facebook ipo’s impact · 2015. 2. 13. · price strategy. the retailer said it widened the gap...

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PHOTO BY THOMAS IANNACCONE WWD On Her Own Aerin Lauder has unveiled the first piece of Aerin LLC, her global luxury lifestyle brand: a color cosmetics collection, which is being produced under license by Estée Lauder. The initial lineup will be launched in late August and early September, with a distribution that includes 100 upscale specialty stores in North America and 20 in the U.K. For more, see page 6. Fashion World Mulls Facebook IPO’s Impact SEE PAGE 5 SEE PAGE 4 By SHARON EDELSON IT MAY NOT LAST beyond the first quarter of 2012 but, for the first time in a long time, the fortunes of Wal-Mart and Target seem to be on similar upward trajectories. Wal-Mart Stores Inc. on Thursday reported its best quarterly U.S. comp-store sales performance in three years, a 2.6 percent increase in the three months ended April 27, which was well above the top of the company’s guidance range of flat to 2 percent. A day earlier, rival Target Corp. revealed a strong first quarter that included a 5.3 percent comp-store sales gain, the largest since the third quarter of 2005. “Improved customer traffic, combined with ex- panded assortments in general merchandise, result- ed in significant progress in apparel, home and hard- lines,” said Mike Duke, president and chief executive officer of Wal-Mart on a Thursday conference call with analysts. Wal-Mart leveraged operating expenses for the quarter, which allowed it to invest in its low- price strategy. The retailer said it widened the gap between its prices and those of competitors. “We’re delivering great value,” Gregg Steinhafel, chairman, president and chief executive officer of Target Corp., said on Wednesday’s call. “We emerged from the recession leaner and healthier than ever.” What’s behind the strong financial performance at Wal-Mart and Target? “A major impact for consumers at Wal-Mart is the price of gas,” said David Schick, a retail analyst at Stifel Nicolaus. “Food and fuel can be 20 percent of the Wal-Mart consumer’s budget. Last year, gas was inflating at 20 percent. This year it’s not. Also, more people are going to work. That’s meaningful.” Wal-Mart and Target’s positioning seems more clear- ly defined than during the recession. “Wal-Mart has a certain customer and Target has a certain customer,” Wal-Mart Surges in Quarter FRIDAY, MAY 18, 2012 $3.00 WOMEN’S WEAR DAILY By RACHEL STRUGATZ NEW YORK — What does Facebook mean for fashion? That’s the $104 billion question as the social-net- working site’s initial public offering takes off today, priced at $38 a share and potentially raising $16.4 billion — the third largest in financial history. While pundits have spent the last few months poring over the most minute aspects of the Internet phenome- non — including how rich its backers and founders will be after today — the biggest issue is whether Facebook will have the long-term transformative and dominating impact of Google or Amazon — or be more like Yahoo or eBay. The fashion world, like almost every other industry, is still trying to figure that out. There’s talk surround- ing where Facebook will focus its energies with its in- creased cash flow, ranging from further developments in its open-graph technology to further engagement, to mobile innovations to fuel brand partners’ brick-and- mortar shopping experience, to improving client ac- count management services for companies. Observers also believe Facebook will become more aggressive in pushing its advertising model, stirring even greater competition with traditional media companies. At the moment, most brands have simply focused on the race to accumulate the most “likes” on their fan pages and to encourage engagement — even those like Burberry and Sephora that advertise heavily on the site. How quickly Facebook can convince brands it can be more important to them than that will be key to its ongoing growth — especially since it’s now widely accepted that early attempts to encourage e- commerce via Facebook have been a flop. Maureen Mullen, director of research and advisory at NYU think tank Luxury Lab, or L2, said that the “dirty little secret” industry-wide is that companies VIEW FROM SHANGHAI BOTTEGA VENETA GOES TYPICALLY LOW-KEY TO MARK THE OPENING OF ITS LATEST STORE IN CHINA. PAGE 11 PLUS: SHE, JANE: JANE LYNCH TALKS BEAUTY, ACTING AND THE FIFI’S. PAGE 6 THE SOCIAL REVOLUTION

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Page 1: Facebook IPO’s Impact · 2015. 2. 13. · price strategy. The retailer said it widened the gap ... First copy of new subscription will be mailed within four weeks after receipt

PHOTO BY THOMAS IANNACCONE

WWD

On Her OwnAerin Lauder has unveiled the first piece of Aerin LLC, her global luxury lifestyle brand: a color

cosmetics collection, which is being produced under license by Estée Lauder. The initial lineup

will be launched in late August and early September, with a distribution that includes 100

upscale specialty stores in North America and 20 in the U.K. For more, see page 6.

Fashion World MullsFacebook IPO’s Impact

SEE PAGE 5

SEE PAGE 4

By SHARON EDELSON

IT MAY NOT LAST beyond the first quarter of 2012 but, for the first time in a long time, the fortunes of Wal-Mart and Target seem to be on similar upward trajectories.

Wal-Mart Stores Inc. on Thursday reported its best quarterly U.S. comp-store sales performance in three years, a 2.6 percent increase in the three months ended April 27, which was well above the top of the company’s guidance range of flat to 2 percent.

A day earlier, rival Target Corp. revealed a strong first quarter that included a 5.3 percent comp-store sales gain, the largest since the third quarter of 2005.

“Improved customer traffic, combined with ex-panded assortments in general merchandise, result-ed in significant progress in apparel, home and hard-lines,” said Mike Duke, president and chief executive officer of Wal-Mart on a Thursday conference call with analysts. Wal-Mart leveraged operating expenses for the quarter, which allowed it to invest in its low-price strategy. The retailer said it widened the gap between its prices and those of competitors.

“We’re delivering great value,” Gregg Steinhafel, chairman, president and chief executive officer of Target Corp., said on Wednesday’s call. “We emerged from the recession leaner and healthier than ever.”

What’s behind the strong financial performance at Wal-Mart and Target?

“A major impact for consumers at Wal-Mart is the price of gas,” said David Schick, a retail analyst at Stifel Nicolaus. “Food and fuel can be 20 percent of the Wal-Mart consumer’s budget. Last year, gas was inflating at 20 percent. This year it’s not. Also, more people are going to work. That’s meaningful.”

Wal-Mart and Target’s positioning seems more clear-ly defined than during the recession. “Wal-Mart has a certain customer and Target has a certain customer,”

Wal-Mart Surges in Quarter

FRIDAY, MAY 18, 2012 $3.00 WOMEN’S WEAR DAILY

By RACHEL STRUGATZ

NEW YORK — What does Facebook mean for fashion?That’s the $104 billion question as the social-net-

working site’s initial public offering takes off today, priced at $38 a share and potentially raising $16.4 billion — the third largest in financial history. While pundits have spent the last few months poring over the most minute aspects of the Internet phenome-non — including how rich its backers and founders will be after today — the biggest issue is whether Facebook will have the long-term transformative and dominating impact of Google or Amazon — or be more like Yahoo or eBay.

The fashion world, like almost every other industry, is still trying to figure that out. There’s talk surround-ing where Facebook will focus its energies with its in-creased cash flow, ranging from further developments in its open-graph technology to further engagement, to mobile innovations to fuel brand partners’ brick-and-mortar shopping experience, to improving client ac-count management services for companies. Observers also believe Facebook will become more aggressive in pushing its advertising model, stirring even greater competition with traditional media companies.

At the moment, most brands have simply focused on the race to accumulate the most “likes” on their fan pages and to encourage engagement — even those like Burberry and Sephora that advertise heavily on the site. How quickly Facebook can convince brands it can be more important to them than that will be key to its ongoing growth — especially since it’s now widely accepted that early attempts to encourage e-commerce via Facebook have been a flop.

Maureen Mullen, director of research and advisory at NYU think tank Luxury Lab, or L2, said that the “dirty little secret” industry-wide is that companies

VIEW FROM SHANGHAI

BOTTEGA VENETA GOES TYPICALLY LOW-KEY TO MARK THE OPENING OF ITS LATEST STORE IN

CHINA. PAGE 11

PLUS:SHE, JANE:JANE LYNCH TALKS BEAUTY, ACTING AND THE FIFI’S. PAGE 6

THE SOCIAL REVOLUTION

Page 2: Facebook IPO’s Impact · 2015. 2. 13. · price strategy. The retailer said it widened the gap ... First copy of new subscription will be mailed within four weeks after receipt

2 WWD FRIDAY, MAY 18, 2012

Gap Net Holds Steady, Comps Tick Ahead

TO E-MAIL REPORTERS AND EDITORS AT WWD, THE ADDRESS IS [email protected], USING THE INDIVIDUAL’S NAME. WWD IS A REGISTERED TRADEMARK OF ADVANCE MAGAZINE PUBLISHERS INC. COPYRIGHT ©2012 FAIRCHILD FASHION MEDIA. ALL RIGHTS RESERVED. PRINTED IN THE U.S.A.VOLUME 203, NO. 104. FRIDAY, MAY 18, 2012. WWD (ISSN 0149–5380) is published daily (except Saturdays, Sundays and holidays, with one additional issue in May, June, October and December, and two additional issues in February, March, April, August, September and November) by Fairchild Fashion Media, which is a division of Advance Magazine Publishers Inc. PRINCIPAL OFFICE: 750 Third Avenue, New York, NY 10017. Shared Services provided by Condé Nast: S.I. Newhouse, Jr., Chairman; Charles H. Townsend, Chief Executive Officer; Robert A. Sauerberg Jr., President; John W. Bellando, Chief Operating Officer & Chief Financial Officer; Jill Bright, Chief Administrative Officer. Periodicals postage paid at New York, NY, and at additional mailing offices. Canada Post Publications Mail Agreement No. 40644503. Canadian Goods and Services Tax Registration No. 886549096-RT0001. Canada Post: return undeliverable Canadian addresses to P.O. Box 503, RPO West Beaver Cre, Rich-Hill, ON L4B 4R6. POSTMASTER: SEND ADDRESS CHANGES TO WOMEN’S WEAR DAILY, P.O. Box 15008, North Hollywood, CA 91615 5008. FOR SUBSCRIPTIONS, ADDRESS CHANGES, ADJUSTMENTS, OR BACK ISSUE INQUIRIES: Please write to WWD, P.O. Box 15008, North Hollywood, CA 91615-5008, call 800-289-0273, or visit www.subnow.com/wd. Please give both new and old addresses as printed on most recent label. Subscribers: If the Post Office alerts us that your magazine is undeliverable, we have no further obligation unless we receive a corrected address within one year. If during your subscription term or up to one year after the magazine becomes undeliverable, you are ever dissatisfied with your subscription, let us know. You will receive a full refund on all unmailed issues. First copy of new subscription will be mailed within four weeks after receipt of order. Address all editorial, business, and production correspondence to WOMEN’S WEAR DAILY, 750 Third Avenue, New York, NY 10017. For permissions requests, please call 212-630-5656 or fax the request to 212-630-5883. For all request for reprints of articles please contact The YGS Group at [email protected], or call 800-501-9571. Visit us online at www.wwd.com. To subscribe to other Fairchild Fashion Media magazines on the World Wide Web, visit www.fairchildpub.com. Occasionally, we make our subscriber list available to carefully screened companies that offer products and services that we believe would interest our readers. If you do not want to receive these offers and/or information, please advise us at P.O. Box 15008, North Hollywood, CA 91615-5008 or call 800-289-0273. WOMEN’S WEAR DAILY IS NOT RESPONSIBLE FOR THE RETURN OR LOSS OF, OR FOR DAMAGE OR ANY OTHER INJURY TO, UNSOLICITED MANUSCRIPTS, UNSOLICITED ART WORK (INCLUDING, BUT NOT LIMITED TO, DRAWINGS, PHOTOGRAPHS, AND TRANSPARENCIES), OR ANY OTHER UNSOLICITED MATERIALS. THOSE SUBMITTING MANUSCRIPTS, PHOTOGRAPHS, ART WORK, OR OTHER MATERIALS FOR CONSIDERATION SHOULD NOT SEND ORIGINALS, UNLESS SPECIFICALLY REQUESTED TO DO SO BY WOMEN’S WEAR DAILY IN WRITING. MANUSCRIPTS, PHOTOGRAPHS, AND OTHER MATERIALS SUBMITTED MUST BE ACCOMPANIED BY A SELF-ADDRESSED STAMPED ENVELOPE.

