Busof Fashion : The Godly Garden of Alessandro Michele’s Gucci


>>> Artemis / Courreges

Artémis acquires Courrèges. The family holding company of French billionaire businessman François Pinault has acquired full ownership of Courrèges for an undisclosed sum. Artémis, which already held 40 percent of the house, has bought out advertising executives Jacques Bungert and Frédéric Tortoling, who acquired the Paris-based womenswear brand from its namesake founder André Courrèges in 2011. The investment follows the appointment of Yolanda Zobel as artistic director.

BofFashion: What’s Next for Farfetch After a Blockbuster IPO?

What’s Next for Farfetch After a Blockbuster IPO?
The fashion platform had a wildly enthusiastic reception on Wall Street. Here’s how the company plans to maintain the momentum.

Farfetch’s public listing had a wildly enthusiastic reception on Wall Street, with shares pricing at $20 — above the expected range — raising $885 million for the company at a $6.2 billion valuation, before soaring once they began trading on the New York Stock Exchange Friday, ending at $28.45. The marketplace — which connects consumers with a curated network of fashion boutiques and brands — has officially emerged from a crowded field to challenge Yoox Net-a-Porter as the leading online purveyor of luxury apparel and accessories. At its closing share price Friday, indicating a valuation north of $8 billion, it's certainly left YNAP in the dust.

Investors buying into the IPO are betting that Farfetch founder and chief executive José Neves and his team can replicate the last few years of blistering growth and eventually find a path to profitability.

In an interview on Friday, Neves said the online luxury market would grow by $100 billion over the next seven years and that his company plans to take a significant slice of those sales.

“Growth is going to be explosive... and we are helping brands and retailers in this industry really seize that opportunity,” he said. Neves added that emerging markets would be key to replicating the 55 percent growth in gross merchandise value the company saw last year.

Technology is the other pillar of the company’s strategy, including a robust mobile app (over half of Farfetch’s sales are already made through mobile phones), and software designed to improve both the online and in-store shopping experiences. All that requires a lot of investment, which is why Neves can’t say when the company will be profitable. Losses widened in the first half of 2018 to $68 million, more than double the same period last year.

“The focus should be on those investments and not in short-term profitability,” he said.

Investors seem unconcerned, perhaps considering precedents like Amazon.com, which ran losses for years before a combination of scale and smart decisions to invest in emerging markets like cloud computing swung the company into the black. Farfetch is trying to walk the same path; it’s achieving Amazon-like ubiquity in some markets, particularly outside the world’s primary fashion capitals, where local luxury retail options are few and far between.

What does Farfetch need to do to make good on its promise to investors?

1. Build an unassailable, global lead over rivals.

Farfetch strikes a bargain with each of the retailers and brands that sell through its marketplace: hand over roughly 30 percent of each sale in exchange for access to millions of potential customers around the world. It’s a deal plenty of sellers are happy to strike, particularly local boutiques and emerging designers who might otherwise struggle to put their wares in front of customers in Angola or Bahrain, to name two of the 190 countries where Farfetch ships.

This “asset light” model is one reason Farfetch was able to secure such a high valuation; its sellers take on the expense and risk of maintaining stores and warehouses full of luxury goods. But it’s also a vulnerability. Retailers work with multiple platform players, from ShopStyle to LVMH-backed Lyst. For Farfetch to justify its relatively-high take rate, it must offer something its rivals can’t. That challenge is likely one reason Farfetch is hyper-focused on underserved emerging markets for growth. By partnering with regional powerhouses like Chalhoub Group in the Middle East and JD.com in China, Farfetch can deliver on its promise to bring sellers the world.

“We have been investing ahead of the curve in our international presence,” as well as new categories like jewellery and childrenswear,” Neves said. “We’re only scratching the surface in these markets and in these categories.”

2. Attract millennials with a powerful customer experience

Farfetch’s vast and growing product selection is among its chief selling points. It also runs counter to one of the biggest trends in retail: the curated shopping experience. But curation is trickier to pull off with a marketplace, where sellers control what’s for sale and have every incentive to offer the broadest selection possible to attract customers. This can turn off consumers, particularly younger ones, who grow frustrated at having to sift through thousands of options to find the perfect item.

