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By: Alexander Loffeld | October 26, 2017

The Salesman is dead, long live the Salesman!


With the constant advances in marketing technology and the rapid growth of consumer self-service sales, has the wholesale distribution segment of the supply chain become an unnecessary step in the sales process? Or has a new opportunity been created? 


As end-consumers, we are constantly solicited. Marketing has taken such a drastic turn in the last few years to a point where companies know what we want before we do. The level of granularity, personalization and trend identification based on behavioral-pattern analysis is just mind-boggling. The pace of innovation and frequency of introduction of disruptive technologies is hard to keep up with. Shoppers’ experience has become mobile, social, f...

By: Alexander Loffeld | July 13, 2017


As she prepares to celebrate 20 years in business, Sarah Andelman talks exclusively to BoF about the genesis and growth of Colette, something of a pilgrimage site during Paris Fashion Week.


  


PARIS, France — In Paris, there is a ubiquitous white shopping bag that bears two cobalt blue dots, one on top of the other. More than a means of carrying goods, it’s a cultural signifier of a purchase that is current, perhaps a little kitsch and most certainly cool. “Some people think it’s the mother and the daughter,” says Sarah Andelman, the co-founder of Colette, of her store’s famous logo, debunking the myth that it depicts her and her mother Colette Rousseaux, with whom she launched the Rue Saint-Honoré institution that be...

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By: Alexander Loffeld | July 12, 2017


Among the many problems facing today's retail market, unsold stock might be one of its biggest handicaps, argues Haley Smith Recer.


Source: Shutterstock

NEW YORK, United States — Check any recent retail headline and it’s hard to miss the headwinds the industry has been experiencing. A warm winter, consumers focusing more on experiences than their closets, and the ever elusive "omnichannel strategy" are just a few reasons why retailer’s top lines have been struggling.


These misses translate to exponentially weaker bottom lines as retailers and fashion houses struggle to adapt their organisations quickly enough to make up for lower sales. We’re all aware of the layoffs permeating retail headlines and of the con...

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By: Alexander Loffeld | June 28, 2017


Can fashion retailers wage war against the seemingly invincible Amazon? Undoubtedly, says Doug Stephens.


TORONTO, Canada — Amazon recently posted its eighth straight quarter of growth. In fact, in the first quarter of 2017 its revenue grew by a jaw-dropping 23 percent, hitting net income of $724 million. Amazon Prime subscribership jumped to over 80 million members, representing a gravity-defying increase of 36 percent. And, while slowing marginally, Amazon Web Services, the company’s cloud computing cash cow, continued to post growth in the mid-40 percent range, giving Amazon plenty of cash to burn on furious innovation.


For one, Amazon continues to expand the capabilities of its Alexa Voice Service, the operating platform of its popula...

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By: Alexander Loffeld | June 19, 2017


The status quo spells certain death for design-driven brands unless they tap new technologies and Economies of Small, argues Lawrence Lenihan.


NEW YORK, United States — The fashion industry is about design. It’s about creation. It’s about the delight we feel when we see something for the first time ever. It’s about unique and it’s about special. We’ve forgotten this because the people who have made this industry so magical, the creators whose imaginations birth the unimaginable, are being crushed by massive, data-driven global supply chain companies that rob them of their creations and exploit the markets and trends they created. The fashion industry playing field is so badly tilted against them it’s little wonder it feels like every da...

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By: Alexander Loffeld | June 16, 2017

What does it take to survive and prosper in a luxury market where digital is becoming the new centre of a brand's gravity?

BY ANTONIO ACHILLE


MILAN, Italy — Online luxury sales exceeded €20 billion in 2016, representing about 8 percent of the total personal luxury market. We expect this figure to reach €75 billion by 2025, representing one-fifth of the total personal luxury market. For many brands and department stores, digital is the only channel that’s growing, as physical stores increasingly become empty temples of desire and go from being an asset to being a liability.


Today, already 74 percent of personal luxury sales are “digitally influenced,” meaning that your customers, before initiating a purchase, have one or more digital touch...

