Fashion Notebook

Lessons in Branding: How Diesel Fuel For Life Rocketed the Brand to the Top of the Fragrance Market, With Just One Launch

So no doubt you've all seen the ads for Diesel's first foray into
the fragrance category, Fuel For Life, right? (If not, check out these trés sexy photos, at right and below, left). Well, what you probably didn't know is that this one fragrance has shot the Diesel name up to the top of the men's cologne business.

According to figures from NPD Group, the fragrance was the No. 3 overall launch (across men's and women's fragrances) for 2007, despite the fact that Diesel had no history in the category. What's more, through February 2008, the fragrance is solidly within the Top 10 Men's Colognes, ranked by sales.

So how'd they do it? With an ad campaign that didn't only win over consumers, but also won awards, picking up the Fragrance Advertising of the Year via the Fragrance Foundation, in both the men's and women's category. So when we're drooling over the eye candy in both of these shots, it's for a reason. This stuff really IS solid gold.

Wanna hear more? Well, you can ready all about it in our article "Filling It Up With Premium." If you're link-a-phobic, here's a taste:

It's no secret that most every fashion brand wants to break into the fragrance business. And with good reason. While the market is fickle, materials can be found on the cheap, the bottles have a long shelf life and their contents are less prone to the more dramatic trend overhauls that characterize luxury apparel. Because customers will actually pay up to $80 for a little bottle of the stuff, the profit margins smell loveliest of all. But Diesel knew it was facing an uphill battle as an unknown in the space, which was presumably behind its decision to partner with L'Oréal, Paris, for its first foray into the category.

It's also why the introductory support broke many of the traditional rules L'Oréal applies to marketing and launching its ever-expanding portfolio of fragrances. First there was the aforementioned antimarketing viral campaign in the weeks leading up to the August 2007 launch. (Some subsequent print ads announced that the fragrance was "finally legalised.")

Next, when it came to traditional brand advertising (chiefly print and TV), the campaign took a more-is-more approach. Rather than one TV spot, the company created six, via agency FFL Paris. Instead of two, static print ads, one for men and one for women, that feature either a celebrity or single model, FFL created four executions, each of them utilizing a new model to express the individuality of the fragrance. The tag read simply: "Are You Alive?"

"For us, this was an ambitious project," said Ulli Lindauer, vp-marketing of L'Oréal European designer fragrances. "There is a moment captured in the photography that is a universal moment of feeling alive. It was about the brand giving each of us the opportunity to be an individual."

Lesssons In Branding: Is Vera Wang the Next Martha Stewart?

Vera Wang, a high-end designer who has made a name for herself over the past two decades creating wedding gowns (with price tags to match, and photo'ed, right), is now opening her own wedding registry—a first in the designer market. Which kind of surprises us, and then, eh, not so much, and then we're all like: "Hey why did no one think of this before?!"

(Full disclosure: It was a late night, and stayed up party with the Cuervo people waaay past our already respectably late bedtime, so if we seem a little dazed today, it's not you, or Vera for that matter. It's us, sweetcakes.)

Anyhow... back to the relevance. VeraWangonWeddings.com will allow not only custom registries for engaged couples, but also a breakdown of runway trends, e-commerce, couples quizzes and wedding planning ideas from Wang herself.

But the bridal registry and e-commerce site is only the tip of the branding iceberg for Wang. In a series of moves similar to those of the one-woman empire orchestrated by love-her-or-hate-her-you-betta- respect-her Martha Stewart, the designer has recently expanded into diverse categories such as bedding, home goods and stationary. Additionally, Wang launched a collection for Kohl's stores late last year.

"Our authoritative position in bridal and bridal registry has allowed us to leverage this [consumer] trust into a lifestyle brand," said Wang. "The next logical step is to capitalize on our relationship with the client over the course of their lives. Our objective is to continue to grow our lifestyle product offering and keep pace with the evolving needs of the consumer."

Wang added that, moving forward, her company is exploring expansion into furniture, decorative fabrics, rugs, lighting and even a Wang-branded line of paint. Now we just won't know who's jungle green to trust when we repaint the bathroom: Vera's or Ralph's?

But what's to stop Wang from becoming like others who burst into multi-category expansions like Bill Blass or Halston, and getting less than sterling results? (Take "less than sterling" to mean abominable here, dears.) Well, apparently, it's because, as Dylan used to croon in that nails-on-a-chalkboard voice: The times they are a-changin'. And so are consumers and designers, y'all!

"We're at a different time for both consumers and designers; and I think Vera is really capitalizing on the ability to do both high and low in the design realm," said Wendy Liebman, CEO of WSL Retail, New York. "The level of sophistication and level of exposure of shoppers has changed and that acceptance, through what's gone on with H&M's designer collaborations, has really opened a door."

For Liebman, Wang's strategy makes sense and she doesn't seem to be stretching the bounds of her brand potential. "The expansion into bridal registry is a logical one, and the home goods are the same . . . Certainly her work with Kohl's appears to be working," said Liebman. "When you look at what Bill Blass or Halston did, versus what Martha or Vera are doing now, you've got a convergence of a smarter shopper and a smarter designer."

Yes, yes, all well and good. And we think V might actually pull it off.

But if her marketing folks are reading this, please, please let us make one wish for how she rolls out home goods, particularly kitchen appliances. Forget the Today Show and get Ms. Wang's face on Food Network's "Paula's Party." We're salivating at the proposition of having Paul Deen (photo, left) do a wedding cake episode with Wang brought on as creative consultant, and having Deen shout out: "We're making weddings today, y'all, and I've brought along my good friend, hot cutter, I'm sorry, I'm sorry, howit creature... Oh whatever y'all, it's fashion designer Vera Wang!" The episode practically writes itself.

This is a sure-fire way to sell Wang, and her image, unequivocally to the lucrative Middle America and mass markets.

Financial Desk: Have a Cigar, Mr. Frankfort, Coach Sales Rise 19% in Q3

It's good to be Lew Frankfort. 

The Coach CEO today announced that third quarter sales had risen 19%, to $744.5 million, and profits rose 8% to $162.4 million, despite an economic slowdown in the North American market that has shaken the retail industry, and been the scape goat for much recent poor financial performance.

