W48 - Tiffany, Nordstrom, Louis Vuitton, Dolce & Gabbana... and more!
1. Tiffany beats estimates in Q3
2. Nordstrom returns to profitability
3. Mulberry's losses reduced by 5x
4. YNAP Sustainability Commitment
5. Balenciaga's video game
6. Dolce & Gabbana virtual show
7. Dior's Ski capsule collection
8. Louis Vuitton's traveling store
9. eBay authentication drive thru
10. Store Openings / Closings
1. Tiffany released their 3rd quarter earnings and beat estimates both on sales and net profit. A performance driven by a 70% increase in sales in mainland China. Overall, Sales in this 3rd quarter went back above the billion dollar mark, and only declined by one percent vs last year. The brand also reported signals of recovery in the Americas where sales declined at a slower pace than in the last quarter. Online sales increased by 92% and now represent 12% of Tiffany’s total sales YTD. On the other side of the P&L, net income increased by 52%, and surpassed estimates.
Tiffany’s management expressed confidence in the near future and they predict a better than anticipated performance in the current 4th quarter, even though 60% of their European stores had to close temporarily in November due to the pandemic.
2. The American department store Nordstrom reported their 3rd quarter earnings and it exceeded expectations, especially by going back to profitability whereas analysts expected a loss. Sales reached $3 billion dollars which was a decline by only 16%, and a clear improvement vs the previous 2 quarters. Online sales increased by 37% to reach $1.6 billion, which is 54% of Nordstrom’s total business. Their discount network, Nordstrom rack performed well, and they also got a boost from moving the date of their always successful Anniversary Sales, which was now accounted for in the 3rd quarter. The top performing categories were activewear, home, beauty and designer, and Nordstrom continues their efforts to rebalance their merchandising towards these more relevant categories. Looking at the future, Nordstrom’s CEO expects the 4th quarter sales to decline by about 20% vs last year but to deliver a positive operating cash flow. Nordstrom’s shares increased as investors get a boost of confidence from these results and believe that Nordstrom will be well positioned to increase their market shares when consumption of formal fashion resumes.
3. British leather good company Mulberry released their first half 2020 earnings. They reported a 29% decline in revenue and the good news was massive reduction of their losses. Indeed, they posted an almost 2-million-pound loss, vs 10 million for the first half of 2019. This 5x improvement shows the success of their turnaround efforts.
As we can expect, Mulberry reported an increase in sales in its Asia Pacific region by 28% well as a 68% increase of its eCommerce sales.
Overall, their retail network sales declined by 25% and their wholesale network revenue dropped by 49%.
The group announced that sales continued to be on an upwards trajectory and that early November results show an improvement. It is important to note that UK billionaire Mike Ashley, who owns Fraser’s Group, increased its stakes in Mulberry to 37% and has until December 17th to announce his intention to acquire the company or not.
4. Yoox Net a Porter announced the launch of a new major sustainability initiative, called Infinity, which is designed to bring Luxury and Fashion back in balance with our planet. This project has a 10-year horizon with measurable commitments linked to the UN Sustainable Development Goals. It is articulated around 5 categories and each has their own sets of projects and measurable objectives.
The first category is called “Circular Business” The goal is to push circularity to its private labels by 2025, as well as influence brand partners to adopt similar initiatives.
Then, another category is Care and Repair solutions. This initiative calls for the creation by 2023 of a network of tailors, craftsmen and specialized start-ups, which will all participate in extend products lives.
Another group of commitments is around “circular culture” with the general objectives of increasing awareness around sustainability as well as increased investments in sustainable products.
Then another set of initiatives is called “planet positive”, which aims at reducing the environmental impact while investing in environmental restoration”. Under this group, the set of measurable objectives will be to switch to 100% renewable energy by the end of this year, become a zero-waste business by 2023, become climate positive by 2030, as well as reducing CO2 emissions.
Finally, the last category is called “people positive”, and is about creating a positive culture empowering the next generation of talent and breaking down barriers. Amen to that.
On another note, Kim Kardashiam’s brand, Skims, is being distributed on YNAP.
5. In Fashion, Balenciaga announced that their Fall 2021 collection will be unveiled on December 6 in the form of a video game! The game is called “Afterworld: The Age of Tomorrow” and takes place in 2031. . While not much information has been released yet, we know that players will embark on a journey through various worlds, in which they have to accomplish certain tasks. They have to simply complete the game to win it, their reward for winning is a “real-life breathing exercise set in a virtual utopia.” It is interesting to note that under the elm of its designer, Demna Gvasaglia, Balenciaga has been a pioneer in digital innovation. You might recall the Instagram campaign released for their summer 19 collection, which used Augmented Reality to distort the models in an artistic and nightmarish kind of way.
6. A few interesting initiatives on the physical front.
Dolce & Gabanna launched a series of fashion shows following a See Now Buy Now format. The shows are live-streamed on the brand’s Instagram account and shoppers can buy the products at the same time from the brand’s website. The brand announced it will continue to broadcast these shows as part of a monthly series, but that it will also maintain its traditional appearances during fashion months. While other fashion brands have adopted the See Now Buy Now model, it has delivered mixed results, but Dolce & Gabbana believe this model is more appropriate to meet their customers’ expectations, in this digital world of instant gratification.
On another front, the brand also added a new store to their list of Virtual Stores, with their Paris store now being accessible on their website for a full-on immersive 3D shopping experience. Dolce Gabbana also rolled out in their website this week the 3D version of their Paris store.
7. Dior is opening a pop-up in Soho, in New York, to launch a capsule men’s Ski collection. It consists of clothing but also skis, snowboards and accessories. The collection was designed by Kim Jones, and developed in partnership with specialized companies to produce the ski gears and accessories. The pop-up will run until Jan 3, 2021 and is part of a series of pop-ups the brand is hosting from the US to Japan.
8. Louis Vuitton is reinventing at-home shopping with the launch of a traveling store. Picture the most beautiful mobile home you can think of, parked in your driveway, set up with fresh flowers, trunks, displays and a screen playing videos from the Spring 2021 womenswear collection. The selection of products is curated for the client, to match her style, taste and size. 2 sales ambassadors ensure that the experience is seamless and at par with what one can expect from a traditional LV store. This program is available only in New York, New Jersey and Connecticut at the moment.
This reminds us of a similar initiative launched in 2019 called Tamara Mellon Mobile Shoe Closet. It has been so successful that the footwear brand will keep these 2 traveling stores going until 2021. They stop They stop at various cities around the US and customers are encouraged to book appointments ahead of time.
9. eBay opens an authentication drive-thru in Los Angeles.
10. Finally. Rolex will open in December its largest showroom in the US at Long’s Jewelers in Boston. The new boutique will be 4,600 sq ft and adjacent to other prominent watch brands.
. Hermes reopened their store at the Short Hills mall in New Jersey, doubling the foot print to 8,000 square feet. Hermes expanded the size of their equestrian department, and also added their newly launched Beauty category called Hermes Rouge.
. Abercrombie & Fitch announced they will close 7 flagships stores around the world, in London, Paris and Munich as early as January 2021. It will also not renew the leases of a few other locations including Madrid and Brussel. They will be left with 8 global flagships. Abercrombie’s CEO justified the closures by explaining that these oversized stores were dragging the revenue and margins down.
Bonus news, which couldn’t make it last week: Breitling is introducing sustainable watch boxes made with upcycled plastic bottles.