Decade List: Ten Moments In Fashion That Changed The Business

Like every industry, fashion suffered quite a bit in the Naughts, with enough shuttered labels and disgruntled consumers for an aspiring fashionista to throw in her Hermes towel. However, in my opinion, the triumphs outweighed the missteps.

While the democratization of fashion may have feathered some ruffles, it–in the end–helped to establish a stronger, more lucrative industry. Here, in the spirit of those top ten lists that I know you love reading, I’ve named the ten moments over the last ten years I that believe changed the business of fashion. Maybe not forever, but at least for now.

2000: H&M Opens in the US
In high school, I read a lot of British magazines. (Yes, I was a bit of an anglophile, watching Are You Being Served when I didn’t have lacrosse practice after school.) I soon understood that while British women were terribly obsessed with fashion, they were also obsessed with not paying exorbitant amounts of money for said fashion. In the pages of British Vogue I discovered H&M, a Swedish retailer that sold clothes rivaling Target in price and Prada in style. By the time I was interning in New York City at a downtown magazine, H&M had arrived on 5th Avenue.

After work I’d take the N up to Rockefeller Center and spend an hour rifling through racks of asymmetrical blouses, wide-leg trousers and colorful plastic baubles.  H&M went on to change American retail, heralding in the concept of fast fashion–clothing that is made cheaply, stylishly and above all, quickly. Soon enough, European favorites like Zara, Topshop and Mango were also infiltrating US shores, leaving All-American basic labels like Gap and Abercrombie & Fitch in the dust.

2001: Vente Privee Launches
Remember life before Gilt Groupe? If you responded by saying “not really,” you’ve got to thank its predecessor, the France-based Vente Privee. You all know the story: Company launches exclusive online sample sales, reports $800 million in revenue in 2008. A decade later, the private sale is the hottest retail model around.

2001: PPR Wins Gucci
After an epic battle between billionaire Bernard Arnault of Moet Hennessy Louis Vuitton (LVMH) and billionaire Francois Pinnault of PPR, the latter finally gained control of the Gucci Group, which includes Gucci, Bottega Veneta, Yves Saint Laurent and more. As PPR moved from discount retail into the world of high luxury, it was obvious to designers that being a part of a big conglomerate like LVMH, PPR or Richemont was a way to build a brand without sacrificing design integrity. The corporate infrastructure of these companies helped brands like Balenciaga, Stella McCartney and Edun to increase profits through fragrance, accessories and other well-thought-out licensing deals.

2003: Target Signs Isaac Mizrahi
When Target brought him on to design a women’s fashion collection in 2003, Isaac Mizrahi was nothing more than a 1990s flash in the pan, better known for his documentary Unzipped and a short-lived talk show than beautiful preppy-glam clothing. Yet women couldn’t get enough of what Mizrahi offered at Target: Shiny shift dresses, polka dot blouses and pointy flats. By 2005, the cheap-chic collection garnered $500 million in sales for Target. Mizrahi has since moved onto Liz Claiborne, but his work at Target made it okay for high-end designers to collaborate with low-end retailers.

2004: Rachel Zoe Becomes a Household Name
While celebrity stylists have been around for decades, it was the Naughts that made them rich and independently famous. When Rachel Zoe transformed train wreck Nicole Richie into a chic hippie, she also made big sunglasses, tiered prairie dresses and honey-highlighted hair the look du jour. Today, stylists command thousands of dollars per day for their services, and more and more young women are clamoring to follow in their footsteps.

2005: LVMH Sells Lacroix, Proving that Fashion is More About Commerce than Art
After standing by his money-sucking side for nearly 20 years, LVMH exec Arnault finally sold off Christian Lacroix’s failing fashion business to Florida-based investment company Fallic Group for a measly 2 million euros. We all know how the story ended: Fallic was unable to revive the brand, which made beautiful six-figure couture dresses but could not connect with a consumer at the fragrance, accessory and ready-to-wear levels. It was reduced to a licensing operation at the end of 2009. As sad as it is that Lacroix is not making his beautiful dresses, his struggles serve as an example for the rest of the fashion industry. The lesson: If you want to stay small, stay small, but if you want to make a lot of money, you’ve got to play by retail’s rules. Design may be an art, but fashion is a business.

