Displaying items by tag: Regent Street

Thursday, 16 May 2019 14:33

ChicGeek Comment New Burberry Working?

Is new burberry working? Gigi HadidArguably the finest looking retail street in London, Regent Street’s sweeping thoroughfare is home to the world’s largest Burberry store. The former theatre and cinema is a huge, cavernous stage for the only domestic luxury mega-brand the UK has. What you’ll notice recently, as you walk past, there is never anybody in it. Worryingly, the store always looks empty of customers, and, as is often the case in fashion, you don’t need to see financials or figures to see whether something is instinctively selling or not. 

After two distinctly underwhelming, but vast collections under new Creative Director Riccardo Tisci, the first results are in and it doesn’t bode well. Sales are flat in a market that has seen stellar performances from Kering and LVMH. Burberry’s sales grew by just 2% to £2.7B over the year to March 2019 with an adjusted operating profit of £438m. According to Bain & Company, the luxury goods and experiences market grew by 5% in 2018 and to put this into further context, LVMH was up 10% and Kering was up an incredible 26.3% over the same period.

Left - Gigi Hadid in Burberry's latest campaign. The collection could easily be confused with Fendi

After Burberry’s huge growth under previous Creative Director, Christopher Bailey, the brand’s new strategy is to take the brand more upmarket and completely change the feeling and identity of the brand. Marco Gobbetti, Chief Executive Officer, who hired Tisci, puts a positive spin on it in the brand’s latest financial release, “We made excellent progress in the first year of our plan to transform Burberry, while at the same time delivering financial performance in line with expectations. Riccardo Tisci’s first collections arrived in stores at the end of February and the initial reaction from customers is very encouraging. The implementation of our plan is on track, we are energised by the early results and we confirm our outlook for FY 2020.”

The two stores Burberry had in Knightsbridge have closed and are now a trashy souvenir shop and while they said they are taking a new store above the Tube station, it is a long way off from opening with only the facade currently standing.

The only hope is that they are still selling in China. There was a report in Jing Daily, the leading digital publication on luxury consumer trends in China, in April, that said Burberry had shut down four retail stores in Shanghai since August 2018, with the latest closure occurring on March 31, when the brand ceased the operation of its flagship store at the city’s L’Avenue, which it opened in 2013. The article said “the company had been laying off Chinese staff in preparation for the closure until only seven of them remained”. The publication also said the permanent closure of the L’Avenue store represented a “landmark event” in Burberry’s perceived exit from Shanghai. 

According to the results, in Asia, it’s seen low single digit growth in Asia Pacific, Korea and China, stable in Hong Kong and declining in Japan. Which is worrying. Burberry is also cutting costs to shore up the balance sheet.

The company is pinning all its hopes on the new Tisci product. The statement said “The first deliveries of Riccardo Tisci’s products arrived in stores at the end of February. Although it is currently a small portion of our offer, the initial reaction from customers has been very positive with sales of the new collections delivering strong double-digit percentage growth.” It’s not clear what the growth is in comparison to.

The company says it is currently on a multi-year journey to transform and reposition Burberry. “FY 2019 and FY 2020 are foundational years where we will re-energise the brand, rationalise and invest in our distribution and manage through the creative transition, after which we will accelerate and grow.”

In retail, they say they are focused on refreshing flagship stores, with over 80 retail doors expected to be “aligned” by the end of FY 2020. "To ensure we are focusing our resources on the most impactful locations, we will also be closing 38 smaller, non-strategic retail stores in secondary locations. In wholesale, we stepped up our wholesale rationalisation in the second half of the year, phasing out non-luxury doors.” says the financial statement. In total, Burberry closed a net 18 stores (seven mainline, nine concessions and two outlets) in the year and new openings included the relocation and expansion of the Dubai flagship and openings in Shin Kong Place, Xian (China). Fourteen retail stores had been aligned to the new aesthetic by the end of the period. 

