In with the old, in with the new?

Fashionista has been thinking about Jaeger's 125 ladieswear collection which features current designs heavily influenced by clothing from the brand's archives. The navy dress with white flower was based on a 1960s swimsuit featuring the same pattern. The success of the range has been such that Jaeger is now planning a seasonal capsule collection based on previous eras of fashion, drawing inspiration from its archives.

Fashionista applauds this highly lucrative business plan which, if marketed correctly, could become a brand's identifying characteristic.

We've heard the message almost daily for longer than Fashionista can remember. We're in a recession. Fashion houses will need to cut costs as much as possible without losing the quality, design and craftsmanship for which they have become known and on which they crucially depend to maintain their reputation. It's not rocket science that designs which are a "tried and tested" success carry less risk than an entirely new design.

Another plus: re-using past designs shows that the brand's designs (and by inference, the brand) are iconic. They stand the test of time and transcend eras in the ever changing world of fashion. And what's more: revamping archived designs will attract those who may have bought the original design when it was first launched and who then drifted away from the brand, but nostalgia will now draw them back; it will attract those who loved the clothes of a particular era which may now be hard to find; and it will attract new customers who simply like the look of a design.

If it was iconic before, there's every chance it can be iconic again. Fashionista wonders what her readers think of the concept of revamping archived designs?

Acquascutum - an MBO explained

Fashionista has noted the recent events at Aquascutum with interest. It was reported back in October 2008 that chief executive Kim Winser, who was brought in by Japanese parent company Renown to revive the ailing Aquascutum brand in 2006, was preparing for a management buy-out. However, it was announced on 22 May 2009 that Winser had stepped down. According to Drapers sources close to Aquascutum, her shock exit is a result of Renown's rejection of her "generous" offer for the business.

Fashionista's private equity friends have explained that a management buy-out (MBO) is the acquisition of a company by the existing management team, usually supported by equity finance from a private equity provider and bank debt financing from financial institutions. A group of new companies is normally set up to acquire the target business. A simple structure will typically comprise of a top company (Newco), which will act as the investment vehicle, and a wholly-owned subsidiary of Newco (Newco 2), which will act as the purchasing and bank debt vehicle.

The private equity provider then makes an equity investment in Newco by typically subscribing for a combination of shares and loan stock. The management team will usually also subscribe for shares in Newco as an ongoing incentive and will be employees of Newco entering into new service contracts. The private equity provider will typically look to make an exit from the target and fully realise the return on its investment within three to seven years of the date of the investment.

MBOs are an essential feature of corporate transactions and there have been several high profile retail MBOs: for example the acquisition of Kurt Geiger in 2008 backed by Graphite Capital. This change of ownership was driven by the management's desire to aggressively expand the brand. Management themselves often initiate MBOs where they see an ideal investment opportunity to take the business forward. Winser was brought in to turn Aquascutum around and it is widely accepted that she had made significant progress. It was reported in December 2008 that the brand was on target to achieve profit by 2010, which could explain why Winser felt that this was the ideal time to make a bid.

MBOs are also a popular method for parent companies to divest of or restructure subsidiaries in a times of recession. A sale to the management team is an ideal way to achieve an exit as they understand the business and will usually be prepared to take on a larger degree of risk than other bidders. Renown purchased Aquascutum in 1990 for £113.2 million and in 2006 injected a further £40 million into the business in an attempt to rescue the brand. However, after a fourth consecutive loss in the year to the end of December 2007, Renown now appear keen to find an exit.

Renown has announced that its preferred bidder is Hong Kong based distributor YGM Trading, which distributes Aquascutum in Asia. However, although YGM issued a notice of intent to make an offer for Aquascutum at the beginning of June 2009, a bid is yet to materialise. Interest has reportedly been shown by both David Hewitt, former managing director of Daks, and Crombie chairman and chief executive Alan Lewis. Meanwhile Aquascutum's entire workforce has been put into consultation and its future remains in doubt so Fashionista will be watching this space with interest.

Never Knowingly Undersold

Breaking away from the recent spate of designers designing more accessible (read "cheaper") ranges for high street stores (think: Matthew Williamson and Jimmy Choo for H&M for example), John Lewis has just announced that it will launch a premium label own-brand collection in September. Rather than seeking to appeal to the masses, John Lewis are seeking to appeal to a smaller audience. An interesting strategy in the current economic climate. Surely brands want to maximise sales and make their products as accessible as possible, rather than narrowing the pool of potential customers?