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By: Alexander Loffeld | June 04, 2017

Digital technology can bring young designers and artisans out of obscurity and give them a marketplace

Amazon recently posted a LinkedIn profile that revealed it was quietly building a team to help people to find clothes that fit people perfectly. The giant online seller wants to recruit engineers and its project will span hardware and robotics, 3D models, applied research and software engineering. The goal: to reinvent retail using machine learning.

Well that’s all fine for high street fashion, you might say, but when it comes to luxury brands, no one will want a microchip to choose an outfit for them.

Luxury fashion takes time, time to create and time to understand. It is about scarcity and unsated desires,...

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By: Alexander Loffeld | June 02, 2017

Millennials and Gen-Z will account for 45 percent of the luxury market by 2025, but their values and spending habits are at odds with the business models of many traditional brands.


Luxury stores on Bond Street, London | Source: Shutterstock

MILAN, Italy — The luxury goods market is expected to return to growth this year, driven by domestic spending in China and tourism in Europe, according to the latest Bain & Co. Luxury Study, released on Monday in collaboration with the Fondazione Altagamma.


While luxury goods sales fell last year to €249 billion ($280 billion), from €251 billion in 2015, spending is expected to grow by 2-4 percent this year.


And over the next three years, Bain predicts that millennials and G...

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By: Alexander Loffeld | May 29, 2017

Despite the success of services like NikeiD, mass customisation has yet to take off in fashion. by Kate Abnett


LONDON, United Kingdom — Ours is a customisable world. From Spotify playlists to sandwiches, we routinely custom-build things according to our individual tastes and requirements. Indeed, in industries as diverse as window manufacturing and personal computers, it is now the norm for companies to tailor individual products to the needs of individual customers.


In footwear, Nike and Converse have built popular ‘mass customisation’ services, which allow customers to participate in the design of their products, which are then built to order in large-scale factories, blending the benefits of traditional craft production with the effic...

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By: Alexander Loffeld | May 29, 2017


Fashion brands are turning to manufacturers in Eastern Europe and Central America for greater agility and speed to market. by Sharah Shannon  


LONDON, United Kingdom — Moncler, the Italian maker of down jackets and après-ski wear, makes around half of its products by value in Italy, where local craftsmen produce items like leather handbags, scarves and gloves. Its “façon” manufacturing operation (cut, make and trim), however, is mostly based in Eastern Europe, where Moncler provides the raw materials and its supplier is entrusted to assemble the product under attentive monitoring and weekly inspections. This includes Moncler’s core down jackets. Last year, the brand even established a new manufacturing hub in Romania and hired 600...

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By: Alexander Loffeld | May 24, 2017

The way the average American dresses has changed drastically in recent years. Evolving dress codes, comfortable and technologically improved fabrics, and stylish but sporty designs have all combined to carve out a large section of the retail market.


Sales for activewear in the US reached $45.9 billion in 2016, according to NPD Group data. That's an 11% uptick from the previous year, and far greater than the growth of the apparel sector as a whole.


The rise of athleisure as the dominant way that people dress has broad implications for the rest of the apparel industry. As people are opting to move away from traditional styles and dress in this utilitarian style, fashion brands that have been slow to jump on the act...

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By: Alexander Loffeld | May 24, 2017


The Asian and European fast fashion giants that disrupted American retail are now themselves feeling pressure.


The business of fashion is full of examples of disruptors being disrupted. Just look at American retailers Gap and Abercrombie & Fitch, once trendsetters that came under enormous pressure from the rise of Zara, H&M and Uniqlo, European and Asian fast fashion players whose “cheap chic” formulas, offering stylish clothing at low prices, revolutionised the apparel market and drove the creation of huge multi-billion-dollar businesses.


Now, these fast fashion giants are facing mounting pressure themselves. To maintain growth, Zara has been relying on cutting prices, sending profitability at parent company Inditex, the world’s larg...

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By: Alexander Loffeld | May 24, 2017

The world’s most successful retail developers reveal the strategies that are helping them thrive in an environment where many traditional malls are struggling to survive.

by HAYLEY PHELAN


NEW YORK, United States — On an unseasonably warm day in April, a swarm of tourists gathered at the entrance to the Westfield World Trade Center, Manhattan’s newest mall, marvelling at the sunlight pouring through the soaring white cathedral of the Oculus. Many posed for selfies, while others asked passers-by to snap photos of them and their families.