"We were pleased with our performance, especially in light of the worsening retail climate in the U.S.," Frankfort said, in a conference call with analysts this morning. "Overall, Coach's quarterly performance reflected the strength of the Coach franchise and the continued out-performance of the U.S. handbag and accessory category as compared to overall retail sales."

And while the macroeconomic landscape is still too murky for Mr. Frankfort to crystal ball fiscal 2008 performance, he did reveal that he expects to post $3.18 billion in sales for fiscal 2007 (which closes in June—you know, screwy fashion financial calendar), a more than 20% increase that will lift earnings per share to an estimated $2.06.

But it wasn't all sunshine and rainbows. Frankfort also said that the strong quarter reflects also "the critical balance provided by our multi-channel and international business model," which, of course, means that overseas sales were a significant factor, particularly in the Asian market. More telling on the domestic front was the department store weakness, where sales grew only 5% for Coach, versus a total revenue increase of 15% across all channels.

Frankfort attributed the growth, first and foremost, to the company's product, bound together with the "brand proposition" of Coach (read: something of perceived quality, for a range of price points), as well as the company's "broad and loyal  consumer franchise." OK, whatevs Lew, basically you owe the success to having products people want at prices they can still afford, or think they can, for now.

Of course, we'll have to wait and see how this whole recession thing shakes out, but if we had to call it earlier, we'd say that Coach looks to be one of the brands that will weather the storm, and perhaps even make a little bit of money in the process.

There's also some speculation, per WWD, that Frankfort might be getting ready to launch into the women's ready-to-wear business, big time, after poaching a series of designers from the house o' Marc Jacobs. Stay tuned.

Financial Desk: Strong Gains in Q1 Portend Bright 2008 For LVMH

In the words of one Flavor-Flav, LVMH Chairman and CEO
Bernard Arnault "knows what time it is."

Remember when the luxury house's head honcho (pictured, right), whom we've always thought was like a lost member of the Rat Pack, said this, a while back?

"I believe that [the recession's] consequences on LVMH will be limited, weak, or even non-existent. In fact, the clientele that we are dealing with is far less affected than the rest of the economy by these short-term economic swings.  They have high purchasing power, located in a number of countries where the economic climate will be bouyant, even if there's a minor recession in the U.S."

Well, he wasn't just puffing his sails. First quarter revenue reports show that, with the sole exception of the wine and spirits group, all divisions of LVMH are up.

Fashion and leather goods grew 7%, led by the strength of Louis Vuitton, which received its own TV commercial this quarter, in addition to recently inking a deal to have Rolling Stones' guitarist (and, we think, animatronic wax doll) Keith Richards star in its current print campaign. On the product front, the company said that the collaboration between Marc Jacobs and Richard Prince (the artist of "Let's not and say we did, XOXO, Jennifer Aniston" fame) was particularly successful. Meanwhile, perfumes and cosmetics grew 8%, attributed to the continued momentum of the Christian Dior brand offerings, as well as the new Midnight Poison fragrance and Addict High Shine lipstick.

But the real winner of the quarter was the watches and jewelry group , which posted 12% revenue gains over the year-earlier period. Strength came from brands including TAG Heuer, Zenith and the Christal collection from Dior. The company added that Chaumet and De Beers also continued their retail expansion plans and increased revenues. New watches previewed at Art Basel in Switzerland have reportedly attracted "large increases in orders" from retailers.

And the bottom kicker of the sales release seems to only confirm what Arnault had promised earlier:

"LVMH will continue its growth in 2008 despite the challenging monetary environment and an uncertain economic climate at the beginning of this year. Increasing market share and the profitability of its leading brands as well as improving the results of its developing companies remain LVMH top priorities."

If they can keep these numbers up, or better yet, best them, then we think it's fair to say that the strategy we outlined a while back, that of weathering the recession by only appealing to the top end clientele, has indeed proved not only stable, but a money maker for LVMH.

Breaking News: Commes Des Garcons' Rei Kawakubo To Design Next Guest Collection for H&M

Now this is one that actually has us a little hot under the collar.   

Lagerfeld, sure. Viktor & Rolf, cute. Cavalli, sexy. Stella McCartney, feh. Rei Kawakubo, what?!

That's right, empress of whimsical Japanese luxe label Comme des Garcons, Rei Kawakubo, has announced that she will be the featured artiste on H&M's next designer collaboration. The collection launches first in early November, to coincide with the opening of H&M's second Tokyo store. In the following days, it will roll out to doors in the rest of H&M's global markets.

The collection will include apparel for men, women and children, as well as accessories and a unisex fragrance. This certainly is a much more expanded program than the fast fashion retailer has done in the past, and it would seem that the growth of product offering owes everything to the freshness that Kawakubo can bring to the brand.

Much like the Japanese designers Issey Miyake and Yohji Yamamoto, with whom she formed the Japanese triumvirate that defined much of the new wave fashion of 1980s American culture, Kawakubo's designs are structurally intense, and often include popular cultural references in a rather Pop Art motif (such as a series of men's suits she rolled out a in spring 2006 back that featured the iconic Rolling Stone's lips n' tongue logo splayed across the fabric). She was also the mentor for another fashion avant-gartist whose star appears to be ascending these days, Junya Wantanabe. For a look at some of her work, check the photo above.

That said, we're so interested to see what she turns out when she's not using high-tech fabrics or restrained by price points that might tie in some of her more flights of fantasy designs. As we see it, this could be a love it or hate it collection, and we just hope that the quality matches up to the buzz that will no doubt follow this collection's launch. We remember hearing that there were some issues with the clothes that Cavalli put out on the racks, not to mention those of the McCartney collection (said one of our friends, at the time: "I walked out with a cute dress that turned into a pile of buttons and thread after two weeks.").

Anyways, as always, here's the mutual lovefest that always follows these kinds of announcements.

"I have always been interested in the balance between creation and business," said Kawakubo, in a statement. "It is a dilemma, although creation for me has always been the first priority. It is a fascinating challenge to work with H&M since it is a chance to take the dilemma to its extreme and try to solve it."

