By VICKI M. YOUNG

WHEN DOES A GIFT from J.C. Penney Co. Inc. mean more than just a gift?

When it might be viewed as a coupon of sorts — or perhaps some other loyalty incentive.

That’s the debate regarding the gift at the bottom of Ron Johnson’s latest e-mail letter to customers.

The J.C. Penney chief executive offi cer sent out his third monthly letter — he started the new custom in August — to consumers Thursday morning, but this time included an invitation at the bottom to visit the “new and improved jcp.”

Johnson wrote: “Our goal is really pretty simple — we want to help you look and live better every day, while bringing back the fun of shopping.”

After an update of some changes that took place over the past month, Johnson said, “I’d like to invite you in to your favorite jcpenney store to see the changes fi rsthand. As an incentive, I’m enclosing a $10 gift. Think of it as a thank-you from jcp for your loyalty through the years.”

The invitation has a bar code for scanning that offers a “$10 off gift valid for one-time use on a single in-store purchase of $10 or more.” Valid for use between Oct. 11 and Nov. 4, the gift also has certain restrictions such as not being valid for jcp.com orders or for certain purchas-es such as Sephora-related merchandise or gift cards.

According to a company spokeswoman, “In the month-ly letters Ron has sent to customers, he has requested their feedback. Through this feedback, we learned that

WWD

Blue NoteWith its new scent, Eros, the house of Versace plays with the many moods of blue. This time it’s not depression, but unbridled sexuality — not to mention the color of the Mediterranean sea, a reminder of the Versace family’s origins. But the hue could come to symbolize happiness if industry sources are right about its sales: It could do

$100 million at retail globally in its fi rst year on counter. For more, see page 6.

FORGING AHEAD

Burberry on TrackDespite Slowdown

SEE PAGE 11

FRIDAY, OCTOBER 12, 2012 ■ $3.00 ■ WOMEN’S WEAR DAILY

PHOTO BY THOMAS IANNACCONESEE PAGE 4

Gift-Giving Season at JCP

By SAMANTHA CONTI

LONDON — The luxury sector might be breathing easier as a bullish Burberry, undaunted by slower de-mand in Mainland China, said Thursday it will con-tinue to open as many as 10 stores there each year, in line with its original strategy.

The optimism comes on the heels of a warning last month of a slowdown in the company’s retail sales, which shook luxury-sector stocks and sent Burberry’s plummeting nearly 21 percent. The brand did in fact report a slowdown in revenue growth in the second quarter, due partly to declining footfall in China, but said the country’s underpinnings were solid.

Burberry added it remains keen on the potential for growth in China’s fl agship markets in particular.

“In Shanghai, for example, we’re not nearly at the level we should be for such a vibrant, dynamic mar-ket,” said Burberry’s chief fi nancial offi cer Stacey Cartwright, adding that the company planned to open three fl agships in that city over the next 12 months.

Burberry currently has 68 stores in 32 cities in Mainland China, and the aim is to get to 100 stores in 35 cities in the medium term.

Cartwright was speaking on a conference call, fol-lowing a second-half trading update and news that Burberry plans to set up an in-house fragrance and beauty division after severing ties with Inter Parfums SA in March.

Burberry’s bullishness was clearly infectious, as the stock closed up 13.3 percent to 11.36 pounds, or $18.21 at current exchange rates.

Revenue in the three months ended Sept. 30 grew 2.6 percent to 475 million pounds, or $751 million at average exchange rates for the period.

Burberry said that a slowdown in footfall world-wide — in China and the U.K. in particular — contrib-uted to the modest growth.

In the fi rst quarter, growth was 11.2 percent, and in the fi nal quarter of last year, it was 16.1 percent.

Burberry said the lessening in traffi c was miti-gated by higher average transaction values, and two of the brand’s priciest lines — Prorsum, the runway

FRUITS OF AN EXOTIC FAMILY TREE

J. CREW HITS HONG KONGSTEPHANIE VON WATZDORF LAUNCHES FIGUE LINE. PAGE 5

PAGE 4

By LUISA ZARGANI

MILAN — Italian jewelry firm Pomellato is eyeing brand extensions with watches and a fragrance, has plans to further develop the Asian and American markets and is evaluating a public listing. “We are thinking about it, it’s one of the possible hy-potheses for Pomellato,” said chief executive offi-cer Andrea Morante during the first “Luxury and Finance 2012” meeting at the Milan Stock Exchange on Thursday.

During the event, which, among its goals, aims to draw companies to consider an initial public offering, Pomellato and Brunello Cucinelli presented their brands to the interna-tional financial community. Meetings with management from Luxottica, Marcolin, Poltrona Frau, Salvatore Ferragamo, Tod’s and Yoox were also held but not open to the press.

Morante, a high-profile entrepreneur-cum-in-vestment banker, has been eyeing a listing for some time, and was asked on the sidelines of the presen-tation if the venue marked a deeper interest in the Bourse. Morante did not set anything in stone, but said he was intrigued by the successful Brunello Cucinelli IPO earlier this year. “We share a similar dimension and a luxury product, so it is a reference point for us,” said Morante, who added he was plan-ning to compare notes with Cucinelli.

Responding to questions about a possible take-

over by a conglomerate such as PPR, frequently rumored to be interested in Pomellato, Morante said it is “normal” as the number of global and in-dependent jewelry brands in the range of Pomellato is not large. However, Morante said the Rabolini family, which owns the brand, is not looking to sell. “Of course, it’s up to the founder [Pino Rabolini], but [the owners] are happy to be independent,” said Morante. In fact, the executive said Pomellato has expressed interest in buying the 18 percent of

shares owned by the Damiani family, which last year assigned Mediobanca a man-date to explore offers. “But we never reached an agreement,” he explained.

Pomellato is expected to close 2012 with sales of 151 million euros, or $194.4 million at current exchange, up 9.7 per-cent compared with last year, and up 50 percent from 2009. Gross profit is fore-cast to reach 14.2 million euros, or $18.3 million, up from 13.5 million euros, or $18.7 million at average exchange, in

2011 and earnings before interest, taxes, depreciation and amortization, or EBITDA, are expected to total 22.5 million euros, or $29 million, compared with 20.1 million euros, or $28 million, last year.

The company has been investing in retail, dou-bling the number of stores over three years, which are expected to total 87 by December. Exports in 2012 are slated to account for almost 57 percent of sales. Sales in the U.S. in 2012 are expected to ac-count for 12.1 percent of total revenues compared with 6 percent three years ago.

WWD.COM2 WWD FRIDAY, OCTOBER 12, 2012

Carrefour Turnaround Gains Traction

TO E-MAIL REPORTERS AND EDITORS AT WWD, THE ADDRESS IS FIRSTNAME_LASTNAME@FAIRCHILDFASHION.COM, 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 204, NO. 77. FRIDAY, OCTOBER 12, 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. For New York Hand Delivery Service address changes or inquiries, please contact Mitchell’s NY at 1-800-662-2275, option 7. 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 condenast@theygsgroup.com, 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

Burberry said Thursday it will continue to open as many as 10 stores in Mainland China each year, in line with its original strategy. PAGE 1 J.C. Penney chief executive officer Ron Johnson sent out his monthly letter to consumers Thursday, which included an invitation to visit the “new and improved jcp.” PAGE 1 J. Crew is reentering the Asian market with an edited collection of its women’s and men’s wear at Lane Crawford stores in both Hong Kong and Beijing. PAGE 4 Brian Atwood’s first flagship will open today at 655 Madison Avenue in New York. PAGE 4 Leonardo Ferragamo has rushed to the defense of his hometown, Florence, following disparaging comments about the city by Fiat Chrysler’s Sergio Marchionne. PAGE 4 Versace will launch Eros, its first men’s fragrance in five years, with a zinger that’s a bolt out of the blue. PAGE 6 The up-and-coming brand E.l.f. Cosmetics is gaining traction by taking the road less traveled — first launching online and then building its retail business. PAGE 6 Caudalie, Norstrom and Intelligent Nutrients are set to launch new beauty retail concepts. PAGE 8 In layoffs company-wide, Condé Nast eliminated roughly 60 positions this week, with midsized magazines — Self and Brides — the hardest hit. PAGE 9 “Seven Psychopaths” director Martin McDonagh joined a few of the film’s stars a screening at Chelsea Clearview Cinemas in New York. PAGE 10 Despite missing full-year earnings and sales targets, Fast Retailing plans to open between 200 and 300 stores worldwide each year. PAGE 11

Elle Fanning at the Chanel party.

