Fashion. Beauty. Business.

DAILY EDITION 4 MAY 2016 1

CLOSE TO HOMEAmerican Apparel steps up its American Made push by soliciting home goods and accessories vendors for products. PAGE 7

TOUGH FOR BEAUTYThe Estée Lauder Cos. revealed plans to cut up to 1,200 jobs by 2019, while Coty Inc. reported lower profits. PAGE 8

THE LATE, LATE SHOWThe Met Ball was merely the precursor to a long night of partying all around Manhattan. PAGE 13

FASHION DIPLOMACY: Karl Lagerfeld poured his love of Latin music into Chanel’s cruise collection, which he paraded Tuesday night on a breezy, tree-lined boulevard in central

Havana. The shirtdress depicted in his exclusive sketch for WWD is, in actuality, printed with colorful, retrofitted Fifties cars known locally as coches Americanos.

For more on the celebrity-studded show, see pages 4 to 6.

FOR MORE INFORMATION, PLEASE CONTACT PAMELA FIRESTONE, ASSOCIATE PUBLISHER AT 212 256 8103 OR PFIRESTONE@WWD.COM

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4 MAY 2016 3

● The former Yves Saint Laurent executive succeeds Jonathan Akeroyd, who leaves after 12 years at the helm.

BY JOELLE DIDERICH AND SAMANTHA CONTI

PARIS — Kering said on Tuesday that it has appointed Emmanuel Gintzburger as chief executive officer of Alexander McQueen, succeeding Jonathan Akeroyd, who leaves the company after 12 years at the helm.

Gintzburger, previously worldwide retail and wholesale director for Yves Saint Laurent, will take on his new duties on May 9, reporting to Grita Loebsack, ceo of the group’s luxury couture and leather goods emerging brands.

Kering said the 42-year-old “will capitalize on his

experience of business development in key geographies as well as his strong expertise in retail and marketing, having held various management positions for over 17 years within the luxury and cosmetics industries.”

At Alexander McQueen, the Frenchman will be tasked with pursuing the brand’s global expansion and accelerating its organic growth.

A graduate of EMLyon Business School, Gintzburger joined Saint Laurent as Europe retail director in 2009 and took over as worldwide retail and wholesale director in 2011. Prior to that, he held positions in retail at Lanvin, Sephora France and Louis Vuitton’s Asia-Pacific branch.

Akeroyd “is leaving the company to pursue

other interests outside of the group,” the group said.

“Kering is grateful to Jonathan Akeroyd for his contribution during the 12 years he served as ceo of Alexander McQueen. In close collab-oration with the creative and leadership team, he successfully oversaw the growth and the international expansion of the brand, making it one of the most recognized British luxury fashion brands in the world,” it added.

The new ceo will have his work cut out for him: Last year, luxury analyst Rogerio Fujimori of RBC Capital Markets wrote in a research note that by expanding its retail footprint in Asia and growing its leather goods category, McQueen aims to double in size and become a 500-million-euro brand in three to four years.

The Canadian bank estimated that McQueen has the potential to reach an earnings before interest and taxes margin of 15 percent in the next few years. It should also improve its sales densities from 15,000 euros per square meter in 2014 to 20,000 euros in the same time frame.

Kering does not break out revenues for McQueen, which belongs to a division that also includes Balenciaga, Brioni, Christopher Kane, Stella McCartney and Tomas Maier.

According to the RBC note, which the bank prepared after a Kering field trip with investors, McQueen aims to double its directly operated stores to 90 in the next three to four years, double the 2015 count and bumping the retail channel to 54 percent of total sales versus 36 percent in 2014.

Leather goods account for 20 percent of brand sales, trailing women’s ready-to-wear at 38 percent, but ahead of men’s at 15 percent, Fujimori noted. E-commerce represents only

2 percent of revenues.McQueen recently revamped its Web site

with the aim of improving the shopping expe-rience and offering more frequent content — including images and films. The mobile-op-timized site allows shoppers to purchase directly from look books.

Special services include click-and-collect services and online appointment-booking for the label’s bridal, couture and bespoke Savile Row tailoring services.

In another report on the Alexander McQueen business, also based on the field trip, Barclays in London estimated that McQueen’s sales generate about 15 percent of the “other luxury brands” portfolio at Kering, which only breaks out the results of Gucci, Bottega Veneta and Yves Saint Laurent.

During his 12-year tenure Akeroyd was nothing if not a steady operator in the most extraordinary of circumstances.

He shepherded the company through extreme highs and lows, including the suicide of founder Lee Alexander McQueen in 2010; the hoopla surrounding the house after it was commissioned by Kate Middleton to design her wedding dress; the “Savage Beauty” exhi-bition at the Met in New York and later at the Victoria & Albert Museum in London, and a robust global retail rollout that stretched from Savile Row to China.

Since McQueen’s death, he worked closely with the house’s creative director Sarah Burton.

Most recently, he helped to launch its first new fragrance for more than a decade, McQueen Parfum, and the foundation of a new “fragrance house” with license partners P&G Prestige Beauty.

“We’re big enough to launch something really special and make it a success as well,” he told WWD before the launch in February. “The brand awareness is very high, and when you’re entering into this market you need strong brand awareness.”

Before joining McQueen, Akeroyd cut his teeth at Harrods, where his last role was as buying and merchandising director.

BUSINESS

Kering Names GintzburgerAlexander McQueen CEO

● The sportswear company has also elevated Michael Lee to chief digital officer.

BY EVAN CLARK

The c-suite is in flux at the hard-charging Under Armour Inc. with new faces in the roles of chief merchandising officer and chief digital officer.

The company said chief merchant Henry Stafford has decided to leave in July. The former chief merchant at American Eagle Outfitters joined Under Armour in 2010, leading its apparel business before serving as president of North America and then rising to his current position in 2014.

“Henry has been an incredible partner and helped us build our brand and tell our story,” said Kevin Plank, Under Armour’s founder and chief executive officer. “First through his leadership in apparel, then by heading up our North America business, and most recently by driving merchandising of our products throughout the world.”

Chief marketing officer Kip Fulks will take up the chief merchant mantle on an interim basis.

Under Armour also said Michael Lee would become chief digital officer. Lee is cofounder of MyFitnessPal, which the com-pany acquired last year as part of an effort to get closer to customers through a connected fitness platform.

The company said Lee “has been a critical leader on Under Armour’s broader Connected Fitness strategy and will help

the brand continue to push the boundaries changing the way athletes live.”

He takes the top digital spot from Robin Thurston, who is also leaving Under Armour in July. Thurston joined Under Armour in 2013 when the company bought MapMyFitness

Under Armour executives have proven to be in demand. Nike Inc. this spring hired the company’s senior vice president of design, Dave Dombrow, and said it was willing to wait for him until 2017, when the non-com-pete clause in his contract expires.

The brand is also looking for a creative director for its women’s business. The online posting for the position gives a sense of the

Under Armour culture and the expectations: “The Creative Director — Women’s Brand will lead and direct the women’s brand creative for the most exciting brand on the planet. Emotional, innovative and passionate — The Under Armour brand is the most important product we create. Our brand story is sacred and must be told with uncompromising passion and stellar execution.”

That attitude and the “Protect This House” mantra seem to have served Under Armour well. The company’s first-quarter net income shot up 63.5 percent to $19.2 million as sales increased 30.2 percent to $1.05 billion.

Under Armour expects to hit revenues of $5 billion this year.

BUSINESS

Henry Stafford Out at Under Armour

Under Armour athlete Granit Xhaka.

Global Stock TrackerAs of close May 3, 2016

ADVANCERS

DECLINERS

Fossil Group Inc. +4.57%

Myer Holdings Ltd. +3.92%

Shanghai Metersbonwe +3.30%

Giordano International Ltd. +2.85%

Hugo Boss AG +2.76%

Coty Inc. -8.73%

Avon Products Inc. -8.67%

Sears Holdings Corp. -5.09%

Yoox Net-a-porter Group -4.99%

Elizabeth Arden Inc. -4.31%

THIS WEEK’S

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Emmanuel Gintzburger

The Pyschology of Now ● Welcome to the Age of Anxiety

Make a Splash ● Independent sunglass-makers

merge retro and futuristic.

The Met Machine ● Goings on around the

annual Gala.

Bridget Foley’s Diary ● The Case of the Truncated Trunk

PLUS ● Social Studies

● Model Call

● Report Card

4 4 MAY 2016

● Karl Lagerfeld paraded afeisty, frothy collection ona tree-lined boulevard.

BY MILES SOCHA

HAVANA – Here’s a little-known fact about Karl Lagerfeld: He’s a massive fan of Latin music, which he reckons is in the throes of a comeback.

“Mambo No. 5” by Xavier Cugat, who popularized the genre in America in the Forties and Fifties, is a particular favorite.

Probably even lesser known is the fact that Lagerfeld was once a cha-cha andtango champion. The German designer

took lessons in his early days in Paris at the Georges & Rosy dance academy on the Rue de Varenne, and would practice in nightclubs.

“I won contests,” Lagerfeld said Monday as he put the finishing touches on Chanel’s cruise collection, which he dubbed “Coco Cuba” and paraded Tuesday night on El Paseo del Prado, a handsome tree-lined boulevard framed by four statues of lions, a symbol of Chanel.

The audience took in the open-air show seated on park benches as the Latin beats ricocheted off the handsome buildings, capturing the essence of lively, steamy Havana, where music leaks from open windows at night and dancing can spontaneously erupt on sidewalks.

