Nike losing teens in footrace with Adidas, analysts say

The investment bank and asset management firm Piper Jaffray released the findings of their latest biannual “Taking Stock with Teens” Survey, MarketWatch reports, and apparently, Nike is losing touch with teenagers. Instead, the demographic seems to be spending more with Adidas and Amazon.

Before you throw out your swoosh-covered sweats and socks, Nike (NKE) still holds court as the top clothing and footwear brand. The survey does relay that the sportswear giant is among the top brands that experienced the largest declines. Other household names that suffered sharp declines include: Ralph Lauren (RL); Steve Madden (SHOO); Ugg, (DECK); Fossil (FOSL); and Michael Kors (KORS).

Under Armour (UAA)  also took a hit from the survey, with teen males ranking it as the No. 1 brand classified as “old.” According to CNBC, Under Armour only got one vote among upper-income females as a brand favorite. Nike vs. Adidas aside, it actually seems as though the entire athleisure trend is beginning to lose favor with the teenage demographic. Only a third of teens chose athletic apparel as their preferred fashion pick, down 40 percent from last year. The overall trend moved towards festival fashion.

Piper Jaffray polled 6,100 teens across 44 states for the survey. The average participant’s age was 16; the average household income was $66,100.

After examining the results, analysts were most surprised by Nike’s decline compared to Adidas’ (ADS) surge in popularity. Adidas “doubled its mindshare,” going from 2 percent to 4 percent. Even with their rise, Adidas didn’t fully offset Nike’s losses.

“Overall, larger brands are ceding share for small brands,” Piper Jaffray analysts noted.

Analysts highlighted brands like Vans (VFC) and Supreme as rising in popularity.

Other familiar names ranked highly in the survey as well. Starbucks’ (SBUX) siren call resounded with teens from upper-income households (average yearly income of $101,000) as their top restaurant; it also ranked first among teens from median income households, those bringing in $55,000. Netflix (NFLX) chilled at the top for daily video consumption. Snapchat was the fan favorite for top social media platform. Turns out that teens don’t diverge much from their grownup counterparts when shopping, picking Amazon (AMZN) as their online retailer of choice.

One reason why Amazon has consistently ranked as teen’s favorite site for the past three years could simply be that the company knows their customer base well. Recognizing the opportunity to turn teen shoppers into lifelong customers, Amazon just announced that teens between 13 and 17 years old can now shop on their site with a personal login. Parents or guardians will receive an email or text with order details. Parents can then either approve the purchase or even set limits on their child’s spending.

Christian Magoon, CEO of Amplify ETFs, pointed out that Amazon’s strategy to capture a younger demographic was good for the company’s longevity, considering entire households can now be raised using Amazon smart home products.

“Younger generations rebel against things that are static,” Magoon highlighted, reasoning that other retailers should take notes from Amazon’s strategy.

“Amazon continues to innovate and grow,” he continued. “We’re not at peak Amazon. People are still excited about what’s next.”

Overall though, teen spending is down 4 percent compared to last year, CNBC reports. Teen spending accounts for 7 percent of the country’s retail sales, amounting to nearly $830 billion yearly.

Crocs, Inc. is making a resurgence

After a series of struggles, most recently an abysmal fourth quarter of 2016, Crocs, Inc. and its iconic foam clog are making a comeback, the Washington Post reports.

The company posted a 28.4 percent year-over-year increase in net profit over the first six months of 2017, and according to the Post. Foot traffic in Crocs stores jumped 12 percent during the back to school season.

Founded in Niwot, CO in 2002, Crocs quickly jumped to prominence (or, some might say, infamy) around the world. Former U.S. president George W. Bush, actor Al Pacino, and former model Brooke Shields were all among the shoe’s early adopters, the Post says.

From 2003 through 2007, the company’s annual revenue grew from $1.17 million to $847.35 million.

But in 2008, amidst the recession, Crocs suffered its first annual revenue decrease since 2002, lost over $185 million and, according to the Post, laid off 2,000 workers. A $67.7-billion annual loss followed in 2009, but the company returned to profitability in 2010 and reported continuous profit growth from 2010-2012.

From 2012 to 2013, though, net income declined 92 percent.

In December 2013, Blackstone Group LP invested $200 million in Crocs. The company installed a new permanent CEO, Gregg Ribatt, the following year.

But the bottom line continued to drop. In 2014, Crocs posted a net loss of $4.9 million. The following year, the company lost over $83 million.

In 2016, profits began moving in a positive direction. Crocs cut its annual loss by 80 percent to $16.5 million.

But, the company lost $44.5 million in the fourth quarter of the year.

Back in March, in conjunction with the release of the earnings results for the fourth quarter of 2016, the company announced plans to close almost 160 stores and appointed then-president Andrew Rees to replace Ribatt as CEO.

Since, Crocs has recovered, reporting net income of $11 million in the first quarter of 2017—a 7.8 percent year-over-year increase—and of just under $22 million in quarter two—a 37.8 percent year-over-year spike.

“Crocs is starting to turn itself around, even in these very difficult times,” said Steven Marotta, an analyst at CL King & Associates, per the Post. “This is a company that has successfully gone back to the basics.”

Crocs discontinued a number of unpopular lines, the Post says, and is redoubling its focus on its flagship product, the foam clog.

That shoe, which sells for $35 a pair, now accounts for half of the company’s sales, according to the Post. “The classic clog has re-emerged as our hero,” said Crocs’ chief marketing officer, Terence Reilly, per the Post. “Certainly in 2017, there’s been a resurgence.”

The signature Crocs, which the company originally marketed as boating shoes, are slip resistant and easy to clean, and as a result, have garnered popularity amongst medical professionals and restaurant workers, the Post says. Targeting the latter group, the company has developed classic Crocs featuring prints of eggs and bacon, sushi, and chili peppers.

