Modcloth screenshot | Source: Modcloth

In Part I, we examined the innovations and infrastructural advances that have improved the historically poor economics of e-commerce and set the stage for a renaissance in online retail. Today, we explore some of new and exciting business models taking shape, the companies exploiting them and the challenges they face.

SAN FRANCISCO, United States — For years, e-commerce suffered from capital inefficiencies and complexities that pushed investors away. But in recent years, major infrastructural advances and the success of innovative start-ups like Gilt Groupe have rekindled investor interest and set the stage for an explosion of promising new business models including personal subscription, social merchandising, mass customisation and collaborative consumption.

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Nicole Farhi Ready-To-Wear Spring 2012 | Source: Style.com

Farhi Sold (Vogue)
“Nicole Farhi is on the cusp of a new wave of business expansion after private equity group Kelso Place Asset Management acquired a majority stake in the company. Kelso Place, which sold British luxury leather goods company Smythson in 2009, bought the stake from OpenGate Capital, which only acquired Farhi in 2010 for £5 million.”

High-End Brands Are Missing the Boat on Mobile, Study Finds (Mashable)
“In a ranking of 100 well-recognized fashion, beauty, hospitality, watch and jewelry, and retail brands, nearly half were deemed ‘feeble’ in their efforts. Only two-thirds of indexed brands have mobile-optimized sites, and yet a full third of those don’t allow consumers to shop from those sites, L2 noted. Many also fail to provide the full range of content available on their desktop sites, including product search and user ratings, to mobile audiences.”

Nike factory to pay $1m to Indonesian workers for overtime  (Guardian)
“A Nike factory has agreed to pay $1m in unpaid overtime to Indonesian workers in a move that could force other suppliers of multinational companies to follow suit. Nearly 4,500 employees at one of the sportswear group’s suppliers, the PT Nikomas shoe plant in Banten province, will be compensated for close to 600,000 hours of overtime clocked up over the past two years.”

Virtual dressing room eliminates need to take off your clothes (LA Times)
“At the Consumer Electronics Show this week, a Calabasas company was giving demonstrations of Swivel, a real-time virtual dressing room that takes a lot of the hassle out of shopping — no more long waits in the fitting room line loaded down with an armful of clothes, or the tedious process of getting dressed and undressed several times during one trip to the mall.”

‘Can I Help You?’ Irks the Web-Savvy Customer (NY Times)
“Self-service has long infiltrated the consumer experience, most recently with self-checkout at grocery stores. But the biggest factor affecting attitudes toward salespeople may be the amount of time people spend shopping online, which tends to be a solitary experience. In 2011, online shopping on Cyber Monday was up 22 percent over the previous year, according to comScore, which tracks Internet traffic.”

App Icons | Source: Blogversity

Online retailing: The mobile allure (FT)
“The transparency and convenience of ‘mobile commerce’ have given Americans the upper hand over retailers, according to Mr Thompson, who echoes the connect-and-inspire ideology of Silicon Valley when he says: ‘The consumer ultimately holds all the power.’ Indeed, for many traditional retailers, rising competition from the internet has capped sales growth, squeezed profit margins and forced them to re-evaluate how they use their store space.”

LVMH stake in Hermès reaches 22.3 pct (Reuters)
“The world’s biggest luxury group, LVMH, has increased its stake in leather bag maker Hermès to 22.3 percent and now has 16 percent of voting rights, according to a statement from France’s AMF stock market regulator. LVMH, which previously held 21.4 percent of its smaller rival, plans to continue buying Hermès shares ‘according to circumstances and the market situation,’ LVMH said in a filing to the AMF.”

Brand power helps Nike beat estimates (Reuters)
“Nike Inc’s quarterly results beat Wall Street estimates, as its swoosh logo attracted shoppers, especially in emerging markets, despite higher prices. Nike shares were up 3 percent at $96.65 in after-market trade on Tuesday, after closing at $93.63 on the New York Stock Exchange. Worldwide futures orders for the Nike brand, a closely watched measure of demand in coming months, grew 13 percent to $8.9 billion at the end of the quarter.”

Founder with an eye for design (FT)
“One of Mr Totterman’s ideas at the start of the business, was to ask Jean Paul Gaultier, the French fashion designer, if Inspecs could distribute Gaultier-branded spectacles in the UK. ‘At the time we had no design function – we were reliant on other people’s products and we felt we needed a big name if we were to get anywhere. To our surprise [Mr Gaultier] said, ‘Yes.’”