The collection riffed lightly on Cuban-isms: The neat vertical pleats of guay-aberas — typical men’s shirts — were incorporated into Chanel jackets; beach-y colors and slogans were splashed across nubby tweeds and souvenir T-shirts, and the vivid paint jobs on bulbous Fifties cars were echoed on sequined dresses. One of the latter, in teal, hugged the curves of Lindsey Wixson — a wiz at sashaying down a runway — like a fender does a tire on a vintage Chevy.

Never mind that house founder Gabrielle Chanel never stepped foot in the Caribbean country — “Perhaps she smoked cigars,” Lagerfeld teased — or that he hadn’t either until Sunday night, when he toured Havana, taking in its decaying colonial buildings, sunbaked

colors and clandestine retro taxis. Lager-feld found it all “beautiful in a way, even if it’s a little neglected — the colors, the cars, there’s something very touching about it. Cuba is like nothing else in the world,” he said. “It has an identity I love, and I always wanted to go, but I need a professional reason.”

Lagerfeld said he hit upon the idea to do a show in Cuba long before visits by Pope Francis, President Obama and The Rolling Stones — all potent symbols of an isolated, stagnating nation slowly open-ing up to the world.

“It was like a private joke because I thought it was impossible,” the designer said. “Suddenly, Cuba is the most talk-ed-about thing in the world and we’re

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Here and right: Looks from the show.

FASHION

Havana Ball: Chanel Cruises to a Latin Beat

the first with fashion.”To be sure, Lagerfeld and Chanel

touched down in Havana as the country sits on the cusp of sweeping changes. In one of those strange coincidences that happen frequently with Lagerfeld, a Carnival cruise ship laden with 700 passengers from Miami docked on Mon-day – the first in decades and a symbol of how rapidly the barriers between communist Cuba and capitalist America are crumbling.

Chanel, too, imported some 700 peo-ple for the show, treating editors, clients and VIPs to lavish dinners, a “Cuba Revolution” tour, cigar factory visits and a night at the Tropicana, the famous cabaret where lithe dancers shake their ruffles like there’s no tomorrow.

Locals crowded on balconies and on rooftops overlooking the boulevard, and shrieked upon the arrival of Vin Diesel, in town shooting the eighth instalment of “Fast & Furious” – practically a slogan for the changes gripping Cuba. The actor arrived in a red and white Mercury named Lola, dressed in a white guay-abera, and marveled at history unfolding on the island nation. “We had the first American military aircraft flying here since 60 years,” he said. “And a Chanel show in Havana. It’s never happened before.”

Diesel said he was first in Cuba 17 years ago, and confessed, “I love it so much it’s scary.”

Lagerfeld’s affection was also plain on the runway. Forgetting a few feath-ery mambo sleeves that had a whiff of Tropicana, he etched the Latin theme lightly and blended it with Parisian chic. There was a host of long and frothy dresses with full skirts, gleaming cha-cha numbers, a surfeit of great knits and lots

of crafty touches, including fringing and loose, macramé weaves.

“The collection is an idea of a chic and modern Cuba,” he said. “It’s easy pieces.”

Stella Tennant, in a mannish jacket with pinstriped white pants and a sparkly cummerbund, was the first to tread the long and wide public space. The tailoring yielded to vaguely Fifties silhouettes with pinched waists and fanning skirts – the dominant silhouette. Then the looks came in the manner of Diesel’s film, from vaguely military shirt jackets with silvery embroideries to candy-striped pants and sultry, multi-color lace skirts.

Accessories included jaunty straw Panamas and sparkly black berets, which could be seen as a wink to the French capital – or Che Guevara, a major figure of the Cuban Revolution in the Fifties.

Celebrity guests, many of them step-ping foot in Cuba for the first time, were dazzled by the place.

“I’m in awe, of the colors, the build-ings, the music, the smiles – people are so nice. It’s just magnificent,” said Vanessa Paradis, who is gearing up for her stint as a juror at the Cannes Film Festival later this month.

Tilda Swinton, filming Joon-ha Bong’s “Okja” opposite Jake Gyllenhaal and Lily Collins, was mum on its plotline, but said filming would move from Korea to New York and wind up in Vancouver. Cur-rently on screens in “A Bigger Splash,” the Scottish actress is slated to reunite again with director Luca Guadagnino on “Suspiria,” a thriller set in a ballet school.

Costumes are typically key to their collaboration, “but we don’t know quite yet,” she said, cooling herself with a canary yellow fan. “It’s set in the Seventies.”

Chanel’s show climaxed with a drum corps that got the models dancing and Swinton shaking her hips, sweat dotting her pristine white shirt.

Bruno Pavlovsky, president of Chanel fashion, said the house only obtained the green light from Cuban authorities to stage the show in March, but had con-tingency plans to mount a Cuban-style event in Paris – as it has done for past Métiers d’Art collections that referenced Russia, India and Turkey.

The event winked to the Twenties and Thirties, when Cuba first emerged as a popular cruise destination in the

Caribbean. And as with Chanel’s other itinerant fashion shows, the exotic locale and narrative anoints the collection with a collectability factor that ignites desire among loyal clients.

“They love to have these kind of strong, identifiable pieces – something you keep forever. It’s more than just clothes,” Pavlovsky said. “The money we invest in the show generates content for the rest of the year. It’s the showcase, the story around it.”

Chanel invited about 100 top custom-ers, mainly from the U.S. and South and Central America, to witness the specta-cle, along with tours and a visit to La Fac-toria, which is hosting an exhibition of Lagerfeld photos as part of a month-long program of French culture in Cuba.

Pavlovsky said he’s confident he can achieve double-digit growth for the cruise collection despite a challenging economic backdrop. Trouble spots for all luxury players include Paris, Brussels and Istanbul – reeling from terrorist attacks and diminished tourism – along with Russia, Brazil and Hong Kong.

While Chanel logged a single-digit sales increase in 2015, Pavlovksy is targeting

4 MAY 2016 5

Havana Ball: Chanel Cruises To a Latin Beat

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6 4 MAY 2016

“more or less flat growth in 2016 com-pared to the year before. We have to be cautious.”

Chanel has zero business in Cuba, but is charting growth across Latin America, Pavlovsky said. The house operates three stores in Brazil; added a boutique in Panama last July and a second location in Mexico City last year.

The executive stressed that showing in Havana was purely a creative impulse by Lagerfeld, with no political message. He and the designer acknowledged that the event could raise the profile of Cuba and advance its progress.

To be sure, Chanel brought a bevy of wealthy guests and influential editors, also hiring local models, chauffeurs, caterers and event planners. A party in one of Old Havan’s most picturesque squares, the Plaza de la Cathedral, fol-lowed Tuesday night’s show.

Wixson, for one, could not have been more grateful, approaching Lagerfeld for a fitting with her hands in the prayer position.

“Thank you, Karl, for bringing us to Cuba,” she said.

The indefatigable Lagerfeld is already zeroing in on a location for Chanel’s next Métiers d’Art show in December, hinting that it would take place in Europe. But first is a campaign shoot for Coco Cuba, with the designer mulling as a location La Pausa, a vacation home the founder built in the Thirties in Roquebrune-Cap-Martin, France. It was recently acquired by Chanel.

Havana Ball: Chanel Cruises To a Latin Beat

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Gisele Bündchen Vin Diesel

Karl Lagerfeld takes his bow with Hudson.

4 MAY 2016 7

● The New York men’s wear store will shutter in June.

BY ARIA HUGHES

Carson Street will cease to exist.

The men’s wear store, which was origi-nally named Carson Street Clothiers, will close its doors on June 15.

In a press release, cofounder Matt Breen stated the following:

“When our doors opened in March 2013, we had one goal: to bring something new to the men’s clothing market, both in New York City and around the world. We approached the business from a ‘fan-first’ perspective, which fueled our desire to continuously bring new product to the market, find and cultivate new brands and relationships, and keep Carson Street interesting to its loyal, amazing customers.”

This closure comes shortly after cofounder Brian Trunzo announced he was leaving the business to pursue different projects stating, “Carson Street is, and will always be, a defining body of work for me. But there’s more work to do out there.”

The retailer seemed to be in growth mode. Just a couple of weeks ago, WWD reported on Carson Street’s new, larger store on Greene Street — they closed the Crosby Street Store — and its brand roster revamp, which moved away from tailored clothing and into more progressive designer brands including E. Tautz, Lemaire and J.W. Anderson. The founders’ goal was to

merchandise these brands in a wearable way that appealed to creative profession-als. “We are buying beautiful clothing as opposed to buying ideas,” said Trunzo. They even hinted at opening an additional store in either Los Angeles, San Francisco, Washing-ton, or Chicago in fall 2017.

The brand also launched a separate Amer-ican-made men’s wear line, Deveaux, earlier this year at New York Fashion Week: Men’s. That line, which was picked up by United Arrows, Totokaelo, Biotop and Spruce, will continue to be produced. According to Breen, they will show the spring 2017 collection this July. The collection, which is designed by Breen, Patrick Doss and Andrea Tsao, who’ve held positions at Sid Mashburn and Michael Bastian, respectively, has a luxury price point and retails from $150 for cotton T-shirts to $4,995 for shearling out-erwear. When WWD previously spoke with the founders, they were insistent on keeping production in the U.S.

Although their retail concept garnered lots of attention within the men’s wear industry, the founders declined to say whether their self-funded business was profitable or not.