The culinary angle is one of a number of new augmentations to the classic shoe. Others include glitter-covered Crocs, and Crocs bearing prints of Batman, Spider-Man and Minnie Mouse.

“New colors and prints are selling well,” Rees said in last month’s earnings call, according to the Post. “We’re striking the right balance of comfort and style, and consumers are responding favorably.”

In December 2016, Crocs signed Drew Berrymore as a spokesperson, and in August, Berrymore agreed to collaborate with the company to create two Crocs designs. The first will launch next February; the second will appear next May.

Wrestler John Cena signed on with Crocs in June.

Both celebrities, along with a few others, are promoting Crocs as part of the Come As You Are campaign, which the company calls a “celebration of the rebellious, the impossible to categorize, the uniquely defined in all of us.”

Crocs may not be cool, but that’s exactly what so many new adopters find cool about them. The new marketing campaign is aimed at the alternative crowd, but the appeal is so great that Crocs are climbing back into the mainstream.

The shoe made three appearances at London Fashion Week, the Post says. Fashion designer Christopher Kane, a long-time proponent, featured an accessorized version of the shoe—replete with mink fur and gems—at his Spring 2018 show.

“Whether or not they’re actually cool — well, that’s up for debate,” said Cameron Peebles, chief marketing officer of inMarket, per the Post. “But our data shows that they’re popular again.”

Featured image via Pxhere

ASOS to build $40 million warehouse in Atlanta, GA

ASOS, a British online fashion and beauty store, released a statement announcing plans to build a new warehouse in the United States on Tuesday, August 8, Business Insider reports.

The giant e-commerce fulfillment center will be located in Union City, near Atlanta, GA and will cost the company an initial investment of $40 million to build. The Union City warehouse will be half the size of ASOS’ main warehouse in Barnsley, England and large enough to house 10 million clothing and accessory items.

This plan is to help fuel US sales growth, which makes up 12 percent of ASOS’ total global sales.

In the company statement as released on the London Stock Exchange, the new center will “significantly enhance ASOS’ US customer proposition providing more cost effective, faster and more flexible delivery options.”

ASOS’ CEO, Nick Beighton, commented on the occasion, saying he believed the move to be a “major step forward” and “demonstrates the opportunity we believe lies ahead in [the US] market.”

According to Beighton, in the current financial year, the US market has “delivered 39 percent constant currency growth in the first six months,” with the financial year ending in Aug. 2016 seeing sales of almost $233 million.

ASOS brands itself as the premier fashion destination for 20-somethings, providing fast-fashion to millennials worldwide. ASOS sells and creates fashion and fashion-related content. They sell over 85,000 products both branded and own-label.

Nicola Thompson, ASOS’ global trading director, had the following to say about the company to Racked in May:

“We are the largest fashion label without a store, and that is because of the sheer volume of what we can offer. Shoppers come to us because they know there will be a product offering unlike any other. We have amazing combinations, and an unlimited amount of popular brands, and that is really a unique positioning within the market.”

ASOS has suffered allegations of exploitative contracts with their UK warehouses. This piece published by BBC News in Oct. 2016 details some of the accusations and the scrutiny ASOS endured from British MPs and campaigners.

To see ASOS by the numbers, check out this slideshow by Refinery29.

J.C. Penney Toying with New Store Idea

J.C. Penney has plans to introduce toy stores within its department stores in an attempt to draw in more customers along with their families. The efforts are intended to recapture part of J.C. Penney’s past spirit when their stores drew in both children and their parents through their holiday catalogs.

In order to reestablish a firmer foundation considering the tenuous times retailers are currently facing, the chain is hoping to capitalize on the opportunity that toy stores offer. The desired end result is to mimic the successful results after the retailer decided to revive toy sales during the 2016 holiday season for the first time in years.

Instead of toy departments, J.C. Penney plans to add toy shops permanently to all of its stores, which is currently cumulative to more than 1000 locations. The chain has already introduced toy shops to 100 stores, and is planning to accommodate the back-to-school special event through an expansion of its assortment.

This companywide rollout is a demonstration of the aggressive measures the retailer is willing to take to demonstrate its competitive edge and relevance amidst the ever growing influence dominated by Amazon.com and more flexible competitors with physical store locations. This is the first company to introduce toy venues as a means of attracting more customers, as other retailers including bookstore chain Barnes & Noble have also bet on commercial merchandise targeted at families.

The decision is based on the year-round demand to buy toys, and by creating not only fun and creative toys but a reflective environment in which to sell the toys coupling the biggest brands and most popular products will encourage higher traffic for both the toy stores and the surrounding departments. The idea is to increase both the turnover and revenue generated by customers, even buying a single, simple toy is an increase in the company’s revenue stream.

The toy shops will be displayed together or peripheral to Disney Collection products, and will feature a wide range of items, including dolls, actions figures, and board games. These toys will be developed in collaboration with Hasbro, Mattel, and Fischer Price. The toys will also be available via the company’s website, with plans for the current selection to double in size as well as add additional items in tome for the 2017 holiday shopping season.

The introduction of toy shops also serves another purpose as an experiment for store-within-a-store concepts. This concept also for more efficient use of space while also opening up locations for brands that either were too late to claim a location within the chains department stores, or were unable to commit to a full-sized department. J.C. Penney has had previous success with this setup, handling floor space over to beauty products firm Sephora and athletics apparel company Nike. Toys assimilate better into the design of beauty products, as customers are encouraged to play with display models and develop and affinity for the product prior to purchasing.

It is important to continue innovating new ways of attracting customers to your stores, which J.C. Penney has faced firsthand as its foot traffic has decreased due to digital competition and fast-fashion competitors such as H&M and Forever 21. It is important to note that there is balance that needs to be maintained, as using toys as a means for drawing customers is beneficial so long as it does not replace the intentions of customers visiting the chain. Otherwise, J.C. Penney may find itself solely in the business of selling toys, and no longer a department store.

