LONDON, United Kingdom — What does a British heritage brand, known for its craftsmanship and practical handbags, have to gain from a partnership with a Scandinavian fashion house with a streetwear edge?

Fashion collaborations — from the high-low mix of Karl Lagerfeld and H&M, to Supreme's tie-up with Louis Vuitton and Moncler's Genius Project —  remain a clever tool to drive excitement, traffic and new consumers to brands.

A tie-up between leather goods focused Mulberry and Swedish luxury label Acne Studios is a little more surprising.

Design elements from both brands — like Mulberry's buckle straps and Bayswater shape, and Acne Studios' twisted knot design and salmon-pink colour — have been married together in the 17-piece collection, which ranges from a £90 keyring up to the £1,295 Musubi Bayswater in Oak. The products will be stocked in both brands' key stores and websites, selected wholesalers and digital partners, including Farfetch, Selfridges, Nordstrom and Tmall.

But the collaboration makes good business sense for both brands.

For one, Mulberry could do with an injection of cool. It has a heavy weighting towards the British middle market where it is sold in department store chains popular among older generations and is widely stocked (it has 55 sale points in the UK alone). Mulberry sales slipped 6 percent last year, pushing the business into the red.

Sales have recovered somewhat, but collaborating with Acne Studios, which has more elevated, limited stockists like Harrods and MatchesFashion, as well as credentials with a younger customer base, will expose Mulberry to a new fashion-forward shopper that is needed to boost its relevance.

"We have been friends with the team at Acne Studios for a long time and we share many of the same qualities," Chief Executive Thierry Andretta told BoF over email. "For Mulberry it allows us to bring something fresh and innovative to our customer that adds a twist to both our brands."

Innovating is key to keeping up with the pace of newness as desired by a social-media obsessed young generation, and Mulberry, while tapping trends like mini-bags and limited edition offers with its new artisan studio at its Somerset factory, is competing in a crowded marketplace. Digital is core to their growth plan — already accounting for 22 percent of sales — and the tie-up will offer some kudos to the brand on social media.

Andretta wouldn't be drawn on the longevity of the collaboration but said that working with other brands is on the cards. "We are incredibly proud of our factories and the world-class quality of our in-house craftsmanship.... [We] are always open to exploring new opportunities."

Opportunity for growth in Asia is also a factor to the collaboration. Andretta has signalled the region as the brand's biggest growth market, where it has taken back control of its franchisee business, opened more stores and invested in influencer-led campaigns, including a catwalk show in Seoul last year. Partnering with Acne Studios, which already has a huge following in Asia (Chinese shoppers account for its largest consumer demographic) and sold minority stakes to two Chinese-focused investment firms last year, will undoubtedly help.

But what's in it for Acne Studios, which typically forgoes large marketing budgets, influencer spend and paid media in favour of word-of-mouth, guerrilla postings and a product-centric approach to Instagram?

Acne Studios' leather goods offering — typically the highest-margin product category for luxury brands — is small in comparison to its peers. Analysts estimate that Acne Studios, which started as a creative collective in 1996 with denim, broadening out to womenswear and menswear, garners only single-digital percentage revenue from handbags, leather goods and sunglasses. Saint Laurent, by comparison, brings in 69 percent of its revenues from leather goods.

"Bags is a relatively young product category for us, and it is obviously a very crowded market," said Mattias Magnusson, chief executive of Acne Studios. "Mulberry have created some of the most iconic bags of our time and we were really keen to marry them with our design."

Acne Studios only began offering handbags to its wholesale accounts from Spring Summer 2018, a year after launching their Musubi twisted knot line, made in Italy from calf leather and priced from £550 to £1,200, just below most luxury players. They also have a cheaper Baker shopper tote, colour-blocked utilitarian bags from its Blä Konst denim line and the streetwear-inspired Face line of sports bags.

Occasionally Acne Studios does enter into collaborations, like last year's tie-up with Nordic outdoor heritage brand Fjällräven, whose functional backpacks, sleeping bags and down jackets were given an Acne Studios design update. But they have been limited.

"It was great to see that the features of our Musubi bags could look great also on the iconic [Mulberry] Bayswater," said Magnusson, adding that more bags are coming. "We have a lot of things in the making also outside of the Mulberry project,"

Natalie Kingham, buying director at Matches Fashion, said Acne Studios has a strong following and a fashion edge. "Not all brands are able to translate into accessories, but Acne Studios have done," she said. "It takes a lot of development. We've stocked their bags from the first season and they've done very well."

For Acne Studios, Mulberry brings craftsmanship and expertise in leather goods. The British brand makes half of its products in two owned factories in rural Somerset, where this collection was produced. Craftsmanship, quality and durability have been core to their business since it started in 1971.

"Both brands deserve consumer attention, in my view, and would stand to gain from the cooperation," Bernstein analyst Luca Solca said. "Mulberry has been in the background for a while, and Acne Studios provides a sharp streetwear complement."

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