WWD : Ralph Toledano: Why Paris Is Flourishing

Ralph Toledano: Why Paris Is Flourishing
The head of French fashion's governing body spoke about resilience and the effervescent cultural and business scene.

The buzz is coming back — online and IRL.
Paris Men’s Fashion Week is in full swing, declared officially open on Tuesday via a spirited video address from “Schitt’s Creek” star Dan Levy. Travis Scott is in town to unveil a collaboration with Kim Jones at Dior, one of a handful of brands holding live runway spectacles with real audiences. Editors and influencers from across Europe have trickled back into the French capital for the first time in about 15 months as pandemic-related restrictions ease on a good swath of the continent.
On the heels of the men’s wear showcase is one of the newsiest haute couture weeks in decades, which has Ralph Toledano smiling. The president of the Fédération de la Haute Couture et de la Mode spoke to WWD about the resilience of the French fashion industry, the effervescent cultural scene in Paris and why haute couture is flourishing.

WWD: Like most European countries, France endured long and difficult lockdowns. How would you describe the industry reactivity?
Ralph Toledano: We have to pay a huge tribute to the French fashion industry for its spontaneous and impressive efforts to fight the pandemic and its financial consequences. Amid shortages of face masks and sanitizing gel, the industry converted its facilities to produce them freely. In addition, the biggest luxury groups turned down the financial help offered by the government support plan, notably in terms of furlough indemnities.

On the business side, the reactivity and the resilience of French fashion brands have been impressive. Whereas in other countries, a lot of companies have disappeared with a high number of jobs eliminated, the French fashion industry has come out of the crisis stronger than ever, and ready to embrace the new growth opportunities.
Companies have reviewed their offer, downsized their collections, adapted them to new needs and adjusted pricing. They digitalized their activities in an extremely fast way, strengthening their direct relationship with the customer. They took advantage of their strong presence, and performed exceptionally well in the only growing markets in the world — Asia Pacific and, notably, China. Sustainability has also become a top priority, and even if there is a long way to go, our sector is now focused on the task.
WWD: Paris took the lion’s share of attention for the women’s fall 2021 shows, with a media impact value $132 million. Those Launchmetrics tallies put Paris ahead of Milan, and dwarf smaller fashion weeks in New York and London. What does the data tell you?
R.T.: Data shows how strong the impact of creative videos has been. Digitalization spawned new areas for creativity and opened the doors of fashion to the final costumer all over the world. It has been a giant step.
WWD: How will Paris Fashion Week maintain its stature as the most important fashion capital, physical and digital?
R.T.: The same selection criteria have been applied for the participants since 1868 for haute couture and 1973 for ready-to-wear: creativity, craftsmanship and internationalization. We will continue using the same guidelines, which have made Paris the indisputable fashion capital of the world. It is now also the fashion capital in the digital world. Our position has lately been strongly reinforced by the support of public powers. I’m referring to Paris Mayor Anne Hidalgo, who has met with editors and helps us with show venues, as well as French President Emmanuel Macron, who has welcomed designers to the Élysée Palace for gala events, spending time with the city’s creative movers and shakers.


WWD:This men’s week, and the forthcoming haute couture week in particular, feature an encouraging number of physical shows. Do you expect a full return to live fashion weeks soon?
R.T.: We expect a total return to physical shows in September, as long as the health situation continues to improve. Press, buyers, designers and fashion professionals in general can’t wait to resume physical shows. Digital events cannot replace them: The full expression of creative fashion requires a real-life emotion. But the industry will now also benefit from the creative digital power. Digital tools, notably videos and livestreaming, will generate a considerable amount of content for the brands to communicate with their communities.
WWD: What’s the future of the federation’s digital platform?
R.T.: The digital platform that we have set up with Launchmetrics has been very successful and we will keep on developing it. We have already started doing that this season, introducing NFTs and augmented reality. The platform is also inseparable from the media partnerships that we have built up, in particular with YouTube, Canal and now Tencent. We will continue to enrich this global ecosystem with our members.
WWD: Most fashion weeks, including Paris, splintered during the pandemic, with several major brands showing on their own calendar now. How will the federation entice them back?
R.T.: First, let me state that the huge majority of our brands have followed our decision to release their videos at exactly the same slots as pre-COVID-19. A very limited number of brands did not for different reasons: delays in industrial production; post-production schedules after shooting videos, etc., but as soon as physical fashion weeks will get back, these impediments will naturally vanish.
WWD: The see now, buy now model seems to be gaining currency again. How does the federation feel about it?
R.T.: When this model was suggested, we stated very clearly that it could work for strictly marketing-driven brands, but absolutely not for creative brands. Time has shown that we were right.
WWD: Do fashion weeks still have professional resonance, in your view, or are they becoming pure consumer events?