J.C. Penney has reported its need to close 138 locations recently, and while it is doing better than its main competitor Sears Holdings, the toy shop concept will be an important factor in determining its future.

Beyond the Runway: The Social Goings-On of New York Fashion Week: Mens

Todd Snyder and Raf Simmons, two renowned menswear designers who showcased their work at New York Fashion Week: Men’s this week, have made their livings putting at fashion shows. What turned heads Monday, though, Max Berlinger of The New York Times reports, was each man’s ability to put on a different kind of show: a party.

Immediately following Snyder’s fashion show Monday, the Cadillac House ceased to be a modeling venue and became a makeshift lounge of sorts. Spectator seating disappeared, paving the way for an army of waiters carrying trays filled with avocado, squid crostini, champagne, and vodka.

Snyder himself disappeared as well, just half an hour after the festivities commenced, bound by professional duty to fly to Italy. Still, a gaggle of devotees kept his scepter alive, sported pieces of clothing that bore the Todd Snyder name.

Most attendees wore “streetwear and preppier outfits,” Berlinger says. Sean O’Pry, one of today’s most prolific male models, donned an ensemble from the former category which consisted in part of a white Todd Snyder bomber jacket.

O’Pry, evidently, has been deployed by the Council of Fashion Designers of America (CFDA) as a sort of social media “ambassador” (Berlinger’s word). Berlinger points out that O’Pry, whom 612,000 people follow on Instagram, is aptly suited for the role. O’Pry himself, though, says he feels a little out of place.

“Honestly, it’s so crazy, I have no idea what I’m doing,” he told Berlinger, “but it’s a blast.”

Danny Miller, who stuck around for the revelry after Lewis Del Mar, the musical duo of which he forms half, finished playing as part of Snyder’s show, shared a similar sentiment.

““Whenever you’re performing in a space that’s so brightly lit, you feel very exposed,” he said. “What’s cool is all the models and the crew backstage. They’re very excited.”

Indeed, the bright lights, whether camera flashes or stage lights, can be a little disorienting at times. But one gets the feeling O’Pry and Miller don’t mind much. “After all,” as Berlinger says, “it was just friends.”

If Snyder’s party turned the Cadillac House into an upscale nightclub, Raf Simmons’ turned Bacaro, which Berlinger describes as “a cavelike Italian restaurant on the Lower East Side,” into an old fashioned rave. DJ Justin Strauss filled the epicurean “cave” with electronic music, and most people were too busy dancing to bother much with the plates of steak, risotto, and tiramisu offered.

According to Berlinger, most of the “revelers” wore “track suits and graphic T-shirts.” Much of the clothing on display was designed by Simmons. Simmons, the creative director of Calvin Klein, was not too shy to promote his own brand.

Simmons packed Bacaro with 100 friends, including Humberto Leon, a fashion designer based on the opposite coast; Hanne Gaby Odielle, a Belgian model; singer Lissy Trullie; Nic Galway of Adidas; actor Ashton Sanders; and 18-year-old social media phenom Luka Sabbat, who has over 180,000 Instagram followers and more than 60,000 Twitter followers, and whom The New York Times’ Guy Trebay has called “the coolest teenager on the internet.”

The gathering took place after what Berlinger calls a “Blade-Runner inspired” show by Simmons, which a standing crowd watched in a Chinatown back alley.

Sanders says of Simmons: “I think that Raf is a revolutionary in every way, man. He’s always been ahead of his time.”

Perhaps it is so, but Simmons is not so far ahead of his time that he can’t slow the clock down a little bit and enjoy some time with a few friends. It’s good to know that once the bright lights turn off, the runways become dance floors and the only lights to be seen are the kind under which people can dance.

New York Fashion Week: Reclaiming American Culture One Stitch at a Time

The American fashion industry is struggling. In the past year, a number of formerly iconic American clothing retailers have shut their doors. True Religion Apparel, Inc. became the latest casualty earlier this month.

Such brands are being pushed out of the market by foreign enterprises like H&M of Sweden and Spain’s Zara, which employ a “fast fashion” business model in which clothes move as quickly as possible from runways to store shelves so that companies can keep up with ever-changing consumer tastes.

But New York Fashion Week: Men’s, which kicked off Monday, may provide a much-needed spotlight that will reestablish US designers as major players in the global fashion scene. Over 65 fashion shows will take place throughout New York this week, showcasing the work of many young American designers eager to carve out space for themselves among fashion’s elite.

Many of the outfits showcased will be available on a “see now, buy now” basis, meaning viewers will be able to purchase them immediately. It is the ultimate in fast fashion: before a product even hits the shelves, a trend-setting consumer can have it in his/her hands.

Many designers are using New York Fashion Week as a platform by which to reclaim each of their unique American identities amidst a political climate they feel threatens to compromise those identities.

Julian Woodhouse, a renowned clothing designer who also happens to be a gay, African-American Army veteran, says much of the inspiration for his “Field Day” collection is born out of uneasiness with the political state of affairs in the USA.

“I called the collection ‘Field Day’,” he told Guy Trebay of the New York Times, “because I was feeling so heavy about political shifts.”

Said collection juxtaposes elements of traditional, conservative American culture against backdrops of chaos and disarray. In one outfit, a pair of suspenders is appended to a pair of cargo shorts and left hanging off of the model’s shoulder. Another outfit features “overalls with pegged ankles and bibs cut low for efficiency of escape,” Trebay reports.

The overalls could be taken as a symbol of outdated aspects of American culture, from which Woodhouse is inviting the viewer to escape. At the same time, Woodhouse’s African-American ancestors would have had far more pressing and concrete motivations for escaping from actual pairs of overalls.

Taofeek Abijako, an American of Nigerian descent, orchestrated a show that, in his words, demonstrates how “the African natives adopted European styles and made them their own.”