ON WWD.COM

THE BRIEFING BOXIN TODAY’S WWD

With Facebook Inc’s initial public offering taking off today, the industry is wondering what the social networking site means for fashion. PAGE 1 For the first time in a long time, the fortunes of Wal-Mart and Target seem to be on similar upward trajectories. PAGE 1 Jane Lynch of “Glee” is ready to apply a lighter, more comedic touch in her role Monday night as emcee of the Fragrance Foundation Awards ceremonies. PAGE 6 Aerin Lauder is about to launch her much anticipated lifestyle brand, with beauty kicking it off. PAGE 6 Catching up with this year’s Chopard Trophy recipients, Shailene Woodley and Ezra Miller, at the Cannes Film Festival. PAGE 9 The knives were flying Wednesday night at Le Bernardin in New York City and they were pointed at Alan Richman, GQ’s food critic. PAGE 9 With the Ben Hogan name now in its stable and its rights to Callaway Golf apparel expanded, Perry Ellis has high hopes for its golf business. PAGE 10 Thursday’s grand opening of Bottega Veneta’s 22nd store in China celebrated the brand’s increasing popularity in the country. PAGE 11 Speaking at The Jones Group’s annual shareholders’ meeting Thursday, chief executive officer Wesley Card spoke of the challenges and opportunities that lie ahead. PAGE 12 Barbara D’Arcy White, a gifted interior designer who worked for Bloomingdale’s for more than four decades, died May 10. PAGE 12 Pacific Sunwear of California Inc.’s net loss in the quarter shrank to $15.6 million. PAGE 12 Barneys New York is relaunching its e-commerce site Monday with a complete redesign that has multiple new features. PAGE 12

Jared Gilman, Kara Hayward in Louis Vuitton, Wes Anderson, Tilda Swinton in Haider Ackermann, Bruce Willis in Giorgio Armani and Edward Norton at the Cannes Film Festival.

CANNES: The 65th edition of the Cannes Film Festival kicked off in spectacular fashion with a teenage romance, stunning gowns and a live performance from Beth Ditto. For more photos, see WWD.com/eye.

PHOT

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WWD.COM

By VICKI M. YOUNG and DAVID MOIN

SEARS HOLDINGS CORP. and The Bon-Ton Stores Inc. on Thursday both posted first-quarter results, with Sears showing a profit as a re-sult of asset disposals and Bon-Ton turning in a loss.

Sears also revealed that its board has approved a partial spin-off of its interest in Sears Canada Inc., of which Sears owns 95 percent of the outstanding common shares. Following the spin-off, Sears will retain a 51 percent stake in Sears Canada. The company, which said the spin-off would occur later this year, also said it could elect to further reduce its Sears Canada stake. The move is expected to enable each business to focus on its own operations.

Sears said net income attrib-utable to shareholders for the three months ended April 28 was $189 million, or $1.78 a di-luted share, against a net loss of $170 million, or $1.53, a year ago. The results include gains on the sale of certain stores in the U.S. and in Canada, as well as lease-hold interests. The adjusted loss from continuing operations was 31 cents a diluted share versus $1.34 last year. On an adjusted basis, Wall Street analysts had expected a loss of 67 cents a share on sales of $9.15 billion.

Sales fell 2.8 percent to $9.27 billion from $9.54 billion, with comparable-store sales at Sears’ domestic stores down 1 percent, while Kmart comp-store sales were down 1.6 percent. Comps at Sears Canada fell 6.3 per-cent. The company said Sears achieved double-digit increases

in its apparel and footwear cate-gories for the quarter. Sears said Kmart saw sales increases in the apparel and footwear categories, but was not specific about what those gains were. Both business-es saw declines in sales of con-sumer electronics.

Lou D’Ambrosio, Sears Holdings’ president and chief executive officer, said, “We are pleased with the results for the first quarter and our progress to-ward restoring profit growth and

transforming our company. Our actions were driven by a focus on three core priorities: enhancing financial and operational disci-pline, improving our core retail operations and leading custom-er-based innovation through in-tegrated retail and an engaging membership program, Shop Your Way Rewards.”

Business at Bon-Ton, which had a difficult 2011, continued to slip in the first quarter of 2012.

Bon-Ton said the net loss in the quarter ended April 28 wid-ened to $40.8 million, or $2.23 a diluted share, from $36 million, or $2.01, last year. Net sales fell 1.4 percent to $640.8 million from $649.9 million. Comparable-store sales declined by 1.3 percent.

“As we got into the quarter we realized we made some tactical er-rors, in terms of marketing events and how quickly we are trying to move to a more updated mer-chandise mix. There are things we need to correct and we will,” Brendan Hoffman, Bon-Ton’s pres-ident and ceo, told WWD.

Hoffman, the former Lord & Taylor ceo who joined the York, Pa.-based, 272-unit department store chain in February, said he’s been visiting many Bon-Ton stores and learning about their markets, including some in malls with heavy vacancies. “In certain cases, in a basically deserted mall, it kind of benefits us as a stand-alone store. In other cases, it may mean shrinking the store or looking to close or renegotiate the lease,” Hoffman said.

About the same number of closings and openings are seen this year. Renovations and mer-chandise changes will be ac-celerated to 67 stores this year, with many in the Minneapolis and Indianapolis markets. The program brings in updated mer-chandise and new brands, and grows space and inventory in the most productive categories, such as shoes.

“I am certainly seeing lots of low-hanging fruit,” Hoffman said. “Now it’s a matter of focus-ing the organization on the easi-est, quickest opportunities. Each month, there is more and more I can effect.”

Asset Sales Lift Sears Income

By EVAN CLARK

GAP INC.’S NET profits were flat in the first quarter, but compara-ble-store sales rose 4 percent and the company nudged up its earn-ings guidance for the year.

Net income held steady at $233 million, but earnings per diluted share grew to 47 cents from 40 cents a year earlier as the company repurchased stock. EPS came in 1 cent ahead of the 46 cents Wall Street expected.

Sales for the three months ended April 28 rose 5.8 percent to $3.49 billion from $3.3 billion a year earlier. Comps in North America grew 5 percent at both the Gap and Banana Republic stores and 4 percent at Old Navy. International comps slipped 4 percent.

“Color was a trend that ev-erybody took advantage of,” said Glenn Murphy, chairman and chief executive officer on a con-ference call with analysts. “Our team did a very good job of that. In general, our product teams stepped up really nicely in this first quarter.”

Murphy said Old Navy rede-signed its T-shirt business in the quarter and the Gap brand put more money into its bottoms busi-ness. The company’s online sales rose 18 percent and the ceo said he would continue to fund that business to gain market share.

The 20.1 percent drop in J.C. Penney Co. Inc. first-quarter

sales might have helped the com-pany some, but it’s not a dynamic Murphy expects to continue.

“We’re not really tracking it directly,” he said in response to an analyst’s question. “When somebody in a quarter only leaks out 20-plus percent of sales in a business that sizable, I would say that I can’t think of anybody in the value business didn’t get some benefit from it.…That team there [at Penney’s], I’m not speaking for them, but they’re going through a lot of unique work to change their business model, so this is just one of those quarters that happens. And nobody here is sitting back and thinking it’s sustainable in

terms of the amount of business they’re releasing.”

Gap modestly raised its 2012 earnings estimate to $1.78 to $1.83 a share, up from the $1.75 to $1.80 previously projected.

The company operates 3,026 stores and has another 244 doors run by partners. In its own stores, square footage decreased by 2 percent from a year earlier, re-flecting the company’s efforts to optimize its North American presence. It closed 42 company-operated doors in the first quar-ter and opened 32.

Aéropostale Inc. also weighed in after the market closed, re-porting a steep profit drop. The retailer said net income for the first-quarter ended April 28 fell 35.4 percent to $10.6 million, or 13 cents a diluted share, from $16.4 million, or 20 cents, last year. Sales rose 6 percent to $497.2 million from $469.2 mil-lion. The company said compa-rable-store sales, including its e-commerce channel, rose 2 per-cent compared with a 5 percent decline last year.

T h o m a s P. J o h n s o n , Aéropostale’s ceo, said he was “pleased with the sequential progress” the company is making in its business. He cautioned that the retail environment remains uncertain and that the company is still “early in the cycle of ex-ecuting our key initiatives.”

— WITH CONTRIBUTIONS FROM V.M.Y.

According to Sears, the

company achieved double-

digit increases in its apparel and footwear categories for

the quarter.

Glenn Murphy

Page 3: Facebook IPO’s Impact · 2015. 2. 13. · price strategy. The retailer said it widened the gap ... First copy of new subscription will be mailed within four weeks after receipt

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Page 4: Facebook IPO’s Impact · 2015. 2. 13. · price strategy. The retailer said it widened the gap ... First copy of new subscription will be mailed within four weeks after receipt

’’

4 WWD friday, may 18, 2012

Forecasting Facebook’s Impacthave been spending money on advertising on the platform for a while, with Burberry leading that charge. The brand has been an aggressive advertiser on Facebook in the fashion world in the past 24 months, as have Chanel and Gucci. While this has greatly contributed to creating an aspirational aura around the value of Facebook, she thinks it is too early to know exactly how the IPO is going to play out with respect to the fashion and luxury sectors.