“Our goal is to get things set up now and worry about profitability next,” Breen previously said. “Part of doing this and leaving the legal community was to be our own bosses, but if Mickey Drexler walked in the door and said he wanted to invest in our business, I would be open to the conversation.”

MEN’S

Carson Street to Close Store

● The company’s Made In campaign, launched today, solicits artisans for accessories and small home goods to sell in AA stores and online.

BY KARI HAMANAKA

American Apparel’s latest move has the Los Angeles T-shirt-maker appealing to small business in a bid to expand its product assortment.

The company today launches a platform that will be used to help it connect with vendors in the accessories and home goods space interested in partnering with Ameri-can Apparel on its Made In campaign to find product made in the U.S. to sell in its stores and online. The company’s more specifically looking for proposals from vendors that make leather and canvas goods, footwear, jewelry, paper goods, fragrances and small items for the home. The items — of which vendors must be able to produce batches of 500 in 30 days — have to retail for $100 or under. American Apparel, in turn would buy the inventory and own it.

“We’re super proud of the fact that we are all made in the USA and we felt that this was an amazing opportunity to bring in new accessories to our retail stores and online,” said senior vice president of marketing Cynthia Erland.

Up to 15 artisans would be tapped in the first iteration of the program, which the

company said is not a contest, and addi-tional calls for solicitations could be in the cards if the program is successful, according to Erland. Product the company buys would initially be tested in its top 10 doors located in markets such as Los Angeles, San Fran-cisco, New York, Miami, Chicago and Atlanta before rolling them out online and across the broader portfolio of more than 200 doors.

The program comes at a time when con-sumers have become much more discerning with what they purchase amid a crafting and DIY movement that has emphasized buying local and conscious consumerism.

“The DIY movement is very Millennial and it resonates in our offices and with our consumers,” Erland said.

The platform being used by American Apparel is from Los Angeles-based Create.It, which has helped brands such as Red Bull and Fox Television with their content marketing. American Apparel represents the company’s largest fashion brand to date, according to founder and chief executive Jordan Katz.

It’s an interesting move for the company, which emerged from bankruptcy protection earlier this year, and is in the midst of con-tinuing a turnaround that includes working through a glut of slow-moving inventory, which has been one of the key challenges for the business, chief executive officer Paula Schneider has pointed out several times in interviews with WWD.

Although the company still makes in-house certain items it’s also soliciting ven-dors for, such as its canvas bag, the program

is seen as a way of further expanding the offering “to provide the consumer a more rich assortment and shopping experience,” Erland said.

The campaign follows a decision announced to workers in April to restruc-ture the production process to more closely align with current buying patterns among its wholesale accounts and customers shopping American Apparel stores. With that decision also came the possibility that the company would consider outsourcing product more complicated to make, which is also not moving as quickly among buyers compared to more basic items, such as T-shirts.

Time and consumers will be the judges as to how well this program fares for American

Apparel. Erland, when asked if the company views the campaign as more a marketing move or real source of revenue moving forward seemed to suggest room for both: “I really believe this is a way to really connect with our consumer online and of course that does include the marketing piece of it, but we really are looking for accessories. We need great, made in the U.S.A. accessories so this is an amazing opportunity for us to reach millions of viewers and an audience through this creative platform.”

The company’s accepting proposals for the Made In campaign through June 17 during which time interested businesses are asked to upload a 90-second video covering their proposed product.

RETAIL

American Apparel Calls Out for Local Businesses

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American Apparel headquarters in downtown Los Angeles.

8 4 MAY 2016

● Lauder unveiled sales gains while Coty revealed declines in profits and details on P&G deal.

BY ALLISON COLLINS

Financial results from beauty busi-nesses on Tuesday were varied, with the Estée Lauder Cos. unveiling sales gains coupled with a restructuring initiative that will result in hundreds of job cuts, and Coty Inc. reporting declines in net income, paired with more details on its acquisition of Procter & Gamble Co. beauty brands.

Lauder’s restructuring initiative, called Leading Beauty Forward, is designed to free up resources to invest in new training, development and organiza-tional models. The three-year plan will result in a net reduction of between 900 and 1,200 positions globally — about 2.5 percent of the current workforce.

“We’re going to invest in a lot of new training and development in areas where our current employees need to retrain and develop,” said Lauder chief execu-tive officer Fabrizio Freda. “An example would be digital media or retail activi-ties, depending on the groups of people. The second area of Leading Beauty Forward is about building new organi-zational models for agility, fast decision making.” The idea is that if a digital asset for one of Lauder’s brands — say, MAC — were developed in New York, it would be available to the team in Australia quickly, in about a half-hour, Freda said.

Over at Coty, the focus remains on the acquisition of 41 beauty brands, which the company expects to close in October, chairman and interim ceo Bart Becht said. Next up for the serial acquirer is integrating those brands, Becht said. “We’re not really actively looking to do new acquisitions,” he said. “We will be back on that, but we’re very much focused on integrating P&G right now.”

When the company is back on the

acquisition train, it’ll likely be looking for businesses that fit within the three segments it has organized itself into: Coty Luxury, Coty Professional or Coty Consumer Beauty. “[Potential targets] would have to fit into luxury, consumer beauty or professional, at least initially. That doesn’t mean that we will not break out of that at some point in time. There is substantial opportunity to expand the portfolio even within those,” Becht said.

After the deal closes, Coty should have about $9.2 billion in net revenues, the company said, which would make it the third-largest business in beauty. The company will have $780 million in syn-ergies as a result of the deal, which will be realized over a four-year period. Coty expects the beauty portfolio to add 600 basis points to its stand-alone operating profit margins over a four-year period, and increase pro-forma earnings per share to between 49 cents and 54 cents by fiscal-year 2020.

Coty’s adjusted operating income for the quarter was down 19 percent — to $81.7 million from $100.9 million in the prior-year period. Net income dropped to negative $26.8 million from $75.5 million year-over-year. Adjusted net income was $31.5 million, down from $63.6 million in the year-ago period. Net revenues were down 1 percent to $950.7 million on a like-for-like basis, and increased 2 percent on a reported basis. Color cosmetics sales increased 1 percent like-for-like in the quarter, to $374.3 million from $336.6 million, driven by Rimmel. Despite growth from Marc Jacobs, fragrance sales were down 1 percent to $415.4 million, and skin and body care declined 5 percent.

Coty closed the acquisition of Hyper-marcas in February, which added $14.3 million in revenues for the quarter. That number was brought down by a change in commercial terms to confirm with Coty’s standards, the company said. It also reported higher estimated costs related to the P&G deal, and shares closed down 8.7 percent to $28.35. Lauder shares slipped 3.95 percent to

close at $93.29.Also at Lauder, the Leading Beauty

Forward is expected to yield $200 million to $300 million in annual net benefits, which will be reinvested. The program was revealed at the same time as Lauder’s fiscal third-quarter earnings, where the company said it increased net sales by 3 percent to $2.66 billion from $2.58 billion for the prior-year period.

Lauder is also considering creating a global business services segment, made up of human resources, finance and sup-ply chain offerings that could serve its businesses, Freda said. “The end result of all this…is that we will develop more funds to invest in our growth…these extra funds will be invested in more advertising, will be invested in more freestanding stores and will be invested in better in-store activities across depart-ment store and specialty,” Freda said.

Net earnings for the quarter for the company were $265.6 million, compared with $272.1 million for the prior-year period. Diluted earnings per common share were 71 cents, on par with the year-ago period. Lauder said that negative impacts from foreign currency transla-tion on diluted earnings per common share were 3 cents — excluding FX impacts, net sales increased 6 percent and diluted net earnings per common share gained 4 percent.

By segment, skin-care net sales were down 3 percent, to $1.07 billion from $1.1 billion in the prior-year period, negatively impacted by foreign currency translation. Lauder grew online skin-care sales by double digits. The category was helped by sales from La Mer, which launched new products including Genais-sance de La Mer the Serum Essence, plus growth from Origins. Lower sales from the Estée Lauder and Clinique brands offset gains from other brands. Those brands had a particularly tough time in Hong Kong, the company said.

Following the success of its Origins and Estée Lauder Power Foil Mask, the busi-ness plans to keep innovating, according to Freda, who said face masks are one

of the more successful subcategories within skin care. “Masks are becoming a delivery system…there are different kinds of masks…then there are different forms, and within each form there are different benefits, so mask forms and mask benefits are going to be the base of pretty intense innovation in the years to come,” he said.

Makeup sales for the quarter grew 7 percent to $1.61 billion from $1.08 billion, driven by strong sales from MAC, Smashbox, Tom Ford and Bobbi Brown. Asian women are wearing more makeup, Freda said, and it’s helping to drive cosmetics sales. “It’s a huge opportunity for us,” Freda said. “The brands which are focused on makeup like MAC, Bobbi Brown, are accelerating and taking advantage of this — keeping in mind that MAC is our biggest brand in Brazil or in the United States, etc., where makeup is very well developed — it was not at all the biggest brand in Asia,” Freda said. “On the contrary, with this new trend, these brands are growing at double digits.”

Fragrance net sales gained 5 percent, bringing in $275.2 million, up from $263.2 million in the year-ago period. Sales from Jo Malone London and Tom Ford drove gains in the category.

Lauder has made a handful of luxury artisanal fragrance acquisitions recently, and is planning to focus on developing those brands, according to Freda. “It’s time to make this part of the industry the fastest-growing and the winning part of the industry,” he said. “Jo Malone alone…is now the number-tw0 fragrance in the U.K., for example. I just came back from Korea, and it’s the number-tw0 fra-grance in Korea with only eight doors.”