Abijako’s collection featured brightly colored, oversized clothing that Trebay says “[looked] as though borrowed from an older brother or else…pulled from the bottom of a prop trunk.”

Of course, African “natives” were forced to, in a sense, “borrow” European culture, but they also transformed it, made it fit them. So it’s not surprising that the baggy, belted trousers, are “tailored close to the leg” (Trebay’s words), for instance: they fit, even though they don’t.

Events like New York Fashion Week take place throughout the year in New York, London, Milan, Paris and Miami. Trebay admits that, from one perspective, the New York event is merely “continuation of a seemingly unending loop of clothes” going on tour throughout the world.

But in terms of the impact it could have on the American fashion industry and the American political situation, New York Fashion Week is uniquely American, just like the designers it showcases.

Hopefully, struggling American apparel companies are keeping an eye on the proceedings at New York Fashion Week, looking for cutting-edge designers who can launch their brands back to relevance. If not, maybe some of America’s political figures are keeping an ear tuned to the subtle undercurrents of social protest that run beneath each outfit.

Men’s New York Fashion Week: What You Need to Know

This week marks the fifth season of the “New York Fashion Week: Men’s” fashioned by the Council of Fashion Designers of America. More than 50 brands will be showcasing their spring 2018 collections in the hopes of drawing attention from editors and retail executives. Lower Manhattan has become a playground buzzing with models, designers and the photographers that follow the latest trends.

The New York Fashion Week draws a distinct crowd compared to those of Milan and Paris which house the majority of the big brands and luxury houses. Instead, New York emphasizes an attraction for feisty brands gathering from all around the world. The diverse pool of designers and fashion influences meshes in a cultural mixing pot that provides a unique take of street wear fashion and certainly acts as a frontier for unexplored fashion designs.

One trend that is characteristic of the New York Fashion Week is the emphasis on easy sportswear being present at the runway shows and presentations. This emphasis represents the casual lifestyle and the clothing that goes along with that as an American culture. This adds a layer of complexity that the designers need to deal with, as is it not simply enough to utilize or push the latest trends in the spring collection. Instead, designers need to be flexible enough with their designs to add an idea of practical casualness that would lend the designs to being worn, and not simply displayed.

The New York event is not the first fashion event of the year, which follows a month of men’s wear shows in London, Paris, Milan and Florence, Italy. A noticeable trend this year has been the refocusing on proportion, which many fashion experts and critics expect to be on display in New York as well. Clothing is bigger, adding a fluid effect as pants look more full, while shorts are even being designed to look oversized. These changes are noted to be a reference to the late ’80s and early’90s fashion but interpreted to keep in line with today’s fashion and the need for always designing something new.

The shows are scheduled from July 10 through 14, with all events taking place at Skylight Clarkson Square in West SoHo unless specified otherwise. Cadillac has heightened its commitment for spring and summer 2018 menswear by providing each designer that will have a showing at the Cadillac House Platform with an additional grant. This grant is to further support designers with bringing their fashion visions to life, but will not be provided to those unable to have a showing. It will be interesting to see if any similar grants are provided for those who do not have the means or influence to acquire a Cadillac showing, as a means of incentivizing diversity in fashion, and not just further supporting those who are successful.

One major theme for designers is to take into consideration not only what is displayed at fashion shows, but the nature of the fashion shows itself. There is an ongoing conversation regarding how fashion shows will be performed, with 13 designers pursuing alternative show formats in an attempt to address consumer relevancy towards a more “see now, buy now” model. These hybrid collections will enable faster and more access to new collections, while also providing samples for future deals with editors and fashion executives. Should the suggested changes take off, fast fashion may result in a complete restructuring to address their supply chain to match the ever increasing pace of fashion, for fear of becoming obsolete in how consumers access fashion.

All in all, this will certainly be an interesting week for fashion, especially in determining the position of the Council of Fashion Designers of America on the global stage, and whether American fashion design will retain or gain as much influence as similar institutions in Europe.

No Longer Up for Sale: Abercrombie & Fitch’s Stock Drops

Teen clothing retailer Abercrombie & Fitch have said on Monday that it is no longer up for sale. Despite being in poor health and having fielded takeover offers, A&F have instead decided to fix itself. This update resulted in Abercrombie shares dropping 10 percent in premarket trading, and a decrease in market value down to about $740 million.

Abercrombie & Fitch first considered preliminary discussions with several parties after reporting another quarter of disappointing sales in May. In recent news, Abercrombie has needed to close another 60 U.S. stores despite attempts to rebrand its merchandise in a new yet ineffective advertisement campaign. Seeing the need for new funding and possibly new leadership, the once popular company was opening itself up for potential bidders including competitors such as Express and American Eagle Outfitters, as well as Sycamore Partners, a buyout shop focused on retail.

However, Abercrombie & Fitch have now decided to recant the possibility of selling the company and instead have decided to go alone in the hopes that their turnaround plan succeeds. This news comes after the Wall Street Journal reported that no acceptable terms between Abercrombie and potential buyers had been negotiated.

The company’s chairman Arthur Martinez has reported renewed faith and vigor in their business and the opportunities for their brands. Martinez further states that through commitment to an aggressive yet supported action plan the company will be able to deliver enhanced performance and long-term stockholder value. The current hit to Abercrombie & Fitch’s is part of a one-step back two-steps forward mentality that the company hopes to achieve.

While a positive company climate is vital is motivating employees to reach the target goals in order to turn a company around, the current consumer opinion of once popular brands has deteriorated significantly. Younger consumers are avoiding similar brands, as seen through the numerous rivals of Abercrombie & Fitch filing for bankruptcy in the past two years. These companies include Aéropostale, American Apparel, Wet Seal, and just last week, True Religion.