Farfetch tries to address this by turning its enormous selection to its advantage. Offering hard-to-find or unique items can appeal to young consumers, who “place more emphasis on buying fashion that reflects their own personality, embracing individuality and self-expression,” the company said in a regulatory filing before the IPO.

Much of Farfetch’s technology investment is centered on taming its own marketplace. Personal shoppers, shopping via text and targeted marketing are among the methods used to create what the company hopes will be an appealing shopping experience. In an interview, Farfetch co-chairman (and Net-a-Porter founder) Natalie Massenet said that, in the future, the website and apps will be even more tailored to individuals, offering products curated by influencers, trends and geographies.

That doesn’t mean Farfetch will start telling customers — or its sellers — exactly what to buy.

“This is the fashion industry — being too predictive removes half of the fun of discovering something you didn’t know you wanted in the first place,” she said.

3. Maintain a technological edge

Farfetch’s early innovations — global shipping, offering a clean, standardized shopping experience — were revelations to small sellers and even some large luxury brands. Today, when even small stores can build robust online presence out of the box with services like Shopify, Farfetch’s core offerings are just table stakes.

The company tripled its investment in technology this year, hiring hundreds of engineers to develop new products and services. Neves said, among other projects, these teams are focusing on mobile as well as the “Store of the Future” project to “transform physical retail” (starting with a Chanel partnership). In July, Farfetch acquired a startup, CuriosityChina, which helps brands find customers and make sales on mobile. Over half of global sales are already made through Farfetch’s app or mobile site, and 70 percent of sales in China are through the app alone.

“We’re only seeing the beginning of what the potential of mobile can bring to the fashion industry,” Massenet said.

These offerings must go beyond today’s gold standard and make a compelling case to sellers that they’ll gain an edge over competitors by signing on with Farfetch.

4. Watch out for Amazon

Farfetch’s valuation in part reflects a perception that the company is Amazon-proof. Luxury is one of the few corners of retail where the e-commerce giant hasn’t made inroads.

Grocers no doubt told themselves the same thing as they watched Amazon’s flailing attempts to enter their market - until the company bought Whole Foods in 2017. Amazon has a long history of entering surprising categories, and no one should consider themselves off limits. Alibaba, with its fast-growing Luxury Pavilion on Tmall, has shown it’s not so outlandish for the same company to sell both plumbing supplies and designer handbags.

WWD : LVMH Taps Designer to Revive Jean Patou

LVMH Taps Designer to Revive Jean Patou
Frenchman Guillaume Henry, who has helmed Nina Ricci and Carven, is to create ready-to-wear and accessories.

PARIS — LVMH Moet Hennessy Louis Vuitton is applying its formidable finances and management might to revive the dormant Jean Patou fashion house, WWD has learned.

Sidney Toledano, chairman and chief executive officer of LVMH Fashion Group, is spearheading the project and has already selected and signed on a designer to lead it: Guillaume Henry.

Last March, Henry exited Nina Ricci and he is said to be passionate about the legacy of Patou, a French designer who brought modernity and buzz to fashion in the Twenties — and innovated in business with fragrances, logos and sport clothes.

LVMH is now in the throes of building teams around Henry with a view to launching the first collection of ready-to-wear and accessories in the second half of 2019.

It is understood the group views Patou as something of a niche, rarified name — and not its next megabrand. Consequently, LVMH will likely start with a single boutique, most likely in Paris, along with e-commerce and select wholesale partners.

The relaunch suggests the world’s largest luxury group is anticipating an easing of the streetwear craze, and a swing of the fashion pendulum back to sophisticated chic.

Toledano confirmed hiring Henry exclusively to WWD, but said it’s too soon to detail more of the strategy.

He is said to be zeroing in on an executive to lead the Patou house from within LVMH’s ranks.

The group quietly acquired majority control of Patou this year, though its first volley was hard to miss: Taking the name of the fashion house’s most famous fragrance, Joy, and stamping it on a new Dior scent fronted by “Hunger Games” and “Silver Linings Playbook” actress Jennifer Lawrence. (She also starred in the 2015 drama “Joy.”)