EYE: Blake Lively, Ryan Reynolds, Elle Fanning, January Jones, Diane Kruger and Lindsey Wixson feted the 80th Anniversary of Chanel’s Bijoux de Diamants collection. For more photos, see WWD.com/eye.

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Bergdorf Goodman will house the David Meister Signature day dress collection on the sixth floor. This was incorrect in a story on page 7 Thursday due to misinformation from Kellwood Co., Meister’s parent company.

PARIS — Carrefour SA said sales rose 2.1 percent in the third quar-ter, driven by emerging econo-mies, although Southern Europe continued to struggle as austerity measures prompted consumers to tighten their purse strings.

Carrefour, the world’s second-largest retailer behind Wal-Mart Stores Inc., posted sales of 22.63 billion euros, or $28.3 billion, in the three months ended Sept. 30. Dollar figures have been convert-ed at average exchange rates for the periods to which they refer.

On a constant currency basis and excluding gas, like-for-like revenues edged up 0.2 percent in the quarter.

“The quarter was characterized by contrasting trends between con-tinued growth in emerging mar-kets and a persistently challenging environment in Southern Europe,” chief financial officer Pierre-Jean Sivignon said in a conference call.

Analysts hailed the better-than-expected results as a sign that the reforms being put into place by new chairman and chief executive officer Georges Plassat are beginning to bear fruit.

The turnaround plan involves cutting 600 jobs and abandon-ing the Carrefour Planet hyper-market concept introduced by

his predecessor, Lars Olofsson, who struggled to redress the un-derperforming hypermarket seg-ment and presided over a string of profit warnings.

Plassat has warned that it will take three years to put the com-pany in order, as Carrefour faces a slowdown in consumer spending not only in the euro zone, but also in more recent markets like China.

The retailer has restated its ac-counts to reflect the reclassifica-tion of its activities in Greece and Singapore as discontinued, after it sold its stake in Greek super-market chain Marinopoulos and closed its two stores in Singapore.

Carrefour has not provided official guidance for 2012, but Sivignon said it expects recur-ring operating income to fall within the revised range of 2.07 billion euros to 2.1 billion euros, or $2.61 billion to $2.68 billion, forecast by analysts.

French budgetary measures ap-proved in August are expected to have an impact of 50 million euros, or $64.2 million, on Carrefour’s 2012 accounts, while a planned re-duction in the deductibility of in-terest on debt will result in an es-timated charge of 35 million euros, or $45 million, he said.

Sales in France, its core mar-

ket, rose 1.2 percent in the third quarter, helped by a rise in fuel sales as a result of the re-tailer’s “low price guarantee” launched in hypermarkets in May. Excluding petrol, like-for-like sales in French hypermarkets fell 3.3 percent during the period.

Sivignon noted that this marked an improvement over the 5.7 percent drop in hypermar-ket sales recorded in the second quarter, adding that the retailer has seen a “slow, gradual improve-ment” in its price perception on the domestic market.

Sales in the rest of Europe were down 2.2 percent, with Italy posting an 8.3 percent drop and Spain recording a 3.2 percent decline. “This constitutes a resil-ient performance, given the tough trading environments in which we are operating, in particular in the south of Europe,” Sivignon noted.

Turnover in Latin America rose 5.2 percent during the quarter, with sales in Brazil — Carrefour’s sec-ond largest market — edging ahead by 0.1 percent.

Meanwhile, turnover in Asia jumped 12.3 percent, although like-for-like sales in China were down 6.1 percent as consumers adjust to slower growth, despite a rise in the minimum wage. — J.D.

PARIS — French department store chain Printemps plans to open two new stores in 2014, marking first new additions to its retail network in more than 30 years.

Printemps chairman and chief executive offi-cer Paolo de Cesare said an administrative com-mission has approved the retailer’s plan to open a smaller-format department store in the Carrousel du Louvre shopping mall adjacent to the Louvre, the world’s most visited art museum with close to 9 million people per year.

“It’s the first step of a long process, so we are at an early stage of this project, and if everything goes well, we’re talking 2014,” he said.

The 32,000-square-foot unit will take over the space formerly occupied by a Virgin Megastore, de Cesare said, adding that the retailer would build a mezzanine in order to increase the selling space of the store.

“It’s a relatively small format for us, but it’s a good format to express some of our beautiful brands and trends and selections,” he noted.

“We are starting just now to work on it from a commercial standpoint, from a design standpoint, so I think early next year we should be able to commu-nicate a bit more on how we intend to position this store,” he added.

In addition, Printemps plans to open a two-story, 64,500-square-foot store within the seafront Terrasses du Port mall in the southern French city of Marseille in 2014. The unit will carry women’s and men’s ready-to-wear, accessories and beauty, de Cesare said.

“We thought there was an opportunity to con-tinue to go upmarket and go towards luxury, but we didn’t want to do a statutory luxury, so our concept is relaxed luxury, which I think embodies very well our approach to luxury — a bit pioneering, gener-ous and audacious,” he said.

Printemps has 15 stores in France in addition to its Boulevard Haussmann flagship in Paris. Its last store opening was in Marseille in 1982.

— JOELLE DIDERICH

Expanding Pomellato Hints at IPO

Printemps Sets First Openings Since ’82

A Pomellato bracelet.

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4 WWD FRIDAY, OCTOBER 12, 2012

J. Crew Teams With Lane Crawford

Atwood’s First Store Opens

FLORENTINE PRIDE: Despite his reserved nature, Leonardo Ferragamo, one of the sons of the late Salvatore Ferragamo, has rushed to the defense of his hometown, Florence, following disparaging comments about the city by Fiat Chrysler chief executive officer Sergio Marchionne.

As reported by Italian newspaper Corriere della Sera on Thursday, Marchionne, who has recently been involved in a war of words with Tod’s chief Diego Della Valle, called Florence “a small, poor town” during a private conversation in Brussels, where the manager was attending a meeting on the automotive business.

“By nature I’m not someone who enjoys controversy, and I don’t want to comment…but, for sure, as a Florentine, following years of embarrassing sleepiness, now I can say that Florence is emanating a great

positive energy fueled both by private entrepreneurs and the public administration,” Ferragamo said in the Corriere della Sera. “A new wind is blowing, there is still a lot to do, but I feel a good vibe.”

Marchionne, who claimed that his comment was taken out of context from a private conversation recorded by a nonauthorized freelance journalist, explained that he referred to Florence in those terms comparing it to the U.S. The Fiat ceo has publicly criticized Florence mayor Matteo Renzi, who is angling to become prime minister, saying he is not on par with President Barack Obama, who has to govern one of the world’s largest countries. Renzi is often compared to Obama in Italy because of his young and dynamic approach to politics. — ALESSANDRA TURRA

POLETTO EXITS: Furla SpA said Thursday that chief executive officer Eraldo Poletto will leave the company effective Nov. 2 for a new position outside the firm.

Chairman Giovanna Furlanetto thanked Poletto for contributing to the reorganization of the Italian accessories firm — from marketing and retailing to streamlining production and its supply chain, while developing its distribution network and expanding it internationally.

In a phone interview from Mumbai, where Poletto was unveiling a new Furla store, he said he was “very grateful” to Furla and what had been accomplished. “My heart will always be with Furla. It was a difficult and important choice, but I leave a company that is well-organized and well-structured,” he said.

Poletto declined to reveal where he is headed, nor did a Furla spokeswoman have information about the his successor. — LUISA ZARGANI

By ELLEN SHENG

HONG KONG — J. Crew is in town to kick off the fashion brand’s col-laboration with Asian luxury de-partment store Lane Crawford.

The New York-based apparel maker is reentering the Asian market with an edited collection of its women’s and men’s wear at Lane Crawford stores in both Hong Kong and Beijing.