Furthermore, Abercrombie & Fitch have reported that comparable sales at its namesake brand fell 10 percent, continuing a long deterioration. However, Hollister, a comparable store than is California-based and a larger brand, saw its comparable sales a higher than anticipated 3 percent, signifying that there is still opportunity for growth in a fast-fashion retail market. Should Abercrombie & Fitch make the appropriate decisions, then there is an opportunity for the company to turn around.

Abercrombie & Fitch have conducted numerous attempts to reinvigorate the brand whose sales have declined over years. One major attempt was through a marketing campaign a few months ago to refashion the brand that is now logo free, however, the advertisement campaign was not successful. Abercrombie & Fitch now struggles to find an identity amongst a mass of dominating fashion chains including H&M and Zara. CEO Fran Horowitz has mentioned the possibilities of returning to Abercrombie & Fitch’s deep roots from before its 1990 peak when it was notorious for bare-chested store greeters and provocative catalogs.

Returning to your roots has the double effect of strengthening your foundation while also sending a message to your customer base that you are returning to what you are good at. One can argue that there is a lack of originality, and instead, it is better to continue diversifying yourself to match the ever-changing needs of the customer. One combination that could prove successful is utilizing what you know in a way that it meets the customer base, especially considering a time when Abercrombie & Fitch was a major competitor in fast fashion, having carved out its niche. Utilizing that niche to moderate a loyal customer base while expanding will ensure that Abercrombie & Fitch can fashion a steadily growing revenue stream.

This will be a difficult transitionary period for Abercrombie & Fitch, as retailer shares are hurting, and the mixed messages behind the fast fashion sector future growths. The decrease in stock will make deals harder to land, so it will be up to the mentality of the company, as well as its flexibility to adapt, that will determine whether Abercrombie & Fitch does indeed make a comeback.

True Religion Apparel Files for Chapter 11 Bankruptcy, Submits Reconstruction Plan

True Religion Apparel, Inc. announced Wednesday that it has filed for Chapter 11 bankruptcy reorganization. The company joins a host of fellow California apparel enterprises, including American Apparel Inc., Pacific Sunwear of California Inc., Nasty Gal Inc. and Wet Sea, who have also gone bankrupt.

The outbreak of retail failures comes as consumers continue to shun traditional stores in favor of online shopping. According to a 2016 study by performance marketing firm HookLogic, 63% of shoppers make most of their clothing purchases online. Macy’s, J.C. Penny, Sears, and Payless have all shut the doors of many of their physical retail outlets. Last year, True Religion closed 20 of its “brick-and-mortar” stores.

The reeling fashion giant, which lost $78.5 million last fiscal year despite $369.5 million in revenue, will aim to reduce its debt by selling equity in its new, reorganized operation.  Its parent company, Towerbrook Capital Partners, an equity enterprise that bought True Religion off of the public market in 2013 for $835 million, has reached a deal with lenders which would cut the apparel retailer’s debt by about 75%, the LA Times reports.

It could take between three and four months for the bankruptcy court to confirm True Religion’s restructuring plan. If the plan is approved, the company will continue to operate, and will move toward “future growth and success,” Chief Executive John Ermatinger said in a statement. Part of the recovery effort, Ermatinger said, would be to allocate more resources to online operations.

True Religion was established in 2002 and grew exponentially in the late 2000s. From 2007-2012, the company’s size tripled  In 2013, the company generated $490 million in revenue, despite online shopping trends which chipped away at sales numbers. Today, it employs 1900 people across 140 proprietary retail stores.

However, high-end clothing companies like True Religion, which prices many of its jeans above $200, have been marginalized by international “fast fashion” stores like Zara and H&M.

H&M’s website claims to offer “fashion and quality at the best price.” The most expensive pair of men’s jeans listed on the site costs just $69.99. A large banner on the homepage advertises a 70% off summer sale.

H&M’s website also invites the customer to “shop in store or online,” and offers next day delivery and free in-store returns of online orders.

The cheapest pair of men’s jeans to be found on True Religion’s site is listed at $159.00, and prices quickly jump above $250 and then over $300.

Consumers’ preference for companies like H&M indicates that fashion trends have become economical.

According to California Fashion Association president Ilse Metcheck, however, many consumers remain willing to spend high dollar on denim. True Religion stores were just “not exciting enough,” Metcheck says, “and [True Religion wasn’t putting enough marketing energy behind their brand to bring them to an aspirational level — that the consumer would aspire to [buy] True Religion.”

In the bankruptcy petition, Ermadinger acknowledges that his company was “… adversely impacted” when it introduced “new product designs… that failed to resonate with the consumer.”

The restructuring agreement, along with $60 million in “post-petition debtor-in-possession (DIP)” from Citizen’s Bank, has given True Religion new life. The fashion market is fickle and consumer tastes are nearly impossible to predict, but if the reorganized company can build its online presence and once again capture the eyes and wallets of consumers, True Religion Apparel could become a household name in the fashion industry once again.

But Metcheck warns that customers are “no longer excited” by “piles of jeans on the table” in a retail store.

“There has to be a look around it,” she says. “Is there an excitement to it that defines the brand?”

If True Apparel wants to reclaim its place at the heart of the fashion industry, it will have to find the exciting X-Factor Metcheck references.

Amazon’s $10 Bras Target Big Box Retailers, Not Victoria’s Secret

Rumors of Amazon’s plan to begin selling its own brand of $10 bras was initially seen as a play against Victoria’s secret. However, a note published by Morgan Stanley explains that Amazon’s budget bras are more of a threat to big box retailers like Walmart and Target, since Victoria’s Secret typically sells bras around $40.

Morgan Stanley’s note also points to the fact Victoria’s Secret continues to own about 27% of the market even though Walmart and Target already intimate apparel at lower prices. This indicates that people who shop at Victoria’s Secret value service and product quality over low prices, and are unlikely to be swayed by even lower prices. Amazon’s strategy, it seems, is near identical to the ones already in place at Walmart or Target.

