue, New York, NY 10017. For permissions and reprint requests, please call 212-630-4274 or fax requests to 212-630-4280. Visit us online at www.wwd.com. To subscribe to other put a freeze on hiring and salary increases and sumer, but certainly not the reticence she had Fairchild magazines on the World Wide Web, visit www.fairchildpub.com. Occasionally, we make our subscriber list available pruned staff. Lauder indicated by December it from the late fall through the early spring 2009,” to carefully screened companies that offer products and services that we believe would interest our readers. If you do not will have notified about two-thirds of the 2,000 he added. “She is coming back, but she is re- want to receive these offers and/or information, please advise us at P.O. Box 15008, North Hollywood, CA 91615-5008 or call 800-289-0273. WOMEN’S WEAR DAILY IS NOT RESPONSIBLE FOR THE RETURN OR LOSS OF, OR FOR DAMAGE OR ANY employees expected to be affected by the firm’s sponding to stronger value propositions.” OTHER INJURY TO, UNSOLICITED MANUSCRIPTS, UNSOLICITED ART WORK (INCLUDING, BUT NOT LIMITED TO, DRAWINGS, plan to trim its workforce by 6 percent.