See what we mean? Seems like old Kawakubo might be prepping us for the design vs. quality vs. price issue we outlined above. Less avant garde, but better quality, or more envelope pushing and delicate? Again, will be so interesting to see her "solution" as she calls it.

And now from H&M's creative advisor Margareta van den Bosch (great name, non?!):

"Rei Kawakubo has been at the top of our wish list for a long time and we are thrilled that she has chosen to collaborate with us," said van den Bosch, in a statement. "We have tremendous respect for Kawakubo's fashion philosophy of questioning fashion's ingrained patterns, and admire her artistic approach to design. We are particularly excited that the collection will be launched in Japan, Kawakubo's native country, at the same time as the launch of our new store there."

Ok, so we'll have to stay tuned, but we think this could be good news. It will drive some buzz—as these collections have done in past incarnations—for both the designer and the retailer, exposing the younger, less monied set to Kawakubo's work and perhaps building brand affinity there, while probably giving H&M a much fresher and more high-concept street reputation for the risk they're taking in bringing her in.

We'll be checking back in November to see what the product looks like!

Lessons in Branding: Why Going Logo-less Might Be A Good Idea For Luxury Brands During The Recession

There's an interesting  article today in the New York Times' "Thursday
Styles" section.

No, no, read on! It's not another critique of an out-of-touch story on youth trends or pandering pitch about how great the rich are and why we, the not-so-rich should thank our lucky stars they exist. Our friends over at Marx Marvelous have that end covered pretty well.

Rather, today, we're calling out a piece about the absence of logos on Bottega Veneta's luxury sportswear.

The piece, which can be read in full here, looks at how the Italian luxury label has revamped itself without going the route of high-profile monogramming or logoing.

Within the article, journo Ruth La Ferla, extolls the virtues of creative director Tomas Maier's consistent attention to high quality goods that hit the real deal in luxury, rather than merely the perception of luxury, and how his actions have driven the brand to a $500 million annual business, thereby making it the second highest earner for parent Gucci Group.

And then our favorite luxurist, Milton Pedraza, CEO of The Luxury Institute, chimes in to tell La Ferla that during a recession, the rich "don’t want to be screaming luxury right now...They don’t want something flashy that everybody else has. They are looking for unique handcrafted things that can’t immediately be reinterpreted at every level of the marketplace.”

The thing about logos, as we've long felt, is that they can cut both ways. In fact, we've been thinking about our own logo, for Fashion Notebook, which you can check out, at right, but the tech guys haven't yet gotten around to installing it. And maybe, now, we're thinking that's a good thing.

But back to the relevance.

Taking Vuitton, for example, when one of perhaps mass-affluent or aspirational means has laid down the dollars for a fashion piece that is truly of excellent quality, not to mention name recognition, it's, we think, safe to assume that we'd like others to know it. After all, that monogram tells others that we care about quality, perhaps that  we're hip to hot or established names in the industry, and, let's be honest, that we could afford to purchase it. In a sense, we want everyone else to know what that handbag, dress, or accessory was worth, and, by proxy, that we're worth something as well.

The problem, of course, is logos also tell us what everyone else is worth, too. And if we see a bunch of Louis Vuitton monograms on my friends' purses, or luggage, shoes, or, god help us, something bigger and obviously more expensive than the piece we bought, suddenly, Vuitton just doesn't seem so special anymore.

This is to ignore the further complications that arise from knock-offs. If everyone on Canal Street is rocking the monogram, and for a mere percentage point of what we paid, why we'd have a fit and would feel somewhat obligated to inform everyone we saw that, well, no, ours is in fact, real and then go into a litany about the stitching and leather quality that, at best, wouldn't gain us any friends, and, at worst, would lose us those we already count in our ranks.

And let's not forget that this isn't, obviously, just a Vuitton problem. Many other luxury brands feature highly-identifiable logos, monograms, or signature patterns on their products that identify the brand with all the subtlety of a bull horn. Think about those brands you recognize within seconds on some of the products worn by your friends: Coach, Gucci, Burberry, Chanel, Marc Jacobs, Dolce & Gabanna, DSquared, etc. 

As far as the recession, the no-logo route is probably a good idea. After all, those who can afford luxury goods without batting an eye are usually so acclimated to that lifestyle that, well, they don't need to scream it, as Milton says, like the rest of us. And those customers are precisely the ones luxury brands need to be going after in times of serious economic downturns. Sound familiar? Yeah, we've said that before.

And we've also dished with Maier on his strategy. When we were writing that tome about the opportunities and potential pitfalls of lower-tier secondary collections for high-end designers, it was Maier who said (towards the end of the article) he would never consider such an extension because he felt that it would potentially overexposure of the handbag business that is the core of Bottega's sales.

"The philosophy of Bottega Veneta is to produce innovative designs with the highest quality materials and contemporary functionality," Maier told us at the time. "All of this comes with a cost that can't be recreated at a bridge level price."

What remains to be seen, however, is whether or not Mr. Maier's activities give the brand something of a glass ceiling when we're in economic boom times, and everyone is scrambling for top-end designer merchandise. Then again, at $500 million in annual sales, I don't think he's got anything to worry about.

Week in Review Pt. 1: Louis Vuitton Rocks Out, Kohl's Gets Punked, and More Rumbles for the Luxury Market

OK, so we've kinda been bad lovers the past two weeks. Yeah, we admit it;
we haven't been updating as often as we, or you, would like. But our offline
job got a bit crazed last week and that prevented us from posting. So, in effect, it's not you, it's us.

Also, we were, like, on pins and needles waiting for the finale of Project Runway. And, hopefully you'll agree, we're so, so, so, fiercely happy that Christian Siriano won we can barely contain ourselves. Kid has some serious talent, and we're sure that we'll be hearing from him sometime soon. Is he adoptable  by the way? We might just forego that Boston Terrier we'd been planning on bringing home and swap it for that adorable pocket-gay (though he'll have to sleep in a closet, as we're still living in a New York state of reality folks!).

But let's leave all this relationship drama to the Spitzers! It's time to take a look at what's happened, what it means, and where we see things going... So without further ado...