The note added, “Given Walmart and Target’s similar price points to Amazon’s supposed $10 offering (Walmart $8-15, Target $10-20, vs. Victoria’s Secret’s ~$35) as well as a similar ‘no to little service’ model, we suspect these retailers are likely to be more negatively impacted than Victoria’s Secret should Amazon persuade consumers to start buying intimates on its site.”

Amazon is accessing a sizable market, given the fact that big box retailers make up about 50% of the US intimate apparel market. Morgan Stanley also notes, however, that intimate apparel products must meet certain fit requirements, high quality standards, and multiple style needs. Bras typically come in 5+ cups sizes, 4+ band sizes and 5-10 different colors, making it a difficult category to win.

Morgan Stanley’s survey also notes that Amazon’s Intimates category is its second least popular one on the site, suggesting the launch of intimate apparel products will be an uphill battle. Though details of the in-house collection are scarce, Amazon has already launched a similar project in Europe by the name of Iris & Lilly. The collection, so far, has been received well.

The U.S. line will most likely debut within the next few weeks, according to the Wall Street Journal.

Add Sears and Kmart to List of Retailers Boycotting Trump Products

Two major United States retailers added their names to the list of companies that refuse to carry Trump products. The boycott on Trump products continues on with the addition of Sears Holdings and Kmart. The two announced on Saturday that they will no longer be the carrier of the Trump Home collection available online. The collection sells furniture, lamps, and chandeliers.

Although it is uncertain which of the Trump Home Collections 31 items will be discontinued from the site, at least 14 of the Trump Home Collection products that are sold by third party sellers still remain on the Sears and Kmart website. Those items have even been discounted. For example, a $942 Trump Home mirror down to $624 is marked down on Sears website. Another mirror that had the original price of $818 is now down to a discounted price of $598. On the Kmart website, two Trump Home lamps have been discounted as well.

However, Sears and Kmart join a growing list of companies that have dropped any and all Trump brands as part of a boycott of the first family’s products. Ivanka Trumps name brand clothing line has suffered quite a bit due to retailers like Nordstrom, Neiman Marcus, and Belk dropping her clothing, shoes, and jewelry.

The boycott begins with the Grab Your Wallet campaign. Grab Your Wallet is a list of all the retailers that carry Trump brand merchandise and encourages shoppers to boycott those locations. Though it is clear that none of the companies like Sears, Kmart, Neiman Marcus, Belk, and Nordstrom mentioned the campaign when they announced their discontinuation of Trump merchandise.

The origin of the Grab Your Wallet campaign began back in October after the tape of a 2005 interview with Donald Trump. In the recording, Trump brags on his groping and advancement of women surfaced. The founder of the campaign, Shannon Coulter, posted a tweet which criticized Nordstrom for doing business with Ivanka.

It wasn’t long after the incident that the company reported the rapid drop in sales of Ivanka Trump’s line dropped by 32 percent in the last fiscal year. Ivanka Trump’s products for the third and fourth week of October were even lower by 70 percent.

Even though Sears, Kmart, Nordstrom and the other retailers didn’t say if the list was part of the decision, it is a possibility that consumer feedback had a large part in the prompting of their choice. Some retailers have stopped selling the items online even though they continue to sell in a store, like Belk. In fact, Nordstrom said that its choice to pull Ivanka Trump’s line was due to performance instead of fuss brought on by politics.

Nordstrom made a statement saying, “Over the past year, and particularly in the last half of 2016, sales of the brand have steadily declined to the point where it didn’t make good business sense for us to continue with the line for now.”

Neiman Marcus even made a similar comment about its choice to get rid of the brand was due to “productivity.”

Trump took to Twitter to show his unhappiness about the incident. He lashed out against Nordstrom about the company dropping his daughter’s line.

Even the White House has jumped to Ivanka Trump’s defense with counselor Kellyanne Conway appearing to have crossed ethical lines during an interview with Fox News for plugging Ivanka’s products.

Conway said, “Go buy Ivanka’s stuff is what I would tell you. I’m going to give a free commercial here. Go buy it today, everybody. You can find it online.”

This endorsement violates an ethics rule that prevents federal employees in office from endorsing products. It wasn’t long after that the White House claimed to have “counseled” Conway about her endorsement.

Severe Changes in Store for American Apparel

Things aren’t going so well for many retail companies in the last few months. Sears Holdings closed dozens of its stores, Macy’s did the same, and The Limited said farewell to all 250 of its stores. Now, American Apparel is shutting down all 110 of its stores.

However, even though American Apparel is gone, the Canadian company that purchased it plans a revamp. At a bankruptcy auction, Gildan Activewear snagged American Apparel for $88 million. Gildan now owns all American Apparel property, factories in L.A., and even manufacturing equipment.

Gildan produces t-shirts and other apparel and says it will shut down all American Apparel stores in effort to rebrand its own company. Yet American Apparel branded its own unique style. The made-in-America style is what kept it customers coming back.

Gildan has not yet announced how it will change the company, but customers can expect that American Apparel won’t ever be the same. A spokesperson for Gildan said, “This was always about buying assets out of bankruptcy. The reality is this wasn’t a purchase of an ongoing concern.”

The closure of all 110 American Apparel stores possibly means that more than 3,500 employees lose their jobs.

The Limited Closes Its Doors

Many retailers suffered at the hands of online shopping this holiday season. The Limited has also announced that it is closing all 250 of its stores. It’s assumed that this is due to consumer preference for online shopping.

Leslie H. Wexner started The Limited in 1963. The store got its name for its limited variety of women’s apparel. What started out as a 2,000-square foot establishment, became the largest presence to circulate shopping malls. The Limited even began to dominate many larger retailers.

The more his business grew, the more ideas Wexner began to harbor. He opened The Limited Express and Structure, which sells men’s apparel. His company L Brands had brief control of Abercrombie & Fitch, Lane Bryant, and other companies. Wexner even took ownership of Bath & Body Works and Victoria’s Secret in 1982.