J. Crew chief executive of-ficer Millard “Mickey” Drexler, who arrived for the Hong Kong kickoff party just a day ago, char-acterized the collection at Lane Crawford as “very, very edited,” with more of a focus on the high-er-end J. Crew Collection busi-ness and featuring more nov-elty items, as well as much of J. Crew’s cashmere collection.

Hong Kong customers have “a huge appetite for fashion and are receptive to “newness,” said Andrew Keith, president of Lane Crawford and Joyce, explaining the curated collection’s fashion-forward slant.

To play up the J. Crew launch, Lane Crawford has allotted a roughly 2,700-square-foot space at the center of its store in Hong Kong’s central district. The J. Crew display features some key fashion pieces from the wom-en’s fall collection, such as the Collection bow blouse and skirt in electric plaid or the Collection sequin color-blocked top. There is a separate men’s wear section decked out with a decorative li-quor bar. The displays will be in the Lane Crawford store through the end of October after which J. Crew will be sold in the contem-porary section. Lane Crawford is also selling J. Crew in its Canton Road store in Hong Kong’s Tsim Sha Tsui district, as well as at its Beijing store in Seasons Place.

Of Lane Crawford’s 200-plus women’s wear brands, about 55 percent are in the contem-porary category. According to Keith, contemporary sales are among the fastest-growing as customers become more con-fident and comfortable about mixing and matching contem-

porary with designer brands. “We still have a great designer customer. I think what’s hap-pening is she’s also savvy to the fact that there’s a great product available at contemporary price points. And also what’s happen-ing is contemporary customers are feeling a lot more confident in terms of putting their own looks together,” said Keith. Lane Crawford is seeing strong dou-ble-digit sales growth, despite the slowing economy, he noted.

In addition to the physical location, both J. Crew and Lane Crawford are making a strong push online. J. Crew rolled out worldwide shipping to 107 mar-kets earlier this year. Hong Kong is now J. Crew’s fifth-largest market for online sales. Lane Crawford, which launched online shopping only a year ago, has seen strong demand for J. Crew since its introduction 10 days ago. Lane Crawford reported that online J. Crew sales have contributed to 45 percent of the store’s total online women’s wear business over its first 10 days of trading.

Popular items have remained similar across markets, Drexler said. Some of the best-selling items this season, both in Hong Kong and elsewhere, are the cash-mere polka-dot sweater, boyfriend sweater and 484 men’s jeans.

Meanwhile, J. Crew contin-ues to scope out store locations in Hong Kong and London. “Nothing is signed” yet in London, but Drexler hopes to have something by the end of

the year. Hong Kong is likely to follow. The company is taking a cautious approach with China and doesn’t have any immediate plans to open a store in Beijing or Shanghai.

“It’s an opportunity. Hong Kong is a major fashion center with a lot of potential business for us, and if there are Mainland Chinese customers, we’d cer-tainly welcome them also,” Drexler said.

Millard “Mickey” Drexler at Lane Crawford with some of the looks.

NEW YORK — Brian Atwood has a place to call his own.

The designer’s first shop will open at 655 Madison Ave. today — the culmination of a series of significant initiatives since The Jones Group Inc. acquired the company in June. Last month saw the launch of a U.S. e-com-merce-enabled site, brianatwood.com (a global site will roll out early next year), as well as an ad campaign shot by Mert Alas and Marcus Piggott.

“It’s Old Hollywood, it’s a posh salon. It’s the chicest haven for women who love shoes,” Atwood told WWD on a tour of the 1,450-square-foot store Thursday, picking up a pair of burgundy and black leopard-print, platform wa-ter-snake sandals. “Can we make #chichaven the store’s hashtag?”

The designer himself is active on Twitter and Instagram, and keeping in line with his dedi-cation to the digital space, five styles in the store will contain QR codes so customers can scan the shoes to access “30-second romance” from Atwood. He will continue to do this with his fa-vorite styles each season.

An energetic Atwood, who’s been at the store since 7 a.m., wants to start at the beginning.

“It’s not exactly minimal. It’s like a Fabergé egg,” the designer said, leading the way to a lime-stone facade arch at the entrance of the boutique. Beside it are rich purple Venetian-plaster walls, marble quartz floors, gray velvet seating with rounded arms and vitrines cut like gems. Within these vitrines are items that can be found in the “Vault” section of the designer’s digital flagship, which sells shoes and handbags at “hyperluxe” price points, includ-ing a $4,500 made-to-order pair of 165-mm Swarovski Elements plat-form pumps and a $3,400 black leather minaudière with gold in-laid chains and spikes.

The space, designed by William Sofield, will carry the largest selection of the designer’s shoes and handbags in the world. Divided into four sections — or

salons, as Atwood prefers to call them — two house designer shoes, and there’s one each for contem-porary B Brian Atwood footwear and handbags.

Every pair of shoes sold at the store has a small gold “655 Madison” plaque on the shank of the sole — giving a unique added element to consumers who opt to shop at the store. Atwood said this is something he plans to im-plement at each of his stores as they open.

By 2017, Atwood plans to have opened 12 additional stores, with the next opening in 2013. He lists places such as Los Angeles; São Paulo, Brazil; London, Russia, and Asia as targets for future doors — noting that the fastest-growing markets for the brand are South America and Russia.

Additionally, Atwood would like to grow the handbag portion of his business. Styles range from simple python envelope clutches to a fuchsia calf-hair shoulder bag with a red leather strap. Atwood hopes this store will help him un-derstand what the client wants, and gravitates to, in the category.

The next category for the designer will be jewelry. In November, Atwood will introduce a six-piece capsule jewelry collec-tion containing cuffs, wrap brace-lets and chokers (each piece comes in gold or hematite) to be sold ex-clusively at the Madison Avenue store and brianatwood.com.

— RACHEL STRUGATZ

Johnson’s Thank You to JCP Customersthere were still some customers who hadn’t yet been to jcpenney since we launched our transformation.

“Ron wanted to personally invite customers out to our stores and have the first $10 be on us.” She also emphasized that the invitation does not reflect in any way a departure from the retailer’s “Fair and Square” every day low prices.

When pressed further via e-mail on whether Thursday’s gift was a one-time offer, the spokes-woman replied, “We haven’t made any decisions at this time. However, we are looking to expand our loyalty program with additional incentives.”

According to Walter Loeb, a former retail ana-lyst who now heads up consultancy firm Loeb Associates, “I think it’s the beginning of couponing again. He’ll do more when he discovers the custom-ers react favorably to that.”

Shares of J.C. Penney on Thursday rose 8.4 per-cent to close at $26.18 in trading on the New York Stock Exchange. One sign of good news for inves-tors is a comment Chip Bergh, Levi Strauss & Co. president and chief executive officer, made Tuesday in an earnings call citing the 700 units with Levi’s shops-in-shop in remodeled stores had experienced “dramatic positive improvement.” That compares

with those stores not yet converted, which seemed to follow the “overall J.C. Penney decline.”

Sales have been decreasing since February when Johnson decided to do away with coupons and sales events. It was part of the plan to overhaul the shopping experience and wean consumers off discounts. In addition to Levi’s, other shops rolled out at select stores include Sephora, Liz Claiborne, Izod and Arizona Jean Co. Other shops in the works include Joe Fresh, Cynthia Rowley, Maidenform and Vanity Fair.

“The collective shops are comping 20 per-cent better than the rest of the store,” according to Johnson.

In a research note last month following a tour of the Penney’s prototype, Citi Research analyst Deborah Weinswig said, “We found the JCP proto-type store to be inviting and exciting, with brighter lighting and ample mannequins to better showcase an impressive array of trendy product.”

She also said that she believed that the “new JCP will offer a shopping experience unlike any other in apparel retailing.” The analyst noted that since the Levi’s roll out, Haggar, Dockers and Disney have signed on. She concluded that more will follow given the “better-than-expected results” from the Levi’s shops-in-shop format.

{Continued from page one}

FASHION SCOOPS

Brian Atwood’s flagship in

New York City.