“Facebook advertising is most effective for driving be-havior within the platform, and specifically how most fashion brands use it successfully is to drive ‘likes’ and to grow the communities on their pages,” Mullen said. “I think that will continue, but the question will be whether it can take those communities one step further and monetize them off the plat-form. I don’t think in the short term we’ll see massive gener-ating of revenue directly from Facebook advertising or directly on the Facebook platform.”

She doesn’t foresee these brands abandoning Facebook anytime soon, but to guarantee success on the medium going forward, Mullen said it’s going to take the right mix of paid ad-vertising and really strong con-tent to increase engagement on a brand’s open graph.

Facebook, she contends, shouldn’t be held to a school of thought that demands instant return on investment, because if one looks at where most fash-ion brands advertise — print — it’s not as if those ads gen-erate immediate sales. “[Print ads] generate aspirational val-ues for the brand, awareness, editorial mentions, and for the most part, Facebook should be held to the same measure-ment,” Mullen said.

Sucharita Mulpuru, online and multichannel retail analyst at Forrester Research, com-pared Facebook advertising to television in that they’re both entertainment vehicles with

a huge reach but not a place where every brand finds value.

“It’s a place where you can discover things you might not have known about otherwise, and reinforce people’s loyalty to existing brands, and that’s why some of the most famous brands in the world all have huge fan bases,” Mulpuru said.

Sephora has been advertis-ing on Facebook for nearly four years — and although senior vice president of Sephora Direct Julie Bornstein declines to re-veal the percentage of the com-pany’s advertising budget dedi-cated to the platform, she said that investment in Facebook ads has grown each year. With Sephora having over 3 million “likes,” Bornstein contended that much testing, research and targeting has helped the com-pany figure out the formula that works, adding that the main goal is to bolster its Facebook com-munity, followed by a secondary goal of driving sales.

Coach, at almost 3.4 mil-lion “likes,” has advertised on Facebook for the past year, and David Duplantis, executive vice president, global Web and digital media, said the goal is to drive fan acquisition and en-gagement.

“Facebook has changed the world and brands and people have truly benefited. It’s going to be fascinating to see how Facebook evolves post-IPO. I believe advertising will become a bigger priority, and that, cou-pled with continued innovation, means the opportunities are limitless for both Facebook and the fashion industry,” he said.

Nordstrom, which has about 1.4 million “likes,” began adver-tising on the medium in 2010 in support of its annual anniver-sary sale — and, according to the retailer, it will continue to do so. In addition to advertis-ing, the company will explore other approaches to social com-merce, with an emphasis on

finding seamless and convenient ways for its customers to purchase online.

Many firms have developed fashion apps for the Facebook platform. One of them is TheFind, which ag-gregates Facebook “likes” from retail-ers across the Web. TheFind, through its social shopping app called Glimpse, then uses that data to create a curated shopping ex-perience that lets users see other items they might be interested in buying based on their “likes.” Like Pinterest, Glimpse can be avail-able for everyone’s friends to see or can be hidden from view.

Glimpse is hop-ing it can facilitate F-commerce on the platform, even after brands like Gap and J.C. Penney have shuttered

Facebook stores.Fiona Dias, chief

strategy officer of ShopRunner.com, be-lieves that the jury is still out on Facebook’s impact on retail and fashion.

“Facebook is very good at building re-lationships among people.…People go to Facebook to hang out with their friends. [However], anyone who has advertised on Facebook has been disappointed, as [many] ads are rarely clicked on,” Dias said.

She said that many companies don’t have a clue as to what Facebook’s impact is on their business, because measuring it is very hard. She ex-plained: “It doesn’t show up on a sale. ‘Likes’ [may] go up, but what’s the value of a ‘like’?”

Dias points to sis-ter company Rue La La — both are under

the Kynetic umbrella — and Gilt Groupe, where Facebook can be helpful for flash sales due to the flash-sale business model’s limitations on either inventory or time duration for the sale as exceptions.

Beyond fashion brands, many wonder if Facebook’s new public status will pressure the medium to become an even greater competitor for ad dol-lars with magazines and news-papers, especially in light of General Motors’ decision to pull $10 million in advertising ear-lier this week. Traditional pub-lishers such as The New York Times, Dow Jones and Hearst Magazines view Facebook as an opportunity — but not without some trepidation.

“Facebook is certainly a competitor to Dow Jones, as is television and every other media competitor,” said Mark Fishkin, vice president of digi-tal sales at The Wall Street Journal Digital Network. “It’s no surprise that ad dollars have flowed to Facebook over the last few years as clients have felt they ‘had to’ be there.”

“For the industry in general, there is always concern when a player of the size and scale of Facebook enters the market-place,” said Eileen Murphy, a spokeswoman for the Times.

Complicating the direct com-petition is that the social network is also a huge distribution chan-nel for publishers, one whose 700 million users they can’t help but capitalize on as they look to con-nect with new readers. Even GM said it will maintain a large pres-ence on Facebook.

Robin Steinberg, a media buyer at MediaVest, said the benefits of Facebook for pub-lishers are greater than the risks. This is especially true as most publishers begin to move toward balancing consumer and advertising revenue.

“As publishers transform their business, this is one com-ponent of how they’re creating content and connecting to con-

sumers,” she said. “It allows them to start a conversation in the social ecosystem.”

It is also unclear as of yet how the value of advertising on Facebook versus traditional media is different, and so it’s likely that for the near future marketers won’t reallocate their advertising budgets wholesale to the social network.

“Every client is going to have a different objective,” Steinberg said. Some clients find the long periods of time consumers spend on the site to be highly valuable. For oth-ers, traditional media yields other dividends, she added. “[Facebook and traditional media] deliver different experi-ences and therefore deliver dif-ferent values,” said Steinberg.

Publishers say this is what sets them apart from Facebook. Marketers know exactly what they’re getting in return for their ad dollars, and they can track a campaign’s performance.

“We know that some of those dollars went to Facebook with-out some of the usual digital ef-ficacy metrics as part of a broad-er experimentation agenda,” the Journal’s Fishkin said. “We have

heard anecdotally that some cli-ents are now looking carefully at their Facebook investments, and, in the case of GM, pulling.”

Said the Times’ Murphy, “We offer premium and highly differ-entiated content, and we believe our advertisers recognize the value in reaching our engaged and affluent audience.”

For now, the approach to take is two-pronged and cautious.

“Like most media compa-nies today, we have a multidi-mensional relationship with Facebook,” Murphy said. “We collaborate with them and we compete with them.”

The Times, in addition to having a strong social-media presence, has also experiment-ed for the past year with adver-tising on Facebook “on a very limited basis,” Murphy said,

’’’’

I believe advertising will

become a bigger priority, and that, coupled

with continued innovation, means the

opportunities are limitless for both Facebook and the fashion industry.

— DaviD Duplantis, CoaCh inC.

It’s no surprise that ad dollars have flowed to Facebook over the last few

years as clients have felt they ‘had to’ be there.

— Mark Fishkin, the Wall street Journal Digital netWork

{Continued from page one}

Burberry’s Facebook page.

Coach’s page on

Facebook.

w18a004a(5);10.indd 1 5/17/12 8:13 PM05172012201359

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WWD.COM

’’

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5WWD friday, may 18, 2012

and intends to continue doing so. As a matter of policy, it did not disclose the results of the campaign.

A spokeswoman for Condé Nast declined to comment for this story.

Advertising aside, James Gardner, founder and chief executive officer of Createthe Group, believes Facebook’s historic IPO will give a lot more money to implement site-wide changes with the poten-tial to affect the fashion and luxury sectors.

For Gardner, one of the big-gest challenges with Facebook thus far has been a lack of trans-parency from the platform, and he hopes that, going forward, the company will provide more guidance before major changes are released, for brand pages

specifically. He also expects Facebook to “really up their resources” in terms of client account management, as well as other strategic development investments that will allow them to leverage and sell their data outside the confines of Facebook.

“With all of the pressure

from investors to monetize and increase revenues, we believe Facebook will start to add more innovative ad products that in-crease profitability, continuing to expand with new ads outside of Facebook — which will focus on new types of content-driven ad units,” Gardner said. “This will present a major opportuni-ty for fashion brands to spread their content through more in-novative types of ad products.”

Wade Gerten, co-founder and ceo of technology solution provider 8thBridge, anticipates that there will be three major Facebook investment areas with the potential to dramatically impact the fashion industry: the open-graph platform, mobile and payments.

On the platform front, Facebook is opening itself up to be used as a development

or technology platform, and in-stead of being solely a destina-tion Web site, it will offer social shopping functionalities on thousands of other sites outside of Facebook.

“This looks more like Microsoft than it looks like Twitter. Companies like us are building software [such as Graphite] on top of the Facebook platform just like how 15 years ago companies were building software on top of the Microsoft platform,” Gerten said, noting that this will pro-vide fashion brands with a way to inherently improve the shop-ping experience by making them more social and by more deeply integrating social into their business models.

Gerten contends that be-cause such a high percentage

of Facebook users operate the platform from a mobile device — 488 million of 900 million users logged into Facebook from both a computer and a mobile device in March — that funds from the IPO will go to-ward significant investments in the category. This includes finding innovative ways to drive

foot traffic in-store through a Facebook offer.

With respect to the payment aspect (the platform generated $557 million from payments, primarily from social gaming), Facebook will likely make this aspect more ubiquitous and “friendly” toward all merchandise. Gerten explained that the current model, with a 30 percent fee on purchases, has made sense economically for virtual goods (which have virtually no overhead costs), but this would be too high of a percentage for fashion brands to sell anything.

“What gets me the most ex-cited is the potential for inte-grating all three. In the future, a brand might incentivize a Facebook user to visit a store and make a purchase through Facebook Offers. The cus-tomer could use Facebook to buy the merchandise and then easily share their purchase to their Facebook Timeline via the open-graph platform. Their friends would then see the purchased item in their Facebook in their news feed and ticker,” Gerten said. “That’s a whole closed loop social shopping experience. That’s where things could go, and the IPO will help fuel in-novations towards more inte-grated experiences like that.”

— With contributions from Erik maza and

Vicki m. Young

By ALEXANDRA STEIGRAD

RACK ONE uP for the Burberry check.

Burberry Ltd. scored a $100 million default judgment in Manhattan Federal court Thursday against a network of Chinese Internet counterfeit-ers, selling goods that infringed upon the brand’s trademark.