Jil Sander and Others Lose the Rights to Their Own Names
Another indication that fashion is serious stuff: After disagreements with their corporate backers, designers like Jil Sander, Helmut Lang and Camilla Staerk have lost the rights to their name brands, which are also their given names. Jil Sander returned with +J for Uniqlo, Lang stopped designing altogether to do fine art and Staerk now designs under her surname.

Versace, Ferragamo and Prada Hint At–But Don’t Go Through With–IPOs
From whispers at Salvatore Ferragamo and Versace in 2006 to Tommy Hilfiger, and Prada’s de-listing–then hopes of re-listing–at several points throughout the decade, many fashion companies sought out public funds, but for one reason or another, were not able to actually attain them. Of course, the 2008 crash made raising money even more difficult. Yet Hilfiger, Versace and Prada still haven’t ruled out public offerings. The Teens may just be the decade of fashion IPOs.

2005: LVMH Starts Suing the Heck out of Copyright Infringees
From eBay to Wal-Mart to Bad Boy Records, LVMH crusaded against counterfeit handbags and copyright infringements in the last half of this decade. The lawsuits resulted in an industry-wide debate over what could-and couldn’t-be copied. Intellectual property lawyers prayed to the Louis Vuitton gods each day, thanking them for making their profession more lucrative than ever.

2006: Tom Ford Proves You Can Still Build A Luxury Brand From (Almost) Scratch
After years of conglomerates buying the rights to old fashion houses and hiring the Next Big Designer to revive the brand, Tom Ford did something radical. He broke away from Gucci (where he had played the corporate fashion game, making both said brand and YSL financially viable) and launched a label under his own moniker. Tom Ford currently consists of fragrance–a partnership with Estee Lauder–men’s suiting, shirts, shoes, sunglasses and a few discreet shops that keep customer’s measurements on file for bespoke services. Next step? Women’s wear. Could Ford be THE brand of the Teens? I sure think so.

Europe’s Awe-Inspiring Retailers

We were blessed with Mango, and now, so is JCPenney. And in April 2009, Sir Philip Greene finally graced us with Topshop’s presence. But there are still plenty of incredible European retailers–from specialty shops to department stores to concept boutiques–that Americans must travel thousands of miles to experience. I don’t love these retailers just because they sell cool stuff, I love them because they know how to sell cool stuff. The “how” is a detail lacking in plenty of mediocre stores on both sides of the ocean. Herewith, Europe’s Awe-Inspiring Retailers:

COS
I’ve been to four locations of this H&M-owned retailer, and I must say, each time I step inside I fall more in love. COS’s product is a cross between H&M’s styling and Reiss’s sophisticated tailoring. The designs are almost directional–I bought a pair of baggy, peg-legged chinos with a super high waist, something you’d expect to find at Acne, not a high street store–but the fabrics, colors and construction are more refined. (During my last visit, there were lots of peaches, navies, and of course, gray and black. These are colors the modern sophisticate loves.) Prices are steeper than H&M–think $120-$200 for a dress, compared with $50-$120 at Hennes–but the quality is elevated. While H&M’s CEO Karl-Johan Persson said via WWD that the company will expand into new markets come 2010, he wouldn’t go into specifics regarding COS. However, I’m confident it will head Stateside someday. The demand is there.

Lagerhaus
Imagine a Pier 1 Imports with products that are actually attractive. That’s Swedish home goods store Lagerhaus, which I discovered on a trip to Stockholm in 2008. A big issue I have with most American housewares shops is that their textiles–napkins, pillow covers, curtains–are just awful. It’s even hard for me to find a piece of fabric I like at Jo-Ann. However, Lagerhaus carries cool prints at an affordable price. Some–like its Hello Kitty collection–are a bit too kitschy for my taste, but Lagerhaus definitely boasts a better selection than I’ve come across in the past. I’m particularly taken with this cutesy fox pillow, $11.50.