Tisci’s first collection ‘Kingdom’ hit stores in February, but it didn’t create the much needed desire within the fashion community which ripples out to consumers. In that period, we’ve seen Givenchy fly, Gucci continue to power on and Bottega Veneta get a new designer and start to make waves. Unless you make positive gains from the energy around a new star creative designer, the energy quickly falls flat and the new Burberry seems to have been striped of identity during its rebrand. 

Riccardo Tisci’s and Christoper Bailey’s Burberrys were always going to be very different. One was incredibly successful and turned the company into a global, billion dollar player, the other, was a fresh start, hoping to equal the growth and appeal of its predecessor but with a new, more street-like aesthetic while trying to elevate the brand. 

Burberry feels like a brand going into reverse and unless new collections start to create some form of excitement people won’t be willing to pay more. The momentum it has built up over the past decade will disappear and it will be a tough job to get that back. This feels like a brand to ‘sell’ before the evidence of the failure of this new strategy becomes even clearer.

Published in Fashion

Superdry strategy bored brand Julian DunkertonSuperdry has been a British retail phenomenon. In under a decade, the brand went from its first store in Covent Garden to a huge multi-storey flagship on London’s Regent Street.

Established by James Holder and Julian Dunkerton, the Superdry name first appeared in 2003. It has been an unstoppable juggernaut since then, racking up yearly sales of over £750 million (2017) and operates in 55 countries.

Left - Superdry went from a single store to a huge Regent Street flagship in under 10 years

At the beginning of this year, the remaining founder, Julian Dunkerton, announced he was stepping down from the company. In a statement, Mr Dunkerton said he had “other demands” on his time, and stepping down was “the right point for me to transition my focus and responsibilities”. Handing the reins to new Superdry chief executive Euan Sutherland, Dunkerton bowed out quietly until this October when Superdry issued a shock profit warning blaming warm weather and bad foreign exchange hedging. Shares in the group crashed 20%. 

Dunkerton has been vocal in his disagreement with the direction the company is heading in, saying, “I cannot sit back and watch my shareholding — and those off all the pensions invested in the company — be dissipated”. He’s trying to gather other shareholder support to return to and steer the company in his direction, but, have they got their strategy wrong or has the Superdry brand simply peaked and run out of steam? 

Mat Heinl, CEO at global creative business Moving Brands, an independent, global creative company, says: “It has become unclear who Superdry is for and it feels like its brand and purpose has been entirely lost. 

“There, now, seems to be a clear disconnect between what made the brand successful and its core base of customers. With the mid-market being hit hard by competitors, brands like Superdry fall into a sea of sameness,” says Heinl.

The strategy in question has been Superdry’s move into fast-fashion. In September, Superdry hired Brigitte Danielmeyer as its new chief product officer to launch a new fast-fashion range called "Superdry Preview”. Formerly Tommy Hilfiger’s global head of womenswear, Danielmeyer, leads the new Superdry Preview label aimed to attract a “younger, more fashion-driven” customer through limited-edition capsule collections. The range will go from design to delivery in just six weeks and be supported by a social media campaign targeted directly at 16 to 24-year-olds.

Yet to be tested, with no results yet for these ranges, Dunkerton thinks it’s a mistake for Superdry to move into the competitive fast fashion arena. He thinks Superdry should stick with fewer, core ranges in store and massively increase the designs and varieties (known as SKUs) being sold online.

“Last Christmas we were at a point where we could hit fast fashion online. We were such a strong brand that we could really increase our SKU count. But they [the new management] did the reverse.

“If you put that product online you would expand brand awareness and create excitement online while combining it with the classic store base.” he said.

Not everybody disagrees with the fast-fashion approach. Natalya Johnson, Marketing Manager, Shopest, who create location- based shopping experiences helping “independent stores to stay vibrant, profitable and nearby”, says “Early on the brand appealed to their target demographic which at the time was young men and women aged around 16-30. 

“Over time, their consumer has changed, developed new interests and shop in a new way. Although brand identity is strong, the brand has failed with adapting into the fast fashion cycles, meaning their products seem to be outdated,” she says.