The defendants sold at least 22 distinct types of goods, each bearing numerous counter-feits of Burberry trademarks, including imitations of the brand’s plaid check and its equestrian knight design.

The judgment follows several static months spent waiting for a response from the defendants.

According to presiding Judge Thomas Griesa, the de-fendants, who ran Web sites such as yesburberryvision.com and buyburberry.com, had not only failed to appear in court when summoned earlier this

year, but they also failed to an-swer the complaint, which was filed in January.

As a result, the judge award-ed Burberry the princely sum of $100 million, as well as any monies held by payment ser-vice provider, PayPal Inc.

Awarding damages held by third-party payment processors is part of a developing trend, as it is almost impossible for brands to collect from Web op-erators located overseas.

In addition to damages, Judge Griesa granted a perma-nent injunction and ordered that the infringing domain names be transferred to Burberry. This al-lows Burberry the power to stop Internet service providers, Web designers, sponsored search engine or ad-word providers, merchant account providers, payment processors and others from doing business with the de-fendants in this matter.

Working with the court, Burberry will also have the ability to shut down any relat-

ed offending Web sites, and it will be able to hold third-party hosts; payment processors; search engines, such as Google, and social media sites, such as Facebook and Twitter, account-able for associating with the in-fringing sites.

Accountability comes in the form of no longer providing services to the infringing par-ties or eliminating their sites from Web searches altogether.

The ruling is nearly identi-cal to decision last month in favor of Hermès International, which also won a $100 million judgment against 34 counter-feit Web sites. In both cases, the judges called out Internet search engines, ad-word pro-viders and social media sites, effectively casting a wider net of accountability when it comes to Internet counterfeiting.

Previously, the courts had focused mainly on holding payment processors, Internet service providers and domain name registrars liable.

Burberry Wins Web Counterfeit Case’’

It’s no surprise that ad dollars have flowed to Facebook over the last few

years as clients have felt they ‘had to’ be there.

— Mark Fishkin, the Wall street Journal Digital netWork

Schick said. “Both do different jobs with different categories. Both retailers are benefiting from certain internal issues. Wal-Mart has focused on a strat-egy of price and the consumer has a little more fire power.”

As for Target, Carol Spieckerman, president of Newmarketbuilders, said, the “P-Fresh rollout is finally doing the trick on driving trips and getting shoppers to cross the aisle on their more frequent visits. The timing couldn’t be better as Target launches its lat-est planned scarcity pro-gram, The Shops at Target. It portends of future gains. P-Fresh and The Shops is a killer combination.”

“With J.C. Penney not of-fering any value equation, consumers are shifting to Macy’s and the promo-tional chains,” said Walter Loeb, president of Loeb Associates. “The consumer is very much aware of the value theme offered by Wal-Mart and Target. Penney’s has given the others an opening step in.”

“You have to wonder if Wal-Mart and Target haven’t benefited from J.C. Penney’s near-term challenges and Best Buy’s recent distrac-tions,” Spieckerman said. “Wal-Mart and Target have tradi-tionally been portrayed as one another’s direct competitors but the fact is, they compete with many other retailers in various categories.”

Like many retailers, both Wal-Mart and Target suffered along with their customers during the economic downturn. Target during the recession emphasized the “Expect More” part of its “Expect More, Pay Less” message, feeding into the perception among consumers that well-designed, trend-right merchandise comes at a higher cost. Shoppers traded down, impacting overall sales. Wal-

Mart was hit hard as its core lower-income shoppers strug-gled with joblessness, rising gas prices and food inflation.

The retailer switched its everyday low pricing strategy into high gear, which helped drive sales but pressured al-ready thin profit margins.

Now, though, various met-rics for both retailers are ro-bust. Wal-Mart’s first-quarter

profits were $3.74 billion ver-sus $3.4 billion in the previ-ous year’s quarter. Diluted earnings per share from con-tinuing operations came in at $1.09, above guidance of $1.01 to $1.06 and compared to 98 cents per share from continu-ing operations last year. Traffic and ticket size were both posi-tive during the 13-week period ended April 27.

Sam’s Club same-store sales, without fuel, rose 5.3 percent for the quarter, while Wal-Mart International grew net sales 15 percent. Constant currency net sales were up 10.9 percent.

Consolidated net sales were $112.3 billion, an increase of 8.6

percent from last year’s $8.9 bil-lion, It’s the largest first-quarter sales increase since the quarter that ended April 2009. Currency exchange rate fluctuations had a negative impact on sales of about $800 million.

Wal-Mart still has some major headaches, though, es-pecially the impact of the scan-dal stemming from corruption allegations about its unit in

Mexico. During the confer-ence call, Duke addressed the allegations, saying the company continues “to strengthen our anticorrup-tion programs around the world. The investigation is ongoing and we are working aggressively to determine what happened, and we will take appropriate action if violations of the law or our policies occurred.”

The two lawmakers leading the probe into the bribery allegations against Wal-Mart said Thursday that they have internal documents that corroborate a New York Times report that said the retail giant’s executives bribed officials in Mexico to expand their presence there and later tried to cover it up. Reps. Elijah Cummings (D., Md.), rank-ing member of the House

Oversight & Government Reform Committee, and Henry Waxman (D., Calif.), ranking member of the House Energy & Commerce Committee, sent a letter to Duke saying their re-view supports the Times report that Wal-Mart’s former gen-eral counsel, Maritza Munich, expressed concern about the independence of a company internal investigation and rec-ommended an independent investigation. After Munich resigned in February 2006, her successor, Alberto Mora, closed the internal investigation with-out taking action.

— With contributions from kristi Ellis

Wal-Mart Seeing Solid Growth{Continued from page one}

Mike Duke

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Facebook shares begin trading today under the symbol FB.

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6 WWD FRIDAY, MAY 18, 2012

By Julie NaughtoN

aeriN lauder caN’t remember a time when she wasn’t deeply absorbed with the beauty industry, wheth-er that involved working side by side with her legendary grandmother, estée lauder, or drawing inspiration from the company’s archives and giving them a modern spin.

Now, lauder is ready to put her own stamp on that world with aerin llc, a global luxury lifestyle brand that will encompass everything from beauty to table-top to jewelry. beauty will bow in late august and early September, with tabletop and gift offerings to follow for holiday. Personal accessories, fabrics and more home items will bow in spring 2013, as well as a book on living and style from random house imprint clarkson Potter, due the following fall.

“i like to joke that i’ve been in the beauty industry for 42 years and actually working for 20,” said lauder — founder and creative director of aerin llc, as well as style and image director for the estée lauder brand — with a smile during an exclusive interview at her madison avenue offices in manhattan. Naturally, she noted, that means beauty would be the first category to bow with her new venture — and she has licensed the aerin name to the estée lauder cos. inc. to produce the cosmetics collections. lenox holds the tabletop license, while Nest is licensed to create a giftable candle line for holiday. home will be a major focus, and will expand to include sheets and towels. lauder’s also excited about designing jewelry: “i have this incredible book of all of estée’s pieces, and it’s such a great sense of inspiration. What i think is so interesting about beauty and jewelry is that you buy it for yourself, and what’s fun about jewelry today is that it doesn’t have to be superexpensive.”

as far as beauty goes, “my goal was to create a line that was all about modern, effortless beauty,” said lauder. “it’s very much a lifestyle brand, which i think is very much how estée started. it was always about lifestyle photography and an environment and a world. it’s not necessarily an age group — it’s a state of mind.” Still, she says, women in their 30s through 50s will most likely comprise the bulk of her customers.

the aerin essentials collection is a permanent offer-ing and is intended to be a carefully edited selection of products women depend upon. “We will keep adding to it, depending on the season and needs,” said lauder. the initial offering is comprised of Fresh Skin compact makeup, a cream-to-powder foundation that doubles as a concealer, is available in six shades and retails for $48; Pretty bronze illuminating Powder, available in two shades, which retails for $45; multi color for lips and cheeks in Natural is $42; rose lip conditioner in

Nude is $28; rose hand and body cream is $40; the rose and white essential makeup bag is $48, and the $148 brush essentials set includes foundation, conceal-er, bronzer, highlighter and lip brushes.

lauder will also launch a limited-edition fall color col-lection in September, and plans to launch carefully ed-ited seasonal on-trend offerings four times a year — for fall, holiday, spring and summer. “For this fall, the idea is very much weekend-weekday,” said lauder. the dra-matic weekday collection includes the Fall Style Palette in Weekday, which includes two eye shadows, a blush and a highlighter for $70. a lipstick, Pout, will be sold sepa-rately for $30, as will a lip gloss in Perfect Nude, also $30. the lineup includes Fall Style Palette in Weekend, which includes two eye shadows, a blush and a highlighter for $70, as well as a $30 lipstick called Sunday morning and a $30 lip gloss called Sweet Pea. gold-toned compacts with a linen texture are placed inside gold-logoed pink pouch-es for safekeeping. For holiday, lauder plans items such as small lipsticks in party-ready colors that will easily slip into an evening bag. For next summer, palettes, beach creams and bronzers will be a focus. “it will change de-pending on needs. it isn’t going to be ‘every season, we’ll

launch four lipsticks and four lip glosses.’” She plans to follow a similar strategy for other aerin categories.

the aerin beauty collection will be merchandised in special-ty stores with the lauder brand’s upscale reNutriv skin care brand. “Since this is going to be living with reNutriv, it’s the perfect balance for that,” said lauder. “reNutriv is always life-style advertising, mostly black-and-white, and this is the make-up complement to reNutriv.”

imagery for the aerin line was shot by claiborne Swanson Frank and features aerin in the New York city apartment she shares

with her husband and two children, wearing jeans, an ivory silk shirt and a vintage gold necklace given to her by her grandmother. While the brand is not planning tra-ditional print advertising at launch, it will use the image on store tester displays, as well as in retailer magazines and catalogues, on social media (including twitter and tumblr) and in a digital campaign. a microsite on esteel-auder.com, aerin.com, will bow in late august and feature and sell the beauty brand, said Jane hertzmark hudis, global brand president for the estée lauder brand.

hudis noted that the aerin brand would be sold in about 100 doors in North america and 20 in the u.K. in its first year on counter. in North america, that will include distribution at bergdorf goodman, Neiman marcus, Saks Fifth avenue, holt renfrew and select Nordstrom doors. in the u.K., it will be a harrods ex-clusive at launch and moving to Selfridges and selected John lewis stores by spring, she said, with selective ex-pansion in both markets in its second year. For her part, lauder would like the brand to expand to asia. “i think

it would resonate well there,” she said. She’d also love to do stores-in-store, and is considering a pop-up shop outside of New York city for summer 2013 (possibly in Southampton, N.Y.).