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WWD.COM

By JESSICA IREDALE

THE FIRST THING one notices when entering Stephanie von Watzdorf ’s ex-pansive, sun-flooded office, located on the fifth floor of 10 Crosby Street in New York, is the size of her couch. An extended sectional with seats deeper than a daybed, it’s bigger than many one-bedroom apartments in Manhattan and forms the centerpiece of a lush show-room. Von Watzdorf envisions it as a sort of Moroccan-style salon, where guests are invited to “discover” her exotic world of things picked up from and inspired by her travels — specifically Figue, her new collection of seasonless clothes.

To the left of the world’s largest couch are racks of colorful designs, from which von Watzdorf pulls out what she calls “the perfect caftan” in a colorful silk print with

beading done in Bombay. One is inclined to wonder if the market needs another caftan, but von Watzdorf ’s version exudes the kind of moneyed, bohemian nonchalance that presumably impressed Tory Burch when she hired von Watzdorf as her founding vice president of design seven years ago, launch-ing Burch into the lifestyle stratosphere. But while Burch’s empire roots back to the waspy suburbs of Philadelphia, authen-tic aristocratic boheme runs deep in von Watzdorf ’s bloodlines.

Her maternal grandfather was Leonide Massine, the legendary choreographer of the Ballets Russes, who had two children with von Watzdorf ’s grandmother, Tatiana Massine, a ballerina and the third of his four wives. Von Watzdorf was born in Paris and spent summers on L’Isola dei Galli, a small island in the Mediterranean Sea be-tween Portofino and Capri, which Massine bought in the Twenties as an outpost on

which to rehearse with his students. “He worked with everyone from Matisse to Picasso, to Dalí — you name it and they all collaborated on incredible ballet pro-ductions,” says von Watzdorf, a tall blonde with brown eyes, dripping in ethnic jew-elry. “I was surrounded with dancers and musicians and opera singers. For me, it was very normal, but clearly not everyone grew up that way.” Then there’s her fa-ther, Stephan von Watzdorf, an art dealer, who was born in Dresden, Germany and left during the War for Paris. Next to her mood board are family photographs, shot in St. Barth’s by Slim Aarons.

Figue is named for the fig trees on the L’Isola dei Galli because “they’re sweet, feminine, a little exotic and very reminiscent of the Mediterranean,” says von Watzdorf, who studied at Parsons School of Design and whose 20-year design career has included stints at Ralph Lauren, Giorgio Armani and Ann Taylor. She had produced a single season of the Figue collection when Burch came calling. “I understood her vision and it was very much in sync with what I was doing,” she said. “I didn’t think I would last that long but it was great and it was fun.”

Three years ago, von Watzdorf decided to get back to her own concept, which she describes as “a real bohemian gypsy spir-ited thing.” The collection is priced in the advanced contemporary range, from $150 for an embellished T-shirt to $1,600 for a custom jacket.

The idea is layered pieces that look like they came from an exotic locale and can easily be packed up to travel to one. Silk tunics come in colorful ikats with pompom tassels, tuxedo shirts have multicolored se-quined bibs and silk dresses feature blown-up photographic insect prints. There are leather jackets, shearling vests and shaggy alpaca fringed sweaters and ponchos knit-ted by a group of women in Bolivia.

Another signature: recycled military jackets that von Watzdorf has custom-ized — one-of-a-kind — with fabulously kitschy embroidery. One style is deco-rated with an Egyptian pyramid on the back. Another has evil eyes. Accessories include chocolate brown suede fringe totes, neon lambskin zip pouches and iPad cases, and pompom bags.

It’s an impressive offer for a launch, and von Watzdorf has not done it alone. Figue’s chief operating officer is Sabina Schlumberger, who is married to Wilfrid Shlumberger of the Sao Schlumberger clan. After earning her M.B.A. from Sloan, she worked with fashion startups including an early Chris Burch project Winter & Miggs, Roberta Freymann and JC de Castelbajac, when it was launching in the U.S.

Von Watzdorf and Schlumberger are showing to a handful of specialty stores, but, to start, the primary retailer for the collection will be figue.com, which launches Tuesday. Eventually, the site will sell all the extras — elaborate sculp-tural necklaces from Indonesia, Swiss dog collars and Beryll sunglasses von Watzdorf already has for sale in her showroom — plus more. “I want to do fa-

vorite sun creams and lip gloss, maybe ‘Stephanie’s favorite

things,’” said von Watzdorf. “People always ask me,

‘Where did you get that?’ Here, you can

buy them.”

5WWD FRIDAY, OCTOBER 12, 2012

Figue: Fruits of an Exotic Family Tree

I was surrounded with dancers and

musicians and opera singers. For me, it

was very normal, but clearly not everyone

grew up that way.— STEPHANIE VON WATZDOR

PHOTOS BY LEXIE MORELAND

Stephanie von Watzdorf

Inside Figue’s studio in downtown New York.

Looks from

Figue.

FOR MORE PHOTOS, SEE

WWD.com/fashion-news.

By BELISA SILVA

AUSTRALIAN COLOR COSMETICS brand Becca is looking to build from its foundation up, with a focus on reestablishing itself as a diverse color-matching authority.

“We are a beauty brand, but with a particu-lar strength in the complexion category,” said Rebecca Morrice Williams, founder and creative director for Becca Inc. “Our mission always has been to have the right shade for everyone.”

After exiting distribution in Sephora stores in 2008, Becca will return to the chain next week with a renewed brand image and edited product assortment. The rollout will begin in 23 doors, with a plan to expand into more than 200 doors in the coming year, including between 50 and 100 Sephora outposts in J.C. Penney.

Industry sources believe Becca could gener-ate $15 million beginning this month to October of next year, a number that represents more than triple what the brand earned during the same pe-riod last year.

Becca exited Sephora due to “functional is-sues,” said Robert W. DeBaker, president and global chief executive officer, and was sold for a brief time in the Duane Reade Look Boutiques. The brand was pulled from the drugstore chain in May, because DeBaker wanted to partner with a retailer with more of a global reach. Already available in 30 countries like the U.K., Australia, Singapore, Germany, Hong Kong and Russia, DeBaker has plans to take his relaunch strategy global, beginning with key markets — including Australia and the U.K. late next year.

To get the brand back to its origins, DeBaker began by researching its past. He quickly learned that Becca’s DNA was centered on the offer of an ample complexion shade range. “Becca helps us deliver broad shade ranges that cover a multieth-nic woman, who now accounts for over 30 percent of clients,” said Alison Hahn, vice president and di-vision merchandise manager for color at Sephora. “It’s not that Becca has the most shades, but they have the right shades.” DeBaker also scaled back Becca’s 360 active stockkeeping units to 160, phas-ing out products that underperformed or seemed extraneous to the lineup. One hundred of the re-maining sku’s are in the cover-up category.

“Becca has worked to focus the line on top-pro-ducing sku’s,” said Hahn. “We have gotten rid of a lot of the noise and honed in on complexion and the perfectors.” A Shade Match Selector Wheel, which will be featured alongside the Becca assort-ment, will allow Sephora customers to find their shades and there will be a heavy emphasis on sampling a variety of hues.

Over the next 15 months, Becca will introduce three additional foundation formulas and a new concealer. Radiant Mineral Powder Foundation, $40, is launching in November, while Radiant Skin Creamy Concealer, $32, will bow in January. Three additional face products, Matte Skin Shine Proof Foundation, $42, Matte Skin Poreless Priming Perfector, $35, and Blotting Powder Perfector, will all roll out beginning in April.

In the second quarter of 2013, Becca will re-launch its Web site with a renewed focus on e-commerce and content. The site will include vid-eos, digital master classes, a library of historical Becca imagery and access to live “conversations” with national makeup artists.

By PETE BORN

FOR VERSACE’S FIRST men’s fragrance in five years, Donatella Versace delved deeply into Greek mythology to find the key to scent’s positioning: unbridled sexual attraction.

“This was very important for us,” she said this week of the scent developed by Versace’s fragrance licensee, Euroitalia. “I have focused a lot on men’s re-cently, and this was a chance to do something different for men, some-thing that speaks of desire.”