Louis Vuitton's New Bag
Unless you've been hiding out under a mountain of paperwork (like us), you've probably already heard that Rolling Stones guitarist Keith Richards is the new, wrinkly face of Louis Vuitton (SEE PHOTO, BELOW, LEFT). (Insert "Vuitton's new, iconic wrinkled bag" joke here, hell, everyone else has. For SHAME Saturday Night Live! You, like fashion, were more inventive in the 1980s.) If you haven't seen the spot already, check the photo at right.

We have to say to say that this is an interesting choice, and it's already done its job many times over in terms of exposure (more than we'd imagine placing, say, Katherine Heigl, or some other, safer choice, in front of the camera). But hasn't Vuitton really missed the rebel-rock-me boat by like, say, 40 years? We would prefer to see the ads featuring this Keith.

Also, how does John Varvatos feel about all of this. Certainly, the Stones trump Cheap Trick, not to mention the fact that the campaign pretty much cribs from Varvatos' own advertising mantra: Bring back old rockers and consumers will come. Of  course, Varvatos seems to have more credibility here and we're still not sure what a great cover boy Richards is for the brand. After all, while he's definitely rich beyond words—and amazingly still alive—we're just not sold on him as a real luxury guy. Then again, maybe that's what rehab and old age will do to you. I'm sure that he has a wonderful assortment of organic teas backstage, but is he really throwing those outfits in a Vuitton steamer?

Love to hear your thoughts on this. Drop us a line, here.

Kohls Pumps Up Its Juniors Jam with Avril Lavigne
Yeah, the girl ain't punk kids. Then again, Richards sold his ass to Louis Vuitton, so what does define the legitimate rocker persona? Anyways, Avril Lavigne maybe didn't steal your boyfriend, but she did ink a deal with Kohl's to produce "Abbey Dawn," a collection of apparel (priced $24 to $48) and accessories (read: jewelry, for now) that will hit the mass merchant's doors nationwide in July.

The move obviously means that Lavigne will get some dollars in her coffers—seriously, is she even that hot anymore?—but it also seems to really define her audience in a way that could be limiting for the popstar. Launching just in time for back-to-school shopping, the line is allegedly for the "broad group of shoppers" that Lavigne attracts, according to SVP Don Brennan, but we're calling bullshit. If it's B-T-S, the tricks are for kids, and that's fine, after all, those are the types that will pay retail for her album "The Best Damn Thing," which came out last year and for which the star began touring to support last week.

According to spokeswoman Vicki Shamian, the line shouldn't cannibalize any of the retailer's other exclusive brands, like Candies given Avril (and by proxy, her collection's) "feminine yet rock n' roll attitude." [Side note: Meanwhile, no notes on how the Simply Vera collection is doing. If you've got deets, or reactions, or if you've tried on the products, send a note here]. Advertising, on which details aren't yet available, will be handled by the Kohl's in-house team, in conjunction with lead agency McCann Erickson, New York. Stayed tuned.

 

Financial Desk: Luxury Retail's Mixed Bag
Ok, so we've probably hammered this to death, but there might be trouble with the luxury market.

Saks Fifth Avenue announced last week that it had approached roughly $1 billion in sales for the quarter ended Feb. 2, up almost 5% from the year-earlier period, but with comp store sales increasing by 9%. Meanwhile, net income rose dramatically, some 83% drama, to $39.5 million, or 26 cents a diluted share. However, gross margin slipped about 50 basis points to 37.4% of sales.

But there's trouble ahead. According to a statement by chairman and CEO Steven Sadove, January and February comp store sales grew by only 4.1% and 3.4%, respectively, and "previously high-growth rate businesses such as handbags, footwear and men's have slowed."

"As expected, the more challenging promotional and overall macroeconomic environment that we began to experience in the third quarter continued throughout the fourth quarter and put pressure on our merchandise margins," Sadove continued. "Our outsized comparable store sales growth indicates that we significantly improved our competitive positioning by market, driven by our merchandise, service marketing and capital investments."

And then  came the wahn-wahn moment.

"Nothwithstanding our improved performance and the longer-term outlook for the luxury channel, we expect to continue to face an increasingly challenging macroeconomic and promotional environment in 2008, and are taking a more conservative approach to planning the business this year," Sadove said, adding that the company expects to see comp store sales growth in the mid-single digits for 2008, with low-to-mid single digit growth in the first half of the year.

Meanwhile, at Neiman Marcus, positive earnings were also overcast by ominous notes. Revenues at the luxury department store grew almost 6% to $1.37 billion in the second quarter ended Jan. 26, while net earnings grew 8% to $44.3 million. However, February comp stores sales posted a 7.3% decrease.

In a conference call, Neiman Marcus chairman and CEO Burt Tansky seemed to feel, well, pretty much like every other luxury retailer these days. He's playing a cautious game as the news of a buckling economy and decreased consumer spending prophecies an even rougher year.

"As we all know, the entire U.S. retail sector has seen sales growth diminish somewhat, and this slowdown has affected some parts of the luxury market," he said in the call. "Our sense is that the aspirational customer has pulled back somewhat in response to concerns about the U.S. economy in stock and housing markets. However, this aspirational customer appreciates quality and can be expected to buy more as the economy improves. Nevertheless, we feel confident that the pure luxury customer, the affluent to the very affluent, will continue to demand only the finest."

Seems plausible, of course, except that we're not getting at raw numbers here. What's the proportion of aspirational consumers to pure luxury consumers? Wethinks it be disproportionate and that Neiman's might have a few, hopefully not too many, pricey dresses that are staying on the racks as Sex and the City fangirls start closing up their upper-middle class purses.

Lessons in Branding: Making Sense of Louis Vuitton's First TV Spot, "Where Are You Going?"

If you haven't seen, first check out the 90-second spot from Louis Vuitton, "Where are you going?", the brand's first-ever TV ad, teased in the most recent earnings report. Creative per Ogilvy, Paris.