Others were passing through on their way to work; the mall sits on top of the city’s biggest transit hub. A group of twenty-somethings were en route to Hudson Eats, the food court boasting New York-onl...

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By: Alexander Loffeld | May 21, 2017

As retailers face a self-reckoning amid a challenging environment, the key is to find a state of equilibrium between the old and the new, writes Bart Mroz founder and CEO of SUMO Heavy.


Retailers and brands are facing a self-reckoning. For proof, look to an unlikely place — New York’s Fifth Avenue.


Ralph Lauren, which for nearly half a century has been a global icon in the fashion world, announced in April that it will close its flagship Polo store on Fifth Avenue — illustrating a larger trend unfolding across the country.


The decision to shutter the iconic store comes at a time when traditional 20th century brick-and-mortar retailers and brands are being forced to reevaluate where and how they fit into the 21st century consumer economy. ...

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By: Alexander Loffeld | May 15, 2017

Goods and services are no longer enough — stores must deliver personal, memorable experiences, argues B. Joseph Pine II.

SAINT PAUL, United States — Retailers the world over need to understand that we have entered the Experience Economy. Goods and services are no longer enough; what consumers want are experiences — memorable events that engage each individual in an inherently personal way. For retailers to survive and thrive tomorrow, they must understand the ramifications of today’s fundamental shift in the very fabric of the economy.


Merchandise will be commoditised

Consumers will want to buy goods at the cheapest possible price and the greatest possible convenience. Meaning, they will continue to buy more and more m...

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By: Alexander Loffeld | May 12, 2017

As the nature of his business changes, the British designer will merge his design teams and collapse his many diffusion lines into two collections comprising both men’s and womenswear, with four drops a year. BY ANDREW BARKER


LONDON, United Kingdom — “I think the world has gone mad,” says Paul Smith, the Nottingham-born designer whose business remains, after 45 years, one of the leading lights of British fashion. “There’s this absolute horrendous disease of greed and over-expansion and unnecessary, massive over-supply of product.”


And in time for the Autumn/Winter 2016 shows, the house — hot on the heels of Burberry and Marc Jacobs — has slimmed down its brand hierarchy to produce only two “collections”: Paul Smi...

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By: Alexander Loffeld | May 12, 2017

This week, LVMH confirmed the launch of 24 Sèvres, its long-awaited return to multi-brand e-commerce. But the once-distinct worlds of online and offline retail are converging, giving birth to a new retail reality.


It’s been 17 years since Natalie Massenet’s Net-a-Porter, Federico Marchetti’s Yoox and LVMH’s eLuxury kicked off the first wave of fashion e-commerce. San Francisco-based eLuxury closed in 2009, a few years after Louis Vuitton decided to launch its own e-commerce site, leaving the business without its anchor brand and isolating it from LVMH’s Paris headquarters. But Massenet and Marchetti’s ventures were successful and ultimately merged to form the world’s largest luxury e-tailer with 2016 sales of €1.87 billion, fundamentally disrupting fashion retail along the way.


Change took time. For the first few years, most high-end fashion brands dismissed the idea of selling luxury goods online. But over time, many top luxury brands began working with Net-a-Porter and Yoox, and investing in their own digital sales channels. By 2014, nearly all luxury market growth was coming from e-commerce, with online sales reaching €14 billion, up 50 percent from 2013, according to McKinsey & Company, which noted a “tipping point” in luxury e-commerce. In the next ten years, the firm expects the share of luxury sales occurring online to triple, making e-commerce the world’s third largest luxury market after China and the US.


This week, eight years after the demise of eLuxury, LVMH jumped back into the ring with 24 Sèvres, its long-awaited return to multi-brand e-commerce. In recent years, the space has become crowded and highly competitive, but Ian Rogers, the group’s chief digital officer, says the venture is well-timed and will set itself apart with a distinctly Parisian point of view, product from LVMH brands like Louis Vuitton and Dior that others don’t sell, a more visual approach to merchandising and high-touch services like styling sessions via video chat.