Sophie Theallet on Running a Fashion Business (Thread NY)
“Sophie Theallet worked under masters like Azzedine Alaïa and Jean Paul Gaultier in Paris before decamping to New York City to start her own label, which launched in 2007. Since then, she has racked up acclaim — including the CFDA/Vogue Fashion Fund Award, which she won in 2009 — and has dressed everyone from Jessica Alba to Michelle Obama.”

Uniqlo New York | Source: Covenants

Fast Retailing sets sights on US expansion (FT)
“Fast Retailing is poised to expand aggressively in the US, where it is opening its largest Uniqlo store on Friday, as part of its plan to globalise operations rapidly and reduce dependence on its home market… Fast Retailing, which made its name selling high quality, affordable, casual clothes, is accelerating its overseas build-up, with plans to open 200 to 300 stores globally each year for the next several years.”

Nike eyes $4 billion in China sales by 2015 (Reuters)
“Sports apparel maker Nike Inc has set a target of boosting its annual sales in China to $4 billion by 2015… The sportswear company had sales in China of about $2.1 billion last year, according to a market research firm cited by the Journal. In its fiscal first quarter ended Aug. 31, Nike reported China sales of $528 million.”

Is China’s elite looking for more ‘exclusive’ luxury? (Red Luxury)
“The upper echelons of society are getting a little more exclusive. Even in these demure economic times, luxury consumers need more than money to set themselves apart: patience and good taste are now more important in determining what’s haute and what’s not… The new frenzy of buying what is not just expensive but highly exclusive is being called hyperluxury…Much of Europe’s hyperluxury sector is being devoured by China, one of the fastest-growing emerging markets.”

Liz Claiborne to sell several brands, change name (Forbes)
“Financially struggling Liz Claiborne Inc. said Wednesday that it is selling its namesake brand and several others to concentrate on its Juicy Couture, Lucky Brand and kate spade fashion plates… Liz Claiborne is the latest company to adjust its business as the U.S. consumer market bifurcates into the high and low ends, essentially squeezing out the middle.”

Jean Paul Gaultier: From the catwalk to the big screen (Independent)
“It is 40 years now since Gaultier was talent-spotted by Pierre Cardin. The young would-be designer from the provinces (he was born in Arcueil) has come a very long way… Khelfa’s film is one of an increasing number of documentaries and dramatic features set in the fashion world. Whether Valentino: The Last Emperor or The Devil Wears Prada, Gaultier has watched most of them. However, he has mixed feelings about the way the camera has captured his professional world.”

Prada Spring/Summer 2012 | Source: Style.com

The Roman Spring of Ms. Prada (On the Runway)
“Miuccia Prada spent her summer vacation in northern Argentina. Karl Lagerfeld was at home in St.-Tropez, ducking camera-snapping tourists. Somehow, though, their spring collections brought us all to Italy, or at least our idea of an Italian holiday. Neither show was a movie-still occasion, but the cottony, upswept hair and glitter-coated eyelids at Fendi might make you think of a 1960s film star. The collarless, knee-length satin coats and pleated chiffon dresses at Prada did the same.”

Nike sees strong worldwide demand (Reuters)
“Nike Inc staved off margin pressure in the first quarter with strong revenue and price increases, and said it was confident about its position among peers as it heads toward the winter holidays… The world’s biggest athletic shoe and clothing maker topped Wall Street’s profit and sales estimates, and its shares rose more than 5 percent in after-hours trading.”

Milan floats a big idea (FT)
“Recently a new fashion store opened in Milan. This would not in itself be a notable occurrence, especially during fashion week, but this is a vast, 43,000 sq ft ‘directional emporium’… This is Excelsior, Italy’s first upscale concept department store in the Selfridge’s/ Barney’s mode.”

Milan fashion week: Dolce and Gabbana call an end to D&G (Guardian)
“Domenico Dolce and Stefano Gabbana, Milan fashion week’s kings of bling, can make anything look glamorous – even the usually rather downbeat business of closing a 26-year-old fashion label. Thursday’s D&G catwalk show, right, was as ever a carnival parade of bouncy, youthful glamour. D&G is the younger sister label to Dolce & Gabbana, and the D&G aesthetic has always appeared to be aimed at a woman with the taste of a cheerleader and the bank balance of a CEO.”

Kanye West recruits London students for debut fashion collection (Guardian)
“Somewhere in London, a nightclub full of fashion graduates are working for Kanye West. The rapper has reportedly recruited Central Saint Martins students to work on his Paris fashion week collection. Next week West is expected to make his prêt-à-porter debut, unveiling, er, something at the fashion world’s most important autumn/winter event.”