OK, what to make of this? First, our impression:

This feels a lot longer than it is. The existential question—"What is a journey?"—is explored through some pretty engaging imagery, and we have to admit, we watched all the way through to the end, and probably would have done the same had we seen it on TV (we don't have cable folks, we read). It recalls the print campaign, featuring Catherine Deneuve at a train station, lots of fog and smoke, revealing and concealing the lensman's subjects. And the soundtrack gets us in the mood for an Alejandro Iñárritu film. We're pleased to see that we're not bogged down with a bunch of branded product, and indeed feel that the spot makes an emotional connection. It's really a beautiful spot in a world full of uglies, and doesn't come off as pandering or offensive.

But the problem we've got, ultimately, is the branding part. We have to feel that people for whom "The journey is life itself," probably aren't the same ones who want to shell out thousands for a suitcase. In fact, they'd probably spend the money that a Vuitton steamer trunk would cost on a fairly comfortable trip to Africa or Asia. Unless, of course, they're among those who prefer custom Vuitton luggage, and travel to India on a half-spiritual journey to connect a dysfunctional family (er, in case you hadn't already caught on, we're talking about The Darjeeling Limited here). So the message seems to be a disconnect with the product,  n'est pas?

And, now, point-counterpoint from two recent critiques:

From BryanBoy.com (AKA the twink blogger who actually got Marc Jacobs to create a handbag named after him): "I *LOVE* the commercial! It's quite moving and touching. In fact, the message is crystal clear to me. IMO, the folks at luxury powerhouse Louis Vuitton went back and paid homage to their roots: the art of travel. Afterall, travel is an integral part of the brand's DNA. Nowhere in this commercial you'll find the usual flash flash "bling" stereotype the average Joe associates with Vuitton. I think it's a nice little  flashback to the bygone era where only the traveling set knows about the historical and cherished by millions monogram."

From Pam Danziger (of luxury analysis firm, Unity Marketing, Stevens, Pa.): "It's atmospheric and evocative, yes, but LV has fallen into a trap that can catch many heritage-rich luxury brands, and that is thinking that brand image is the ultimate reason why people buy. In my research into the mindset of the luxury consumers, brand image plays a supporting, not a leading role in why people buy.  When affluent consumers buy a luxury brand, first and foremost they want outstanding quality.  Image may be a primary motivator for the 'aspirational' consumers who want to put on the trappings of a luxury life they have not yet attained, but not for the affluent shopper who has already made it. It is even questionable that the company's target consumers will get the brand identity message that is this commercial's primary objective.  When I viewed this ad, all I had were questions, but no answers.  'What is a journey?' is the question poised in this commercial, but the answer about why I need the Louis Vuitton brand to accompany me on my journey was left unanswered."

Anyhow, at least the ad has people talking, which is always good in this biz. Of course, Vuitton doing its first TV ad would naturally have every one talking. What remains to be seen is, as Danziger notes in her review of the spot, whether or not consumers (and critics) will go from talking to buying.

Financial Desk: Despite Q4 Weakness, Nordstrom Rolls on With Seven New Stores for 2008

Another sign that the luxury market might be buckling, Nordstrom reported declines across the balance sheet for the fourth quarter.

Net sales dropped 4.4% to $2.51 billion for the quarter ended Feb. 2, and net earnings declined 8.6% to $212 million, or 92 cents a share. For the full year, sales increased 3% to $8.83 billion, and earnings rose 5.5% to $715 million, or $2.88 per share.

The declines were caused, in part, by a "trailing effect" from the previous quarter, according to President Blake Nordstrom's statements in a conference call.

"[That trailing effect] coupled with the softer environment impacted our bottom line," he added, noting that the first half of the year had been, "in terms of sales," successful. "As we look ahead to 2008 and beyond, we are focused on executing our long-term strategy of increasing market share with our core customers by offering great service and the best merchandise the market has to offer. We are in a position of strength financially, which allows us to take advantage of opportunities that may come our way, as well as weather any current challenges that we may face."

Increasing market share with  core customers, boosting service and merchandise, eh? Seems that's exactly what Milton Pedraza, of The Luxury Institute told us was precisely the strategy the luxury market needed to combat the pending/current recession.

While the year-end increases do support Nordstrom's contention of his company's strong financial position, we have to think that moving ahead with the retailer's growth plan is unwise at this time. Nordstrom plans to open seven more stores this year—in Honolulu, Hawaii; Burlington, Mass.; Clinton Township, Mich.; Thousand Oaks, Calif.; Indianapolis, Ind.; Pittsburgh, Pa.; and Naples, Fla.—in addition to the 165,000 square foot store it opened Feb. 15 in Aventura, Fla.

No notes about changes to their marketing plan that we've seen yet, but those cartoonish inserts they've been running for a while now certainly haven't made us want to shop there.

Oscar Wrap-Up: Why Marketing Was the Night's Most Interesting Star

So if last night's ceremony, presenter banter, and Jon Stewart had us yawning in our
seats, at least the marketing plugs were there to wake us up! In fact, we might go so
far as to say that marketing was the real star of the show.

Things kicked off with some good designer plugs in the women's dress category. Headline news: Cotillard up, Kidman down. For a more comprehensive breakdown, check out our previous Oscar post, here. (Or, er, scroll below!)

But we left one of those ladies out of the line-up, because she was just such a good piece of marketing collateral that we thought her more appropriate for this part of the wrap-up. Drum roll please: Heidi Klum in that gorgeous red dress by John Galliano, a philanthropic tie-in for Coca-Cola, which ran its Red Dress campaign spots during the event. The dress (pictured, with Klum, below) will be auctioned off on MyCokeRewards.com, with proceeds going to the charity Heart Truth, which raises awareness about heart disease in women.

Then there were the commercials, and I have to say that the fashion set more than represented. The new J.C. Penney ads for the "American Living" collection seemed to translate well (at least, among our viewing audience last night in a cramped Brooklyn apartment), and everyone seemed pleasantly surprised by the American Express ads with Diane von Furstenberg. Both ads got some prominent sponsorship play before the commercial break had even commenced.

So for the fashion marketers, it seemed like the night sailed on smoothly, unlike Cameron Diaz's attempt to pronounce such difficult words as "cinematography" (again, we still don't understand why she gets Galliano's Dior dresses!).

