LVMH has confirmed it has taken a minority stake in Young Italian Designer (we will not acronym that for obvious reasons) Marco de Vincenzo, making him the second such up-and-comer to receive such investment from the luxury behemoth, and underscoring the increasing competition among the established groups to identify, and potentially own, new talent. The terms of the deal were not disclosed, but there’s no question, it’s putting its money where its mouth is. At least some money.
It yet another indication that high end fashion brands see growth opportunity in charging ever-further upmarket, today Ralph Lauren (that’s their most recent show, left) named Valerie Hermann, latterly CEO of Reed Krakoff, as President of a newly created Luxury Division. This follows announcements by Louis Vuitton and Gucci that they see their future on the tippy-top of the luxury pyramid. At the same time, the move puts the Ralph Lauren strategy at odds with that of his fellow American “premium brand,” Michael Kors, whose phenomenal growth has been driven in large part by exploiting the price-point opening left when peers deserted the high end for the highest end. It suggest Mr Lauren is going after European competitors, as opposed to Mr Kors.
Whoopee: the very fun holiday game of “Who’s Going to Buy Who Next Year?” has officially begun with a launch entry from Bernstein Research, an arm of AllianceBernstein. And what are they thinking? Watches. Watches and jewellery galore.
Pity the poor luxury CEO in Francois Hollande’s France: no sooner is your wife speaking to a foreign real estate agent than the rumour mill is rife with speculation that you are about to flee the country (and maybe all those proposed wealth taxes), and set up home somewhere else. What else to conclude from the recent furore over the sight of actress Salma Hayek, aka Mrs Francois-Henri Pinault, aka wife of the CEO of Kering, the second largest French luxury group, lunching with a UK broker earlier this week?
Forget obvious battlegrounds like stores (who has got the biggest/luxist/most special) or designers; the most heated fights in luxury are clearly taking place behind the scenes, in the back-end and backrooms. The latest entrants: Chanel and Paco Rabanne, which stepped into the supplier/accessories arenas respectively.
What a week. Monday, LVMH announced it was opening a giant, Google-like beauty campus in central France to help research and the local economy; Tuesday, Kering announced it was entering into a JV with Bottega Veneta designer Tomas Maier to grow his eponymous business. Yesterday, LVMH announced the establishment of the LVMH Young Fashion Designers Prize, which would award a young designer E. 300,000 and mentorship, from an LVMH exec (plus three grads a smaller amount and a year’s employ at LVMH); today, Kering announces it is creating the “Python Conservation partnership” in conjunction with the International Trade Centre (ITC) and the International Union for Conservation of Nature (IUCN SSC Boa & Python Specialist Group) “with the aim of contributing to the improved sustainability of the python trade and helping facilitate industry-wide change.” (Kering likes snakeskin; that’s a look from the Gucci spring/summer 2013 show, above left.) Zowie. What are they putting in the water over there in Paris? Anyone else feel competition to be good heating up?
In yet another sign that the balance of power between designers and the brands and Groups that employ them may be shifting in the designer’s favour, today Kering announced it had entered into a Joint Venture with Tomas Maier (left), aka the creative director of Bottega Veneta, aka the man who made that brand into the second largest luxury brand in the Kering stable, and the fastest growing, to develop his own brand, entitled – guess – Tomas Maier! Still, Mr Maier founded his brand in 1997 and joined Bottega in 2001. So why is this happening now?
The analysts are not happy. Chairman Yves-André Istel’s statement at the Richemont earnings report today that “No disposals are under consideration at this time or for the foreseeable future.” has been met with grim reaction in the city, which was hoping that Johan Rupert’s sabbatical, and the new leadership of co-CEOS Bernard Fornas and Richard Lepeuwould opt for a rationalisation of the Group, where the fashion brands – Chloe, Alfred Dunhill, Lancel, Shanghai Tang, Alaia – have always seemed an anomaly. Clearly, there’s something of a perception gap here between internal and external players. Why?
Having now spent an entire evening mulling over Nicolas Ghesquière’s move to Louis Vuitton – OMG! Time to think! Such a radical concept – I can’t help feeling a little tinge of regret that M Ghesquière ended up at another major brand, instead of opening his own house. Sure, I’m excited to see what he does at Vuitton, and how the brand gets re-imagined with a new team, both corporate and creative, but at the same time, the fashion world feels smaller, rather than larger: instead of adding a new brand, and maybe a truly new designer to an old brand, which would create two new opportunities, we’ve simply engaged in yet more musical chairs. And I keep wondering why?