The result was Eros, named after the Greek god of love and the son of Aphrodite. The Greek allusions are a bow to the fash-ion house’s late founder Gianni Versace, who grew to love Greek history and mythology while grow-ing up in the seaside province of Calabria in southern Italy. His sym-bol was the head of the goddess Medusa, which adorns the bottle’s face and the top of the cap. The an-cient Greek key symbol is molded into the front and back of the see-through flacon, which is colored in a special blue to capture the par-ticular hue of the Mediterranean.

Claudio Tenan, export director of Euroitalia, said the color was achieved by mixing existing shades of blue into a new color. Giovanni Sgariboldi, president of Euroitalia Srl, which is based in Cavenago di Brianza outside Milan, agreed that every effort — in the juice, the packaging and the advertis-ing — was made to produce “a very Versace” fragrance.

“For me the fragrance is very iconic, it’s really the DNA of Versace,” added Donatella Versace. “We have the Greek motif that makes you think of ancient Greece and antiquity, mythology, and the color turquoise represents the Mediterranean. It’s very Versace.”

Her thinking ran straight through the advertising, which, complete with thunder and lightning bolts, shows an armor-clad warrior shooting an arrow through an ex-ploding bottle of fragrance. It’s not exactly the cuddly Cupid of Rome tickling lovers’ hearts.

“For the model, I wanted a gladiator who fights for what he wants, who fights to attain his goals,” Donatella Versace said of Brian Shimansky, who appears in a commercial produced by Mert & Marcus under her creative direction. “This is a fragrance for man who is a master of himself. He is a hero: someone who defends his ideas and opinions.”

The fragrance, designed by Aurelien Guichard from Givaudan, is described as a fresh, woodsy oriental. The top

note contains mint oil — capitaliz-ing on a trend — lemon Italy Orpur and green apple. The heart in-cludes tonka bean, Venezulan am-broxan and geranium flower, giving the formula a hint of fougère.

The fragrance will be unveiled later this month at the Tax Free World Exhibition in Cannes, France, and launched in Italy in November, then rolled out to the rest of the world, starting in spring 2013.

Sales projections were not bro-ken out, but industry sources es-timate that global sales could hit $100 million at retail for the first full year on counter. An estimated 25 to 30 percent of that total could be generated in the U.S.

Connie Ruscio, general man-ager of the U.S. distributor, Fragrances Elite, said Eros could be Versace’s top men’s scent in the U.S. Eros will be launched in the U.S. in March with an exclusive at Macy’s. Then the line will be rolled out to the balance of the 2,200 door distribution. In terms of American

pricing, the 1.7-oz. eau de toilette spray will be priced at $60, the 3.4-oz. size will be $80, the deodorant stick will be $26, the aftershave balm $25 and shower gel $35.

The TV commercial will figure prominently in the promotional package. Co-op TV will be done with Macy’s for Father’s Day and Euroitalia will make liberal use of the commercial in Europe. In general, Tenan said the company is making largest use of TV it ever has. In the U.S., the company is advertising its top-selling Bright Crystal fragrance at Christmas for the first time. For the holidays, Eurotalia will be doing more TV than print during the holidays in Europe.

WWD.COMWWD FRIDAY, OCTOBER 12, 201266

PHOT

O BY

THO

MAS

IANN

ACCO

NE

An assortment of Becca products.

E.l.f. Ramps Up Offerings

Becca Staging Brand Comeback

Versace to Launch Eros for Menbeauty

NEW YORK — Breaking into the mass-market color cosmetics busi-ness is not for the faint of heart. Even powerful players have tried to intro-duce new color brands and failed — Procter & Gamble Co.’s Olay brand, and Revlon’s Vital Radiance and Jane Cosmetics, which at one point was owned by the Estée Lauder Cos. Inc.

Against the odds, the up-and-com-ing brand E.l.f. Cosmetics (Eyes. Lips. Face.) is gaining traction by taking the road less traveled. The brand launched online first and is building its retail business.

“We’re disruptive be-cause we do things differ-ently,” said E.l.f. founder and chief executive offi-cer Joseph Shamah.

Industry sources es-timate that E.l.f. is about a $50 million business, and roughly 70 percent of its sales are generated in stores. It counts Target and Walgreens among its retail partners. E.l.f. Studio, which is positioned as a professional makeup artist line, will be featured in an exclusive depart-ment at a Walgreens set to open in Hollywood.

Next year could prove to be the real test of Shamah’s disruptive course. The company plans to unleash its largest collection of new items to date: 144 stockkeeping units across a number of new categories. The brand

also is looking to expand beyond Target and Walgreens to other discount and drugstore and even food chains. In some cases, the brand aims to gain a foothold with new retailers with seasonal programs. The company’s close ties to the ap-parel business through Shamah’s family also enabled E.l.f. to distribute its color products in stores such as Forever 21, Urban Outfitters and Ross.

The brand is moving full-throttle ahead, said retail executives, with

an arsenal including more nail color — holiday gift

sets with 15 colors for $15 — new eye shadow quads, “chubby” lip stains, an eye refresh item with a roller ball and potentially BB creams and other cor-

rective skin care. E.l.f. also remains

committed to e-com-merce. Its digital effort al-

lows for deep product assortments that stores can’t accommodate, said Shawn Haynes, vice president of re-tail sales. The devoted E.l.f. consum-ers serve as a “test” market to identify the biggest hits, which can roll out to stores, he said. For instance, Studio Mascara & Shadow Shield — an item so hot that one can’t even be found in E.l.f.’s New York showroom — was a hit online first. The tool is held below the eye during makeup application to

reduce smudges and shadow over-

flow. Other items aiding online sales

included baked eye shadow palettes, High

Definition Blush and Mineral Primers in the Studio line.

In the same vein, E.l.f.’s online business can sift out failures and eliminate them quickly instead of having a flop in stores.

While e-commerce pro-vides a testing ground, Shamah doesn’t believe it detracts from demand in stores. “It is a dif-ferent consumer online and for those who like the products in the store, they can go online to find more of our items. We have thousands of stockkeeping units online,” he said.

The majority of price points range from $1 to $3, but E.l.f. has been able to trade consumers up to

its Studio line priced at $6.However, Shamah said the moder-

ate price points inspire more multi-ple sales. “If retailers ask, ‘Aren’t the lower prices driving dollars down,’ we can show that people buy more and build a bigger basket,” he said. Shamah said one retailer moves four times the pieces of E.l.f. than many other makeup brands producing in-ventory turns for the line that are at least twice the industry average.

criticalmassFaye Brookman

by

An ad visual for Eros.

E.l.f. Studio Mascara & Shadow Shield

15 NYC LOCATIONS. 200 BRANDS. 13,000 PRODUCTS.

BEAUTY MOVESFORWARD

SEPHORA.COM

WWD.COMWWD FRIDAY, OCTOBER 12, 201288

What’s in Storebeauty

Caudalie, Nordstrom and Intelligent Nutrients are set to launch new retail concepts.

Nordstrom is aimiNg to add to its already robust hair business by testing salon brand aveda in 16 of its doors, starting in November.

“Hair care has been a part of our mix as we’ve al-ways wanted to explore the total look — but right now hair care is a category that does extremely well for us, and it’s still growing,” said Laurie Black, general merchandise manager and executive vice president for cosmetics at Nordstrom inc.

this marks aveda’s first entry into department and specialty store distribution, following sister brand Bumble and bumble’s move to do the same several years ago. Bumble is now sold in sephora, Bloomingdale’s and other retailers, in addition to salons. it is unknown if aveda will choose to expand its department store and specialty store distribution to additional retailers.

Nordstrom currently carries a range of shampoos, conditioners and styling products, including Frédéric Fekkai, Kiehl’s, oscar Blandi, L’occitane, Philip B., Phyto and Living Proof. the retailer also carries hair tools and hair accessories.

the Nordstrom doors installing the “Experience Centers” are located at Chandler Fashion Center in Chandler, ariz.; arden Fair mall in sacramento, Calif.; irvine spectrum Center in irvine, Calif.; Cherry Creek shopping Center in denver; the Village of merrick Park in Coral gables, Fla.; montgomery mall in Bethesda, md.; Northshore mall in Peabody, mass.; West County Center in st. Louis; Fashion show mall in Las Vegas; Providence Place in Providence, r.i.; North East mall in Hurst, tex.; NorthPark Center in dallas; tacoma mall in tacoma, Wash.; alderwood mall in Lynnwood, Wash., and dulles town Center in dulles, Va. “We wanted to test this in a diverse group of stores,” said Black. “if it’s a good fit — and we hope it will be — we will consider moving it into other stores.” Black said the length of the testing period has not yet been defined and added that the aveda space in each door would be tailored to its store size and market.