And then there were these weird product plugs.

Here's Jon Stewart bemusedly futzing with his iPhone. If ever there were a completely smooth pitchman, Stewart's not one of 'em. In a lame segue, he talked about getting to catch up on all of the year's great films right there at the podium. (Because, you know, the square inches of the iPhone really help to communicate the Old West grandeur of "There Will Be Blood." Seriously, has Stewart even used this device?). Then of course, he announces that they're better viewed in widescreen. He turns the phone horizontally and the camera pans in for a great shot of the iPhone and Apple logo. In the end, it's not a bad plug, it's just, well, kinda shameless and we're sure that even those who aren't marketers recognized this little bit for the sham it is. Kind of like the Bluefly.com "Accessories Wall" in Project Runway or the numerous mentions Coke gets during American Idol.

And then there was this COMPLETELY SHAMELESS PLUG for the Nintendo Wii. Coming back from commercial, Stewart and the little girl from that Gospel choir, were engaged in a heated game of Wii Tennis, projected on enormous screens for the whole audience to see. No joke followed, no setup really introduced the plug. It was suddenly just there.  Check out the video below.

Do marketers seriously think the American public is this stupid that they wouldn't know a complete corporate shill when they see it? Why not give away sponsorship titles for the awards at this point? And the Oscar for the Coca-Cola Best Actress goes to... Marion Cotillard! Just think of it! She could thank Diet Coke, of course, for all of those days on set when she needed a fizzy drink that calmed her stomach but didn't contribute to any stress-induced weight gain. Well, that's if San Pelligrino doesn't get the award sponsorship first.

Now that we're mulling it, is this a bad idea? Everyone knows these shows are rigged shams anyways, I don't care how many staged videos I have to see of Frank Pierson being denied at the doors of Price Waterhouse Cooper.

Oscar Wrap-Up: Which Actresses Repped Their Brands the Best on the Red Carpet

So we're back after a late night staying up for that tired annual awards show: The  Oscars. (We know the show ended just after 11:40 our time, but we stayed up late bitching to our bicoastal friends about lame montages, good/bad dresses, and, like everyone else apparently, Diablo Cody).

Seriously, if it weren't our job to stay up  until the wee hours tracking who was wearing what, how they wore it, and how brands made their way onto the stage or in the commercial slots, we would have wrapped this up by 9:00 pm EST and sailed off to bed on a few DVR'ed episodes of "Paula's Home Cooking."

But, for better or worse, we stayed up, enduring less-than-pithy commentary by John Stewart, and some heartbreaking losses ("Surf's Up" losing out to "Ratatouille" for Best Animated Feature and "There Will Be Blood" losing out to "No Country For Old Men" for Best Picture). And it's a good thing we did, because the marketing, as far as we're concerned was the star of this year's drag-along show. But let's kick it off chronologically, with some of the more notable carpet dress-vertisements. (Note: All pictures per WWD. "Fierce Factor"s, our own judgment of how well the star wore her particular dress, set against how likely the placement is to boost the brand, are awarded on a 1.0-5.0 scale.)

Name: Amy Adams
Film: Enchanted
Dress: Proenza Schouler
Fierce Factor: 4.0
Our Take: Aesthetically, this is the perfect pairing. Adams' red hair and ivory white skin work wonders against the emerald gown. The edgy, classic appeal evokes a more colorful version of John Singer Sargent's "Madame X" or the femme fatale of H. Anglada- Camarasa's "Retrato de Sonia Klamery." Unfortunately, points off for that eye-gouging performance, though the girl did have to pimp her movie. Also, she's not that high-profile. 

Name: Penélope Cruz
Film: No noms this year, most recent was "Volver"
Dress: Chanel
Fierce Factor: 4.5
Our Take: Even so-so dresses look amazing on Penélope Cruz. Not only does the girl have extracurriculars to add to her hotness (Cruz speaks four languages! Name one of her American contempos that can claim that), but she can pull off designs that would look perhaps silly on a lesser body. Straight up: she's a stunner every time with no bad publicity to drag her down. With her small frame and captivating gaze really pronouncing this dress, Karl gets the most out of a rather ho-hum haute couture look.

Name: Cameron Diaz
Film: No noms this year, er, like every other year. Most recently, "Shrek The Third"
Dress: Dior by John Galliano
Fierce Factor: 3.0
Our Take: We will never understand why Diaz always gets Mr. Galliano's best. Don't get us wrong, the girl has a great frame, an established bold-faced name, and she photographs well. That, in and of itself, is worth the plug. But c'mon! Certainly the upper crust clientele doesn't want to share threads with Hollywood's leading empress of the Ditzy Dame shtick, right? And we're not going to hate on the pleats, like E! did. But, at the end of the day, it's a rather dull dress, on a very dull girl.

Name: Marion Cotillard
Film: "La Vie En Rose," WON: Best Actress
Dress: Jean Paul Gaultier
Fierce Factor: 5.0
Our Take: Perfect storm here, folks! Not was this fish-scale detailed mermaid dress equal parts daring and stunning for the red carpet debut, but its wearer walked away with the Best Actress award. And did so with one of the most genuine speeches we've seen in some time from the Oscars! As an added bonus for Mr. Gaultier, she's been the talk of the papers this morning, with pictures abounding. What she'll also likely add to that nice stew is that her figure looks like a real woman (admittedly, a thin woman) and she fills out the dress in a wonderfully tasteful way. This is as good as it gets!

Name: Nicole Kidman
Film: "The Golden Compass"
Dress: Balenciaga
Fierce Factor: 2.5
Our Take: What goes up must also come down, and the real low point (ok, with some obvious exceptions that we'll note later, we're lookin' at YOU, Diablo) came with this unfortunate placement on Nicole Kidman. Even preggers, she has the kind of body (read: alien model-esque) that could really show off some of Nicolas Ghesquiere's more ambitious designs, easily clinching the press coverage for the next day. Instead, she walked the carpet as a pretty, pregnant girl in a pretty boring black dress. And that diamond necklace just looked like a sad, glittery trapeze.