“Superdry are beaten by big brands such as ASOS and Zara, who not only offer consumers constant variety, but also a difference of style. 

Superdry strategy bored brand Julian Dunkerton

“Superdry do have great potential to revive the brand, tapping into current trends in the fashion industry that would attract their ideal consumer. It seems that they keep missing the mark in trends that would complement the brand e.g. streetwear and also brand collaborations. 

“Once the product becomes more relevant, the brand can offer new innovations in store and develop stronger marketing strategies. In conclusion, Superdry appear to be very stagnant at the moment, but definitely have the potential to make things right,” she says. 

The shares now sit at roughly 780p. They began the year above 2000p. The October profit warning said it expected to make £83 million in profit this year, well shy of the near-£110 million expected. 

Superdry is heavily reliant on sales of heavy winter items such as jumpers and jackets, making 45% of annual sales. It said “unseasonably hot weather” in the UK, Europe and the east coast of the US was hitting sales.

“Superdry is a British phenomenon who’s growth has been nothing short of miraculous,” says Anthony McGrathpastedGraphic.png, Lecturer and Editor-in-Chief of Clothes-Make-the-Man.com. 

“In their heyday, celebs galore were spotted in their trademark casual wear and they set up home in a huge flagship emporium dedicated to all things Superdry on the retail Mecca of Regent Street. BUT! They have rested on their laurels and the whole nature of the beast, that is fashion, is that it changes at a break neck speed. Tastes, styles, trends change and unfortunately Superdry haven’t. So, yes, I do think Dunkerton is right,” he says.

Right - Is Superdry too reliant on coats and jackets?

Dunkerton, who retains an 18.5% stake, said “The management team remains hell-bent on their strategy, publicly supported by the chairman; but the numbers and the market warnings speak volumes. It is very clear that the company needs to change strategic direction; I have a clear and simple plan to correct the problems, and I have been explaining my plan to shareholders over the last couple of weeks.

“This company and brand has such a great opportunity - we must grasp it now,” he said.

This added pressure onto the Superdry management comes at a time when the retail landscape is looking schizophrenic. Long one of the darlings of the British retail scene, could this just be a case of the brand losing momentum and consumers growing tired of the Superdry brand regardless of the strategy? Has the ubiquitous Superdry branding reached its zenith, and, regardless of what the brand does, exponential growth can’t go on forever?

“Another challenge for brands like Superdry is the rise in people turning away from highly disposable and consumerist brands as they become aware of the massive pollution and poor working conditions associated with those brands which emphasise profits over ethical business practices,” says Heinl.

“To claw back momentum, Superdry, and other struggling brands, could do a number of things to help them stand out in a crowded marketplace. They could become a champion of sustainable fashion, improve and showcase high quality products, define a distinct design direction or take a leadership position in improving supply chain transparency and quality,” he says.

Dunkerton said, “My model means less wastage. It is far easier to manage and you have lower stock risk.

“There are too many products in the stores with short shelf life. You shouldn’t try and change it all the time. Get the product right and be confident in it. There’s no reason a jacket in October shouldn’t stay until March. Now, you see jackets on sale already. Can that be right?” he says.

Shareholder Aberdeen Asset Management is supporting current management, saying Dunkerton left after multiple profit warnings. Superdry chief executive Euan Sutherland has said “it will take up to 18 months for the benefits to come through” and Superdry chairman Peter Bamford said: “The Board of Superdry has huge respect for Julian Dunkerton as an entrepreneur and founder of the business. Julian has raised a number of issues with the board regarding strategy since he left the business. We have reviewed and discussed these issues and, while we have sympathy with some of his points, we have a different view on the best strategy or approach to addressing them. 

“Superdry is an ambitious, global, multi-channel brand and the Board believes that Julian’s view of strategy has not evolved with the needs of the business. We remain fully committed to our successful global digital brand strategy and the board is confident that Superdry has in place the right leadership to ensure the continued development of our highly relevant brand.”

