The Gap and Zara | A tale of two brands

So it's official. As of the first quarter of 2008, Inditex, the phenomenally successful Spanish fast-fashion conglomerate and parent company of Zara, has officially overtaken The Gap to become the world's biggest fashion retailer. In the meantime, the once venerable Gap is still tweaking its product around the edges, struggling to find a formula that works. Zara stores have been popping up on high streets and in malls around the world, registering  a whopping €6.3b in sales in 2007, making it larger than Louis Vuitton. Perhaps more surprisingly, the performance of Inditex's smaller brands like Bershka and Massimo Dutti has also been strong, registering revenues of €925m and €696m respectively, in 2007, making Bershka's business larger than that of Christian…

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Everybody’s talking about | Women in the middle

NEW YORK, United States and LONDON, United Kingdom - Some say that during a downturn, there is a flight to the high-end: buy fewer of the more expensive pieces that will stand the test of time and do away with impulse fashion purchases. There is also a rush to discounters: buy the same quantity of goods, but at lower prices which enables consumers to keep the newness factor, albeit at inferior levels of quality. Therefore, it is said, the middle market suffers. Whatever is the conventional wisdom, if recent moves by some of the industry's most successful fashion executives are any indication, there is a significant opportunity to be captured in the middle market, which has lagged in recent years.…

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Breaking News | Qiu Hao wins Woolmark Prize

PARIS, France - Just a few weeks ago I met Qiu Hao in Shanghai I am thrilled to announce that tonight in Paris he has been awarded the Woolmark Prize, worth €100,000. The award is is famous for anointing both Karl Lagerfeld and Yves Saint Laurent in 1954 and this year it has been resurrected by Australian Wool Innovation, which recently acquired the Woolmark brand. Said Mr Craig Welsh, CEO of AWI, "We see the Woolmark Prize as an opportunity to support the future of design and at the same time, showcase to the world Australian Merino wool at its best and most innovative." For those of you who missed it, please check out our feature on Qiu Hao and his…

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Qiu Hao and Helen Lee | Diversity in design, comrades in commerce

SHANGHAI, China - While most Chinese are still focused on buying into the prestige and status of international luxury brands, there are emerging local alternatives for those who want something more individual. Bubbling design and fashion scenes in and around Shanghai’s Taikang Lu and JinXian Lu offer a little bit of niche, homespun design to offset the ubiquity, even in China, of Gucci, Prada and Louis Vuitton. In the new Shanghai, emerging fashion designers seek inspiration from home or abroad, create garments that range from the culturally literal to the conceptually commercial, and target mass and class and everything in between. All the same, they share the same business challenges as their counterparts in other established and emerging design centres, from…

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Everybody’s talking about | Fashion copycats

At what point does referencing and inspiration turn into blatant copying? It's a question that is increasingly on the minds of designers -- particularly young designers and small brands -- who don't have the legal muscle (read: cold hard cash) and time to defend the integrity of their designs. In other creative disciplines like music, writing and visual art, it is much easier to defend copying. In fashion, referencing, inspiration, and trends form the backbone of our industry (just check out this long list of adventures in fashion copyright). So, where do we draw the line? Case 1:  Steve MaddenSometimes it's quite straightforward to see what is going on.  A post on Manolo's shoe blog alerted us to this blatant…

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Breaking News | Gucci sales growth disappoints

News flashes have been coming in today from investment analysts covering PPR, which reported its 1Q08 results earlier today. The news is not good for the Gucci brand, but Bottega Veneta has managed to beat market expectations, even in this downbeat economic environment. Gucci sales only increased by 2.4% to €513m, versus market expectations in the neighbourhood of 7% growth. As a result, some analysts are considering posting downgrades to their ratings on the PPR stock. Given it's self-stated positioning as an 'Aspirational luxury' brand, it may not seem surprising that Gucci would be one of the first brands to show signs of the economic slowdown. But that's not the whole story. Interestingly, the slowdown in sales growth is not…

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The Business of Fashion | Talks to Vogue Korea