However, the red flag went up to shoppers in December. The stores posted 80 percent mark downs at many of its locations. What really sparked concern was the refusal of returns.

Back in November, the company released a letter to its employees announcing that mass layoffs were in the future. According to the Washington Post, The Limited said,  “product misses and massive shifts in retail shopping trends have been especially difficult for the company’s business, and the company is dealing with significant debt obligations.”

Shopper from Washington to New York have been receiving e-mails from The Limited announced store closures near them. It seems that shoppers are also seeking alternatives for fashion these days. Liz Dunn, from Talmage Advisors, says shoppers are looking for “inexpensive” apparel. She also pointed out that many consumers seek “what’s going on in fashion right now.”

Despite the 4,000 jobs lost due to store closings, the company’s website will remain open. The Limited joins Macy’s who closed many of its stores and eliminated 10,000 jobs.

Aspire Heads to NYC; Creativity, Achievements and Education to be Highlighted

Whether it be food, business, or fashion New York City has well-earned it reputation as the greatest city in the world. New York City is also known for its diverse creativity. In February, it hosts an event that will hopefully bring inspiration to artist over the world. The event is called the ASPIRE FESTIVAL.

ASP FEST, created by iConcept Media, seeks to give aspiring talent exposure to thousands of people. The audience, in turn, has the chance to get closer to artists who have dedicated so much time to their work. It is the Aspire Series’ hope that not only the artists, but the audience as well, benefit from the event.

The anticipation for what Aspire has in store continues to build as the inaugural event, the first of many like it, draws near. A range of 25 to 50 artists will display their talents. Aspire says that exhibits will vary from fashion, film, cooking, and performing and fine arts. Audiences can look forward to parties, inspirational speeches and conversations as well as art exhibitions each day of the event.

Three various artists will have the opportunity to present their talent within nineteen minute segments. During the segments, the artists will get their chance to perform, converse it the audience, or be interviewed by the host.

After its time in New York City, Aspire says it plans to head to Art Basel Miami Beach. Art Basel Miami Beach has its own set of extraordinary talent. As for New York City, the event will take place from February 23rd to February 26th and hopes to shine light on the imaginative accomplishments of creative minds from around the globe.

China Trades Luxury Goods for Adidas?

China’s luxury market is facing some new competition.

In 2015, half of the global luxury market consisted of Chinese consumers. These consumers are now setting their eyes on sportswear.

But why did this trend surface? There are but two reasons.

Recently, luxury goods are becoming less accessible to the Chinese middle class due to last year’s anti-extravagance campaign led by president Xi Jinping. In addition, the tastes of the elite have moved from visible brand name goods to sportswear.

This trend mirrors the “athleisure” trend, athletic apparel that can be worn in non-athletic settings, in the U.S. Now that China has joined the bandwagon, it presents US companies with huge opportunities to profit from.

The Chinese sportswear market is quickly growing and may threaten to surpass the luxury-goods market in the next few years. Euromonitor International, a market-research firm, reports that the Chinese sportswear market grew to $25.3 billion in 2015 and estimates that the market will continue to grow to $43.1 billion by 2020, topping the Chinese luxury-goods market.

U.S. companies aren’t standing still. To satisfy the growing demand for sports apparel and goods, sports companies are opening more stores. Specifically, Adidas is opening 3,000 more stores in China, expanding from 9,000 to 12,000, after sales in the region increased by 18%. Under Armour and Lululemon also expect to reap benefits. Under Armour estimates that sales will increase up to 25% per year until 2018. Lululemon’s first store in Hong Kong is reportedly on track to making $8 million in sales in 2016.

With this new trend, Chinese sportswear companies are declining. As U.S. companies become bigger and more influential, they are devouring Chinese sportswear sellers. The South China Morning Post reported that Chinese companies were losing profit. The main driving factors for the athleisure boom come from the promotion of sports for the upcoming 2022 Winter Olympics held in Beijing and the possible boost from the end of China’s one-child policy which, in turn, strengthen the international athletic apparel companies leaving Chinese companies in the dust.

Louboutin Announces Their Own App

Christian Louboutin is going beyond fashion and making it easier for you to edit the perfect #ootd for Instagram. Louboutinize is the ultimate photo editing app that easily changes a color or even the texture of a photo with just a touch.

Launched as of August 10, the photo-filtering app is available for iPhone users to download and start editing up. You can upload or take photos straight from the app.

Louboutin put his own personal stamp on the project with a feature that allows you to turn any shoe sole to the iconic red color by simply touching the bottom of your shoe. You can also switch out your own limbs for a famous celebrities’, like model and burlesque icon Dita Von Teese. And if that wasn’t enough, see the world through Louboutin’s nail lacquer crystal bottle.

louboutinizevia Louboutinize by Lounoutin

The app is full of fun features including sound effects. Touch the lightning-bolt button to hear a “bzzz” sound and share your photo to Facebook, Twitter and/or Instagram.

The Louboutin brand will also be joining the club and will be sharing some creative photos weekly on their social media platforms.

Don’t worry if the filters seem dull as of now. The French brand will be adding more filters monthly or bimonthly making it the one stop for all your photo-filtering needs. They will also be adding a men’s version of the app sometime in September.

Get your iPhones out and check out what this app is all about.

Serena Williams Slams in Every Way

Sports Illustrated states that Serena Williams has one of the most sustained careers in the history of athletics. Williams who is not shy in the athletic world she is just as equal to the fashion world.  Not only is she not afraid to get her hands on new projects,  she has proven her abilities in many other ways. Serena can do no wrong in any way as a woman of today’s times.