The management will have to start seeing the fruits from this new strategy and fast, otherwise shareholders will push for change. The next set of results will either quieten Dunkerton or add fuel to the fire for a reversing of the company direction. Superdry is too reliant on coats and jackets, but this has also helped them grow to the size they are. Regardless of strategy, what if consumers are simply bored with Superdry? That’s going to be an even harder job to fix. 

Published in Fashion
Friday, 09 February 2018 15:56

ChicGeek Comment Human Cookies

Human cookies l'occitane Regent Street Retail physical stores

French beauty company, L’Occitane, opened their huge - the largest in the world - new flagship store on London’s Regent Street last night. This isn’t just another standard branch, it’s spacious, has a luxurious yet homely finish and even has a Pierre Hermé macaroon counter to boot. It feels like a cross between an airport lounge and a store. It’s definitely somewhere you could happily spend time in.

Left - Upstairs at L'Occitane Regent Street February 2018

Anyway, chatting away, somebody mentioned their boyfriend had come into the store previously and was looking for hand cream. The sales assistant said it was upstairs. As he went upstairs another sales assistant came over and said, “You’re looking for hand cream?”.

Human cookies l'occitane Regent Street Retail physical storesMind reading is a skill that modern retail needs. Clearly, the sales assistant, downstairs, had radioed ahead. Not only is this great service, it’s also a form of human cookies - the chain of information your internet journey/history leaves behind allowing brands to track your movements and also recommend appropriate stuff.

It’s not magic, it’s just clever data, and I, for one, don’t mind having things recommended for me or being reminded I looked at something previously. You can clear your history every now and again if it becomes annoying. 

What this shows is a linked up journey in a physical store. The customer is looking for something and rather being lost somewhere on the journey or not finding what they want, the sales links became strong and would obviously have more conversion in sales with the added bonus of wowing the customer and making them feel they had received great service.

Right - The flower filled ceiling installation from above inside the new L'Occitane Regent Street store

This is what physical stores need in order to compete with online: sales assistants quickly talking to each other, directing the consumer and having that want to please and fulfil expectation. 

I understand many stores are too busy, some of the time, for this type of individual attention, but many luxury brands can offer this type of service if the sale assistants are motivated. It’s about a personal, human touch, which in the future we will miss from online shopping and something that can become a physical store USP.

‘Human Cookies’, as a concept, would definitely put new meaning into a physical store’s customer journey.

Published in Fashion
Wednesday, 23 August 2017 22:14

ChicGeek Comment New H&M Brand Arket

Arket H&M Regent Street

When Banana Republic decided to chuck in the towel, leave the UK and move out of the H&M-owned, old Dickins & Jones flagship building on Regent Street, it made sense, to H&M anyway, to fill it with their own house brands, especially at a time when you could struggle to fill such a large, flagship space.

Left - Upstairs at Arket, Womenswear

The space has been split between Weekday, which already has stores across Europe, and Arket, which is brand new and this is the first one in the world.

The big question is: does the world need anymore H&M brands? It makes sense for the companies. Put your eggs in lots of baskets, aimed at lots of different sectors and consumers, and not only do you have all bases covered, you can weather the ups and downs of fickle consumers better: as one brand is going down, another one can be coming up.

What with COS, & Other Stories, Cheap Monday, Monki, as well at the main H&M brand, they are pushing out, much like the Spanish Zara owner Inditex, with many consumers unaware or past caring about who owns what. It’s the fashion equivalent of a one operator food court.

Arket H&M Regent Street Cafe

Anyway, let’s talk about Arket. They’ve gone London grey - Scandinavian pink perhaps?! -  with the shop fit. It looks a bit like a stage fit of a shop in “1984”. The top half is empty and looks like a cheap wardrobe carcass waiting for the doors. The floor is Valentino-type grey terrazzo and it is lacking, somewhat, in personality. This looked like the template for every future store and you wouldn't know where you were. Are brands still in that mind set of rolling out the same shopfit the world over? I thought we were done with all that.