R.T.: The rationale of fashion weeks is more legitimate than ever. Ask any professional — they will all tell you how impatient they are to go back to the pre-COVID-19 fashion weeks. Virtual showrooms, for example, were extremely helpful during lockdowns, but buyers will tell you that they are often disappointed by what they receive just because they could not see, touch and evaluate the silhouette or the fit of a physical sample in person. They could not meet face to face with their vendors either, and those moments are essential to build a mutually profitable relationship.
On the other side, the digital tools have proven extremely effective to reach out to the final client, which is critical for the success of our brands. Being in touch with your community, being able to communicate your purpose and your values, and assemble a strong data base is indispensable for the brands.
WWD: Paris is brimming with new cultural venues, retail attractions and scores of new restaurants and galleries. How do you explain this explosion of new energy, and how is the federation seizing on it?
R.T.: There is now a huge entrepreneurial and cultural energy in France, which is the most attractive European country for investment. Almost 1 million companies of all types have been created in France in 2020 and the tech and start-up scene is flourishing, as was shown at the successful VivaTech event recently. Fashion and luxury are at the heart of the Parisian identity.
The great initiatives emerging now in Paris will strengthen its economic and cultural power. Paris Fashion Week as a major global event will benefit from this enriched ecosystem and at the same time contribute to its success.
WWD: I understand the federation is stepping up its efforts around emerging designers. Can you elaborate on this and explain how they fit into the ecosystem?
R.T.: The federation has a department dedicated to emerging brands, which brings its expertise in every single aspect of fashion management. Sphere offers a showroom for these brands at every fashion week, and it is now running at full speed through June 27. For the last seasons, we put in place a virtual showroom through a collaboration with Le New Black.


Last September, we also created a fashion fund to financially support emerging brands during this pandemic crisis, and I thank very warmly the fund contributors, including the big French brands. We have a committee that decides how to dispense the money, and we’ve helped between 25 and 30 designers per season. Emerging talents are the future of fashion, either by working for existing brands or by starting their own companies. We are therefore committed to support them.
WWD: Paris Fashion Weeks have always been a platform for talents from around the world. How are the upcoming men’s and couture weeks stacking up in this regard?
R.T.: The selection of newcomers, as well as the exit of previously invited brands, are decided by industry experts committees chaired by the president of each Chambre Syndicale. The current men’s and upcoming haute couture weeks will be transitional, as they are mixes of digital events, physical shows held in Paris as well as shows taking place abroad because of the COVID-19 crisis. The majority of the presentations will still be digital. In total, we will have 72 houses for men’s wear and 34 for haute couture.
WWD: People have been predicting the end of haute couture for years, yet here we have a calendar brimming with new names. How do you explain this?
R.T.: Some people, notably the late Pierre Bergé, predicted that haute couture would die. Time showed that they were wrong and haute couture remains a major and distinctive pillar of French fashion. In a world more and more digitalized and profoundly transformed by AI, it represents the highest degree of human know-how and creativity.
Economic factors explain the strength of haute couture. Since the 1980s with the inception of the Reaganomics in the U.S., the globalization of the economy has, in the Western world, made the rich people wealthier and the number of high-net-worth individuals higher. The fall of the Berlin Wall sparked an impressive growth in Eastern Europe, and yielded a substantial number of ultra-wealthy people, notably from Russia. Finally, the extraordinary development of Asia Pacific and China, especially, brought a large group of new high-income customers. At the same time, sales in the Middle East kept growing.


The offer has also improved and expanded. The most prestigious fashion houses and heritage brands have heavily invested in haute couture as it is a unique laboratory for rtw, an exceptional vehicle in terms of image and a profitable business for the major players. Haute couture entices designers wanting to express freely their creativity, discover the possibilities offered by new technologies and new sustainability practices. Each season, the federation receives an impressive amount of applications for admission in the haute couture calendar.

>>> US Gapping down

Gapping down
In reaction to earnings/guidance
:

  • CAMP -8.2%, FDX -3.7%, JKS -1.7%, BB -0.7%

Other news:

  • OMP -10.6% (stock offering)
  • TBPH -9.4% (prices offering of 6.7 mln shares of common stock at $15.00 per share)
  • MPX -4% (stock offering)
  • ADVM -1.9% (names new CFO)
  • SNCR -1.7% (offering of 38,461,538 shares of its common stock at a public offering price of $2.60/share)
  • UNVR -1.6% (expands distribution agreement with Tata Chemicals)
  • UPS -1.3% (on FDX earnings)

Analyst comments:

  • LOGI -3.5% (downgraded to Neutral from Buy at Goldman)
  • RAD -2.8% (downgraded to Underweight from Neutral at JP Morgan)

WWD : Nike Partners With Louis Vuitton on Air Force 1 Sneakers

Nike Partners With Louis Vuitton on Air Force 1 Sneakers
The French luxury brand unveiled the sneakers as part of Virgil Abloh's spring 2022 men's collection.