Colette
It may have transformed from an insider’s paradise into a tourist destination, but despite all the negative remarks, I believe Colette is still the coolest. On my last visit to Paris, I spent time in the store’s Rodarte-curated art exhibit and shop-in-shop, and even paid for my items while standing next to Karl Lagerfeld. (It doesn’t get cooler than the Kaiser.) Sarah, the store’s buyer and daughter of Colette, still works the shop floor every day. This boutique, opened in 1997, is credited with pioneering the concept store–ahem–concept. Twelve years later, as specialty retailers struggle to maintain market share, it seems that many mass retailers are taking a page from Colette’s book, and that the concept boutique idea has gone mainstream. Some business background: For thirty years, specialty retailers like Gap, Abercrombie & Fitch and Victoria’s Secret have defined American mall culture, as well as American retail in general. (They replaced the department store as the mass trend-setting entity.) While specialty retailers will always exist in some capacity–just as department stores will always exist–many are morphing into stores that sell a lifestyle (or a concept), not just a certain kind of shoe or a particular style of jeans. (Anthropologie and J.Crew are great examples of this. If you shop frequently at one of these stores, it’s likely you see yourself as a “J.Crew” girl or an “Anthropologie” type of person. It’s not just about what they sell, it’s the combination of what they sell and, again, how they sell it.)

Merci
This newish Paris concept shop–created by the founders of the Bonpoint brand of children’s clothing–is truly innovative. It sells a mix of vintage and new clothing, with brands donating their profits to charities in Madagascar. Labels represented include YSL, Stella McCartney and Isabel Marant–a dream lineup, I assure you. But there’s more. Alongside the second-hand Repetto flats and vintage Chanel bags, you’ll find an Annick Goutal create-your-own fragrance laboratory, a bookstore that looks more like a library, a housewares department stocked with affordable clay dinnerware and an extensive stationery section. I picked up two beautiful notebooks–one in rust, another in granite–and some colored pencils. In the “library” you can have tea and small plates, while a larger eating area downstairs serves a full menu. I spent a few hours at Merci on my visit, and I wish more stores would put so much time into creating such a pleasant environment; it makes it harder to leave empty-handed.

Weekday
Acquired by H&M in 2008, Weekday sells its own line of hip duds, mid-market labels like Acne and also reworked vintage. What it’s most famous for is the Cheap Monday line of jeans, which became hot in the U.S. around 2006, mostly because of the $65 price tag. I like Weekday because while it’s not a boutique–the flagship store consists of three large floors–it has the feel of a boutique. The clothes, like COS’s, are quite directional, but they’re also super inexpensive. I paid $35 for a cropped, over-sized button down shirt a couple of years back, and it still looks forward today. While Cheap Monday jeans and its accompanying woven collection are available at stores like Inven.tory and Barneys New York across the country, I’m still waiting for that elusive Weekday store to pop up in SoHo. Fingers crossed!

Primark
I’m not denying Primark is a bit sketchy and that many of its goods are far too inexpensive–1 GPB for a pair of knickers is not normal, people–but I will say that when you’re 21, broke and living paycheck-to-paycheck in London, one of the most expensive cities in the world, this discount retailer is a real comfort. On a recent visit to the U.K. I picked up a gray jersey blazer for about $12. Unbelievable. And kind of scary.

Ten Fashion Labels Investors Should Be Watching

Alexander Wang Spring 2010, via Style.com.

M&As are back! Well, at least according to a recent survey conducted by accounting firm Ernst & Young. Indeed, one-third of businesses are likely to buy other companies over the next year.

What does that mean for the fashion industry? Luxury conglomerates and private equity firms are probably paying closer attention to the businesses behind successful independent designers.

I’ve highlighted ten labels that might make for a good addition to an already strong portfolio of brands, or a smart investment for a private equity firm that would like to dabble in the “glamorous” fashion industry.

These aren’t no-names; they’re hot labels that show very few weaknesses in terms of design and branding choices. What many investors forget when they delve into fashion is that unique clothing is only a tiny sliver of what it takes to run a successful designer label. Commercial viability and diversity in offerings are bigger factors.

Sorry, but you won’t find the next Christian Lacroix on this list.

Alexander Wang
He may be a 20-something scenester who describes his aesthetic as “Model Off Duty,” but the Alexander Wang mini-empire is serious business. Along with a ready-to-wear collection, the designer has introduced a successful t-shirt line, accessories and now menswear. And with his rugby-inspired spring 2010 collection, he proved to critics that instead of a one-trick pony, he was the new definition of American sportswear.