Well, no, and Fashionista thinks it a savvy move. John Lewis is a high street favourite. According to the John Lewis Partnership website, "John Lewis has been recognised as top for customer service by the UK Customer Satisfaction Index" and, in January, was voted "Britain's favourite retailer 2008" (as part of a customer satisfaction index). Whilst this may all be true, Fashionista thinks the general perception is that John Lewis is the "sensible" department store. It doesn't quite have the glitz, the luxury, or the cutting edge fashion of Harrods, Harvey Nichols or Selfridges - but you know you are going to get good quality, good value goods if you walk into John Lewis. You also know you'll find most things you are looking for from their huge stock of more than 350,000 separate lines. Except, perhaps, that luxurious "a little bit special" evening dress, or impeccably tailored suit. Enter the new premium label.

John Lewis already draws in most people off the high street. So one of its aims for the new label must be to draw in the small handful of fashionistas who will shop in "The Big 3" or will more frequently be seen snaking in and out of stores on London's Bond Street or Sloane Street. Another aim must be to provide even more choice to the existing John Lewis customer, filling the only gap in its product range to avoid losing business to rival department stores. If this move works, John Lewis really could become a one stop shop for all shopping needs. But will customers go for it?

Fashionista will be interested to see whether this works. She thinks it is an ambitious move and queries: can the brand distance itself sufficiently from its current reputation (echoed in the strapline "never knowingly undersold") so that customers will want to spend money on a luxury piece branded "John Lewis"? Fashionista anticipates that it will take great products, the right price point, clever PR and marketing, and has her fingers crossed for this high street favourite.

The luxury lifestyle - is online the place to be?

Fashionista is, it goes without saying, a true devotee of online shopping - or should that be a dedicated follower of Net-A-Porter? But in the main luxury brands have been slow to embrace the wonders and the opportunities of the online space. Fashionista has often wondered why.

Luxury brands on-line was the subject of discussion earlier this week at the Internet Advertising Bureau. Fashionista learnt that 16% of the global population now has access to broadband and also represents 78% of global earnings. What is more 80% of high net worth individuals spend time on-line every day so surely the time must be right for luxury brands to embrace the opportunities offered by the internet?

Abby Carvosso, deputy MD of Grazia, Bauer is a passionate advocate of the benefits of being on-line having launched and nurtured Grazia Daily as a premium magazine online. Here are the 10 things she has learnt from this experience:

1. Be brave. To date luxury brands have been the slowest category to go on-line with only 1% of their media spend being spent online.

2. Understand your audience. Influence and involve them.

3. Premium audiences are online now. So be part of the conversation with them.

4. Deepen the consumer relationship with your brand. See what D&G have done with "Behind the Seams"

5. Give the consumer control. Don't be scared - allow consumers to become involved. Follow the example of Gucci and open a Facebook page for your brand - Gucci has over 400,000 followers on Facebook.

6. Test and learn. Don't be afraid to experiment. If it doesn't work, you can take it down!

7. Scale is not everything. Limited editions work well in the premium market - see 20ltd whose hand picked exclusive items appeal to the luxury consumer.

8. The experience and the service you provide must be the best. Here Net-A-Porter is the role model to emulate.

9. Don't miss the opportunity. If you are not there then someone else is and you will lose out.

10. Be the first to know. We are all intrinsically nosey - exploit this and use the online space to break news to your loyal customers first.

Fashionista is convinced. Are you?

A report from Milan - but not from the catwalk!

Fashionista's Italian sister has reported on the first Italian Luxury Summit which took place in Milan last Tuesday, 30 June. The summit was organised by ILSOLE24ORE, Italy's influential financial newspaper and was attended by representatives of many of the brand names on Fashionista's "must buy before I die" list. The discussion centred on the impact of the current economic climate on the spending patterns of the rich - and it seems that the new trend is to make lifestyle investment purchases rather than short term seasonal purchases.

This is the reason why brands like Hermès continue to do well according to Ms Di Carrobio, CEO of Hermès Italie. Classic items with a history built over generations are more "acceptable" than ephemeral vanity purchases. But also, it seems, the affluent fashionista is also looking for some additional form of justification or validation for her luxury purchase so it helps her to feel good about her shopping if her latest acquisition is also linked to something like green energy or the protection of the environment (or so said Sergio Loro Piano).