“because of the unique nature of her family back-ground, company expertise, and the way the business has been structured, only aerin could do this brand,” said John demsey, a group president of the estée lauder cos., who has worked with lauder on the company’s flag-ship brand for nearly a decade. “this step in beauty is a natural progression of aerin as a stand-alone image and style leader. She has a strong point of view, amazing style and, like her grandmother, a strong intuition about what women really want. if estée lauder was alive today, she’d be doing what aerin is doing.”

of the brand’s first home at the estée lauder reNutriv counter, demsey noted: “clinique and Prescriptives both had origins at the estée lauder counter. this is an authentic, next generation.”

Fabrizio Freda, president and chief executive offi-cer of the estée lauder cos., added, “i am very proud that aerin’s beauty brand has been licensed to the estée lauder cos. aerin has done a great job for the estée lauder brand for a very long time and for me person-ally, and she continues to lead a lot of creativity and style of that brand. With the aerin line, she is creating feminine, pretty, effortless beauty.”

While none of the executives involved would discuss sales projections or promotional spending, industry sources estimated that the brand would do about $8 mil-lion at retail globally in its first year on counter, with about $2 million to be spent on marketing.

6

’’’’

beauty

JaNe lYNch iS PerhaPS best known for her role as the abrasive Sue Sylvester on Fox’s “glee,” but she has one ironclad rule when it comes to her projects these days: they can’t be Sue clones.

“it’s incumbent upon me to reach a lit-tle to the left or the right to make some-thing a little bit different in each role,” said the 51-year-old actress, whose other recent roles include mother Superior in “the three Stooges” and the voice of Sergeant calhoun in the upcoming ani-mated film “Wreck-it ralph.” “We have many things inside of us — murderers and gandhi, we have it all inside of us,” she said during a recent interview with WWd. “i have to find a different part of myself every time i do a different role, so i’m not derivative or repetitive. i try to do something with their inner lives to distinguish them, not only for myself but for the audience. i don’t want them

to say, ‘oh, there’s Jane, she’s going to do her thing again.’”

lynch will play a psychologist in the upcoming “a.c.o.d.” — an acronym for adult children of divorce, which also stars adam Scott and amy Poehler and is tentatively set for a late 2012 release. the inspiration for her characterization of that role is right in her household: wife lara embry, a clinical psychologist and professor of psychology.

lynch is quite down to earth about her acting career. “i was 49 when ‘glee’ succeeded — i had my ‘who i am in the world’ down, so it didn’t rock my world to the point i didn’t know who i was anymore,” she said. “When you’re younger and a little less formed, that can happen. For me, it’s been nothing but a blessing. a lot of fun, and i love to work. as far as i’m concerned, i don’t work enough.”

to that end, lynch is taking on anoth-er new role: as mistress of ceremonies at monday night’s Fragrance Foundation awards at lincoln center in New York city. She’s not new to running the show — she served in the same role for the 63rd Primetime emmy awards last September — but lynch is happy that the FiFi’s will be lower pressure, even if they share last year’s technical difficulties. “i’ll make sure i’ll have notes on note cards and not on a teleprompter,” she cracked. “and i’ll bring a flashlight in case the lights go out. We’ll make it fun. What i like most of all is being off the cuff and making sure everyone has a good time. that’s what i hope to do for this show.”

lynch was recruited for the FiFi gig last fall through a friend of a friend while promoting her memoir, “happy accidents,” which was released in hard-

My goal was to create a line

that was all about modern,

effortless beauty.— Aerin LAuder

Aerin Lauder Goes Solo With Brand

Jane Lynch to Make Her Beauty Industry Debut

WWD.COM

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Jane Lynch

Aerin Lauder

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WWD.COM8 WWD FRIDAY, MAY 18, 2012

cover last September and is out in paper-back this month. but unlike many celeb-rity FiFi attendees, lynch isn’t looking to do her own fragrance. “i probably wouldn’t do anything like that, but i love that [cat-egory],” she said. “i’m the first one who will pick up a scent and say, ‘oh, this is beyoncé. this is what beyoncé smells like?’ i love how very serious [celebrities] are about how they chose the particular fragrances. my olfactories are very sensi-tive, and i’m not a big fan of perfume, but i am a big fan of scent. if someone has a delicious smell about them, i always re-member it. my dad wore brut when i was growing up, and anytime i smell brut i think, ‘my dad.’ the nose gives you really strong memories and strong impressions, and emotions that come with it.”

that said, rotators would best steer clear of lynch if she appears on the beauty floor. “it’s probably because i’m thin-skinned and blonde, but if i put on a perfume and it’s wrong, i have to take a shower,” said lynch, who spritzes Jo malone’s orange blossom scent when she’s in the mood for fragrance. “Some

people stand in macy’s and want to spray you — i’m like, ‘don’t do it, because if it’s not good i’m going to have to go home and take a shower.’ it just envelops me.”

lynch also noted that sense of smell played a large part in honing her craft. “When i was in acting school, we’d use all sorts of things to bring out memories to

prepare for a scene,” said lynch, who has a bachelor’s degree in theater from illinois State university and a master of fine arts from cornell university. “i remember them saying that smell was the strongest at inspiring memories and emotions.”

after finishing graduate school, lynch worked briefly in public relations in New York city before spending 15 years

in chicago, acting in the prestigious Steppenwolf theatre co. and Second city groups, and playing supporting roles in films such as 1988’s “Vice Versa” and 1993’s “the Fugitive” before landing her breakout role on “glee” in 2009.

lynch’s stage career resulted in a love of musical theater, making “glee” a natural

progression. but even she didn’t anticipate the show’s runaway success. “i know how devoted an audience can be to musical theater,” she said. “i knew if we got on the air, we would probably have a very rabid following, but i didn’t know it would reach these heights. but we’ve got these kids who vibrate out of their bodies when they see someone from the cast on the street. it re-

ally means a lot to them, and that’s really powerful for kids. From what i understand, ‘glee’ has also created a renaissance in the arts in schools, and more kids are audition-ing for plays than ever before. that’s a re-ally great and positive thing in schools.”

and lynch relishes every moment of in-habiting Sue Sylvester’s abrasive personal-ity, confessing that she finds Sue’s “in the head, out the mouth” persona a lot of fun. lynch observed, “Whatever she thinks, she says. also, they’ve given her such di-mension. i don’t think you could laugh at her and find her so absurd if she didn’t have a heart somewhere. She’s protect-ing something very tender in her heart, and every once in awhile you see that. in fact, it’s almost incumbent on the writers to let me express that part, because, if not, i think i’m just this mean, bitchy girl that no one likes, and that’s good for about one episode. i always start from the position of ‘What do i feel for this person, what’s ten-der about this person, even though they act like a real ball-buster?’ What’s inside of them that are they afraid of? and that usually makes for some really funny stuff.”

� —�Julie�NaughtoN

8

’’

’’beauty

I was 49 when ‘Glee’ succeeded — I had my ‘who I am in the world’ down.

— JAne Lynch

{Continued from page 6}

Lynch to Shed Tough Girl Act for the FiFi’s

w18a006(8)a;7.indd 8 5/17/12 7:45 PM05172012194640

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ON THE SPIT: The knives were flying Wednesday night at Le Bernardin in Manhattan and they were pointed at Alan Richman, GQ’s food critic. The normally elegant, subdued atmosphere of the classic French restaurant was replaced with a ribald roast, as Eric Ripert, Daniel Boulud, David Chang and Anthony Bourdain took turns delivering playful blows at the curmudgeonly critic, who is celebrating 25 years at the magazine. Boulud had plenty of quips about how cheap Richman is, giving examples of corked bottles of wine and the lengths he’ll go to avoid the bill, but it was Ripert who let it rip: “When I say you’re smart, I mean, come on: this guy grabbed the ass of a waitress at a diner and then won the f---ing James Beard Award.”

Former New York Times food critic Sam Sifton spent

nine minutes delivering one punch line after another to the crowd, which included fellow roasters Frank Bruni and Lettie Teague. “Twenty-five years at a men’s magazine and he still looks like an extra from ‘Law & Order,’” said Sifton, who recounted the experience of watching Richman at work. One night, they were seated at separate tables at Daniel. “He was at a corner table that could have seated a dozen people, under a sign that said ‘Alan Richman, GQ magazine,’” Sifton said. He added Richman was surrounded by two dozen waiters and had a notebook in front of him the size of a billboard. “He wrote nothing,” Sifton added.

Chang said he’s never met a man with a more negative view of the world, besides himself: “He’s the only person that I speak to who went to the Vietnam War and speaks of it fondly.”

Bourdain, Richman’s arch enemy, delivered the final blows. “I had said some very

bad things about Alan Richman after he dropped the big steamer on New Orleans,” said Bourdain. Following Hurricane Katrina, Richman visited the city and then delivered a diatribe on its cuisine. Bourdain took umbrage with the piece and the barbs have flown back and forth. Since the New Orleans debacle, Richman decided to review Les Halles, the restaurant Bourdain worked at 10 years ago. “He called it the worst restaurant in the universe. Statistically, this can’t be true,” Bourdain said.

Trying to find at least one nice thing to say, Bourdain searched for words. “You know what? At least you’re not [Esquire critic] John Mariani.”

— AMY WICKS

ARRIVAL: Departures has tapped Amanda Ross as fashion director. Previously, Ross worked as global fashion director of W Hotels and market editor of Harper’s Bazaar. She also worked on the launch of C

Magazine in Los Angeles. More recently, Ross has been a stylist for publications such as Town & Country and L’Officiel, and clients including Mariska Hargitay, Vera Farmiga and Naomi Watts. — A.W.

NO UPTURN: Sally Singer opened the most recent issue of T The New York Times Magazine with a tribute to leisurely evolutions. “You realize that even when taste is a given, patience is a virtue,” she wrote. Her subject was architectural renovations, but her editor’s letter could have doubled as a memo to her boss, New York Times executive editor Jill Abramson, who reportedly grilled her last year over declining ad sales.

Abramson won’t be much happier with T’s numbers so far this year as it continues to shed advertisers.

The luxury title lost ad pages in all but two of 2012’s first seven issues. The trend puts it out of step with most luxury and fashion magazines,

which are overperforming as the luxury sector once again booms. And T rival WSJ. is also juiced up through the first four issues of the year, with more advertising than in the past and more pedigreed brands than those at its rival, said publisher Anthony Cenname.