It's turning out to be fashion magazine week on the Business of Fashion. A couple of months ago, Dominic Sohn, a newly appointed Fashion Editor at Vogue Korea, contacted me to get some thoughts on the revolving doors for designers at major fashion houses. This was before Lars Nilsson was turfed from Gianfranco Ferre (just days before his first runway show) only to be replaced by Tomasso Aquilano and Roberto Rimondi of 6267 and before Paulo Melim Andersson was sent packing after three seasons at Chloe, making way for Hannah MacGibbon. Dominic's questions were timely indeed. Excerpts from the interview have just been published in an article in the May 2008 edition of Vogue Korea, along with the reflections of…

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Fashion Magazines | Balancing advertising and editorial

The other day I nipped out to grab a coffee in London's Hanover Square. As I was waiting, who should walk in but Alexandra Shulman, the Editor-in-Chief of British Vogue. There was no entourage or chauffeur or huge sunglasses. Rather, she very normally ordered her skinny cappuccino (without assistance and without attitude) and waited like the rest of us to be served. It got me to thinking that (thankfully) some people in the fashion industry are completely normal (despite the caricatures that may be painted of them in the Press), and it also got me thinking about the business of magazines -- fashion magazines in particular. It turns out Ms. Shulman has been quite the business woman during her respected…

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Angel Chang | High-tech meets high-fashion

NEW YORK, United States - I'm sure you've all had one of those moments when a friend or colleague picked up your phone by accident, because it looked the exactly the same as theirs. I know it's happened to me on more than one occasion. Today, Paul Taylor of the FT cleverly compared the uniform style and design of most mobile phones to the Ford Model T, when Henry Ford declared that “the customer can have any colour he wants, so long as it’s black”. Just the other day, we dove into the marriage of fashion and technology for the first time, looking at the emergence of the fashion phone. But, the ideas, questions and suggestions have kept coming since…

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Festival d’Hyères | A different kind of fashion competition

Held each year at the Villa Noailles in the South of France, The Festival International de Mode et de Photographie à Hyères offers up an unparalleled cornucopia of fashion and photographic talent. It has been an invaluable incubator and launchpad for some of fashion's top up-and-coming names, including Viktor & Rolf, Gaspard Yurkievich, Christian Wijnants, and Charles Anastase. The list of previous jury members reads like a who's who of the fashion world. In the past, Azzedine Alaïa, John Galliano, Martin Margiela, Ann Demeulemeester, Helmut Lang, Karl Lagerfeld, and Jean Paul Gaultier have have all had the honour of selecting the winners. This year's jury, which includes Riccardo Tisci of Givenchy,Maria Luisa of the Maria Luisa boutiques in Paris, and …

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Investment opportunity | Luxury stocks take unjustified beating

Our colleagues over at Savigny Partners released their regular newsletter today, demonstrating just how tough things have been for many luxury and fashion stocks in recent months and highlighting an investment opportunity for those who believe in the long-term fundamentals of the luxury market. The Savigny Luxury Index (SLI) has plummeted by 29% since its peak in June 2007, underperforming the overall market as measured by the performance of the FTSE All World Index. But, longtime industry watchers will recall that the luxury industry was one of the first to bounce back after the post 9/11 economic malaise. Stocks with exposure to accessible luxury have been hit the hardest with Coach, Tods, Burberry and Tiffany seeing their Enterprise Value/EBITDA multiples…

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Kellogg | Fashion management 101

Kellogg, the prestigious school of management at Northwestern University in suburban Chicago, has announced plans for a business course on fashion -- or at least, how fashion can play a role in industries as varied as fast-moving consumer goods to consumer electronics and home computers. ESSEC, the French business school, has an entire MBA program dedicated to a Luxury.  And, fashion and luxury clubs are popping up at business schools around the world, from Harvard to Columbia to London Business School. These are the latest signs that professional general managers are playing a more prominent role in the fashion and luxury industry. Before the emergence of major luxury groups, first LVMH, and then Gucci Group and Richemont, many fashion and…

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