Retail Scoop

Bling. In the wondrous land of luxury little LVMH elves pop bottles of Moet and sing celestial hymns. Unfortunately, that wondrous land is not the U.S. of A. Bernanke Captain Obvious says Asia is leading the recovery. While America, which represents 1/3 of the luxury market, has been hit the most. Around 2011 or 2012 Amerrrrricans will resume buying shiny timepieces. Follow Gucci on Twitter, but don’t expect discount tweets because PPR sales dropped 7.6% in Q3.

Mall Madness. In case you are visiting your sister in the Jers, in malls across America Genesco (Lids, Journeys, Dockers), Pacific Sunwear and Joe’s Jean are in the green while their competitor, Zuniez (oh, you don’t know what that is? Neither did we! It’s a store in malls.), Cache, New York & Co. and poor, poor FCUK are in the red. Hot Topic is also in the red, but that’s because they ran out of pleather devil tails. We aren’t sure why the same companies are in the top ten green one week then the top ten red the next, but we will ask an expert and get back with you.

CIT…Again. So Carl Icahn took a break from his busy horse-breeding schedule to write a letter to the CIT Board offering to lend CIT $6 billion in an effort to save bondholders from voting for debt exchange. But, and we are no experts (see above), isn’t that just trading debt for different debt? We thought CIT aimed to trade debt for equity, and now we are confused. So is everyone else, and CIT says they will likely file for Chapter 11 protection anyway and requests Mr. Icahn clarify his, er, offer.

But the Dow holds 10,000, which is good news for us since all we want for Christmas is an autographed pair of Christian Louboutin’s Barbie Shoe. And in case that wasn’t clear: ALL WE I WANT FOR CHRISTMAS IS AN AUTOGRAPHED LOUBOUTIN BARBIE SHOE.

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Emma Dinzebach

If you were one of the bevy of fashion heavy-hitters that pounded pavement yesterday for Fashion’s Night Out, you might have noticed the pleasant home décor shout out at the GUESS store. While the pink cocktails were flowing and the manicures a plenty (perfect for those who didn’t make the list at nearby Chanel where sign up slots had reached 10:30pm just an hour into the night!), the biggest draw was the personalized pop portraits done by artist Carter Kustera. Known for his tongue-in-cheek silhouetted pictures, Kustera set up shop inside the store where he drew and painted profiles before writing a quirky fun fact about you underneath. No fret for those who missed out, Kustera has also paired up with design favorite Jonathan Adler to offer his portraits in candy colored hues. Just be sure to give some thought to your tagline (favorites from last night: Kristin hates children and Hanna likes her potatoes mashed). Jonathan Adler, 800.963.0891.

Oh this pesky recession. It drained the life out of the retail therapy business leaving Americans in search of shallow esteem boosts heartbroken…and broke but also surprisingly aware of happenings in southern Manhattan. As expected, the more lavish the luxury, the worse that company fared in the first half of 2009. Bottom lines continued to drop and for companies like Hermes, LVMH and Tiffany & Co., meaning the first half of the fiscal year was anything but profitable. LVMH was down 23% and rumors that Bernard Arnault contemplated separating the signature LV’s from the premium bubbly ran rampant while Francois Henri-Pinault (think Gucci, think YSL) rubbed his palms together and laughed evilly – muahaha, muahaha, muahahahahahaha.

In the land of opportunity, Tiffany & Co. remained positive siting industry control, new product development regulation and cost control as reliable strategies. Despite these efforts, the little blue boxes couldn’t immediately get Tiff out of the red. Tiffany & Co. expects total year sales to be down 10%. Hermes swears that this time they really hit their bottom line! But in store sales are up – thanks East Hampton! – everywhere but Japan, which confused us because aren’t emerging markets supposed to save lux retail. Or is Japan the only Asian country not “emerging?”

Oh and be sure to get your swine flu vaccinations! Why? Because as long as swine flu stays contained, you can travel. Internationally, retailers hope that during your travels you purchase Hermes scarves…and belts and shoes and perfumes and such. Duh. No seriously, the company’s CEO, said he anticipates “globalization” will boost luxury sales, especially his own, as long as the swine flu doesn’t re-rear it’s ugly head.

L’Oreal should be celebrating their 100th Anniversary! But, they were also down 3.6%. CEO John-Paul Agon says their strategy, according to the WSJ report, relies on unprecendented cost-cutting as well as the creation of a non-advertised, lower line product. By selling less expensive wrinkle erasers and smell well sprays and saving money on marketing costs, L’Oreal hopes to satisfy consumers’ need for a product they can actually purchase and their need to, er, make money.

Then yesterday, a week after everyone was reporting on the luxury versus normal dichotomy, the WSJ reported: “The whole luxury sector has bounced back.” Wow. The whole luxury sector? Again proving that we still don’t quite have a grasp of this whole recession thing. But as we know from our reliable, trustworthy financiers, the numbers don’t lie! Coach is up 40%, Ralph Lauren 43%, LVMH and Richemont (Cartier, Monteblanc, etc.) apparently samezees. So they aren’t selling the bubbly? Phew. Whose responsible for the bounce back? WSJ says a mixture of greedy Americans and Asians with money. Because rich Asians aren’t greedy, right?

In any case, retail was up 1.1% last week, and that is a fact. Baby steps here people. Baby steps.

http://www.ft.com/cms/s/0/7d53b85c-2f60-11de-a8f6-00144feabdc0.html — http://online.wsj.com/article/SB125139884831864295.html — http://www.wwd.com/business-news/#/article/business-news/tiffany-earnings-up-297-percent-2251187?navSection=business-news

Emma Dinzebach

According to the New York Post , Saks Fifth Avenue is moving toward a no-discount strategy this holiday season. This seems to be the result of designers complaining about their dramatic price slashing move last October (after Wall Street signaled crisis, Saks immediately reacted by slashing prices 40% across the stores; discounts picked at 80% around the holidays).

While those were great times for our readers at TVC, they weren’t so good for designers and the Saks investors as they lost money every time somebody bought something. The New York Post uncovered this “In response, Saks CEO Sadove and other top brass have been making an unusual round of personal visits to fashion labels’ offices and showrooms, urging a return to a “full-price mentality” that emphasizes fewer items at a higher level of quality, as one source put it. “They’re out there preaching the gospel of full prices and  anonymity.”

However, Saks  is not the only player and with Neiman Marcus on one side, and the numerous private online sites on the other, one wonders if Saks’ CEO, Steve Sadove really made the right decision and we can be re-educated.