{Continued on page 11}

WWDSTYLE

Youth Movement

MEMO PAD

PHOTO BY STEPHANE FEUGERE

CANNES, France — With the Cannes Film Festival officially under way, WWD caught up with this year’s Chopard Trophy recipients, the burgeoning, restless young talents Shailene Woodley and Ezra Miller, seen here. For more, see page 10.

T The New York Times Magazine has seen ad sales decline.

ASIAN INFLUX: Bottega Veneta celebrates the opening of its 22nd store in China. PAGE 11

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10 WWD friday, may 18, 2012

A yeAr After his chilling portrayal of a mass-murdering teen in “We Need to talk About Kevin,” ezra Miller is back at the Cannes film festival — and trying to convince people that he is a nice guy, really.

“I think maybe the pervasive fear of me as a person is slowly fading away, which is nice,” he says. “If you meet someone for the first time and they’ve only seen ‘We Need to talk About Kevin,’ for the first 10 minutes of that conversation, they’re really wondering if I’m truly a bad guy, and I’m really acting now.”

the 19-year-old’s next movie, “the Perks of Being a Wallflower,” is unlikely to dispel his reputation for playing tortured high schoolers. In Stephen Chbosky’s adaptation of his cult coming-of-age novel, Miller stars as Patrick, a gay adolescent who goes by the nickname Nothing.

“I’ve just spent a year or two reading that I’m capable of only playing dark, dysfunctional humans,” he shrugs. “every human is dark and dysfunctional, and I’m not interested in movies that make up a story that’s fun for us to pretend is real.”

But whether or not he knows

it, Miller is about to leap into another league. As recent spreads in L’Uomo Vogue and GQ attest, the 19-year-old actor has blossomed into something of a heartthrob — all cheekbones, soulful eyes and pillowy lips.

the fact that Sean Penn was the godfather of this year’s Chopard event was the icing on the cake.

Miller credits Penn with triggering an “epiphany” when he was 11. “from one character to another, Sean Penn is

unrecognizable, whole human beings — every time, without fail,” he says.

finding a balance between high art and earning a living is something the young actor is still working out. In addition to acting, he plays drums and sings in the New york-based band Sons of an Illustrious father. An opera buff since the age of 6, Miller is equally comfortable wearing a tuxedo to the Met and joining the Occupy Wall Street protesters at Zuccotti Park. Sitting in the Chopard Lounge on the rooftop terrace of the tony Hotel Martinez, he sports the slogan “99 Percent” written on his left hand in black ballpoint pen.

“I know the world of high art, power, privilege, and then I know the world of complete crust punk, do-it-yourself, independent art making, and I think they both have things to learn from each other,” he says. “that’s where I want to be, using the power of both those worlds.”

Up next is his first period drama. Miller starts filming this summer opposite Mia Wasikowska in an adaptation of the classic french 19th century novel “Madame Bovary

— Joelle DiDerich

Miller’s CrossingThe Trophy Kids In picking Shailene Woodley and Ezra Miller as the recipients of its annual Chopard Trophy, the Swiss jewelry and watchmaker is highlighting a new generation of socially conscious stars. WWD caught up with the winners to discuss everything from choosing roles, the 99 percent and growing your own food.

WItH A HIt tV show and a breakout film role as George Clooney’s teenage daughter in “the Descendants,” Shailene Woodley could be forgiven for whooping it up in Hollywood nightclubs. Instead, the 20-year-old is more likely to be found tending to her vegetable patch.

“I think I was just born with an intense love affair with trees,” she laughs, curling up barefoot on a sofa on the rooftop terrace of the Hotel Martinez, her wooden Marni platform shoes discarded on the floor. As a former child actor, Woodley has more in common with the world’s Lindsay Lohans than would appear. Most people know her as Amy Juergens in the ABC family drama “the Secret Life of the American teenager.”

With another two seasons to go on her contract, Woodley is fitting movie shoots — such as the upcoming “the Spectacular Now” — around her busy tV filming schedule. “I’d rather at this point do a small scene in a Meryl Streep movie than do the lead of a super action hero movie,” she says. “I really respond to human scripts, scripts that are raw, and real, and risky. I love playing scary characters — not horror-film scary, but vulnerable scary.”

Woodley is keeping it in perspective.

“I would love to act for the rest of my life, but I also know that it could be taken away in a day,” she says. “It’s something I’ve always loved, but it’s nothing I’ve ever revolved my entire life around. I have many other passions as well.”

the biggest of these is the environment.

“Growing your own food, hunting and knowing your natural resources, collecting spring water,” explains Woodley,

who grew up north of Los Angeles in Simi Valley, Calif. “I’m really passionate about becoming a self-sovereign human being, independent of any system or corporation.”

Accordingly, Woodley is not much of a clotheshorse. though she uses a stylist for red-carpet events, she rejects the phenomenon of the actress as fashion arbiter.

“I think it’s ridiculous that the boundaries have been crossed between cinema and fashion. they’re both their own separate art forms,” she says. “I didn’t start acting in order to wear

something beautiful and wear lots of makeup. that’s not why I do this. I do this because I really love being on a film set.“

So where does Woodley see herself in 10 years’ time?

“I’d like to be living somewhere in the middle of the woods, flying to L.A. when I need to, and balancing my lifestyle of living in stride with the earth as well as being in this industry,” she says. “I think there are ways to bridge gaps between my two worlds: My wild, muddy-all-the-time, no-makeup, no-shoes world, and this world, which is high heels and fancy clothes.” — J.D.

PERRY’S PITCH: the pun was probably unintentional when Oscar Feldenkreis referred to golf apparel as a “huge growth driver” for Perry ellis International Inc. But with the Ben Hogan name now in its stable and its rights to Callaway Golf apparel expanded, the company has high hopes for its golf business, which feldenkreis, president of the firm, expects to see expanded to between $400 million and $500 million in the next five years, possibly more than triple its 2011 level of about $150 million.

During its first-quarter conference call with analysts thursday, the Miami-based company also reported that it’s talking with a number of interested parties about a possible sale of brands in its portfolio, which is currently undergoing a strategic evaluation. — ARNOLD J. KARR

DEAL NEAR: eton, the luxury Swedish shirtmaker, is close to bringing in a financial partner. the company, which was founded in 1928 by Annie and David Pettersson and is still a family-owned business, is finalizing a deal that will bring an investor on board to help finance its growth plans.

A company spokesman confirmed the report, saying the firm would be ready to reveal details about the structure of the deal and plans for the extra investment by the end of the month. “It’s a pretty straightforward financial deal,” he said.

eton operates stores on Madison Avenue in New york and in Montreal, as well as shops at several specialty stores in North America. It also has stores in Sweden, russia, Switzerland and London. — JEAN E. PALmIERI

BY THE BAY: Jimmy Choo will open its first store in San francisco — its sixth freestanding door in California — today on Geary Street. the 1,700-square-foot unit will carry the brand’s women’s shoes, handbags and accessories, including the Choo 24:7 collection.

to mark the opening, as well as pique the interest of the city’s digerati, the store will carry an exclusive limited-edition iPad case in salt-and-pepper glitter fabric. It will retail for $495.

“to expand the brand’s footprint in California was always part of our long-term growth strategy. We have been searching for the right location in San francisco and we are excited with this new space,” said Brian Henke, president of Jimmy Choo USA. — RACHEL STRUGATZ

CLOSING ON mADISON: Cole Haan is expected to close its store at 667 Madison Avenue in New york in february, opening up a small but prime location near Barneys New york, Hermès and Michael Kors among other top brands.

“this is a once-in-a-generation opportunity for a luxury retailer to make a brand statement,” said Leonard Stern, chairman and chief executive

officer of the Hartz Group, the property’s owner.

the store space, situated at the southeast corner of 61st Street and Madison, has a 1,689-square-foot ground floor, 1,858 square feet of storage space, and the potential to add a 500-square-foot mezzanine.

Glenn Frankel, vice president at Hartz, responsible for leasing 667 Madison, said the site has more than 120 feet of wraparound window frontage, including six double-story window displays and 24-foot ceilings. the building also has a replica of the Statue of Liberty at the entryway. Cole Haan officials could not be reached for comment. — DAvID mOIN

HUNTER TAPS mENDEL: Hunter Boot Ltd., known for its functional rubber rain boot, is going high-end again. the brand, which previously collaborated with Jimmy Choo, has tapped J.Mendel’s Gilles mendel to design a limited-edition line of Wellington rubber boots for fall. “Hunter, like J.Mendel, is a brand that combines a strong european heritage and reputation for quality with a modern-day relevance,” said Susan Sokol, president and chief operating officer of J.Mendel. “We thought it would be a fun, innovative way of showcasing the expertise J.Mendel is known for.”

three styles — a modified design of the iconic Hunter boot, with tall and short boot options in white or black and a branded J.Mendel ankle buckle — will retail from $585 to $795 at Saks, Nordstrom, Gorsuch and hunter-boot.com in November. — KRISTI GARCED

PAY IT FORWARD: the Wall Street Journal celebrated its “Donor of the Day” column on Wednesday evening at Manhattan’s Whitney Museum of American Art. Several dozen philanthropists who have been profiled in the daily feature, including Susan Sarandon, were on hand for the dinner, sponsored by Harry Winston and Oscar de la renta. Jeff Koons hosted the evening and spoke to the crowd about his work on behalf of the International Centre for Missing and exploited Children. the Whitney will also be the site of the first major Koons retrospective in New york in 2014, which will serve as the museum’s swan song on Madison Avenue before it moves to its new home in the Meatpacking District in 2015. “the next couple of years of production are very important to me, so that my work is as fresh as possible,” said Koons of the upcoming show.

John varvatos said he devotes his charitable efforts to children’s causes, including Stuart House in Los Angeles, a direction spurred on by his own fatherhood. folk-rock singer Brandi Carlile concluded the evening with a four-song set that set off a standing ovation from Frédéric de Narp, Alexander and Eliza Bolen, Timothy Greenfield-Sanders, Jeanne Greenberg Rohatyn, michelle Harper, Daniel Boulud, Julie Henderson, Heide Lindgren and ruffian designers Brian Wolk and Claude morais. — DAvID LIPKE

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POLO mATCH: fred Perry, the British sportswear label known for its preppy polo shirts, is relaunching its collaboration with Raf Simons. the spring-summer 2013 raf Simons x fred Perry collection will launch at Men’s fashion Week in Paris in June, featuring 28 style and color variations. Distribution and marketing is to be handled by fred Perry. “We have great appreciation for the heritage of the brand as well as their dynamism in guiding the brand towards the future,” the designer said.