But now a new wave of change is washing across luxury retail. While e-commerce is growing fast, the portion of personal luxury goods purchases that happen online — now about 7 percent of the total — is expected to plateau at about 20 to 25 percent by 2025. This means that, for the foreseeable future, the vast majority of sales will still take place in physical stores. And yet, about three quarters of all luxury goods purchases, even if they take place in stores, are influenced by what consumers do online, according to McKinsey. “My assumption in the long term is that 99 percent of purchases will be influenced by digital in one way or other,” Nathalie Remy, who leads the firm’s fashion and luxury goods practice for EMEA, told BoF last year.


To be sure, the customer journey is more complex and non-linear than ever before, blending online and offline touchpoints. Today, the path to purchase could easily start online and end in a store, or vice versa, moving easily between physical and digital interactions along the way. Make no mistake, retail and e-tail are converging, and there’s little point in thinking of them as separate entities any more. It’s all just shopping.


In response, legacy players with large store networks like LVMH are accelerating online, while digital players like Farfetch and Moda Operandi are deepening their presence in the physical world. Just this week, MatchesFashion.com, which began with physical stores before e-commerce became the engine of its growth, announced plans to open a new “townhouse” in London’s Mayfair which will play host to events and private clients as well as two floors of physical retail.


Some are learning to connect the dots, integrating their online and offline businesses to seamlessly serve customers who move fluidly between physical and digital touchpoints. Farfetch, in particular, has a developed a robust ‘new retail’ strategy, leveraging the virtual store network of its brand and boutique partners.


But this new world of convergence comes with challenges as well as opportunities. For a start, there’s the challenge of building a universal view of inventory across multiple channels, and making sure the right product gets to the right place at the right time. Then, there’s the task of keeping track of consumers — and their data trails — as they move from online to offline and back again. This isn’t easy and will require the kind of innovation that Farfetch, for one, hopes to spark with its Store of the Future platform, which aims to dramatically improve retail productivity, in part, by tracking in-store interactions and developing a more holistic view of customers by meshing together online and offline data.


There’s also the challenge of reimagining the physical store. As e-commerce grows, the store of tomorrow will have to deliver experiences you can’t get online, becoming much more than a selling space. To facilitate omnichannel services like “click and collect” and 90-minute delivery, stores will surely function as distribution hubs for online orders. But now that nobody needs to visit a physical store on a Saturday afternoon, retailers will also have to compete for precious leisure time with activities like seeing a movie, going to a concert, attending a sports match or visiting a museum. That means staging the kind of experiences you can’t get online and, ultimately, transforming stores into places where people go to spend time and connect with others — not just to shop.


Finally, the stores of tomorrow — much like MatchesFashion.com’s ever-changing new townhouse in London — will also have to display the kind of flexibility that allows them to evolve at a rapid rate, because, in today’s new retail reality, a large percentage of shopping may still be happening offline, but there’s little doubt that consumer expectations are being formed at the pace of digital.

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By: Alexander Loffeld | May 12, 2017

Divia Harilela BY Divila Harilela

For the past 35 years, Salvatore Ferragamo’s elegant Vara shoe has 

remained a bestseller with only a few colour changes along the way. But 

the round-toe style with a grosgrain bow is getting a hip makeover by 

new women’s footwear director Paul Andrew.


“I’ve gotten rid of the grosgrain and replaced it with a more technical 

nylon webbing,” says Andrew, whose debut pre-autumn 2017 collection is 

in stores this month. “We then made it more fun and youthful by fraying 

the edges, and...

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By: Alexander Loffeld | May 04, 2017

Are Trends Dead, or Are They Just Being Recycled in an Endless Loop?



If fashion trends are meant to be a sign of the times—from Millennial pink to athleisure at the workplace—then the state of the trend itself can also be an indicator of the ebb and flow of culture. And as the fashion industry matures in the digital age, trends are not only coming and going at different rates, (is merch really dead?), but also emerging from new and varied sources. Every day it seems there's a new trend to know about, so much that it can be hard to keep up.


So today, as we begin to enter not only a new season but also a new age (Mercury's finally out of retrograde...), it's useful to ask: Where do trends come from? Are they cycling faster than ever b...

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