Neither Nordstrom nor aveda would discuss sales projections, although industry sources estimated that the installations could add an average of $200,000 in each door in their first year of operation.

the Estée Lauder Cos. inc. acquired aveda from founder Horst rechelbacher in 1997, in a $300 million cash deal. — Julie NaughtoN

CaudaLiE, a sPa and skin-care line rooted in the French wine country of Bordeaux, is sprouting new branches in New York with the opening next week of a boutique at Lexington avenue and 74th street. a second, larger store is also on the way, scheduled to open down-town in greenwich Village at the end of November.

the strategy of Caudalie’s founders — mathilde and Bertrand thomas — is to use the shops as consumer re-cruitment and awareness builders for their main base, the 8,000-square-foot Caudalie Vinothérapie spa at the the Plaza, which opened in 2008.

Caudalie has 10 spas in the world and a global vol-ume of 100 million euros, or $129 million at current exchange, according to industry estimates.

the boutique that is expected to open next week measures about 300 square feet. the second store, located at Bleecker and grove streets in the Village, has 500 square feet of space, which mathilde thomas proudly calls “the worldwide flagship of Caudalie.” Bertrand thomas noted more than once that the cou-ple’s intention is not to open a new vein of retail distribution. in addition to the Plaza spa, Caudalie’s 60-stockkeeping-unit face- and body-care range is already carried in 500 u.s. specialty stores — sephora, Blue mercury, space NK, Nordstrom and 120 independent boutiques.

the goal is to connect with new customers and tell the story of Caudalie and its derivation from the wine-growing process. “We want them to feel the story, to feel the values of the brand,” Bertrand thomas said, noting that the couple is putting its toe in the retail waters with a sense of humility and modest commercial hopes. the most prominent wall space is devoted to a display called the history wall.

“You’ll be able to understand how we produce the ac-tive ingredients,” Bertrand thomas said. “We think the

new customer, they vote with their dollar. they buy the product if they agree with the values of the brand. We want to tell people there is a genuine story, there is a doctor, there is a woman who is committed behind each formula.”

another prominent feature is a countertop island, whose sides are clad in the same oak wood used in the cooperage at the couple’s Bordeaux vinery. it therefore has been dubbed the “beauty barrel.” a video wall will flash images from their Bordeaux estate.

Bertrand thomas points out that a very small percentage of the space is dedicated to actually selling product.

to win over customers, licensed aestheticians in the boutique — generally the manager — will give shoppers quickie facial treatments. Bertrand thomas noted, “We know that if we tell you, ‘give us two hours,’ you are going to say, ‘No.’ We know if we tell you,

‘Buy this product, it’s great, in two months you’ll see a result,’ you are not going to buy it. this is a showcase for Caudalie. [if we] say, ‘Come learn more about our history and if you can give us seven, eight, 10 minutes of your time, we will make our best effort to meet your expectations.’”

While the owners’ primary objective is not profit, at this point, clear-ly there is little appetite for losing money. No

projections were provided, but industry sources calculate — based on size and location — that Caudalie’s average break-even point is $1 million a store.

the owners have created what they call “urban spas” within existing spas around the country, where five signature Caudalie treatments are offered. While the thomases say they are not interested in opening more boutiques in this city or country, the company is on the verge of opening units in shopping malls in são Paulo, Brazil, and Hong Kong. “that proves the goal is not to roll out all over the u.s. and try to be better than all the retailers,” said Bertrand thomas. “the goal really is to establish the brand awareness.”

— Pete BorN

iNtELLigENt NutriENts is giving its organic product offering a high-tech spin for its first brick-and-mortar out-post, a 1,000-square-foot space in the mall of america.

set for a soft launch on Black Friday, the store will officially open its doors the following week, according to brand presi-dent tyler Heiden Jones.

“We always knew we wanted an expe-riential bricks-and-mortar element to our business,” said Heiden Jones, who added that the brand derived much of its inspi-ration from apple stores’ “ability to ani-mate a retail experience. We believe that using technology allows the consumer to control just how much product informa-tion they want, when they want it and how they want it,” he said. “and [just] think of all the brochures we don’t have to print.”

to that end, the intelligent Nutrients store and sales associates will be equipped with a number of apple de-vices — from iPads to iPhones — that allow for various levels of service. For example, sales associates can conduct full checkouts on the sales floor and e-mail receipts to the consumer, forgoing the traditional cash wrap and even the need for shopping bags. For those cus-tomers who prefer a more informative

experience, no less than five iPads will sit on the sales floor, each featuring edu-cational material about the brand and its offerings. “if you want to buy a product, in a New York minute you can do that. if you want to get into a more detailed discussion about ingredients and being proactive about protecting yourself, your family and the environment, we can do that,” said Heiden Jones, who added that the brand’s Web site will also be updated and relaunched in November. “[intelligent Nutrients] is not only about giving intelligent choices to consumers, it’s about educating them.”

the store will feature a private back room for hair services, including blow-outs and scalp massages and treatments. Complimentary energy reading services will also be offered, which calculate cli-ent’s energy levels with a biofeedback ma-chine before and after sampling intelligent Nutrients products. “the back room will be built on experiential component that shows how products work instantly,” said Heiden Jones. designed with in an eco-luxe positioning, the outpost will also feature soundproofing that filters outside noises and keeps consumers immersed.

in order to take the idea of naturals out of the “granola” realm into the mod-ern, the outpost’s color scheme will re-

flect a “sophisticated neutral” palette. “When [guests] walk in, it’s going to feel like a cocoon,” said Heiden Jones. “it will be an oasis within the mall.” although the brand declined to break out figures, industry insiders believe the intelligent Nutrients store could gener-ate at least $1 million in its first year.

to differentiate the store from the online shopping experience, Heiden Jones said a number of in-store exclu-sives will be offered, including a range of private collection aromas and body heal-ing items, formulated for the location by intelligent Nutrients’ founder, Horst

rechelbacher. “it’s about creating that experience you can’t get purely online,” said Heiden Jones, adding that the mall of america draws in 55 million people a year, a number that represents more than those who visit to disneyland and disney World combined each year. “if you don’t have a point of differentiation to cre-ate an experience at point of service in brick-and-mortar, why do [customers] need to go to you?”

Looking to the future, Heiden Jones said discussions are underway for a second store to be opened in New York next year. — Belisa silva

Nordstrom

Intelligent Nutrients

Caudalie

A sketch of the Intelligent Nutrients store.

A rendering of the Caudalie boutique.

w12a008a;9.indd 8 10/11/12 7:02 PM10112012190318

PHOTO BY STeve eicHner

MeMo pad

WWDSTYLE

In the BlackNEW YORK — Chanel celebrated 80 years of fine jewelry with a moodily lit dinner on Tuesday, though there were plenty of baubles and starlets, including Blake Lively, to cut through the dark. For more, see page 10.

cOrniSH iS Game: actress abbie cornish weighs in on her lack of mental issues at the “Seven Psychopaths”screening. PaGe 10

TOUGH DaY: In layoffs company-wide, Condé Nast eliminated roughly 60 positions this week, several sources said.

Most brands were affected, though midsize magazines — Self and Brides — were hardest hit. Pink slips even went out on the 18th floor, at the corporate communications office, where two staffers, including a corporate vice president, Susan Portnoy, were let go.

The layoffs, which began Wednesday morning and continued through Thursday, came after Condé, which owns WWD, had already asked brands to cut back 10 percent off their annual budgets. The latest round of cuts are related to next year’s business plans.

On Thursday afternoon, after a grim day at 4 Times Square, chief executive officer charles Townsend sent an internal memo attributing the layoffs to “the challenges of the U.S. economy.” He said no additional announcements related to next year’s budget are expected.