Simons and fred Perry’s initial partnership terminated in spring-summer 2011 after seven seasons of collaboration. Simons, who last month was named the new couturier at Christian Dior, has a signature men’s wear line. — KATYA FOREmAN

SeOUL-fUL fASHION: Where Calvin Klein Inc. goes, celebrities follow. Chloe Moretz, Kate Bosworth, and models Lara Stone and Matthew terry are expected to touch down in Seoul next week for CKI’s multi-brand event there next thursday [fOLO:MAy24], which is hosted by creative directors francisco Costa, Italo Zucchelli and Kevin Carrigan. for the occasion, CKI is teaming up with downtown’s New Museum of Contemporary Art to present a one-night exhibition called “Infinite Loop” in tribute to video art pioneer Nam June Paik. the private event will take in a purpose-built structure on top of the landmark Seoul Station, and will also feature three interactive video installations by rafaël rozendaal, Scott Snibbe and the flightphase collective. the night’s highlight, however, will probably be positioned across from the station: A specially-curated program of videos will be displayed on the Seoul Square Media Canvas, the world’s largest LeD screen at 23 stories tall.

the celebs won’t be the only ones traveling to South Korea for the event. Others include CKI president and chief executive officer tom Murry, the New Museum’s Lisa Phillips, and Hanneli Mustaparta, who contributes to the official Calvin Klein tumblr blog.

— Marc Karimzadeh

DOWN IN DALLAS: Jonathan Adler met possibly his biggest fan Wednesday evening at the grand opening of his Dallas store on McKinney Avenue. Inserting himself between Adler and another guest, a young man declared, “you have no idea who I am, but I have decorated my apartment in everything you have.” “I love you,” Adler replied. It was the home furnishings designer’s 18th store opening, but there was nothing routine about the social crowd perusing the madcap, colorful wares. Art collecting philanthropists Howard and Cindy rachofsky, who snagged a bright blue bowl, and Brian Bolke were among the faithful who accepted the invitation from co-hosts Katherine Perot-reeves, Kim Schlegel Whitman and elizabeth Showers. “I love his stuff -- it’s fun, and it’s attainable,” Showers said. “I got a baboon pitcher. I don’t know if you know I’m a frustrated anthropologist.” Adler was headed for yet another store opening in downtown Austin. “We’ll have 22 by the end of the summer,” he said. -- Holly Haber

Fashion scoops

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While the Times’ Sunday magazine is also significantly down year-to-year through May 13 — 12.5 percent fewer ad pages, according to Media Industry Newsletter — it’s never had T’s mandate to bring in gilded buckets of luxury advertising cash. The loss casts a harsh light on the magazine, and especially on Singer’s nearly two-year tenure.

She came on board in 2010 and remodeled the magazine as a literary take on a fashion glossy. Recent issues have featured a travel piece by Thomas Beller, a regular of the Paris Review and the cofounder of the literary journal Open City, and a Middle East photo essay by journalist Trevor Snapp.

Under her watch, the magazine also has plateaued. Last year, it increased ad pages by 0.7 percent, according to MIN.

Seven issues into the new year, the numbers haven’t improved: The magazine is about 4 percent down in overall ad pages through May 20, according to figures from MIN and the Times. Its three fashion issues so far have all seen declines from last year, with a cover of Jessica Chastain notching a 10 percent drop.

The Times declined to make management or Singer available for comment. Through a spokeswoman, it said sales for May are flat compared to last year, and confirmed its upcoming seventh issue, focusing on travel, had a slight decline in pages.

“T remains a strong performer and it is an important part of The Times’ overall portfolio of products available to luxury advertisers to reach our affluent and highly engaged audience,” said spokeswoman.

She maintains the company’s luxury business is “robust,” pointing to advertisers Louis Vuitton and Dior, and counters that WSJ. often runs in-house ads and ones by the likes of Starbucks and Jeep.

Among fashion and luxury titles, the ad page figures make T an anomaly. With the exception of Harper’s Bazaar and Glamour — which are slightly down and flat for the year, respectively — the fashion monthlies are showing muscular legs through March, according to MIN.

Luxury advertisers are spending

more money across the board, leading several publishers — Time Inc., Forbes and Bloomberg — to launch — or relaunch — magazines aimed at deep-pocketed readers.

WSJ., already cocky as it is — it dubs itself the world’s leading luxury magazine after four years in publication — has 51 percent more pages March through May than last year, said Cenname; the publisher did not include a new February issue, part of its increased frequency. Its March spring fashion issue has 50 advertising pages in all. The figures can’t be independently confirmed because the Journal doesn’t release magazine-specific data. It also did not disclose their ad rates.

Cenname said the numbers are helped by an increase in the weekend edition’s circulation, which has encouraged more advertisers to spend on the magazine. Some of those “Madison Avenue” brands that are inside: Audemars Piguet watches and Devi Kroell footwear.

“I don’t know if we’ll reach that 1,000,” Cenname said, referring to T’s 1,087 total ad pages last year; WSJ. finished 2011 with just 383 pages. “But we’re getting closer.” The Journal, he noted, expects as much. “There is a tremendous sense of urgency for the magazine to produce.”

Though a decision won’t be made until the summer, Cenname hopes to expand frequency again next year. — ERIK MAZA

11WWD FRIDAY, MAY 18, 2012

Bottega Steams Ahead MeMo padBy REBECCA KANTHOR

SHANGHAI — Arriving relatively late into the China market, Italian luxury brand Bottega Veneta is certainly mak-ing up for lost time.

While the brand only opened its first store in China in 2007, Thursday’s grand opening of the 22nd store in China — the fourth in Shanghai — brought together customers, industry executives and fashionistas to cele-brate the brand’s increasing popularity in China. The new store at the Yi Feng Galleria mall, near Shanghai’s most ex-clusive address on the Bund waterfront, will be the brand’s largest in China. It will also be Bottega Veneta’s first store to double as gallery space, where works by promising Chinese photographers will be on display starting in August.

The opening highlighted how the brand sets itself apart from other Western labels hoping to making inroads in one of the fastest-growing economies in the world. With no red carpet, few VIP ap-pearances, and not so much as a brand spokesmodel, the event was as understat-ed as Bottega itself. The biggest names in attendance were chief executive offi-cer Marco Bizzarri and creative director Tomas Maier. In a country where flashy bling still holds cachet, that kind of quiet confidence is unusual, but it seems it has definitely found its place here.

Guests mingled amid displays of bags and clothing, Bottega bags on their shoul-ders and glasses of Champagne in hand as they gathered around female artisans from the brand’s Vicenza, Italy, workshop demonstrating the signature weaving technique that has made Bottega Veneta recognizable throughout the world. The opening showcased the next phase of the brand’s “Initials” project, which will offer personalization services for custom-ers. Harking back to the brand’s motto of “When your own initials are enough,” the artisans, wearing tan lab coats, hand-stitched crocodile skin initials onto pur-chased bags. Thirty bags sold at the open-ing, with one shopper snapping up five.

Guests at the event inevitably used the same word to describe the appeal of Bottega Veneta products: “low-key.” Chinese actress Zhou Xian Xin said she specifically buys Bottega Veneta bags because they don’t carry a logo, pointing out that the past two to three years have seen a developing trend of low-key lux-ury here. Shanghai resident Judy Ren, age 30, clutched a BV wallet and a small BV handbag in one hand. “This brand is quite understated but they really value the details and it’s high-quality, so you feel it is really worth owning,” she said.

In fact, that toned-down quality has been earning Bottega a growing legion of followers in China. This segment of luxury customers are becoming more interested in fashion that’s not flashy. Bizzarri said the brand’s understanding of their Chinese consumers has evolved over the years. “At the very begin-ning, we needed to make sure that the Bottega Veneta values were matching

Chinese consumer behavior,” he said. “That’s why we were a little cautious at the beginning. Afterward, we realized that the Chinese consumer is very so-phisticated. Of course there are a lot of people that are still buying and showing off logos, there’s nothing against it, but the point is that we are approaching a consumer that is different.”

Unlike other luxury brands, they make no attempts at localization or spe-cialization for the China market. Maier said this was a conscious decision. “This is an Italian product that is conceived to go out into the world, that has a very cosmopolitan outlook to it, but it’s very Italian. I think that is very important because it is special and it has a prov-enance to itself. It has a reason to be there,” the creative director said.

Maier believes Chinese consumers, like its customers around the world, are not interested in being pandered to. “Bottega is a global product and the cli-ent in every local market wants exactly that product. I’m against a product that is localized and specifically created for a market. I find that personally hideous. Hideous. And I think that is not what the client would want. The customer we have has that certain type of sophistica-tion and likes a product that is not really localized and has a certain kind of un-derstatement to it,” he said.

The fast growth in the China market has meant that Bottega Veneta can try new things here. Armed with the knowl-edge that men are some of their big-gest customers in China, the company opened its first men’s-only shop last year in a Shenyang, Liaoning province, mall. Following the success of the store, it opened a similar unit in New York City this spring. The fall also saw the launch of a Chinese-language Web site to intro-duce the brand to Chinese consumers.

Bottega Veneta is doing well all over the world, with first-quarter sales up 39 percent, but Bizzarri said he feels particularly confident about the China and Asian market. “If you look at our business, over 55 percent of our busi-ness is in Asia, 45 percent is the U.S. and Europe. That is completely the re-verse of the industry,” he said.

For now, the strength of the Asian market depends on the brand’s huge popularity in Japan. China is still catch-ing up, he said, but he has high hopes. “China is a superimportant market and it is growing very fast. The fact that the Chinese customers are approaching our brand quicker than any other emerging country is due to the speed of the matu-rity of the market,” said Bizzarri.

Even so, he said Bottega Veneta is not banking on the growth of the China mar-ket. “We don’t want to put all our eggs in a single basket. We are actually investing a lot in Europe and the U.S.,” he said. “We strongly believe that Europe will con-tinue to be the flagship for luxury and if the Chinese consumer buys in China it is also because in traveling, he looks at our brand in the proper way. If tomorrow for any reason China slows down, we need to be strong in other regions. We need to have a balance in terms of geographical location of investment.”

Marco Bizzarri and Tomas Maier

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Shi Zhou Liang at the Bottega Veneta opening.

WSJ. saw a 51 percent uptick over last year in ad pages from March to May.

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By RACHEL BROWN

PACifiC SuNWEAR of California inc. hasn’t quite turned the cor-ner, but the Anaheim, Calif.-based action sports retailer’s first-quarter performance shows it might be on the right track.

in the three months ended April 28, PacSun’s net loss shrank to $15.6 million, or 23 cents a di-luted share, from $28.7 million, or 43 cents a diluted share, a year ago. The adjusted loss was 20 cents a diluted share, 9 cents better than the 29-cent loss ex-pected, on average, by analysts.