PARIS — In an homage to hip-hop culture, Virgil Abloh has brought together his two biggest brand partners to create what is sure to be one of this year’s hottest sneaker collaborations: new versions of Nike’s iconic Air Force 1 trainers developed in tandem with Louis Vuitton.

The shoes, designed in 21 colorways, were unveiled on Thursday as part of Abloh’s spring 2022 men’s collection for the French luxury powerhouse, but additional details were scarce. Asked whether they would be made available for sale, Vuitton responded: “Stay tuned for more details.”

Images released by the brand showed green-and-white and blue-and-white versions of the sneaker, with the word “Air” in quote marks written on the sole, and the French word “Lacet” on the laces. The quote marks are a signature of Abloh’s brand Off-White, which has a highly successful collaboration with Nike.

The shoes feature a small neon green serrated tag on the side, and a label with the Louis Vuitton name and the Nike swoosh on the tongue. Vuitton has also created a neon orange sneaker trunk in monogram-embossed calf leather, with a 3D tag in orange leather with a white swoosh on top, as part of the collection.

Abloh began by reinventing 10 models of Nike sneakers for his initial “The Ten” project in 2017, and has kept up a steady pace of drops since then. Nike and Off-White have also developed clothing, including custom outfits for tennis champion Serena Williams.

In its “State of Luxury Consignment” data report earlier this year, resale site The RealReal picked Off-White x Nike sneakers as the top item to consign in 2021.
In the notes for the spring collection, revealed in a film called “Amen Break,” Vuitton said the partnership was inspired by the cover of the 1988 album “It Takes Two” by hip-hop duo Rob Base and DJ E-Z Rock. It shows E-Z Rock wearing a Nike Air Force 1 basketball trainer altered with a swoosh adorned in the LV monogram.
“The cover embodied the hip-hop community’s early practice of hacking together high fashion and sportswear, sidelining diverging brands with equal reverence. A cultural symbol in its own right, today the Nike Air Force 1 serves as an objet d’art emblematic of self-generated subcultural provenance,” Vuitton said.
A sneaker trunk developed by Nike and Louis Vuitton. Courtesy of Louis Vuitton
The partnership comes on the heels of Dior’s highly successful collaboration last year with Nike’s Jordan Brand. Five million people registered for a chance to buy the limited-edition Air Jordan 1 OG Dior sneakers, although only 13,000 pairs of the coveted shoes were produced.
Vuitton helped ignite the luxury streetwear phenomenon with its landmark 2017 collaboration with cult New York skatewear brand Supreme, which sources said drummed up 100 million euros in business for the pair.

>>> US Gapping up

Gapping up
In reaction to earnings/guidance
:

  • NKE +13.1%, KMX +5.5%, APOG +4.1%

Other news:

  • OSMT +47.2% (announces Alora will acquire Osmotica's portfolio of legacy products and its Marietta, Georgia manufacturing facility, for up to $170 mln)
  • PIRS +21.7% (announces inhaled CTGF inhibitor PRS-220 for idiopathic pulmonary fibrosis and 17 million dollar grant from bavarian government to accelerate program development for post-COVID-19 pulmonary fibrosis)
  • SPCE +12.3% (receives Full Commercial Launch License from FAA)
  • BVS +5.3% (completes minority investment in Vaporox)
  • ASAN +2.7% (TWLO and ASAN to dual list on Long-Term Stock Exchange in August, according to WSJ)
  • LPRO +2.7% (signs producer agreement with insurance carriers)
  • GVA +2.5% (wins $16 mln Alaska airport contract)
  • IQV +2.2% (introduces Clinical Data Analytics Suite)
  • TIGR +2.2% (UP Fintech's Tiger Brokers (Singapore) Pte received approval-in-principle to be admitted as a Clearing Member of The Central Depository)
  • ONCS +2% (CEO resigns)
  • BTG +1.6% (commences arbitration proceedings for Menankoto permit)
  • MRTX +1.6% (receives FDA Breakthrough Therapy Designation for adagrasib)
  • DLX +1.6% (announces collaboration with MSFT to bring its HR and payroll solutions to Dynamics 365)
  • HEAR +1.1% (partnering with NBA star Immanuel Quickley)

Analyst comments:

  • GMS +4.2% (upgraded to Outperform from Sector Perform at RBC Capital Mkts)
  • LAZR +3.5% (upgraded to Outperform from Neutral at Robert W. Baird)
  • VMC +2.9% (upgraded to Buy from Hold at Jefferies)
  • NOK +2.7% (upgraded to Buy from Neutral at Goldman)
  • NTAP +2.2% (upgraded to Outperform from Mkt Perform at Raymond James)
  • CRH +2% (upgraded to Buy from Hold at Berenberg)
  • CLR +1.9% (upgraded to Overweight from Neutral at JP Morgan)
  • MLM +1.7% (upgraded to Buy from Hold at Jefferies)
  • NFLX +1.4% (upgraded to Outperform from Neutral at Credit Suisse)
  • SPLK +1.4% (upgraded to Buy from Sell at Arete)
  • DAR +1.3% (upgraded to Outperform from Market Perform at BMO Capital Markets)
  • DRI +1.1% (upgraded to Buy from Neutral at MKM Partners)

>>> US Early premarket gappers

Early premarket gappers

  • Gapping up:
    • NKE +12.1%, BVS +5.3%, MRTX +5.3%, APOG +4%, GVA +3.8%, ASAN +3.2%, TIGR +3.2%, LPRO +2.7%, CZR +2.1%, ONCS +2%, HPE +1.9%, WFC +1.5%, BAC +1.3%, ABBV +1%, BTG +0.9%, MATX +0.9%, C +0.8%, JPM +0.8%, BLDP +0.6%, XLF +0.6%
  • Gapping down:
    • TBPH -9.3%, CAMP -7.1%, OMP -5.2%, MPX -4%, FDX -3.8%, SNCR -3.4%, JKS -2.5%, ADVM -1.9%, PRGS -1.7%, UNVR -1.6%, SNX -1.4%, UPS -1.3%, KBR -1.2%

FT : Dozens of groups brought to market via Spacs to enter key Russell index

Dozens of groups brought to market via Spacs to enter key Russell index
One in five additions to Russell 3000 benchmark went public via blank-cheque company

Dozens of companies that entered US markets through deals with blank-cheque vehicles in the past year are set to graduate into the Russell 3000 index on Friday evening, giving a potential boost to the fortunes of electric vehicle developers and other speculative ventures.

FTSE Russell, which maintains the popular benchmark, is conducting the annual refresh of its indices this month, adding and removing companies based on their market capitalisations and other factors.

Companies that join the Russell 3000 — a gauge that tracks about 98 per cent of the investable US stock market — often receive a bump in their share prices, while gaining exposure to a wide swath of investment managers and inclusion in passive funds that track the indices. The reconstituted indices come into effect before markets open on Monday.

Investment vehicles with $9.1tn of assets either track or are benchmarked to Russell indices, according to FTSE Russell.

This year, the additions to the Russell 3000 index are set to include a number of early-stage electric vehicle companies that went public through special purpose acquisition companies, whose shares first soared and then declined as wild investor enthusiasm gave way to concerns about regulatory scrutiny of the sector.

Among them are Canoo, Lordstown Motors and Nikola, companies that have dealt with the departures of key personnel and face investigations from the Securities and Exchange Commission over their disclosures to investors. All three have said they are co-operating with regulators. 

Other notable additions will include the sports betting business DraftKings, healthcare company Multiplan and 3D sensors manufacturer Velodyne Lidar, according to a preliminary list published by Russell.

More than 20 per cent of the companies joining the Russell 3000 index this year will have gone public through Spacs, according to Steven DeSanctis, an equity strategist at Jefferies.

“You’re opening yourself up to a much larger audience,” DeSanctis said. “You should see an increase in trading volume for a lot of these stocks.”

Unlike the S&P 1500 index, which is collated by rival S&P Dow Jones Indices and includes companies on the blue-chip S&P 500, the Russell 3000 welcomes companies that have not reported recent profits. Neither the S&P 1500 nor the Russell 3000 include Spacs themselves; companies enter only after they have been acquired by the blank-cheque vehicles.

The index reconstitution could add fuel to critics of Spacs, who argue the vehicles provide a less rigorous route to public markets compared with regular initial public offerings.

“The danger is that these companies went public without that vetting process,” said Usha Rodrigues, a professor of law at the University of Georgia who has researched Spacs. “There’s more of a risk to each shareholder in those individual companies and, to the extent that there’s a lot of them, to all the holders of the Russell 3000.”

An index of Spacs maintained by IPOX has fallen more than 20 per cent from a peak in the first quarter, as investors sour on the structure following a deluge of new offerings. The SEC has issued a series of warnings about Spacs to investors and the companies themselves, particularly concerning their sales and profit projections.

Several high-profile short-sellers have targeted companies that have come to market via a Spac and will now be added to the Russell indices — but retail traders on Reddit forums have cheered the index reconstitution as a positive signal for popular stocks.

The Russell index changes go into effect after the close of trading on Friday; the session is usually one of the busiest trading days of the year as investors and index funds reshuffle portfolios in anticipation.