While Dior Parfums never explained how it wrangled the name in its press packet about the new scent, fragrance aficionados know Joy is a marvel. Created for Patou in 1929 as a reaction to the stock market crash that year, Joy was voted Scent of the Century by the public at the Fragrance Foundation FIFI Awards in 2000, edging out Chanel No. 5. Joy was often touted as one of the costliest perfumes in the world to produce, owing to its high concentration of natural flower essences. (One perfume bottle contained the essence of as many as 336 roses and 10,600 jasmine flowers, according to one report.)

LVMH acquired the Patou brand from London-based Designer Parfums, whose founder and ceo Dilesh Mehta was looking for a partner to revive the fashion house and approached LVMH. It is understood Mehta and LVMH forged a deal allowing LVMH to use the Joy name for Dior, while waking up another of fashion’s sleeping beauties.

Born in 1887, Patou is considered one of the great names of couture of the Twenties and Thirties, prized for the glamor and showmanship he brought to high fashion. He opened his house in 1914, served in the First World War, and resumed business in 1919 with a Paris shop called Parry.

More than a designer, Patou was a fashion trailblazer, one of the first to launch a diffusion line, promote sportswear and push accessories. He even installed a bar in his salon to serve alcohol to customers during fittings.

His fashions often made waves, as in 1929 when he proposed ankle-length skirts and natural waistlines. Patou is credited with pioneering the tennis skirt, knitted swimwear, men’s designer neckties and sunscreen.

He famously dressed Barbara Hutton for her 1933 wedding to Prince Alexis Mdivani, and in 1925 designed a dark daytime dress with an embroidered Eiffel Tower that was a precursor to today’s high-tech clothing: The landmark was topped by a tiny electric bulb operated by the wearer.

After Patou’s death in 1936, the house continued under his brother-in-law Raymond Barbas, who conscripted a series of resident designers, including Marc Bohan (who later took up the mantle at Christian Dior), Karl Lagerfeld, Jean Paul Gaultier, Angelo Tarlazzi and Christian Lacroix, whose stint from 1982 to 1986 attracted the attention of LVMH kingpin Bernard Arnault, who poached Lacroix and built a couture house in his name.

Patou has also passed through several owners. Procter & Gamble Co. purchased the brand from Jean Patou SA in 2001, flipping it to Designer Parfums in 2011.

To be sure, LVMH has deep experience cultivating and animating heritage fashion brands as diverse as Louis Vuitton, Givenchy, Loewe and Celine, the latter now under the stewardship of Hedi Slimane.

In Henry, Toledano found a young designer who breathes Parisian chic, and boasts experience at a number of fashion houses.

After graduating from the École Supérieure des Arts Appliqués Duperré, Henry completed a postgraduate program in design at the Institut Français de la Mode. He worked in the studios of Givenchy and Paule Ka before taking the creative helm of Carven in 2009.

Henry forged his reputation there by revving up Carven as a contemporary label with a bold, young — and accessible — approach to Parisian chic.

After an acclaimed five-year run at Carven, Henry left for Nina Ricci in 2015, exiting that brand in March after completing his initial three-year contract. His designs for Ricci proved popular with celebrities like Gigi Hadid, Rihanna and Queen Letizia of Spain.

WWD : Versace Acquisition Talk Swirls in Milan

Versace Acquisition Talk Swirls in Milan
Multiple sources contend a deal to sell the company is imminent.

MILAN — Speculation that Versace is in play has been rife during Milan Fashion Week, reaching a fever pitch on Sunday.

The company had no comment on a possible divestiture by the Versace family, and the likelihood of a transaction could not immediately be learned. However, multiple sources contended that a deal could be clinched as early as this week.

French luxury giants LVMH Moët Hennessy Louis Vuitton and Kering, and American groups including PVH Corp., Michael Kors Holding Ltd. and Tapestry Inc. are all believed to have looked at Versace in recent months. (A spokesperson for Tapestry declined comment.) Sources said the deal could involve a group of American investors working with a strategic partner.

During a conference call earlier this year, Manny Chirico, chairman and chief executive officer of PVH, reiterated its potential appetite.

“Obviously, given the strengthening dollar, buying international assets like taking back licensing businesses internationally or looking at potential brand acquisitions outside the United States, given the strengthening dollar compared to where it was two or three years ago, it becomes more attractive on that level,” he said.