“It’s about the handmade, super-high-quality experiential world of fragrances, where the ingredients have been chosen, where there is the taste of a maker, where there is a perfumer point of view,” Freda said. “[It’s] giving new life to the consumer experience of the world of fragrances…we want to make this come back.”

BEAUTY

Estée Lauder Eyes Job Cuts; Coty Reports Net Down

● Lady Gaga and Sir Elton John figure into the program.

BY DAVID MOIN AND SHARON EDELSON

Macy’s is getting musical for its fourth annual “American Icons” campaign running May 12 to June 19.

On the agenda, Macy’s is staging its first digital music festival on YouTube with emerging artists; singer Adam Lambert becomes the face of the INC International Concepts private brand, and advertising

will spotlight performers in Macy’s fashions.There’s also the launch of the Love

Bravery limited-edition line of clothing and accessories from Lady Gaga and Sir Elton John, which the pop greats say is designed to “inspire compassion and combat prejudice.” Twenty-five percent of those purchases will benefit the Born This Way Foundation and the Elton John AIDS Foun-dation. Lady Gaga is scheduled to launch Love Bravery at Macy’s Herald Square on Wednesday.

“This year, American Icons is all about the celebration of music. We’re offering a medley of different experiences for

customers,” said Martine Reardon, Macy’s outgoing chief marketing officer. “In our advertising campaign, we pay tribute to locations rich with music history such as New Orleans and Memphis, as well as some of the hottest musical talent today. We will also be hosting our first digital music festi-val on YouTube, which benefits Got Your 6,” a charity supporting veterans and their families.

On the fashion front, the big store will play up folksy looks such as off-the-shoulder chambray dresses from Michael Michael Kors; raw-edged cropped jeans from Pau-linaa and Tommy Hilfiger’s tie-front eyelet shirts and patterned shorts. There will also be “festival-ready styles channeling easy-breezy California cool” like bare-shoulder crocheted dresses from American Rag and American flag bodysuits and high-waisted shorts from Material Girl.

For the ad campaign, 19-year-old sing-er-songwriter Austin Mahone will be seen in

festival gear from American Rag and Levi’s; Destiny Frasqueri, aka, Princess Nokia, will be in Calvin Klein; Kelsea Ballerini will be in Rachel Rachel Roy, Maison Jules and Ray-Ban; and Mexican songstress Thalía Sodi will be in sexy styles from her collection for Macy’s.

Macy’s digital music festival on YouTube starts June 2 at 8 p.m., EDT, on youtube.com/macys. Created and produced by Macy’s and Portal A, the festival will fea-ture, among others, Broadway and TV per-sonality Todrick Hall; pop rock singer-song-writer, AJ Rafael; the Gardiner Sisters, and teen singer-songwriter Macy Kate.

American Icons also encompasses in-store events for kids and cooking demos. For the Got Your 6 charity supporting vet-erans, with each view of the festival, Macy’s will donate $1, up to $100,000. From May 13 to May 15, customers can give $3 at Macy’s stores or on macys.com to the charity, and receive 25 percent discounts.

RETAIL

Macy’s Gets Musical for American Icons Campaign

4 MAY 2016 9

● Declining U.S. sales, inventorywrite-downs in China andretail expansion costsbattered earnings.

BY MELISSA DRIER

BERLIN — Losses mounted at Hugo Boss in the first quarter of 2016, when net income plunged 49 percent and operating earnings fell 48 percent, due to numerous factors including increased discounting and decreasing sales in the U.S. and rising operating expenses.

Group sales were also down, by 4 per-cent, in the period ending March 31.

Although analysts were expecting a troubled quarter, given the group’s latest profit warning in February and chief operating officer Claus-Dietrich Lahrs and chief brand officer Christoph Auhagen’s subsequent resignations, the quarterly performance was nonetheless below forecasts.

Net income reached 38.5 million euros, or $42.4 million, in the quarter compared with 98.2 million euros, or $110.8 million, in the same prior-year period. Earnings before interest and taxes reached 53.7 million euros, or $59.6 million, versus

102.8 million euros, or $114.4 million, in 2015, while EBITDA before special items fell 29 percent to 93 million euros, or $103.3 million.

Dollar figures are converted at average exchange for the periods to which they refer.

Boss cited a catalog of pressures on earnings: a declining gross profit margin, which fell 140 basis points to 64.1 percent; increased discounting and decreasing sales in the U.S.; negative effects from write-downs of inventories in China as well as price adjustments in that market; rising operating expenses related to the global expansion of own retail plus the digitization of the business model; special items connected to the recent manage-ment board changes, as well as signifi-cantly higher depreciation and amortiza-tion expenses.

Group sales reached 642.6 million euros, or $713.4 million, down 3 percent on a currency-adjusted basis. Sales in Europe, which had motored growth in 2015, slipped 2 percent. In the Americas, double-digit sales gains in Canada and South America couldn’t compensate for a 16 percent slump in the U.S., which Boss said reflected declines in both wholesale and own retail businesses. Sales in China

fell 11 percent, though Boss noted price adjustments and stepped-up digital com-munication led to a 10 percent increase in volume in Mainland China.

Hugo Boss’ own retail sales, which includes outlets and online, managed a 1 percent gain in currency-adjusted terms, while retail comp store sales excluding exchange rate effects fell 6 percent. The group’s wholesale business was down 9 percent. Men’s wear sales fell 2 percent in local currencies, while women’s wear sales were down 4 percent.

Looking ahead, Boss reconfirmed its 2016 forecast, which calls for a low single-digit increase in currency-adjusted sales, driven by own retail. The wholesale channel, on the other hand, is expected to book a high to midsingle-digit percent-age decline.

Gross profit margin is expected to remain at 2015 levels of 66 percent, supported by improvements in Boss distribution in the U.S., reduction of dis-counts in the next few quarters, further optimization of inventory levels and the growing share of sales generated by the group’s own retail business. However, Boss is forecasting EBITDA before special items will decline by a low double-digit percentage rate.

BUSINESS

Hugo Boss Earnings Drop 49 Percent in Q1

● At 4,300 square feet, thenew flagship is markedlylarger than the former TimesSquare store.

BY MISTY WHITE SIDELL

NEW YORK — The Swatch Group marked the opening of its new Times Square flagship for the Americas on Tuesday night.

The unit, measuring 4,300 square feet, is intended to provide shoppers with an interactive experience.

Located at 1535 Broadway, the multi-level store is in the former breezeway of the Marriott Marquee hotel. It is mark-edly larger than the Swiss firm’s former Times Square flagship at 1528 Broadway, which measured 3,125 square feet.

Creative director Carlo Giorda-netti told WWD of Swatch’s New York upgrade: “Certainly one of our major objectives is to make the space much lighter, brighter, more open and transparent — for Swatch the notion of transparency is a very important part of our DNA.

“We love interaction — especially a location like Times Square — you need to engage people much more than just with product,” he added of the store’s entertainment factor.

The store is retrofitted with an inter-active color wall that morphs when

shoppers spin a “watch gear” fixture. Interactive digitalized viewfinders pro-vide a virtual sightseeing tour of the city. Many of the watch display cases were built to mimic New York iconography, including hot dog stands. The company’s interchangeable “Pop” collection will be a focal point of merchandise stocked.

Construction of the store began six months ago, and the unit had a soft opening in mid-March. The design aspects of the store are unique to the location.

Giordanetti said that with the new

fixtures and space, the brand could see its Times Square sales easily increasing by 15 to 18 percent. He declined to pro-vide exact sales volumes.

Swatch Group is the world’s largest watch company and has been battling headwinds over the last year as a result of the strong Swiss franc. The group’s net revenues fell last year by 3 percent to 8.45 billion Swiss francs, or $8.51 billion, while net income slumped 21 percent to 1.12 billion Swiss francs, or $1.13 billion. That prompted broker downgrades on fears that profit margins were being sacrificed to preserve market share.

To help jumpstart growth, the group has been expanding its own-store net-work. Revenues from its own stores now account for about 30 percent of group sales, double the level of five years ago, sources said.

FASHION

Swatch Opens New Times Square Flagship

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● Robbie will be the campaignface for the brand’s soon-to-launch Deep Euphoria.

BY RACHEL STRUGATZ

Calvin Klein has tapped Margot Robbie as the face of its soon-to-launch Deep Eupho-ria women’s fragrance.

The fragrance, the third of the Euphoria range, is slated for release in the fall and billed by Calvin Klein as the “more mod-ern, empowered sister” to the existing two fragrances.

The 25-year-old actress, who attended the Met Ball Monday night dressed in a white silk crepe Calvin Klein strapless dress with cutouts, will appear in the global print and television advertising campaign for Deep Euphoria that will roll out in August. It’s the first time Robbie has fronted a fragrance brand.

It’s going to be a big summer for the actress who rose to star status after appearing in “The Wolf of Wall Street” in 2013. Robbie will star as Jane Porter in this summer’s highly anticipated “The Legend of Tarzan,” as well as “Suicide Squad.”

“The addition of Deep Euphoria to our diverse and comprehensive portfolio will fuel the development and innova-tion to continue driving the Calvin Klein Fragrance business,” said Vincent Brun, senior vice president of global marketing of Calvin Klein Fragrances, Coty Inc., which holds the Calvin Klein fragrance license. Brun added that Robbie “perfectly embodies the modern femininity” of the scent.