Band of Outsiders
CFDA winner and filmmaker Scott Sternberg’s men’s collection Band of Outsiders and its female counterpart B.O.Y. appeal to hip preppies with a taste for fine tailoring. His grosgrain ribbon high-heel sandal collaboration with Manolo Blahnik was genius, as is his long-term partnership with boat shoe kings Sperry Top-sider. Sternberg understands that partnering with mass market brands can reinforce trust in your own label if the collaboration seems genuine. I could envision Tom Ford–who is also a designer/director–scooping up this label as his own empire grows.

Pieces from Steven Alan's holiday collection.

Steven Alan
Liberty floral printed dresses, plaid button-downs and Breton shirts. I’d say that Steven Alan played a pretty big role in bringing these classic styles to the fashion forefront. The company is comprised of several stand-alone boutiques, a showroom and a wholesale label. In my mind, SA could become the 21st century version of the Gap. (Particularly because concept stores have replaced specialty retailers as the shopping channel of choice.)

3.1 Phillip Lim
“Classics with a sense of madness.” That’s how Lim describes his collection of lipstick red double breasted blazers, metallic brogues, cozy cardigans and dotted dresses. With the help of whip-smart chief executive Wen Zhou, Lim has gone from indie label to successful lifestyle brand in five years. (2009 global sales are estimated to reach $48 million.) While the company currently has no outside investors and is not recruiting them, Zhou and Lim aren’t totally cold to the idea. “Never say never,” they once told me in unison.

Luella
I know, I just wrote a post explaining why I believed Bartley’s business failed. But I also said that if under the right supervision, it could be revived. Her point-of-view is too original to ignore.

Rachel Comey
A former Theory menswear designer, Comey’s signature style is librarian-chic. There are plenty of quirky prints and unique silhouettes, favored by girls (and guys) that care less about looking sexy than they do about looking cool. But where Comey really succeeds is footwear, with flat boot styles and lace-up oxfords that have been imitated by lesser labels. If she gets her manufacturing in check–while the designs are beloved, I’ve hear more complaints about the quality of RC footwear than any other indie label–she could fold easily into a portfolio such as Renzo Rosso’s, which also includes Diesel and a majority stake Maison Martin Margiela and Sophia Kokosalaki.

Zero + Maria Cornejo
Brooklyn-based, Chilean born Cornjeo makes graphic, well cut clothes that never date. One caveat: While Cornejo does inject a few trendy pieces into her roster each year, her aesthetic is rarely altered. That’s a good for thing devoted customers, but it’s something investors don’t love. They look for newness, because newness means more, different customers. However, robust and stable sales should be enough to woo the level-headed.

A sold-out Kane dress from his spring 2009 collection.

Christopher Kane
He may already be under the wings of Donatella Versace, but that S.p.A. has enough of its own problems. In the eyes of insiders: Christopher Kane is perfect! He’s THE fashion darling! Why? Because he makes clothes that are far ahead of the trends, yet still wearable. (You can throw on a Christopher Kane dress for a cocktail party, for work even. The only place Gareth Pugh garb is acceptable is on stage.)

Jen Kao
A New York knitwear designer that’s cool enough for 15 year olds to admire, but luxe enough to for 40 year olds to buy. Sounds like Jen Kao has the Chanel success formula down pat. Her leather pants, whisper thin sweaters and subtle palette of nude, grey, black, navy and lavender appeal to all ages.

Tim Hamilton
I fell in love with Tim Hamilton’s menswear after I saw a cobalt blue v-neck featured on men.style.com. The designer–who produces quite a bit of his product in Europe and even shows his women’s collection in Paris–offers a luxe take on American sportswear that feels very new. Plus, he’s a terribly friendly and accommodating person. That can take you far in any business setting.

Corto Moltedo "Kryptonite" clutch.

Corto Moltedo
This Paris-based accessories line, launched in 2004 by the son of the founders of Bottega Veneta, is totally modern but created in an old-school way. Designer Gabriel Moltedo produces all of his calf leather “cassette tape” clutches and soft python shoulder bags in his own factory outside of Florence, which means his prices are more reasonable than competitors. (Say, between $300 and $2,00 for a gorgeous Italian leather bag.) And with his father serving as a mentor, he’s already built a following with Hollywood and fashion types alike.

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