John D. Idol, ceo of Kors, has made no secret of his desire to build the firm’s portfolio, and he has said publicly that he is on the hunt for more acquisitions. The company sees itself as a global luxury company. Its latest acquisition was the $1.2 billion deal for the Jimmy Choo brand in 2017. Adding Versace to the Kors umbrella would fit perfectly with the push to intensify its focus on high-end luxury.

At the time of the Choo deal, Idol said, “We are creating a global luxury fashion group. Our focus is on international fashion luxury that are industry leaders.” The executive noted that having the two together under one umbrella helps the firm diversify from a brand and product standpoint, as well as geographically with greater exposure in Asia and Europe. A Kors U.S. spokeswoman declined comment.

New York-based Blackstone Group acquired 20 percent of Versace in 2014 in a deal that, at the time, valued the Milan-based company at around 1 billion euros. The remaining shares are in the hands of siblings Donatella and Santo Versace and the creative director’s daughter Allegra Versace Beck. It is understood an offer for Versace now values the company at around double that 2014 valuation.

Donatella Versace paraded her spring 2019 collection here on Friday night, exalting the brand’s reputation for fierce and sexy fashions in a measured way.

Speaking about the future from Blackstone’s point of view, sources contend the group could be looking for an exit over the next few months given most private investor’s three-to-five year time frame and that selling to another private equity fund is unlikely. The idea of an initial public offering was floated shortly after Blackstone’s investment and former ceo Gian Giacomo Ferraris started setting the wheels in motion for a possible IPO in 2015, but it was later shelved and never materialized. Ferraris was tapped in 2009 to restructure the company and in 2010 the company swung back to profit ahead of the 2011 date that had been forecast, and started setting its expansion. Former Alexander McQueen ceo Jonathan Akeroyd succeeded Ferraris in 2016 and navigated through months of chatter as Riccardo Tisci and then later Kim Jones were said to be joining the company, although neither deal in the end ever took place.

In June, Akeroyd told WWD that, after a string of investments that had pushed the company into the red, he saw improvements, with a 4 percent growth in retail and sales totaling 686 million euros, in line with the previous year, when they reached 669 million euros. The company once more returned in the black as net profit reached 15 million euros, compared with a loss of 7.4 million euros in 2016. Akeroyd underscored the brand’s “great momentum” following Donatella Versace’s successful run of collections, including her tribute to her late brother Gianni in September last year. Asked about possible challenges ahead, the executive said at the time that he was working on concentrating on making the brand’s European and American business as strong as it is in Asia, “and we are on the right way to achieving that.”

Multiple sources have over the years concurred that the Versace family is deeply committed to the company, has great ambitions for it and feels the responsibility to grow it in the wake of Gianni Versace’s murder in 1997. His niece Allegra Versace Beck inherited 50 percent of the company, and his sister and his brother Santo have a 20 and 30 percent stake, respectively.

>>> Buccellati majority shareholder Gansu Gangtai could sell all or part of 85%

Buccellati majority shareholder Gansu Gangtai could sell all or part of 85% stake - report (translated)
23 SEP 2018
Gansu Gangtai [Gang Tai Kong Gu; SHA:600687], a Chinese gold and jewellery manufacturing company, could sell all or part of its 85% stake in Italian jeweller Buccellati Holding, the weekly edition of Italian-language daily Milano Finanza reported. The report cited market rumours noting that Gansu could look for other shareholders rather than exiting entirely.
The article added that Buccellati posted revenues of EUR 52m in 2017, up 19.6% on 2016. The item added that EBITDA for 2017 was a negative EUR 1.5m while the loss was EUR 11.55m.

>>> Scottish Power assets suitor Drax confirms talks

Scottish Power assets suitor Drax confirms talks
24 SEP 2018
Drax [LON:DRAX] has confirmed it is negotiating the acquisition of Scottish Power assets from Iberdrola [BME:IBE] of Spain, The Times reported. The UK-based assets under discussion include hydroelectric, gas-fired and pumped storage facilities, Drax said.
Any transaction is to be fully debt financed and will need first to secure the approval of shareholders, Drax said.
Scottish Power did not wish to make any comment, the item reported.
The terms of the deal were not reported but Scottish Power’s gas-fired plants alone last year generated GBP 23.4m (USD 30.6m) pre-tax profits, the report said.