The original Euphoria debuted in 2005, with a follow-up, Endless Euphoria, nine years later. Russian supermodel Natalia Vodianova was the face of the first Eupho-ria campaign and model Vanessa Axente the face of Endless Euphoria.

“Her [Robbie’s] beauty and talent is an expression of the incredible legacy of women who have been captured in Calvin Klein campaigns over the years,” said Melisa Goldie, chief marketing officer of Calvin Klein Inc.

Robbie hosted a dinner Tuesday night in New York at the Calvin Klein Collection store to celebrate the new scent.

MEDIA

Calvin Klein Names Margot Robbie Face of Fragrance

The Swatch store in Times Square.

Margot Robbie in Calvin Klein

10 4 MAY 2016

● Many leases are believed tobe up for renewal in the nextfive years.

BY VICKI M. YOUNG

The optimization of Sears Holdings Corp.’s asset base likely means more store closures ahead.

That’s the conclusion of Cowen analyst John Kernan, who wrote a research note Tuesday. He also concluded that Burlington Stores Inc. and Dick’s Sporting Goods could be the beneficiaries of store sites that might become available down the road.

According to Kernan, Sears owns 302 U.S. Sears stores and leases 403. In contrast, only 97 Kmart stores are owned, while 844 are leased. The analyst noted that an analysis of Sears’ operating lease payments suggested that a large portion of the leases could be up within the next five years. He said the regional distribution of the Sears full-line and Kmart stores “skews to the Midwest, South and Northeastern regions of the U.S.” In addition, there are 651 Sears Auto Centers, of which 620 are associated with a Sears full-line store.

Kernan said landlords are incentivized to redevelop or re-anchor many of the sites as Sears pays $4.30 a square foot in rent compared with other tenants who pay between $12 and $20 a foot for a compara-ble location. Sears’ 266-store sale leaseback transaction last year with Seritage Growth Properties envisioned the possibility of redevelopment for some of the properties.

Cowen analysts also looked at cross-shop-ping tendencies and found that 56 per-cent of Sears shoppers have also visited a Burlington store, “while demographics such as age, ethnicity and income levels are strikingly similar.”

The Sears and Kmart nameplates

generate $25 billion in sales in North America, while Sears itself still generates $6.3 billion in apparel and soft home sales. However, Sears Holdings also has “$3 billion in debt outstanding with no issue rated above CCC+,” Kernan noted. The retailer has burned through $6 billion in cash in the last four years, with $2.4 billion burnt in 2015. Moreover, Sears faces $734 million in pension contributions over the next two years, the analyst said.

Kernan sees Dick’s and Burlington as retailers that could be interested in acquiring some of the Sears sites when they become available.

The analyst said that, according to a sell-side report, same-store sales for the two nameplates combined has been estimated to be down 5.9 percent for fiscal year 2016. “With traffic pressure in retail building, there is a strong possibility that same-store sales trends could worsen through 2016,

although we note that removing closed stores from the comp-store base could improve trends,” Kernan said.

The analyst added that Sears’ apparel business could be the key to improving profitability, but that also could be “highly uncertain and will be very difficult given industry conditions.”

Among the vendors with exposure should Sears close more stores are Iconix Brand Group, which generates 5 percent of its sales at Sears Holdings, and Hanes-brands Inc., the largest intimates vendor to the mass retailer, although its exposure is more likely a low-single digit percent of Hanesbrands’ total sales.

Sears Holdings said last month said it plans to shutter 68 Kmart stores and ten Sears locations. Most of the closures will be completed by late July.

At the time, Sears chairman and chief executive officer Edward S. Lampert said, “The decision to close stores is a difficult but necessary step as we take aggressive actions to strengthen our company, fund our transformation and restore Sears Hold-ings to profitability.”

Separately, some factors that are still checking Sears are now approving orders based on nameplate, which means that a supplier could get approval to ship to Sears, but not necessarily obtain approval to ship to Kmart as well. One financial source said that the split by nameplate — instead of looking holistically at the balance sheet of the corporate parent — suggests that finan-cial lenders might see the Kmart business as the one that’s more pressured.

A Sears spokesman in the past has repeatedly debunked the idea that factors play a key role in Sears’ inventory levels, noting that the categories where they might have an influence are not major compo-nents of the retailer’s overall business. For example, much of Sears’ apparel business is private label.

RETAIL

Cowen Analyst: Sears Likely to Close More Stores

● Neil Cole will retain his role of TheNext.org, a teen pregnancy prevention group. BY LISA LOCKWOOD

The Candie’s Foundation, which focuses on teen pregnancy prevention, has been re-branded as TheNext.org following its separation from Iconix Brand Group.

Neil Cole will retain his role as founder and chairman of TheNext.org. The foun-dation will be managed by executives Dari Marder and Maria Dolgetta, who created, launched and maintained The Candie’s Foundation under Iconix’s philanthropic umbrella begun by Cole. He and his foun-dation colleagues are no longer associated with Iconix.

TheNext.org will create a national dia-logue, starting today — The National Day to Prevent Teen Pregnancy — with celebrity supporters and social media influencers, which will result in an estimated reach of more than 20 million people. In addition, TheNext.org will launch a platform with Big Boots, a digital studio, later this year. The Web site, thenext.org, and the social media channels including Facebook, Instagram, Snapchat and Twitter will launch with the new creative.

Cole said he is organizing an advisory board comprised of experts, influencers, celebrities and real teen moms to help guide the organization’s efforts and to create original content. Maci Bookout, who appeared on the first season of MTV’s “16 and Pregnant,” will join the advisory board. Bookout’s social media platforms reach more than four million people.

Cole became involved with the teen pregnancy charity when he was in his family shoe business and it owned the Candie’s brand. “We were doing all these sexy shoes and people had different expres-sions of what kind of shoes they were. We were looking for a cause for the company that kind of showed young girls that just because you’re wearing sexy shoes, you shouldn’t do anything crazy, like have a baby. We found out that no other corpora-tion was involved in it, and everyone was scared of it,” Cole said.

Since peaking in 1991, the teen preg-nancy rate in the U.S. has declined by 55 percent. Still, nearly one in four teenage girls get pregnant by age 20 and the U.S. teen birth rate remains higher than in other comparable nations. Cole said that, this year, 300,000 kids will have babies.

“We just want to educate teenagers that there’s plenty of time later to have a baby. We have a unique way of doing it through celebrity,” Cole said. Over the years, the foundation has enlisted the help of celeb-rity supporters such as Bookout, Taylor Swift, Bruno Mars, Jenny McCarthy, Justin Timberlake, Beyoncé, Lea Michele, Hilary Duff, Bella Thorne, Fergie, Vanessa Hud-gens and Usher. The foundation has made billions of media impressions with its print, TV and digital PSAs featuring such people as Bristol Palin, Ciara and Jenny McCarthy. Cole said he will continue to have events next year. Now that they’re not aligned with a corporation, they plan to get more endowments and do more fundraising. “I’ll continue personally to support it as I have over the last 15 years,” Cole said.

MEDIA

The Candie’s Foundation Re-brands

● Amazon and total U.S. onlinesales are set to continue theirdramatic growth, accordingto Forrester.

BY MAGHAN MCDOWELL

U.S. online retail sales are going strong, and much of that flows from the e-commerce leader Amazon.com, according to a recent report.

This year, e-commerce sales are expected total $373 billion, and that’s seen growing to as much as $500 billion by 2020, according to research from

Forrester analyst Sucharita Mulpuru. (That compares with just $100 million 10 years ago.) In addition, the number of U.S. online buyers is expected to grow to 206 million by 2020 from 186 million last year.

Amazon alone captured about 60 per-cent of the total growth in U.S. online sales in 2015. This growth includes rev-enue from its third-party marketplace and seller services. Researchers esti-mate that Amazon’s gross merchandise value stood at $100 billion last year.

In addition to Amazon, the growth in e-commerce sales can be attributed to retailers’ efforts to satisfy customers

with personalization, loyalty pro-grams and omnichannel initiatives that improve convenience. The stronger U.S. economy also helped to provide attrac-tive prices and confidence in spending.

Still, the researchers also found chal-lenges on the e-commerce front. The report noted Nordstrom, for example, said it would not increase its investment in technology in 2016 because it wasn’t worth the cost from a revenue stand-point. There are also relatively small barriers to entry for smaller businesses, with platforms such as Magento and Shopify, increasing competition.

Mobile shopping was another sticking point. Although the practice is growing, customers still reported frustration with the process of making purchases on a small device.

And the U.S. dollar and a weaker global economy in general meant that buying from a U.S. online retailer is more expensive for foreign shoppers.

Ultimately, the report advised that e-commerce merchants stand out withproducts that favor private label overcommodities, that they identify areas inwhich they are failing and consider newways to monetize.

RETAIL

U.S. Online Retail Sales Strong, Fueled by Amazon

4 MAY 2016 11

● Pinto died in Milan shortly after his son Andrea and his wife, designer Mariuccia Mandelli.

BY LUISA ZARGANI

While he formed half of a power couple and was a fixture of Milan society who helped build Italy’s ready-to-wear industry globally, former Krizia chairman Aldo Pin-to’s death in March was a quiet and private matter.

Pinto died in early March shortly after the death of his son, Andrea, from a brain tumor, and three months after his wife, designer and Krizia founder Mariuccia Man-delli. Pinto, 91, had been ill for several years.

“Given the circumstances, it was all kept very low-key and understated, with a small intimate ceremony for the family,” explained Mario Boselli, honorary chairman of the Camera Nazionale della Moda Italiana.