Brides let go about five staffers on the editorial side, though some have been asked to work part time. Some have not been informed because they were attending bridal shows taking place this week. Six employees were dismissed in business. The magazine appointed a new editor in chief, Keija minor, in September.

At Self, eight editorial and three business staffers were let go, WWD confirmed; the layoffs at the magazine and corporate communications were first reported by the New York Post.

Condé Nast Traveler, GQ and Wired each lost at least one editorial staffer, sources said. It’s not clear what other positions throughout the company were eliminated.

Portnoy had been with Condé for more than six years, and as part of her portfolio, she also handled media relations for Fashion’s Night Out. A decision has not been made as to who — corporate communications or Vogue — will play that role in next year’s event.

Portnoy’s duties in the corporate office will now fall to a senior vice president, Patricia Steele. Though no final decisions have been made, the office itself, overseen by chief administrative officer Jill Bright, may be reimagined to focus more broadly on corporate branding. — eriK maza

rOiTFeLD JOinS Bazaar: carine roitfeld on Thursday was named global fashion director of Harper’s Bazaar.

Roitfeld had been working on her own magazine, CR Fashion Book, since she left Condé Nast’s French Vogue in 2010 after 10 years in the role.

At Harper’s, she’ll work with creative director Stephen Gan, her collaborator on Fashion Book, on several stories a year, including covers, for all international editions of the magazine. She starts in March.

“Carine is one of the fashion world’s most influential tastemakers, and we look forward to seeing what she does with Bazaar,” said Hearst Magazines president David carey.

Roitfeld also added she won’t stop working on the biannual Fashion Book or other projects. — e.m.

cOrniSH iS Game: actress abbie cornish weighs in on her lack of mental issues at the Seven Psychopathsscreening. PaGe

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“IT’S SO WEIRD and dark in here,” Rose Byrne said to a friend shortly after arriving at the former site of the Museum of Folk Art in Manhattan on Tuesday night for a dinner to toast Chanel’s latest fine jewelry collection. The Midtown space was so dimly lit that it could only be described as cavernous. Yet even through the darkness, one could make out a sea of tweed, chain straps galore and the blinding bijous adorning the ears, necks and hands of the evening’s attendees, including Blake Lively (her new hubby, Ryan Reynolds, hightailed it inside to avoid being photographed), Elle Fanning, January Jones, Diane Kruger and Lindsey Wixson.

The sparklers were all procured from the couture house’s new high-jewelry line, a reimagination of Gabrielle Chanel’s first fine-jewelry collection, Bijoux de Diamants, created 80 years ago. During cocktails, revelers were led into a separate planetarium room, lit by a projected starry sky above, to take in the objets d’art on display. The collection, aptly named 1932, is a riff on Gabrielle Chanel’s signature motifs: comets, feathers and ribbons conceived in an assortment of white, yellow and black diamonds, blue and pink sapphires and pearls.

The lucky few who borrowed a bauble or two for the evening were mindful of their finery.

“They were delivered with a guard,” said Nora Zehetner of the diamond-encrusted pair dangling from her ears. “I think they’re worth more than everything in my apartment.”

Byrne also erred on the side of caution.

“We originally were loaned clip-ons, but I put them on and I was like, ‘Listen, I can’t. These will fall off,’ ” the actress said. “I’ve got tiny ears!”

Kruger opted for a single earring instead of a pair.

“It’s purposeful. I wanted to be less classic, and it goes with my hair,” Kruger said of her half-gilded look, which complemented her coiffure, swooped over her bare ear. Lively was in the clear, as there was no chance of her misplacing her jewels.

“This dress is actually held together by jewelry,” she said of her plunging gown, literally held together by diamond fasteners.

The newlywed was on her toes when it came to questions about her recent nuptials. When she was asked what her most treasured jewelry piece is, her hovering p.r. rep shook her head as if to signal to the starlet to sidestep the engagement ring-wedding band trap.

“My grandma’s old watch,”

Lively demurred before rushing to her dinner seat.

After the first course, a trio of crudo, was cleared, a smoky mist filled the room, indicating that the broody Brit indie rockers The xx were about to take the stage. Lively and Reynolds sat quietly front and center, politely taking in the performance. At a neighboring table, Leigh Lezark and Harley Viera-Newton bopped to the music.

“They were really good,” one partygoer said over dessert. “I don’t know who they are, but they were really good.”

— TAYLOR HARRIS

10 WWD FRIDAY, OCTOBER 12, 2012

Paper’s DollsFOR MORE PHOTOS, SEE

WWD.com/eye.

“IT WAS deliberately written to be a Shih Tzu,” Martin McDonagh said Wednesday night as he worked the press line at Chelsea Clearview Cinemas before a screening of his latest film, “Seven Psychopaths.”

The plot centers on the increasingly violent fallout of a dognapping, and WWD was curious if the playwright-turned-director, who is known both for his breakneck dialogue and predilection for mayhem, had settled on the breed for its poetic possibilities.

“I love the image of a Shih Tzu,” he laughed. “But, no, I’m an antipun kind of guy.”

The movie’s marketers didn’t practice such restraint. A poster on an easel over McDonagh’s shoulder displayed a particularly egregious example.

“Not me,” McDonagh said

with a smile. “CBS. Not me. There’s one joke in the film that does play on that. If you’ve seen it, it only happens once. Everything else. The advertising, everything else, is not mine.”

A few of the film’s stars, including Christopher Walken and Sam Rockwell, followed their director down the line ahead of the Cinema Society- and Hugo Boss-sponsored screening. Both rushed by the press line. Abbie Cornish, who has a small role as a put-upon girlfriend, said that she had wanted to work with McDonagh since she read the screenplay for his directorial debut, “In Bruges.” Dressed in a floral-print-accented Roland Mouret dress, Cornish didn’t seem particularly given to any psychosis herself.

“No,” she smiled. “I’m pretty chill.” — MATTHEW LYNCH

Psycho Drama

Dark Matter eye

PAPER MAGAZINE started out more than 25 years ago chronicling the shenanigans of up-and-coming performance artists, club kids and avant-garde personalities. At its eighth annual nightlife awards on Wednesday, the magazine celebrated the stage of the new demimonde — social media.

Cat Marnell and the Brant Brothers were up for best social-media stars. Cory Kennedy picked up that prize. The radio personality Miss Info was a presenter, and an actor named Fabrizio Goldstein was listed under “notable attendees.” Both have big Twitter footprints. Also attending: dubstep superstar Skrillex, Cynthia Rowley, Andrew W.K., Rita Ora, the Washington, D.C.-based rapper Wale and “Girls” actor Alex Karpovsky.

“We’re social-media whores. It’s an event that’s fun for that,” said Mickey Boardman, Paper magazine’s editorial director since 1993.

Accepting her prize,

Kennedy, listed as a socialite in a press release for the event, said the magazine’s editors had known her since she was “very underage.”

Acme and Le Baron were among the night’s other winners, though the awards were really more of an afterthought. Free drinks, exhibitionism and self-promotion were the priorities. Webster Hall, the evening’s venue, won best megaclub.

Boardman’s night had started with a quiet dinner around 6 at Elio’s on the Upper East Side. Jane Fonda and Bravo’s Andy Cohen were his guests.

The question remains, Who’s better company, Barbarella or Cat Marnell?

“It’s a combination for me. At the show, I was watching a gaggle of drag queens, and earlier I was talking with a two-time Oscar winner about Ava Gardner,” he said. “To me, that’s the magic of New York. It’s the whole cornucopia.” — ERIK MAZA

Rita Ora and Wale

Romy Madley Croft of The xx

performing.

Linda Evangelista in Chanel.

Rose Byrne in Chanel.

Abbie Cornish in Roland Mouret with Vanessa Hudgens and Austin Butler.

Michael Pitt and Michael Stuhlbarg

Sam Rockwell

Caroline Sieber in Chanel.

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WWD.COM11WWD FRIDAY, OCTOBER 12, 2012

Fast Retailing Posts Growth, Foresees Asian ‘Gold Rush’

Burberry Strategy on Track Despite Slowdown in Salescollection, and London — outperformed in the period.