WSJ : WPP Considers Merger of Young & Rubicam and Digital Ad Firm VML

WPP Considers Merger of Young & Rubicam and Digital Ad Firm VML
New CEO Mark Read is preparing to consolidate some of the ad giant’s major properties to keep pace with the industry’s digital shift

WPP WPP -0.11% PLC’s new chief executive is preparing to consolidate some of the advertising giant’s major properties, as traditional agencies struggle to keep pace with the industry’s digital shift.

Marquee ad agencies that buoyed WPP in earlier decades—including Young & Rubicam, Ogilvy, J. Walter Thompson and Grey—are generally growing more slowly than WPP’s digital and media buying operations, according to the company.

CEO Mark Read has said that he will unveil a strategy update by year-end and that merging creative and digital firms makes more sense than combining creative agencies.

One idea under consideration is a merger between Young & Rubicam and WPP’s digital-ad firm VML, with VML Chief Executive Jon Cook leading the combined business, according to people familiar with the matter. That change would place Mr. Cook at the helm of Young & Rubicam, an agency that WPP acquired in 2000 for a record $4.7 billion, and that sports accounts as varied as Office Depot and the U.S. Navy. The new entity could be called VMLY&R, according to one of the people.

A WPP spokesman declined to comment on merger considerations.
There have also been discussions about having WPP’s tech-savvy direct-marketing company Wunderman work with its creative firms, to provide access to consumer data to help them craft more relevant ads, a person familiar with the company said.

The strategy aims to make the creative agencies less dependent on television and other traditional advertising revenue while also bolstering their digital know-how and giving them access to more consumer data and new technologies such as artificial intelligence.

Advertisers are increasingly doing more of their creative work in-house or taking their business to smaller agencies that have been more nimble in adapting to a digital age dominated by Facebook Inc. and Alphabet Inc.’s Google. “It’s been the perfect storm” for creative agencies, said Greg Paull, co-founder of R3, a consulting firm that helps match marketers with agencies.

WPP’s like-for-like net sales—a figure closely watched by analysts to measure the company’s underlying performance—have dropped for six consecutive quarters in North America. Although WPP doesn’t break out the performance of its creative agencies, it blamed weakness in their North American operations for its latest lackluster quarter. Analyst Brian Wieser from Pivotal Research estimates their sales fell 5% during the first half of the year.


JWT, one of the world’s oldest agencies, has lost business from consumer-goods companies Kimberly Clark Corp. and Kellogg Co. For more than two decades, the agency handled the Royal Dutch Shell PLC account for WPP. But when WPP pitched the oil giant earlier this year, it used an approach from its Wunderman agency, according to Mr. Read.

WPP won a bigger share of Shell’s business, but JWT lost some of the work it does for the oil company.

Meanwhile, American Express Co. has been shifting business away from Ogilvy, which handled its ads for more than five decades.

“Creative agencies are disproportionately impacting holding-company-level results,” Mr. Wieser said.

Despite their decline, some executives at WPP’s creative agencies don’t want Mr. Read’s overhaul to affect the status they have traditionally wielded within WPP’s pecking order.

Under WPP founder Martin Sorrell, who resigned in April, many agencies operated mostly independently, competing against each other to win accounts. Executives are jockeying for position as Mr. Read looks to streamline reporting lines, limiting his direct reports to between 10 and 20 executives compared with the dozens who reported to his predecessor, Mr. Sorrell, according to some of the people.

Some executives were surprised when Mr. Read singled out the creative agencies for their lackluster performance on a Sept. 4 conference call with analysts. One head of a top creative agency at WPP phoned Mr. Read to complain, said people familiar with the matter.

“I tell things as I see them—maybe a little bit too much,” Mr. Read told one executive, according to a person familiar with the call.

As the industry grapples with the shift to digital ads, advertisers are creating fewer traditional ads and are demanding a wider suite of services from creative agencies such as influencer marketing campaigns, new product development, data science and content for social-media channels that needs to be crafted in real-time.

Part of the reason traditional creative agencies have been slow to adapt is that they are weighed down with globe-spanning operations. Clients signed up for “agency of record” relationships, paying a retainer to a single agency that is then responsible for most of its projects.

Now, marketers are switching agencies more often for various reasons, including the need to make sure their agency is keeping pace with the changes taking place in advertising. Many are also looking to save money and often pressure ad firms to reduce their rates to win or retain the business.