In summation, these were just a few of those that stood out to us last night. But we would be remiss if we didn't mention that, while Keri Russell looked great (as we imagine all women do) in the Nina Ricci gown, we were stunned that the label couldn't get more of an A-lister to work a look, especially following that stunning little yellow dress that worked so well on Reese Witherspoon last year! Also, all of our friends were screaming (screaming!) about Diablo Cody, and not in a good way. The dress was terrible, no wonder the maker has not appeared in any credits we've seen, and she looked like so many tired Betty Page-hipster-wannabes that we see most nights at Beauty Bar. (But we'd like to submit, for the record, that we liked "Juno".) Also, Tilda Swinton didn't do much for that Lanvin dress and that really makes us sad, because we love both of those names! We'll have to chalk that up, like the Kidman debacle mentioned above, to a stylist just making a poor choice, one for which the brand will suffer, or at best, not get any brownie points for.

But hey, we're not bitching in a vacuum people. Drop us a line and let us know what you think, either here, or in the comments below!

AmEx Continues Its Fashion Push, With Diane von Furstenberg Starring in New Campaign

Off the heels of the New York Fashion Week initiative
where it offered streaming runway shows among other goodies, and a $500,000 donation to the CFDA/Vogue
Fashion Fund, American Express is continuing to deepen its fashion industry connection.

The credit card company announced that designer Diane von Furstenberg (she old the large dots and wrap dresses) will star in the latest "Are You a Cardmember" campaign, per Ogilvy & Mather, New York, which breaks during the Oscars on Feb. 24. See a still from the TV spot, right.

No doubt the campaign seeks to create more brand affinity among female consumers (also the general goal of the company's effort within the fashion industry, according to Jessica Igoe, director of sponsorship and event marketing at American Express, New York), and given von Furstenberg's longevity in the industry and reputation as a fiercely independent designer and businesswoman, it should resonate fairly well.

Indeed, von Furstenberg's own statement seems to play right into that angle.

"Women inspire me and I inspire them to be independent and free, which is how I feel when I use my American Express card," said Von Furstenberg. "American Express represents a sign of independence and freedom and if you have your card, you can do anything."

See what we mean? Though we must admit, that the feeling of freedom that our credit cards (of all stripes) have given us only resulted in vast numbers of consumers in our age group (let's say 20-30 years old) entering into not-insignificant personal debt. After all, we just had to have that Vuitton throw rug and somewhere along the way, trips to Sephora seemed, well, like a necessity no matter how much they squeezed the budget.

Directed by "Capote" chief Bennett Miller, the TV spot follows Von Furstenberg from the inspirational Winter Wonderland of her backyard, through the design process in her studio. The print ads were shot by—who else?—Annie Leibovitz.

Financial Desk: Abercrombie Posts Gains in Q4, But Notes Problems with Ruehl Line

Seems like Abercrombie's still on top, no pun intended. 

The New Albany, Ohio-based company posted an 8% sales increase during the fourth quarter, reaching $1.23 billion, and a 9% boost in net income, which registered at $216.7 million. For the full year, sales grew 13% to $3.75 billion, and profits rising 12.6% to $475.7 million.

While the picture was pretty glossy for the most part, the company did note a slowdown in sales for its Ruehl line, according to statement from CFO Michael Kramer, in a conference call.

"Unfortunately, sales productivity declined in the second half of 2007, as we began to anniversary markdowns  from fiscal 2006," said Kramer. "We anticipate lower sales productivity compared to last year through most of the first half of 2008 as we continue to anniversary the high markdown levels associated with Ruehl...Until we can establish Ruehl as a proven  concept we will moderate the pace of new store openings."

But despite that bad news, it was all sunshine and rainbows from Chairman/CEO Mike Jeffries.

"Our brands represent high productive, consistent businesses that are the result of an unyielding focus on merchandise quality and customer experience," said Jeffries, in a statement. "We continue to make strategic investments in the business to sustain and to enhance brand quality and to support future growth, both domestically and internationally."

Well, at least one of those "strategic investments" includes a $300 million initiative to remodel existing and construct new stores in 2008, as well as the brand's decision  to bring back its porn-a-log, A&F Quarterly, which has raised eyebrows in the past for its debatably pornographic imagery, not to mention its lack of actual clothes on lifestyle models. (Well, some things never change in that department.)

The new Quarterly has puzzled us for a while too, and not just for the obvious reasons everyone else seems to have cited which include, chiefly, that the guys aren't wearing underwear in their dungarees. What's gotten us stumped is why the campaign is still all-white.

While we admit we haven't seen  the most recent installment, the images on the brand's Web site include the same line up of idealized white models that were featured (although they have changed the bodies they're using, natch, since the shelf life of fashion models is relatively short if you're not of the Naomi ilk) when we were covering their legal discrimination troubles at El Diario/La Prensa (our Spanish-language journo days).

Check out a few shots from the current campaign, below.

Listen, we're no Pollyannas about this stuff, and are well aware that it's widespread issue in the industry, but after so many issues of its own discriminatory mess (remember those "Two Wongs Can Make it White" tees?) we just have to wonder why Abercrombie wouldn't just toss a bone out and include one minority in its prominent imaging? C'mon guys, help colorize our wank bank!

Research Desk: Prestige Beauty Sales Grew 2% in 2007, Sez NPD

The prestige beauty industry—that's the expensive,
marquee stuff y'all—gussied itself up in 2007, according to a report from NPD Group, Port Washington, N.Y.

The category grew 2% overall to $8.9 billion in sales for 2007. Leading that charge were the makeup and skincare categories, where sales rose 4% to $3.4 billion and $2.5 billion, respectively. Makeup still leads in market share, now at 38% of the total beauty biz, just ahead of fragrance, which controls 33% of sales, and skincare, which gets 28% of the cut at $1.2 billion in sales.

And growth in a prestige market despite The Recession! Though, we can't say we're surprised, because, after all, even in the worst of times we'll plunk down the cash to prevent the world from seeing our wrinkly, blemished, pale faces, or smelling our "natural" scent. And hey, if it's got a designer name on the box, all the better! If we're not paying more than $100 for the goods, we usually chalk it up to a normal indulgence, especially when it lasts for a year (Happy Valentine's Day to our very dresser-top fave Prada Amber Pour Homme!).