Williams hit the stands August 10th on the cover of The New York wearing an Elizabeth and James dress. Showing that Serena is no stranger to fashion. Being on many other covers besides the two Vogue covers just shows how good she is at what she does. With having such success at whatever she touches how could anyone not want to work with someone as talented as Williams is.

Williams has always wanted to not only be a Tennis Pro but also always wanted to be a designer, and not just any, a Wedding Dress Designer. Is this the time for Serena to make the switch over? At 33 years of age, should she start feeling the wear and tear of every day of being the ultimate athlete? She has already beat the odds of being the oldest in her field of being able to play still and still win like it was nothing. Paving the ways for all the youngster that wanting to be the next Williams of this new generations.

After 16 years of playing, the Williams sisters feel that they brought fashion back to Tennis.  So even back then fashion was always on the minds of these two young women. Venus has a line called EleVen in active wear. So Serena following in her sister’s footsteps creates her path in the fashion worlds as well. As HSN and Serena take the shopping network head-on with her new line, Serena Williams Signature Line in athletic wear.

Williams always knew that the plan was to go into fashion as a designer once she retired. She has however decided to make athletic wear as she is still playing tennis and may not stop anytime soon. She explains to the New Yorker, she is fully aware that she has all eyes on her. With her Fashion Career on the path to a great start, protecting her title is also her number one priority.

Serena shuts down her haters about the way, she looks as a woman, she pulls off the chatter of haters by just showing what true grace is by doing what she does best and be just herself as is, by just putting on some clothing and stand out with class and instead of responding. Granted, Williams is hot as hot can be at the moment, and proudly showing every curve in her dress.

In The New Yorker, she becomes very blunt about the passion she has for the fashion world and certainly open to what other opportunities her  future may hold. She also talks about the subject of racism of today’s times. So not only  is Serena Williams the ultimate athlete, not only is she beautiful but she has brains to keep her passions alive. Williams understands her role in today’s world and she wears her crown with honor.

 

Adidas Passes on Rockport to New Balance

Adidas no longer holds the ownership of its Rockport business. As of Monday, Adidas has officially handed over their company to both Berkshire Partners LLC and New Balance Holding, Inc..

Both companies who bought Rockport are in affiliation with the New Balance brand. Berkshire is a Boston-based investment firm and New Balance, Inc. is head of New Balance investments. Another corporation who joined in part with the transaction is Drydock Footwear LLC, home to Cobb Hill, Aravon and Dunham brands and is also affiliated with the New Balance corporation. These jointments will be forming The Rockport Group.

Adidas has not yet announced what they officially sold their footwear based company for, but back in January when they announced they would be selling Rockport to Berkshire Partners and New Balance, the price was set at $280 million.

A CEO for The Rockport Group has already been named; Bob Infantino, who has worked at Drydock since 2011, will take on the role as CEO.

Rockport will still remain in its home stomping grounds in Canton, MA, but with The Rockport Group, it will now be considered a stand-alone company. The group is responsible for four global brands, Rockport, Cobb Hill, Aravon and Dunham. One will be able to purchase comfortable and casual clothing and footwear at the four retailers.

Image: Via Flickr/Mike Mozart

Limited Too Clothing Chain Store to Re-launch

It is every twelve year-old’s dilemma of being torn between dressing-up as a child and dressing-up as an older teenager. Some of the most fashionably confusing years of one’s life are possibly the “tween” years indeed.

One such store that was around between the late 1980’s and the early 2000’s was Limited too Inc. The store specifically sold clothing for older children and younger teenagers.

Apparently, the stores all closed down in 2008 due to poor business. However, the ‘Bluestar Alliance’ has now acquired the store from ‘Sun Capital Partners’ and plans to reopen the store and do full-fledged business.

People who grew up shopping at ‘Limited too’ during the early 2000’s are all getting nostalgic once again. The store was a perfect amalgamation of a clothing, accessory and toy store for young teenage girls.

Hopefully, the store manages to stay strong this time and help their loyal customers keep up with the modern trends.

Only time will tell if the store makes a decent comeback. Hopefully, they will manage to hold a strong and loyal customer base.

 

A Study Reveals That Millennials are Loving Denim

Denim will always be classic, and for millennials (ages 18-34), it is all they can think about. In a study done by NPD, millennials represent 28 percent of all jean sales in the U.S., showing a renewed interest in the denim market.

In the last 12 months, ending in May 2015, jean sales as a whole have fallen 5 percent, but for Millennials, it increased by 2 percent. So while jeans are losing popularity with many of Americans, millennials will not let denim die. Especially the older part of the group, as 13 percent of sales come from ages 25-34.

“Denim is facing a real opportunity to build on past and present success with subtle strategic changes. While the industry is not yet in a state of recovery, brands are focusing their energy on the younger customer base, where jeans sales are growing,” said Marshal Cohen, the chief industry analyst for The NPD Group, Inc.

Recently, NPD conducted a survey revealing that 63 percent of people said ‘they love their jeans’, but it must be a specific pair because only 32 percent of those actually bought a new pair in the past 5 months. The study also determined that, “1 out of every 4 consumers said they can’t find jeans they like or that fit well anymore.”

npdstudy-denim

Cohen brainstorms to come up with a solution to this ever-growing problem by producing jeans that are versatile for all age groups and styles.

“There are missed opportunities across the denim retail landscape, from the limited distribution of classic styles, fuller cuts, and peripheral specialty sizes, to the absence of color that is living large in so many other industries. Providing a broader mix of product that appeals to a broader audience, with variety stocked in stores, will help to bridge the gap between what consumers are buying, what they want to buy, and rejuvenation of the denim market,“ Cohen announces.

With all the vintage love coming from millennials, it is no surprise that they have been the largest denim consumers lately. Overalls, high-waisted shorts, denim skirts and dresses, have all come back to style in recent years and just in the last couple of months.

Denim, a true American staple, is hard to ever see dying, but to be sure, the industry will keep appealing to more than just the millennials.