In September, Burberry reported that same-store sales were flat, with new stores kicking in the 6 percent sales growth in the 10-week period. As a re-sult, it said adjusted pretax profits for the full year would be “around the lower end” of market expectations.

On Thursday, the company noted that the second-quarter picture had im-proved slightly, with same-store sales rising 1 percent in the full three months, and new stores still contributing 6 per-cent of the overall retail growth.

In the quarter, Burberry cited a “modest improvement” in all three major regions. Comparable-store sales in the U.S. and Europe were unchanged year-on-year, while Asia-Pacific delivered slightly positive com-parable-store growth.

Compared to the first quarter, Hong Kong, France and Germany maintained their “robust” performance, Burberry said, while the U.K. and China slowed. Korea and Italy remained weak.

With regard to the slowdown in China and the U.K., Cartwright said a variety of factors were at play: Gift-giving in China has slowed because of new government regulations, and be-cause of a “macro” slowdown triggered by upcoming elections.

She added that Burberry’s London stores — like so many other fashion and luxury outlets — suffered from the Olympic Games, with footfall in London decelerating in the second half of July and in August.

Locals either refused to travel into the center of town, or they took early holidays to avoid crowds. Olympic tick-et holders tended to congregate at the main sports venue in east London, and most did not spend on luxury goods.

Cartwright said traffic was down generally because the “aspirational customer” was reluctant to spend, while the high-spending customer proved more resilient to the ups and downs of the macro environment.

Burberry also revealed the bare bones of its plans for the beauty and fragrance business, which, until now, has been operating under license with Inter Parfums.

“We’re very excited to be taking the business in-house, which is in line with our strategy” of controlling the brand and its distribution, said Cartwright. She noted that Burberry would be stepping into the shoes of its licensing partner, Inter Parfums, and leveraging the relationships it already has with suppliers, distributors and logistics partners.

“We’re not reinventing anything, and we see this move as a natural evolution of the business,” she said. Fragrance and beauty will be run as the company’s fifth product division, alongside accessories and women’s, men’s and children’s apparel.

In fragrance and beauty, Burberry already controls product design, pack-aging and marketing activities, and the company said it would be making “key senior hires” to support the back end of the business.

To facilitate the transition, the relationship with Inter Parfums has been extended until March 31. Burberry will begin direct operations on April 1. The company indicated it will give more details about the new division on Nov. 7, when full interim results are released.

In a research note on Thursday, Investec, the bank and asset manager, said it felt “slight relief ” in light of Burberry’s profit warning last month.

“The decision to take fragrance in-

house is a small negative (at least until we hear the financials on Nov. 7). We think the retail like-for-like beat will offset disappointments elsewhere,” the bank said in its report.

Deutsche Bank was bullish about the 1 percent increase in second-quar-ter like-for-like sales, and the increase in the average transaction value during the period. “This stabilization, as well as evidence that full-price sales and average transaction value have risen, should provide reassurance to the mar-ket,” the bank indicated.

In the second quarter, wholesale sales fell 1.3 percent to 151 million pounds, or $239 million at average exchange rates for the period, due to the re-phasing of deliveries into the first quarter from the second quarter. In the first half, wholesale sales grew 2 percent to 253 million pounds, or $400 million.

Burberry said that in the second half it is expecting broadly flat under-lying wholesale revenue year-on-year, reflecting the rationalization of certain opening-price-point products in core accessories and outerwear.

As reported, Burberry has phased out the Nova Check, one of the firm’s early iconic patterns with a khaki background and burgundy, black and white stripes. The company admitted the Asia-made Nova Check accessories line was a big, highly profitable busi-ness, but no longer right for the brand.

“With a more cautious approach from [wholesale] customers globally, the United States, Asia travel retail and emerging markets are expected to continue to grow, offset by further contraction of small specialty whole-sale accounts, especially in southern Europe,” the company stated.

Similar to other brands such as Gucci, Burberry has been pruning its network of wholesale clients in countries such as Italy as it pursues a strategy of building its own stores, and focusing on prominent retail outlets worldwide.

In the second half, Burberry said average retail selling space is on plan to increase by about 14 percent. Openings in flagship markets will in-clude Chicago, Shanghai and a stand-alone men’s wear store in London, as well as further stores in Brazil, Mexico and the Middle East.

In the six months to Sept. 30, Burberry revenue climbed 6.4 percent to 883 million pounds, or $1.4 billion.

By KELLy WETHErILLE

TOKyO — Fast retailing Co. Ltd. re-ported double-digit growth for the full year but missed its earnings and sales targets due to lower-than-expected sales both internationally and in its home market of Japan.

The company, which is the corporate parent of Uniqlo, said Thursday that its net profit rose 31.8 percent to 71.65 billion yen, or $910.72 million at average rates, for the year ended Aug. 31. The compa-ny’s previous forecast was for 79 billion yen, or $1 billion at current exchange.

Sales spiked 13.2 percent to 928.67 bil-lion yen, or $11.8 billion, just shy of its fore-cast of 929.5 billion yen, or $11.82 billion.

Operating profit grew 8.7 percent to 126.45 billion yen, or $1.61 billion. That compares with a previous target of 131.5 billion yen, or $1.67 billion.

Fast retailing cut its full-year earn-ings targets but increased its sales fore-cast when it released its nine-month fig-ures in July.

Although the company didn’t break down its results for each quarter, its nine-month net profit, released in July, was 72.5 billion yen, or $922.9 million, mean-ing that Fast retailing posted a small loss in the fourth quarter. A spokesman for the company attributed this to a decrease in tax benefits in both Japan and the U.S.

In Japan, Uniqlo posted sales of 620 billion yen, or $7.88 billion. This was up 3.3 percent from the previous year, but 0.2 percent shy of the company’s own fore-cast of 621.5 billion yen, or $7.9 billion.

Uniqlo’s international business saw sales jump 63.4 percent on the year to 153.1 billion yen, or $1.95 billion, how-ever this fell short of the forecast of 157 billion yen, or $2 billion, by 2.4 percent. In the U.S., where Uniqlo has opened some high-profile New york stores dur-ing the past fiscal year, the company’s operations are currently in the red due to a lack of sales growth and efforts spent on brand building.

At a press conference in Tokyo on Thursday, Fast retailing’s chairman, president and chief executive officer Tadashi yanai reiterated his company’s ambitious plans to become a leading

global retailer by opening between 200 and 300 stores worldwide each year. By the year 2020, yanai said the com-pany aims to have 1,000 stores each in Japan, China, elsewhere in Asia, and in Western countries.

“Greater China, ASEAN and India have a population of four billion, the big-gest [regional] population in the world, and they say that over the next 10 years, between one third and half of those [peo-ple] will become the middle class,” yanai said. “I think it’s an [exceptional] busi-ness chance. I say that this is the ‘gold rush.’ Asia is an exceedingly great busi-ness chance for us.”

yanai also spoke of the huge potential he sees in San Francisco, where he said 1,000 customers lined up to enter the city’s first Uniqlo store when it opened last week.

“There’s Asia within North America, especially on the West Coast,” he said. “Among international students, number one and number two are students from India and students from China.”

The executive outlined plans to open an additional 20 to 30 stores in New york and its surrounding area, plus 20 to 30 in the San Francisco area. He said the company also plans to start global online sales from its offices in San Francisco, and to open doors in European cities such as Berlin, Milan and Barcelona. He said the current economic climate across the world will not make Fast retailing slow its expansion pace.

“I’m always saying this, but there are chances during recessions [because] there are no [other] people who open stores [at those times],” yanai told reporters.

Fast retailing also released its guid-ance for the current fiscal year ending August 31, 2013. It expects net profit to grow 17.9 percent to 84.5 billion yen, or $1.08 billion at current exchange rates. The company forecasts operating profit will increase by 13.5 percent to 143.5 bil-lion yen, or $1.83 billion.

The retailer also is expecting its full-year sales to exceed a trillion yen for the first time, forecasting a total of 1.06 tril-lion yen, or $13.49 billion.

yanai said the company aims to achieve sales of 5 trillion yen, or $63.89 billion, by the year 2020.

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Burberry plans to open as many as 10 stores in China each year.

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