Seems NPD's senior beauty analyst, Karen Grant, agrees.

"During challenging economic times in 2007, the prestige beauty industry managed to rise above the negatives," said Grant in the report. "Women and men are still willing to spend money on products that make them look and feel better."

However what did surprise us were the rankings of the top fragrances, for both male and female shoppers (keep in mind that females actually buy a greater percentage of men's fragrance than men do):

1. Acqua Di Gio (Giorgio Armani)
2. Beautiful (Estée Lauder)
3. Coco Mademoiselle (Chanel)
4. Chanel No. 5 (Chanel)
5. Cashmere Mist (Donna Karan)

OK, ok, Beautiful isn't a surprise, nor is Chanel No. 5, those fragrances are so classic they're a lock for the top spots. Coco Mademoiselle is an interesting one, since we were sure that everyone was like sooo over their current ad girl, Keira Knightley, but it's obvs just us who thinks she just a poor-man's version of Penelope Cruz with a perma-pout. And Cashmere Mist? We have to think some of those sales were a case of mistaken identity. We've never touched the stuff but the bottle looks like an exotic sex toy.

But the real shocker was No. 1: Acqua di Gio. Seriously!? Acqua di Gio!? We thought that fragrance was hot like, four years ago when we were having our Año Español and all the boys (including us) were awash in that sweet, citrus-y smell. But that was four years ago!

"It's just an easy fragrance, a good juice that easy and likable and that no one is going to hate you for gifting," Grant told us, admitting even she had been surprised that the fragrance had stayed on top for the past several years. "Men can wear it to work and to the club, and women like it, which you know is the number one factor for the guys. It isn't overpowering and its versatile. They've hit on a formula that is working on both the mass and prestige levels."

Grant also told us that a new ad campaign, by parent L'Oréal's agency Publicis, that offered new imagery for the popular fragrance, was well timed to continue the momentum of the brand last year, swapping out male model Larry Scott with Lars Burmeister (pictured above, with product), and bowing a new TV campaign, which you can view, to your water-dripping-on-abs delight, below.

John Varvatos Goes Back to His Record Collection For Spring 2008 Campaign

It's always been clear where designer John Varvatos
gets his inspiration: his record collection.

Growing up in Detroit, Varvatos became infatuated with the slew of 1970s-era rockers that defined the music scene of the time (and, obvs, continued to influence for many years to come), and that infatuation has become the flashpoint of influence across not only his collections, but also his advertising creative. Recent spots have included Alice Cooper, Iggy Pop and Aerosmith's Joe Perry, alongside more modernist rock figures such as Chris Cornell, and the Scott Weiland-fronted and Slash-anchored Velvet Revolver.

So another season, another rocker and this time from the vinyl bin, Varvatos, and the team over at Yard, New York, have unearthed another vintage treat: Cheap Trick. Check out one of the spots above (click to enlarge), which feature members Bun E. Carlos, Rick Nielsen, Tom Petersson and Robin Zander (can you believe they're all still alive!) racing along on, what else, 1970s-era vintage two-seaters.

The creative, steered by Stephen Niedzwiecki, the creative director over at Yard, was inspired by boardwalk and carnival imagery (why do we always think Diane Arbus when we hear these words?) from the 1940s and 1950s.

"The Cheap Trick guys have an almost uncontainable energy," said Varvatos, in a statement. "This season is one that embodies a freewheeling style that is so quintessentially America. The campaign continues to be about iconic rock n ' rollers caught in real moments."

Real moments? I'd definitely classify this as stylized fantasy. I mean, honestly, when's the last time you saw a bunch of guys pushing into the stretches of old age racing around on bikes in full evening wear? (And if you have seen such a phenomenon, frequently, let me know where you live because it sounds like an interesting vacation spot!)

We also have to wonder if this campaign doesn't make Varvatos' brand feel too old. While we loved the campaign with Iggy Pop (who, let's face it, is no spring chicken himself, with wrinkles that recall Varvatos' own pricey, aged leather carry-alls), that campaign had a youthful exuberance that we just don't feel from the shock-white heads of the Cheap Trick-ers. This could also be a function of the fact that our eyes automatically gravitate to Rick Nielsen in the spot above; his bandmates do look more youthful on second consideration.

Regardless, the aging rocker-as-posterboy works for Varvatos, solidifying his brand's musical heritage, and, here's the big bonus: he'll never get accused of just tapping somebody because they of-the-moment (looking at you Versace with your robotic Jonathan Rhys Meyers ads). And double bonus: these guys probably come pretty cheap.

  You know what would make our day, though? If Varvatos' next campaign featured T. Rex's Marc Bolan (pictured, left). C'mon John, you know you love him too! This guy is the original unicorn... Just imagine that sex bomb in a Varvatos suit!

Updated: Financial Desk: LVMH Closes Out 2007 with Multi-Category Growth and Teaser For New Vuitton Campaign

Another positive luxury earnings report, now with some
straight talk about how 2008 will shape up, comes across
our desk this morning from Paris-based juggernaut LVMH.

The company, which markets a wide range of luxury products, posted sales gains across every category in its portfolio. In sum, company-wide revenues increased 8% to $24.1 billion, with profits climbing 12% to $5.2 billion for 2007.

While those gains are certainly commendable, Chairman and CEO Bernard Arnault didn't shy away from addressing some of the problems facing the U.S. market, though he was bullish on the company's prospects, given its higher-end clientele.

"It is true that the year is starting in a rather worrisome situation in terms of the economy and the financial markets in particular...[and] our analysis of the situation is that in 2008 we're likely to experience a degree of recession more or less important in the U.S. economy," Arnault said, in a conference call, though he added that January sales were in line with year-end performance for the company and noted that he believes the recession should only last one or two quarters into 2008, with market recovery by 2009.

"I believe that [the recession's] consequences on LVMH will be limited, weak, or even non-existent," Renault said. "In fact, the clientele that we are dealing with is far less affected than the rest of the economy by these short-term economic swings.&n