Pinto is survived by his brother, architect Piero Pinto, and his son, Silvio.

Boselli praised Aldo Pinto’s entrepre-neurial and commercial expertise, which “actively contributed to support [Mandelli] and develop the brand.”

A textile entrepreneur, Pinto was born in Egypt and his Italian grandfather was a cot-ton trader. Pinto left Egypt under the Gamal Abdel Nasser regime and returned to Italy, where he met Mandelli in Milan.

After first opening a small fashion factory with a friend, Mandelli in 1954 launched the Krizia brand, which was named after a Plato dialogue on feminine vanity. She showed the collection for the first time at Palazzo Pitti in Florence in 1964. In 1968, Pinto married Mandelli in Jamaica. The marriage was made official only three years later in Milan.

Pinto was a pioneer in expanding the Kri-zia brand outside Italy, especially in Japan. In 2003, the Asian country was the compa-ny’s largest market, with 30 brand stores and 400 multibrand clients. The company entered China in 1994.

At its peak in the Nineties, Mandelli and Pinto had grown Krizia into a $500 million business, leveraging a string of licenses and a global network of stores. In the Eighties and Nineties, boutiques stood in top shop-ping streets around the world, including New York, Paris, Venice, London and Hong Kong, mainly designed by Piero Pinto. The architect also created the exhibition venue “Spazio Krizia” in 1985, located in Milan’s Via Manin, also home to the company’s headquarters. Mandelli and her husband helped promote the arts through this large multifunctional and multimedia space.

Long before other designers branched out into hotels, Pinto and Mandelli in 1989 opened the K Club in Bermuda. The exclu-sive resort was designed by Mandelli and became popular with celebrities including the Princess of Wales and Michael Douglas.

In 2014, Mandelli passed the baton after six decades in business, selling a controlling stake of Krizia SpA to Chinese fashion retailer Shenzhen Marisfrolg Fashion Co. Ltd., based in Shenzhen.

FASHION

Remembering Aldo Pinto, Former Krizia Chairman, Who Helped Build Brand Globally

● The brand is focusing on a new consumer: a “self-empowered” female shopper.

BY NATALIE THEODOSI

LONDON — Danish jeweler Pandora has mapped a shift in its design and communi-cation strategies to address what it sees as a change in consumer behavior and the rise of the “self-empowered” female shopper.

The new strategy includes an extension of the brand’s product offer, with a renewed focus on categories such as rings and earrings, in addition to Pandora’s signature charm bracelets.

“I think that, in the past, we were design-ing charms — and then jewelry. What we do now is design concepts for jewelry and within those concepts there is the charm category,” said Stephen Fairchild, senior vice president and chief creative officer at Pandora.

Fairchild added that the introduction of stackable rings in 2014 has attracted a new consumer. At the same time, existing customers who associated Pandora with charm bracelets have started responding to the rings.

The collection consists of a series of delicate designs in sterling silver, yellow gold and diamonds. Prices range from 35 pounds, or $50, to 399 pounds, or $576. Sales have increased by 73 percent in the last year and now make up 12 percent of Pandora’s total revenues.

Earlier this year, the Copenhagen-based firm said it expects group revenues this year to increase to about 19 billion Danish kroner, or $2.8 billion at current exchange. Sales

in 2015 totaled 16.7 billion Danish kroner, or $2.5 billion, while net profit gained 19 percent to 3.7 billion Danish kroner, or $551 million.

The markets bringing in the highest rev-enues in 2015 included the U.K., Australia and the U.S. From a growth perspective China, Italy and France were among the highest.

The next category the Copenhagen-based jewelry brand plans to focus on is earrings.

“In the jewelry industry, the largest cat-egory is earrings, so you will see a big push on our behalf in the next year. Ultimately we want to design collections which are sets and encompass all the different categories,” said Fairchild.

The company has also re-evaluated the needs of the 21st-century consumer and shifted its communications and product strategies to reflect them. It worked closely with the consulting and trend forecasting agency The Future Laboratory and tweaked its strategy on the basis of their research.

“Women are much more self-empowered, more confident within themselves, and also very confident in self-purchasing,” said Fairchild. “Whereas in the past I would pri-marily say that the jewelry industry was all about gifting, the interesting shift is that now the consumer is willing to gift to herself.”

The brand’s latest campaign, “Unique As We Are,” launched last month alongside the spring 2016 collection and reflected the new outlook. Photographed by Cass Bird, the campaign features women of different eth-nicities and backgrounds in natural makeup and understated clothing, wearing Pandora jewelry.

“We believe in the longevity of this new outlook, this is really a platform for the

next three to five years. There are so many different stories to talk about, so we feel this really has a lot of different legs and can be communicated across different channels,” said Fairchild.

Last month the company released “Unique Thank You,” the second phase of its campaign, dedicated to Mother’s Day. It consists of a video where eight daughters are asked to write a sentence of gratitude to their mothers. The mothers are then asked to spot the message addressed to them.

“It’s the same platform, but here the sto-rytelling is about the relationship between mother and daughter. It’s not just about the perfect things in life. The story can be based on an argument where mother and daughter then come back and say they love each other,” said Fairchild, adding that the campaign is meant to be relevant to today’s relationships.

Fairchild said the shift in focus comes from a global perspective: “I’m a big believer of simplify and amplify. Within our total assortment we have to understand that there are [regional] differences, but we take on a global point of view and embrace one

message when it comes to our key products and the way we talk to our consumers.”

The company plans to focus on branded sales through Pandora concept stores, as well as shops-in-shop, to reinforce its new direction. There are more than 250 concept stores set to open this year, 60 percent of which will be in Europe, 20 percent in Asia-Pacific and 20 percent in North and South America.

The stores’ merchandising will also be adapted to reflect the different categories.

“We started off by categorizing our stores, as we wanted consumers to know that we didn’t just have charms and bracelets. I think the second phase will be looking at how the consumer touches and feels her jewelry, how she tries it on in-store,” said Fairchild. “The way a woman interacts with the product today is very different. She would normally look at her earrings in a tiny little mirror while now she actually goes and looks at her entire outfit. There’s a whole other story of how a piece works with how she is dressing and I think that is where we are trying to really look at how to merchan-dise the stores better.”

ACCESSORIES

Danish Jeweler Pandora Marks New Direction

Aldo Pinto and Mariuccia Mandelli

A visual from the Pandora Spring 2016 campaign.

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New York City Ballet corps dancer Unity Phelan will get her big break tonight. The lithesome 21-year-old has been hand-chosen for a principal role in Christopher Wheeldon’s new ballet “Ameri-can Rhapsody” — a triumphant casting for a dancer of her rank. The piece, which premieres at the company’s spring gala, is set to George Gershwin’s jazzy, momentous overture “Rhapsody in Blue.” It will see Phelan partnered with lauded male prin-cipal Amar Ramasar, dancing alongside New York darlings, the husband-and-wife team of Robbie Fairchild and Tiler Peck.

The ballet marks the first time that Phelan, a dancer who has been gaining significant on-stage momentum since the company’s winter season, has had a principal role choreographed for her at NYCB.

“I have always loved [Christopher’s] ballets, but I had never thought I would be picked to be a principal in one of them — that’s not something that ever crossed my mind,” Phelan, who

joined the company as an apprentice in 2012, said of her fortuitous position.

Wheeldon, NYCB’s former resident cho-reographer, has since gone on to become something of a rock star in the dance world. The 43-year-old was named an Officer of the British Empire in January. Last year’s Broadway production of “An American in Paris,” which Wheeldon conceived and directed, won him a Tony for best choreography.

For “American Rhapsody,” his first origi-nal piece for NYCB’s repertoire in four years, the choreographer has remained in the Gershwin mood — setting the ballet’s rapid tempo to a score that will be well-known to American audiences; it is frequently featured in United Airlines commercials.

Phelan has found herself at an interesting time in the compa-ny’s history. Its Ballet Master Peter Martins has recently begun incubating new talent by casting a score of corps members in highly prized roles: Her fellow

dancers Indiana Wood-ward, Claire Kretzsch-mar and Miriam Miller’s careers are also on the rapid ascent.

Despite this, the dancer said she is utterly confused by Wheeldon’s casting; seemingly forgetting the fact that this past winter season saw her debut in seven principal roles — including that of the Sugarplum Fairy in “The Nutcracker” and Jerome Robbins’ “Glass Pieces.”

Wheeldon feels that Phelan shouldn’t be all that surprised by his decision: “I actually saw her dance the part of the wild horse [in my ballet] ‘Estancia’ last season. I had been away from the company for a while and was just astonished by this beautiful new girl with phenomenal energy.

“She has incredible leg and footwork, and a great attack — she is very petite and very beautiful, she looks like

she would be porcelain until she starts to dance and shows this wild energy.”

While Wheeldon has worked with Ramasar, Peck and Fairchild numerous times (he attended the latter two’s wedding and cast Fairchild as the lead in “An American in Paris,” a role that earned him a Tony nomination), the Englishman hadn’t yet established a choreo-graphic process with Phelan — creating an

interesting dichotomy among the cast.

In observing an early rehearsal of the piece, Phelan — a Princeton, N.J., native who moved to New York at age 14 to attend NYCB-affiliated School of American Bal-let — appeared rattled. As she leaps alongside Ramasar, her nerves spike. Her Cavalier King Charles Spaniel Pippin — who accompanies her to most rehearsals — begins to whimper for attention, leaving her

even more skittish.“I was terrified, pure

terror,” Phelan said of her first rehearsal for the piece. “I was so nervous it took me 15 minutes to pick up any steps. I feel so out of place and honored at the same time.”