Right - Café with a shop attached

The product is good. The knitwear feels substantial and of good quality. So good, in fact, I think you’ll have to buy it two sizes bigger just to get into it. The ground floor is split between men’s at the front and back, homeware in the middle and a café to the side at the back. Upstairs is womenswear and childrenswear. 

Arket H&M Regent Street

Branding is minimal and it’s all very plain and Scandi - can we ever get enough?! - The women’s has more colour and it does flow.

Arket likes a serial number on things. I think the target customer is the trendy mum, she wants clothes for her, her children, a café to sit down in and some little treats in homeware, plus she’ll be buying the menswear too, which is why there are Breton stripes - every woman loves a man in Breton stripes, don't they? 

Left - Using brands such as R.M. Williams & Tricker's to elevate the branding & clothes

When this rolls out to the big shopping centres all over the country, depending on how successful it is in London I guess, then she’ll in there with her stroller, smugly mocking the Cath Kidston nappy bags. (If she’s buying the clothes, she’s probably washing them too. I’d like to see how those knits fare).

As for the hubby, there’s nothing he won’t be happy with, there’s nothing not to like. 

Like Weekday, there is a sprinkling of other brands: they are using quality shoes like Tricker’s and R.M. Williams to elevate the clothes. The price points are £80 for a jumper and £45 for a pair of good quality long-johns, which to me feels more like a Swedish customer used to paying for quality and not a London or U.K. customer hooked and satisfied on cheap clothing.

There was a very nice Black Watch tartan mac, which won’t hang about for long, and, like all stores, you cherry pick the best pieces and ignore those that are over-priced or not special enough.

What Arket lacks in personality it makes up for in quality. This feels like a store for Millennial milfs and dilfs, which was perfectly illustrated by two dads proudly feeding their babies on the opening night, probably while their wives were busy shopping.

Published in The Fashion Archives

Coach Regent Street Dinosaur RexyYou walk into the new Coach store on Regent Street and the first thing to confront you is Rexy, Coach’s T-Rex dinosaur. This isn’t the replacement for Dippy the Diplodocus, the Natural History Museum’s famous dinosaur, which is going on a regional tour, but it’s just as magnetic.

Left - Putting the sexy into Rexy!

The new store is impressive. It feels like a one-off. Coach has always been a perfectly acceptable, mid-market and luxury with a small l, brand. 

moving handbags coach regent streetRight - The handbags move around the Heath Robinson-type contraption

But, with this new store they’ve really stepped it up a gear. It shows a Creative Director - Stuart Vevers - putting himself into the brand and being allowed to do so. What they’ve done is thought about injecting personality and identity rather than focus solely on ‘luxury’. 
So many brands get fixated on luxury and forget about identity and personality. For some, it’s all about the Carrara marble and shiny finishes and they’ve started to look soulless, empty and, ultimately, boring. 

Rexy The Dinosaur Coach bags Regent Street

Left - Coach Regent Street's giant Rexy is going to be auctioned off

The new Coach store has a mechanical track with bags running along it, a giant pink neon dinosaur in the window and special product, downstairs, designed with British tourist badges and travel souvenir symbols. It’s fun without being gimmicky. It feels like somebody has thought about it rather than simply rolling out a format the world over. Yawn.

In contrast, I popped into the new handbag hall in Selfridges. The biggest in the world, when finished, it has all the usual suspects: Valentino, Celine, Balenciaga, Chanel, Burberry, all with their signature shop-fits. It all feels so predictable and formulaic. The only one of interest was Gucci with a mosaic floor featuring their, now, signature wasps. 

Luxury needs personality. It needs a strong individual to lead with instinct and intuition. Brands need to create newness and not just consistency. Coach seems to not only made Rexy sexy, but also fun. It's approachable and welcoming. If brands are going to get us off our sofas, offline and outside, there needs to be something worthy of going out for. 

Published in The Fashion Archives

TheChicGeek talks a buzzy Pitti Uomo in Florence, how the major brands were domestic, Zegna looking around again after their foray into high fashion and why Michael Kors is the fashion brand of this decade. Enjoy!

Published in The Fashion Archives

Advertisement