PacSun’s net sales from con-tinuing operations rose 1 percent to $173.8 million from $171.9 mil-lion in the first quarter of last year, and comparable-store sales increased 1 percent. Gross mar-gin picked up 430 basis points to 23.6 percent of sales versus 19.3 percent a year ago.

The results might harbinger a reversal of fortune for the long-suffering retailer, which regis-tered comp declines of 1 percent, 8 percent and 20 percent in fiscal years 2011, 2010 and 2009, respec-tively. They come as PacSun has been jettisoning underperform-ing stores at tertiary malls. The company had 729 stores at the end of the first quarter and an-ticipates culling its store count to around 630 by yearend.

“We saw strong improve-ment in the second half of the quarter, and we really execut-ed on every dimension finan-cially that you would want to achieve,” PacSun chief execu-tive officer and president Gary Schoenfeld told WWD. When asked about PacSun possibly turning the corner, he added, “i’m not prepared to put that stake in the ground based on one quarter, but there is a growing sense of optimism, and we will see how the balance of the year plays out. But i am en-couraged by what i have seen.”

During an afternoon confer-ence call, Schoenfeld suggested that PacSun’s momentum from the first quarter hasn’t ebbed in the second. “We are early in the quarter, but we are seeing posi-tive comps continue so far in this quarter,” he said. PacSun has

forecast same-store sales in the second quarter in the range of down 1 percent to up 4 percent.

Schoenfeld noted that wom-en’s and men’s both comped up 1 percent, the first time both had increased since 2005. PacSun’s female customer “parallels our guy customer and the sweet spot continues to be in that late teens, early 20s” group, he said. “We all know that if you are suc-cessful in that age group, you will have the younger customers aspiring to be part of that.”

Efforts to reconnect with customers are getting a boost from a campaign dubbed Golden State of Mind that will cross print and online advertis-ing, in-store imagery and gsom.com, a content-driven Web site launching Sunday.

“We have confused the cus-tomer over the past four, five or six years in terms of what we really stood for. Throughout the company’s first 20, 25 years, it was very clear that PacSun was the retailer bringing this new lifestyle and a world of new brands to consumers around the country. i think we lost our way a bit, chased more of the vertical retailers,” said Schoenfeld. “importantly, Golden State of Mind brings us back to the authentic heritage, which was why PacSun was successful for so many years.”

WWD friday, may 18, 2012

By LiSA LOCkWOOD

NEW YORk — Wesley Card, chief executive officer of The Jones Group inc., is pleased with the progress the company is making, after experiencing mixed economic trends and low consumer confidence last year.

Speaking at the company’s annual shareholders’ meet-ing Thursday at its law firm, Cravath Swaine & Moore, Card discussed the company’s overall performance in 2011, and spoke about the challenges and oppor-tunities that lie ahead.

in 2011, Jones’ sales in-creased 4 percent to $3.8 bil-lion, while net income was off 5.8 percent to $50.7 million. The company delivered $272 mil-lion in operating cash flow and ended the year with $240 mil-lion on its balance sheet, thus beginning 2012 “in a strong fi-nancial position,” said Card. “Over the past few years, we have been undergoing a sub-stantial transformation to en-hance our operating perfor-mance. Although we have been doing this in difficult economic times, we have been steadfast in making very significant changes in our organization and operat-ing philosophy,” he said.

Card has identified five stra-tegic pillars to achieve their goals. They consist of revital-izing core brands, investing in emerging brands, expand-ing its international footprint, improving direct-to-consumer performance and building op-erational excellence.

Specifically, he said, the company’s core brands of Nine West, Jones New York, Anne klein, Gloria Vanderbilt, L.E.i. and Easy Spirit gener-ated about two-thirds of its revenues in 2011. He said the company’s emerging brands — Stuart Weitzman, kurt Geiger,

Robert Rodriguez, Rachel Roy, Jessica Simpson and B. Brian Atwood — contributed 14 per-cent to net revenue in 2011, compared with less than 1 per-cent in 2008. Since 2008, inter-national sales have increased from 9 percent of total sales to an estimated 21 percent pro-jected for 2012.

“Our biggest profit opportu-nity is turning around our own chain of stores — and we have been aggressively closing un-derperforming locations,” said Card. He noted that the firm has been enhancing product assort-ments and improving the overall in-store customer experience. in addition, Jones is improving its online presence, connecting with customers via social media vehicles as well as its e-com-merce sites.

One shareholder asked Card if the company has resolved its issues with People for the Ethical Treatment of Animals, and Card replied, “We no longer use fur in any of our products.”

following the meeting, Card and Richard Dickson, president and ceo of branded businesses at Jones, briefly discussed the status of some of the Jones brands. Dickson told WWD he was excited about Anne klein’s new look. He said Anne klein sportswear is making a come-back, and the footwear and jew-elry continue to do well. Card said its denim division “is no longer for sale,” after a deal to sell it to Delta Galil industries fell through in January. He said the L.E.i. business has been solidified with Wal-Mart Stores inc. for its department store distribution, it is producing a denim line under the Jones New York label, which is the core of the business. Card said the company is working on sev-eral initiatives with J.C. Penney Co. inc., but was unable to dis-cuss them at this time.

By MARC kARiMzADEH

NEW YORk — Barneys New York’s Madison Avenue flag-ship isn’t the only thing getting a facelift — the retailer is also revamping barneys.com.

Barneys is relaunching its e-commerce site with a complete redesign that has multiple new features. The new look was qui-etly introduced on Thursday, and the full launch, with all the site’s new features, is slated for Monday.

Executives felt a re-design was long overdue. Even though e-commerce is not the largest door for the specialty store, it is the fastest-growing chan-nel and fuels much of Barneys’ growth and fu-ture strategy.

“it’s a huge emphasis for us as a company,” said Daniella Vitale, chief merchant, execu-tive vice president and general merchandise manager of women’s merchandising and bar-neys.com. “it represents one of the biggest op-portunities in terms of revenue growth and market share. We wanted to create a completely dynamic and very emotional experience, which we couldn’t do with the old site.”

To that end, Barneys worked with digital agency Huge to retool its online presence. in collabora-tion with Barneys’ in-house team, they developed a cleaner aes-thetic that mainly serves to high-light available product. Barneys sought to simplify the navigation process for visitors, and regis-tered users can now shop with as few as two clicks.

Similar to Twitter or facebook, shoppers can “favor-

ite” items they like, and their selection will then appear on a personal list through a new “favorites” tool. They can share the list through social-media platforms facebook, Twitter, The fancy or Pinterest. Based on their picks, Barneys will also propose items that these customers could like.

“With the list and things that you favor — it could be a de-signer, it could be a shoe — we will be able to tell your shop-

ping patterns and recommend anything from a shoe size to a brand,” Vitale noted.

Effective Monday, the site will feature special lists by ce-lebrities, fashion personalities and other tastemakers. for the launch, these include favorite lists from Mary-kate and Ashley Olsen, Julianne Moore, stylist Leslie fremar, katie Holmes and her co-designer Jeanne Yang, and chefs Melia Marden from The Smile and Michael Chernow from Meatball Shop.

The “Most Loved” feature displays the most trending items of the moment, which are mea-sured against users “favoriting”

pieces. “Exclusively Ours” in-forms visitors of items exclusive to Barneys, while “The Window” adds an editorial context to the site with information about art, lifestyle, culture, fashion and initiatives related to Barneys that can be linked back to the designer merchandise for sale.

The visual icons associated with each tool will be part of Barneys’ overall strategy and will also be reflected at store level.

Vitale said it was “critical” to engage consumers today. “The mobile device, the iPads, the smartphones…have changed life forev-er,” she said. “it’s very in-tegrated in everyday life. The notion of on- and of-fline behavior has fallen by the wayside. it’s com-pletely seamless. We use technology, we use mo-bile devices, we use Web sites to do everything these days.”

While planned be-fore, the Web relaunch is the first major activ-ity since Perry Capital became the majority owner of Barneys earli-er this month. The rede-

sign is part of the overall stra-tegic direction and overhaul spearheaded by Barneys chief executive officer Mark Lee.

“We are not changing the DNA of Barneys but reviving the way we communicate with customers, and how we high-light what we do best and cu-rate the best — product,” Vitale said. “The renovation of the store [serves] to create a clean backdrop, and that’s what we are now doing on the Web site. We know we have huge pen-etration of customers who shop Madison Avenue and the Web site. We want to make sure the messaging is the same.”

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A page from Barneys.com.

An image from the new campaign.

A New Look for Barneys.com

Jones Moves Ahead With Confidence

BARBARA D’ARCY WHiTE, a gifted interior designer who worked for Bloomingdale’s for more than four decades, died May 10 at Southampton Hospital in Southampton, N.Y., after a short illness.

D’Arcy White, 84, whose model rooms for the store became the stuff of legend, was hired by Marvin Traub, Bloomingdale’s former chair-man, as a “very young unknown” in 1953, Traub said Thursday. “i be-came responsible for the furniture floor in the early fifties and was anxious to develop product and a fashion reputation.” He said under D’Arcy White’s direction, the store created innovative, colorful model rooms including the now-famous Cave Room, made of wood and chick-en wire that was sprayed with polyurethane foam, as well as an all-cardboard room she designed with help from architect frank Gehry.

“She had a great eye for picking furniture,” Traub said, “and thanks to her, the Bloomingdale’s name and reputation grew. Her work was unique and made us like no other store. She was also the soul of our country promotions.”

She joined the store to head furniture design and presentation and in 1973, was promoted to head of store design and visual dis-play. in 1975, she was named a vice president.

D’Arcy White is survived by her husband of 46 years, kirk White, an interior designer and architect. He recalled that while working at W.J. Sloan department store in New York City as head of its decorat-ing department, White visited the other stores in the city to check out the competition. “i went to Macy’s and B. Altman and reported back. They all had the same wallpaper and Grand Rapids furniture. Then i went to Bloomingdale’s. i came back and told my boss, ‘There’s some woman up there who is doing furniture that should be in museums. We’re out of our league with them, we’ll never catch up.’”

He said not long after, the two met at a “fabulous cocktail party. She had no idea who i was, but she saw me and said, ‘That’s for me.’ it was a chance meeting that kept going and going and culminated in a beautiful marriage.”

Visitation will be from 2 to 5 p.m. and 7 to 9 p.m. Sunday at the frank E. Campbell funeral home at 1076 Madison Avenue in New York City. The funeral will be at 1:30 p.m. on Monday at the Church of St. Vincent ferrer at 869 Lexington Avenue on 66th Street in New York. — Jean e. Palmieri

Obituary

Barbara D’Arcy White, 84

PacSun Shows Sign of Turnaround Taking Hold

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