“I’m very demanding and push my dancers to discover qualities in themselves. The process has probably been quite hard for her,” Wheeldon said.

The following week, Phelan appeared more relaxed at the compa-ny’s in-house costume atelier, where she and Pippin meet Janie Taylor — a former NYCB principal designing the wardrobe for “American Rhapsody” — for a fitting. For “American Rhapsody,” Taylor has created a sleek set of jewel tone satin-and-mesh long-sleeved bodices that subtly pannier at the hips. A contrast-colored pleated miniskirt is

layered underneath. Said Phelan: “It makes me feel like a little sass machine.”

Taylor has long had an affinity for fashion. Since retiring from her principal post in 2014, the self-taught designer has created costumes for myriad choreog-raphers, including Justin Peck. Wheeldon recently enlisted her to assist in the curation of the exhibit “Fashion Foward” at Les Arts Décoratifs, for which he served as artistic director.

For Phelan, Taylor’s involvement in the bal-let’s costuming process is symbolic. This past winter, she wore Taylor’s old Sugarplum Fairy tutu for her “Nutcracker” debut.

“I wrote her an e-mail to let her know and she sent me back a long message with so much advice — it felt like a pass of the baton,” Phelan said earnestly. — MISTY WHITE SIDELL

Dancer Unity Phelan Gets Her Big Break The 21-year-old corps dancer will originate a principal role in Christopher Wheeldon’s new ballet.

Catering to the ‘Cultured Millennials’Condé Nast Entertainment played the quality card at its NewFronts pre-sentation Tuesday afternoon.

“Our Millennial audience expects a certain quality,” said CNE president Dawn Ostroff at the company’s New-Fronts, held at Cipriani 42nd Street in New York.

During the hourlong presentation, the entertainment arm of Condé Nast revealed a slate of incubator programs with filmmaker Jon Avnet, a distribu-tion partnership with Comcast and a deal with Simple Reach to establish data measurement for branded video content for advertising partners.

Ostroff said internal data provided by partner Data1010 suggest that younger Condé content consumers are “cultured Millennials.”

“Or as we like to say, they’re the ones with jobs,” she offered glibly. Ostroff

expounded on that, noting that the fe-male consumer is more “Mexico meets Tulum and not Cancún” whereas for the male Millennial, “drinks with friends involves craft beer and not a keg.” She didn’t provide quantitative analysis, but the point was received — they are the upscale Millennials.

If the colorful descriptions didn’t pique the interest of potential advertis-ing partners in the room, then perhaps the sleek sizzle reel that depicted stars such as Jennifer Lawrence, Amy Schumer, Kendall Jenner, Steph Curry and Taylor Swift did.

“No one has access like Condé Nast,” she said, noting that the com-pany “creates” the events to which the stars flock. Perhaps she was referring to the previous night’s Costume Insti-tute gala, which drew Schumer, Jenner and Swift — but not Lawrence or Curry.

Marking its fourth NewFronts pre-sentation, CNE has released the latest

iteration of its digital video platform, dubbed “The Scene” as a mobile-first offering. The Scene, which carries pro-gramming of 17 partners and 21 Condé Nast brands, has generally been hard to locate, but now it has its own mobile app available in the iTunes app store. Ostroff said The Scene has added new content partners, the NBA and CNN’s Great Big Story. The Scene will also be distributed across more than 50 plat-forms via a partnership with Comcast.

Also on the editorial front, Ostroff said the company has introduced three incubator programs meant to support the next generation of digital video storytellers. The first two incubators, which were previously launched, are in partnership with Indigenous Media and filmmakers Jon Avnet, Rodrigo Garcia and Jake Avnet. The first is called “Project: Her,” which focuses on female filmmakers and their mentors. It will include Lesli Linka Gatter (“Home-land”) and Sara Treem (“The Leftovers”), among others, and it will follow their journeys through social videos with the finished product premiering on CNE’s digital video network.

The second project, “Big Script,” is also in partnership with Indigenous

Media and “Hunger Games” actor Josh Hutcherson, who will cull through Hollywood scripts and scale them into short films, which will be available on CNE. The final project, “Creators in Residence,” helps Millennial filmmakers develop and produce their content. A comedy series, “That’s What She Said,” is already in the works.

On the virtual reality front, CNE will premiere its scripted series “Invisible,” which is directed by Douglas Lipman, in September.

CNE is gearing up to release its second feature film, “Army of One,”

starring Nicholas Cage, later this year, following its first feature-length documentary “First Monday in May.” A third feature film, “Granite Mountain,” starring Josh Brolin and Miles Teller, is in development.

On the branded content front, CNE inked a deal with Simple Reach, a dashboard that will provide partners a lens into branded content video perfor-mance across every distribution outlet, which will launch in the fall.

Lisa Valentino, CNE’s chief revenue officer and senior vice president of network sales for Condé Nast spoke to the native advertising side of the company. She noted that the firm has completed more than 700 campaigns to date. She then highlighted the work of 23 Stories, its in-house native unit, offering that editors would help “curate” content anchored in video.

“When you pair data with great storytelling and use it to tell yours, the results are incredible,” she said. “When CNE first launched its digital video network in 2013, we were pioneers in the space. Since then our digital video has grown up and our audiences have growth up with it.”. — ALEXANDRA STEIGRAD

Memo Pad

Dawn Ostroff

Phelan and her partner Amar Ramasar rehearse

as choreographer Christopher Wheeldon

looks on.

Former Principal

dancer Janie Taylor fits her

costume design on

Phelan.

4 MAY 2016 13

Shortly after 11 on Monday night, 13th Street between Washington Street and 10th Avenue was a veritable parking lot. The tract of the Meatpacking District was occupied by a fleet of loitering black SUVs, their drivers taking naps in the front seats. It was going to be hours before their passengers were going to be heading home — or elsewhere.

It was the official Met Ball after party being thrown by Apple at the Boom Boom Room. Perhaps not surpris-ingly (but infuriatingly), the control-freak tech company decided not to invite press to the bash, which of course meant the hotel’s periphery was mobbed.

A steady stream of A-listers hopped out of their town cars outside the side entrance of the Standard, puddle-skipping into the ho-tel. Teenage fans, apparently uninterested in making it to first period on time Tuesday morning, stood diligently in the downpour in soaked hoodies and backpacks be-hind metal partitions along the sidewalk, hoping to get a glimpse of their favorite celeb.

Early arrivals included

Wendi Deng, Kate Mara and Jared Leto, who popped out of his car with Alessandro Michele hot at his heels. Leto, scepter in hand, gamely gave a thumbs-up to the crowd. Saoirse Ronan, new to the Met Gala game, looked confused as she tried to find her way from car to club. Her publicist had her pause for the lenses before she made her way inside. The designer crowd was next to arrive en masse: Maria Grazia Chiuri and Pierpaolo Piccioli, fol-lowed by Marc Jacobs and then Alexander Wang. After that was Donatella Versace in a sequin-tinged catsuit. “Happy birthday, boo!” a fan shouted from across the street. Just after midnight, a Mercedes limo pulled up, pop music blasting. Jeremy Scott emerged, his bestie Katy Perry in tow.

Close to 1 a.m., a mini-dress-wearing Rita Ora popped out of her black car, breezily gracing fans with a “Hi, honey” purr as she head-ed into the party. Before her, James Corden proceeded with less confidence, con-fusedly wandering around in the rain on his phone.

At 1:20 a.m., much of the hobbyist crowd had thinned out, but the party was just

getting started. Wiz Khalifa popped out of a limo SUV, puffing on the joint in his hand.

“Excuse me,” a befuddled neighborhood resident walking his beagle said to re-porters. “Is there some sort of party going on here?”

While Boom Boom maintains a safe berth — 18 stories, that is — from the plebeians, the only insurance for those attending Olivier Rousteing’s bash at the Gilded Lily was a heavily manned door. “It’s just get-ting started,” a headsetted brand rep told a trio of early arrivals, the concrete rum-bling under their feet. It was what seemed to be the first stop of the evening for those eventually on their way to the Boom Boom Room — the two venues’ proximity of 0.3 miles door-to-door really working to their advantage.

The party didn’t really get started until around midnight, when the entou-rage emerged. Take a wild guess who. Kim, Kanye, Kris and their tangentially famous acolytes — e.g., Tyga, Corey Gamble — emerged, the crew’s bling-encrusted wares bursting from the flash bulbs. They nestled into a corner booth with Rousteing and continued to get sprayed with flashes. At least 10 photographers encircled the booth, clicking away. The Kanye-heavy playlist seemed to please no one more than Kanye him-self, who bobbed to his own music with a self-satisfied smile spread across his face. Beyoncé rolled in around 1:30 a.m., well after Kimye had left. She curled up next to Roust-eing, her bodyguards block-ing any paps from getting a shot of her. Even a discreet attendee who attempted to get an iPhone shot quickly had a flashlight shone in his face. It read like a small coup to Kimye’s unofficial Balmain throne. Who — really — run this motherf----er?

— TAYLOR HARRIS, LEIGH NORDSTROM AND KRISTEN TAUER

Boom Boom BoxMet Ball attendees kept the party going into the wee hours, tag-teaming it between the Gilded Lily and Boom Boom Room.

Queen Rania of JordanSaoirse Ronan in Christopher Kane.

