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Department Stores Cash in on Private Labels

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Lucy Archibald

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This is the featured image caption
Credit: This is the featured image credit

Retailers including Liberty’s and Harrods are leveraging their brand value as they launch their own fashion labels.

Over the last decade, collaborations between luxury brands and contemporary artists have gone beyond mere artistic partnerships towards a new kind of luxury branding.

PARIS – Art and fashion have always developed side by side, for fashion, like art, often gives visual expression to the cultural zeitgeist. During the 1920s, Salvador Dalí created dresses for Coco Chanel and Elsa Schiapparelli. In the 1930s, Ferragamo’s shoes commissioned designs for advertisements from Futurist painter Lucio Venna, while Gianni Versace commissioned works from artists such as Alighiero Boetti and Roy Lichtenstein for the launch of his collections. Yves Saint Laurent’s vast art collection, recently auctioned at Christie’s in Paris, testified to his great love of art and revealed the influence of a variety of artists on his own designs.

In the 1980s, relationships between luxury brands and artists were advanced when Alain Dominique Perrin created the Fondation Cartier. In the Fondation Cartier pour l’Art Contemporain, a book marking the foundation’s 20th anniversary, Perrin says he makes “a connection between all the different sorts of arts, and luxury goods are a kind of art. Luxury goods are handicrafts of art, applied art.”

The Fondation Cartier pour l’Art Contemparain building in Paris

Retailers including Liberty’s and Harrods are leveraging their brand value as they launch their own fashion labels.

Following its recent sale to Qatar Holding LLC for $2.3 billion, the iconic London department store, Harrods is planning to open an in-store shop selling Harrods-branded clothing and accessories by 2012. General merchandise manager Jason Broderick revealed that the range of men’s clothing and accessories will be positioned as an alternative to brands like Brioni Roman Style SpA, the Italian maker of $5,000 suits. Broderick believes that private-label fashion is “a growing part of our business with huge potential.”

The model seems to have worked for Saks whose re-launched men’s collection is set to become the New York retailer’s largest menswear brand, according to Thomas Ott, Saks senior vice president of menswear. The theory is that by leveraging the image of the stores themselves and slightly undercutting the main luxury brands, or eclipsing those who have lost their sense of identity, they can appeal to a broader base of more price sensitive, post-recession consumers. “The recession seemed to reset everyone’s expectations as to price point, bringing it back into reality,” said Liberty’s buying director Ed Burstell. But lower price points do not mean inferior product or branding. Product, packaging and promotion have all been stepped up such that “They don’t look like private labels anymore,” said Ciccoli, a former partner at consulting firm Bain & Co. “they’re more like real brands.”

Liberty, another iconic London retailer is pushing the idea even further with plans to distribute their own Spring Summer 2011 men’s clothing line, unveiled at Milan fashion week last week, in competitors’ stores as well.

Big retailers like these have the advantage of carefully positioning their own brand alongside their buy to give customers a great range of options. “Our private label business is complementary rather than strategic,” says Alberto Baldan, managing director of Milan-based retailer Rinascente Spa, whose private label accounts for 20% of revenue. Moreover, department stores also have the upper hand in ensuring that their brand is serving a unique consumer purpose, or “white space” within the store. Ott has also taken a gradual approach at Saks “Each season we edit our portfolio of resources and instead of filling with only other new brands, some of these dollars and floor space have gone to our own collection.” Moreover, by pulling in new customers with a new, exclusive line department stores can also hope to capitalise on their custom in other product areas.

Sources
Bloomberg

Lucy Archibald
Lucy Archibald

Associate Editor

RETAIL

Department Stores Cash in on Private Labels

by

Lucy Archibald

|

This is the featured image caption
Credit : This is the featured image credit

Retailers including Liberty’s and Harrods are leveraging their brand value as they launch their own fashion labels.

Over the last decade, collaborations between luxury brands and contemporary artists have gone beyond mere artistic partnerships towards a new kind of luxury branding.

PARIS – Art and fashion have always developed side by side, for fashion, like art, often gives visual expression to the cultural zeitgeist. During the 1920s, Salvador Dalí created dresses for Coco Chanel and Elsa Schiapparelli. In the 1930s, Ferragamo’s shoes commissioned designs for advertisements from Futurist painter Lucio Venna, while Gianni Versace commissioned works from artists such as Alighiero Boetti and Roy Lichtenstein for the launch of his collections. Yves Saint Laurent’s vast art collection, recently auctioned at Christie’s in Paris, testified to his great love of art and revealed the influence of a variety of artists on his own designs.

In the 1980s, relationships between luxury brands and artists were advanced when Alain Dominique Perrin created the Fondation Cartier. In the Fondation Cartier pour l’Art Contemporain, a book marking the foundation’s 20th anniversary, Perrin says he makes “a connection between all the different sorts of arts, and luxury goods are a kind of art. Luxury goods are handicrafts of art, applied art.”

The Fondation Cartier pour l’Art Contemparain building in Paris

Retailers including Liberty’s and Harrods are leveraging their brand value as they launch their own fashion labels.

Following its recent sale to Qatar Holding LLC for $2.3 billion, the iconic London department store, Harrods is planning to open an in-store shop selling Harrods-branded clothing and accessories by 2012. General merchandise manager Jason Broderick revealed that the range of men’s clothing and accessories will be positioned as an alternative to brands like Brioni Roman Style SpA, the Italian maker of $5,000 suits. Broderick believes that private-label fashion is “a growing part of our business with huge potential.”

The model seems to have worked for Saks whose re-launched men’s collection is set to become the New York retailer’s largest menswear brand, according to Thomas Ott, Saks senior vice president of menswear. The theory is that by leveraging the image of the stores themselves and slightly undercutting the main luxury brands, or eclipsing those who have lost their sense of identity, they can appeal to a broader base of more price sensitive, post-recession consumers. “The recession seemed to reset everyone’s expectations as to price point, bringing it back into reality,” said Liberty’s buying director Ed Burstell. But lower price points do not mean inferior product or branding. Product, packaging and promotion have all been stepped up such that “They don’t look like private labels anymore,” said Ciccoli, a former partner at consulting firm Bain & Co. “they’re more like real brands.”

Liberty, another iconic London retailer is pushing the idea even further with plans to distribute their own Spring Summer 2011 men’s clothing line, unveiled at Milan fashion week last week, in competitors’ stores as well.

Big retailers like these have the advantage of carefully positioning their own brand alongside their buy to give customers a great range of options. “Our private label business is complementary rather than strategic,” says Alberto Baldan, managing director of Milan-based retailer Rinascente Spa, whose private label accounts for 20% of revenue. Moreover, department stores also have the upper hand in ensuring that their brand is serving a unique consumer purpose, or “white space” within the store. Ott has also taken a gradual approach at Saks “Each season we edit our portfolio of resources and instead of filling with only other new brands, some of these dollars and floor space have gone to our own collection.” Moreover, by pulling in new customers with a new, exclusive line department stores can also hope to capitalise on their custom in other product areas.

Sources
Bloomberg

Lucy Archibald
Lucy Archibald

Associate Editor

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