And another area of increased investment is in health and well being. (Fashionista is always up for a spa visit so this was definitely good news). Legal support in this growing area of luxury spending may move towards patents (for example, for new forms of cosmetics - suggested by a man who knows this area well, Mr Guillot-Boschetti, Lancome General Manager) or non-traditional trade marks (for example the sound of "silence" - a suggestion from Mr Agrati of Culti developers of a new "Day-SPA" concept).

Opinions on financial matters will always vary, but there was one thing that all the Summit attendees agreed on, namely the greatest luxury today is to have time to spend on yourself. So if patents are the new "must have" legal purchase, will the next step be for someone to file a patent containing the secret of how to manage life to achieve the perfect balance?

Celebrity fashion fame: more than 15 minutes?

Earlier this week, Justin Timberlake's fashion label "William Rast" made its London debut, with a pop-up shop in Selfridges. Rumour has it that Mr Timberlake took time out of his busy schedule to personally brief employees as to how his William Rast brand is to be worn and marketed.

Never before have we seen so many celebrities branching out into fashion - whether through brand collaborations (think: Kanye West designing trainers for Louis Vuitton and the news that Mr West is working for Gap to learn the ropes as an insider before branching out on his own); or as stand alone fashion brands (think: Nelly's "Apple Bottom Jeans" or P.Diddy's "Sean John"). It seems that celebrities are not content at being known for what they do. Is this part of today's cultural need to be loved by all, or is it savvy enterprise, maximising on a ready-made brand?

JT's news came hot on the heels of the news that Jennifer Lopez's "Sweetface" brand is to be shelved. Fashionista wonders whether it is harder or easier for celebrity fashion brands to survive?

It must be easier for celebrities to break into the fashion market than for the unknown "start from scratch" designer. The celebrity will have the PR and advertising crew; the financial muscle; the (helpful or not) media attention; the ready-made brand and a fan base ready to buy into any off-shoot product of their icon.

But it must also be easier to crash and burn. Not wanting to sound cynical, Fashionista can't help but ask: what happens when the celebrity "du jour" has had his or her 15 minutes of fame? Can what may at one minute be a highly covetable brand become un-cool the next? Fashionista would like to hear what her readers think of the merits or otherwise of celebrity brands. Can the celebrities compete with the serious players in the fashion market or will they be no more than temporary pop-up shops in an industry where the long-leased premises are those that go the distance?

Gathering of the clans

Fashionista has been on her travels - to Scotland. As she read The Edinburgh Evening News last week, Fashionista's eye was caught by an article about a very Scottish fashion item - tartan. Lord Jamie Sempill, vice-convener of the Standing Council of Scottish Chiefs, has called for a "tartan trade mark" to prevent cut-price kilts being passed off as authentically Scottish, adding that the peddling of "budget kilts and knitwear" was a "disservice" to Scotland's international visitors. Added Lord Sempill:

"The point is to make it very clear that when you pick up a tartan scarf or other tartan product, that there is a legal requirement for it to state its country of origin.

Tartan is produced and woven around the world to a very high quality, but there is a difference between something that is produced in Scotland as opposed to something produced in Lahore.

I have no problem with the quality of some of these items necessarily, but I think we're doing a great disservice to international visitors who want to take home something genuinely Scottish but end up going away with something produced in China or India".

The proposed mark would not preclude budget kiltmakers such as The Gold Brothers, whose budget clothing stores dominate the Royal Mile, continuing to sell cheap internationally produced products -- so long as they made it clear that those products were made abroad. Gold Brothers partner responded that Galab Singh said all of his company's products already had the country of origin clearly marked on the label.

The Scottish Tartans Authority has already called on the European Parliament to extend its geographical protection scheme to include products other than food and drink, giving heavyweight legal protection to descriptions such as "Scottish tartan", "Scottish kilt" or "Highland kilt".

It's an exciting thought that the European Union's scheme for the protection of geographical indications and designations of origin might be extended to cover items of clothing. Lace from Bruges and Dutch wooden clogs are also possible contenders for protection. And here's some advice from Fashionista: when it's cold and windy, you can keep warm under your tartan kilt by donning some stylish Tyrolean lederhosen.