Beyoncé at the Balmain Met Gala after party. Kylie Jenner

Kanye West, Kim Kardashian and Kris Jenner at the Balmain Met Gala after party.

Sarah Jessica Parker and Andy Cohen

Anna Cleveland at the Balmain Met Gala after party.

Alessandro Michele and Jared Leto

Maxwell Osborne and Dao-Yi Chow

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Zoë’s New GigZoë Kravitz is Yves Saint Laurent Beauté’s latest U.S. muse.

The 27-year-old actress and musician will begin a social media campaign with the L’Oréal-owned brand this month.

The brand said it was attracted to Kravitz because of her strong sense of individual personal style. “Zoe is not afraid to stand up for what she believes — we love her confidence and authentic-ity,” said Alexandre Choueri, president of international designer collections at L’Oréal.

As part of her muse duties, Kravitz, who is the daughter of Lenny Kravitz and Lisa Bonet, will share her favorite makeup products and tips in content to be released on both her own and YSL Beauté’s social media channels.

She will also appear in an installment of YSL Beauté’s new video project, “Before the Light,” which will document the pre-show beauty routines up-and-coming female musicians. Kravitz fronts band Lolawolf when she is not filming acting projects.

The YSL announcement comes on the heels of the Met Gala, at which Kravitz walked the red carpet wearing a black strapless Valentino minidress and black lacy masquerade mask.

This is not Kravitz’s first time aligning herself with a brand. In June 2015, it was revealed that Alexis Bittar had tapped her as the face of the jewelry company’s fall ad campaign. — ELLEN THOMAS

Another OneJust as a number of brands ranging from Ermenegildo Zegna, Bottega

Veneta and Calvin Klein Collection to Costume National, Corneliani and No. 21 will, for different reasons, forgo the catwalk during Milan Fashion Week in June, Damir Doma has decided to show both his men’s and women’s collections on the runway.

“It took almost a year to make this decision but we think this will enable us to improve our deliveries and perfor-mances,” said Doma, who unified his women’s pre-fall and main collections into a single lineup in June. The Croatian designer said he will show the same number of men’s and women’s outfits. “The sales campaign will close in July and we will have the right amount of time to produce the collections and have them delivered in stores earlier than in the past.”

Doma also said that by showing together the two collections buyers might make more coherent purchases. “Men’s buyers used to focus on sports-wear, while women’s buyers tend to look for special pieces,” he explained. “The image of the brand was not cohesive in the stores and it also turned out that women’s wear had a higher retail price point. I hope that, from now on, things will be more balanced.”

Doma, who sells his collections in 120 stores, added that his goal is not to dramatically enlarge the number of doors where his brand is available but to enhance the quality of purchases in those stores which better fit the label’s standards.

In order to increase the visibility of the women’s collection, which might be penalized by the fact that it will be shown during men’s fashion week, Doma said re-sees and appointments

will be organized at his Milanese show-room in September. — ALESSANDRA TURRA

Bufano’s PayBon Ton Stores Inc.’s Kathryn Bufano saw her salary slip 6.7 percent in 2015.

The retailer’s president and chief executive officer received total com-pensation of nearly $2.5 million last year, compared with $2.6 million in 2014. She joined the retailer in August 2014.

Bufano’s base salary last year was $900,000, compared with the $380,769 that she received for slightly over four months of work in the previous year. She received a greater bonus in 2014

— $350,000 compared with last year’s $250,000 — and the biggest difference between the two years is the higher stock awards granted in 2014 of nearly $1.9 million versus the nearly $1.3 million in 2015.

Her total compensation was detailed in the company’s proxy statement, which was filed Tuesday with the Securities and Exchange Commission. The company said it will hold its annual shareholders’ meeting on June 14, at 9 a.m. at the retailer’s offices in York, Pa. — VICKI M. YOUNG

Adieu, LanvinLanvin will close its Chicago boutique at 116 East Oak Street in the Gold Coast neighborhood, according to a source familiar with retail real estate in the area. The French house opened the store, which was once home to well-known re-tailer Ultimo, in March 2013. The source, who asked to remain anonymous, said St. John would be moving into the space after renovating the store. “It’s a pretty blank canvas inside the Lanvin space,” the source said.

Calls to the Lanvin and St. John stores confirmed the stores would be closing. St. John has a boutique at 919 North Michigan Avenue. A Lanvin sales-person said the store would be closing within two weeks. An e-mail to Lanvin public relations was not returned.

A story in Crain’s reported in 2012 that Fred Latsko paid $7.4 million for the former Ultimo store and Lanvin rented the 6,000-square-foot building. It was a 10-year-lease, with two five-year renewal options.

In addition to Chicago, Lanvin has stores in five U.S. cities: Costa Mesa, Las Vegas, Los Angeles, Miami and New York. — KRISTIN LARSON

One for the BoysBritish designers Christopher Rae-burn, Lou Dalton, Astrid Andersen, Craig Green and Sibling have been shortlisted

for the BFC/GQ Designer Men’s Wear Fund 2016, the British Fashion Council said Tuesday.

“As the men’s wear industry contin-ues to grow in size and reputation this year’s shortlist shows the diversity and the talent of London’s men’s wear de-signers,” said Caroline Rush, the BFC’s chief executive officer. “As well as sheer creativity, these designers also have impressive business strategies and the potential to be Britain’s next big men’s wear brands.”

The nominees for the prize will take part in a two-week mentoring program where they will receive aid on branding, leadership, commercial retail, e-tail, wholesale and digital innovation. The fund is supported by Vertu, which will hold a mentoring day at Interchange Camden in London.

At the end of the month, the short-listed designers will provide a business plan to a judging panel and the winner will receive mentoring support for a year as well as a grant of 150,000 pounds, or $218,245, towards their business and 50,000 pounds, or $72,748, worth of services. The winner will be announced on May 18.

The prize is focused on businesses that have been trading for more than two years in the U.K. and globally. — LORELEI MARFIL

Moto MomentLucky Brand is racing into the realm of high-end collaborations with British artist Ornamental Conifer.

For the Los Angeles-based compa-ny’s fall collection, the artist also known as Nicolai Sclater is hand-painting bandanas, T-shirts, and leather and denim jackets in bright colors and his signature hand-lettering style. The items are bound to strike up a conversation with their lightning bolts, New York and Los Angeles area codes and other imagery that pays tribute to Lucky’s moto heritage.

The tie-up is Conifer’s latest project in the fashion industry. Once raised by hippies, kicked out of school at 15 and worked as a mechanic, Conifer has worked with brands such as Nixon and Alpinestars.

Lucky is also making moves to expand into a lifestyle business. In con-trast to the rebellious feel of Conifer’s creations, it included a men’s formal suit in its fall lineup for the first time.

With this collaboration, Conifer took a hands-on approach. According to Lucky’s chief creative officer Kin Ying Lee, he inspected the denim to select the fabric that would pick up his paint the best. Whereas the bandanas and T-shirts retail for about $50, the jackets range between $1,000 and $2,000. In comparison, an embroidered jean jacket from the company’s premium sub-brand Lucky Legend goes for $148.

“It elevates the brand and brings uniqueness and personality,” said Lucky Brand chairman and chief executive officer Carlos Alberini. “That is worth pursuing.” — KHANH T.L. TRAN

Fashion Scoops

4 MAY 2016 15

● The short film “Something Unpredictable” will help launch the Carolina Herrera x Mytheresa.com limited-edition collection.

BY ROSEMARY FEITELBERG

Even after 35 years in business, Carolina Herrera is still all about ingenuity.

With that in mind, the designer will use Danny Sangra’s short film titled,

“Something Unpredictable,” to launch a limited-edition capsule collection with Mytheresa.com.

Kat Clements headlines what is sup-posed to be a mockumentary of a fashion film that was shot at the Elyx House in the Hollywood Hills. The Mytheresa.com x Carolina Herrera capsule collection will make its debut May 10 on the e-tailer’s site.

Clements also makes an appearance in “Goldbricks In Bloom,” the feature film Sangra wrote and directed. Due out in

September, the movie also features Zosia Mamet, Waris Ahluwalia and Jake Hoff-man. The Central Saint Martins-trained Sangra has created a social satire about the rise and fall of a New York painter amidst a self-obsessed group of disen-chanted young creatives. He is also work-ing on another short film for Mytheresa with Balenciaga.

Herrera drew upon her heritage for the capsule collection for the e-tailer. In doing so, she wanted to evoke the essence and craftsmanship of her New York atelier and

more specifically to reflect the vibrant spirit of her first runway show in 1981. Bianca Jagger, Andy Warhol, C.Z. Guest and Diana Vreeland were among the first to see her inaugural collection at the Met-ropolitan Club.

“The collection is very reminiscent of the glamor from my first collection,“ Herrera said. “It embodies the style and effortless silhouettes, but with a modern spirit. I wanted to focus on pieces that were uncomplicated in shape, allowing women to have fun making it their own — fashion, after all, should be fun.”

Pieces include an asymmetric gold lamé gown, a maroon velvet military jacket and coordinating skirt, and a zebra print silk shirtdress. There is also ruby and onyx jewelry and bejeweled sneakers designed in collaboration with Eytys. Retail prices for the collection range from $250 for jewelry to $3,700 for a gown.

FASHION

Carolina Herrera, Mytheresa.com Team for Capsule Collection

Zoë Kravitz at the Calvin Klein Fall 2016 runway show.

A Lucky Brand jean jacket painted by Ornamental Conifer.

Lou Dalton Men’s Fall 2016

Damir Doma

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