By  on April 7, 2008

NEW YORK — The road to the top is getting crowded — especially in that zone just above women's specialty chains such as J. Crew and Ann Taylor.

The latest to enter the fray is Banana Republic, which today will open its first freestanding store for the new limited edition BR Monogram collection. The line focuses on better fabrics and tailoring at prices about 30 to 40 percent higher than the brand's core collection.

The 3,000-square-foot BR Monogram store at 205 Bleecker Street and Sixth Avenue here was previously a Banana Republic unit. A spokeswoman said Banana Republic customers will be serviced by stores on Broadway in SoHo and in the Flatiron District.

At a time when the retailer's core shoppers may be feeling the pinch of rising gas prices and a weak economy, BR Monogram is an interesting experiment. It comes at a time when many other chains are trying the same strategy, from J. Crew to Ann Taylor and Coach.

J. Crew's higher-priced, limited edition J. Crew Collection was initially launched to complement the original assortment. But what began as a small line has grown into a business of its own with a separate Collection Web site and the first Collection store slated to open on Madison Avenue in May.

Ann Taylor in September introduced a line also called Collection that is priced 40 percent above its core merchandise. Collection features suits and dresses in fabrics from some of the same mills used by designer brands, such as Loro Piana.

Meanwhile, Coach in 2006 introduced items such as exotic animal skin handbags priced 48 percent higher than its traditional products. Last year, the accessories house formally named the stand-alone collection Legacy. Geared to the logo-craving crowd of "It" bag worshipers, Coach has found a market for $10,000 alligator handbags, launched as part of the Legacy collection. The first two Legacy boutiques opened in the fall on Bleecker Street here and Robertson Boulevard in Los Angeles.

BR Monogram aims to tap into this same customer who is fashion-obsessed but on a budget. Visitors to BR Monogram will find a very different atmosphere than typical Banana Republic stores. "Step out of the everyday and into the extraordinary," begins a statement about the brand's philosophy, writ large in brushed silver letters against a wall painted in Benjamin Moore's Rock Gray. "A limited edition collection defined by exquisite fabrics, distinctive details and modern silhouettes, Monogram is the most eloquent expression of style."Banana Republic quietly launched Monogram for men in the fall. Women's has now launched for spring and is being sold in 30 Banana Republic stores. The company declined to say whether further freestanding stores will be opened.

The retailer in January appointed Simon Kneen, formerly of Brooks Brothers' parent Retail Brand Alliance, as executive vice president of design and creative director. At the time, Jack Calhoun, Banana Republic's president, said Kneen's experience with high-end women's and men's wear would allow him to take the retailer to another level, including the Monogram collection.

Calhoun said he saw great potential within Banana Republic for freestanding retail for Monogram. "We're constantly talking about it," he said, adding that the brand has tremendous potential.

A spokeswoman said Thursday that Kneen's influence will first be felt on the spring 2009 collection.

"There's more elevated fabrications and detailing," said Monogram's spokeswoman. "It's a more sophisticated sensibility that can go from day into evening."

The store environment is more sophisticated, too, with residential furniture such as Billy Baldwin sofas and chairs covered in glazed linen the color of sand. That same fabric is used for heavy drapes that partially cover the large windows, giving the store a sense of intimacy. Gray sisal rugs trimmed with black leather anchor the seating areas and black lacquer Niedermaier mirror screens bring the scale of the high-ceilinged store down to human size.

BR Monogram sales associates are called "stylists" to reflect their specialized training. "We're hoping people will set up appointments and utilize our stylists," the spokeswoman said, noting the store has seven dressing rooms. Other services exclusive to BR Monogram are a full-time concierge and on-site tailor, who will hem pants, skirts and dresses, shorten jacket sleeves and let skirts in or out at the seams, at no cost. The cash wrap is hidden behind more heavy curtains so that consumers don't have to stand in line waiting for their transactions. "Our stylists will take the item and give you some water. While you're waiting you can read a magazine or look at a book," the spokeswoman said. Choices included Jasper John's "Gray" and "Richard Avedon: Photographs 1946-2004."It's hard to avoid comparisons between Banana Republic, J. Crew and Ann Taylor. Banana Republic is a division of Gap Inc., which was once led by Millard "Mickey" Drexler. Now, as chairman and chief executive officer of J. Crew, Drexler has put his energies into turning the formerly bland preppy business into fashion with an eccentric flourish. J. Crew Collection features items such as a tulle cascade wedding gown for $2,200; a Galassia jacket in a couture-quality fabric, $425, and snakeskin stacked-heel sandals, $358.

Several Ann Taylor prints this season, including an interlocking box motif and a circle pattern, look like Monogram's chain-link print, which is one of the collection's signature patterns. Ann Taylor Collection's double-weave jacket is $365; matching pants, $195; silk print top, $195, and sleeveless dress, $195.

The Monogram chain-link fabric appears as a silk dress, $150; silk skirt, $78, and chiffon scarf, $49.

BR Monogram also features a black suit jacket with pick stitching, $250; matching pants, $155; a sleeveless black silk dress with design, $175; silk blouses with puff sleeves, $68, and cashmere ribbed cardigans, $195.

A white trench with silver buttons is the most expensive item in the BR Monogram women's collection at $295. "The women's handbags aren't Monogram," the spokeswoman said. "We're supplementing them from our core assortment. We're taking a lot of care and attention to elevate accessories across the board." The spokeswoman didn't know whether Monogram accessories would be developed for women, but the men's line illustrates the potential of the brand. Men's prices reach $750 for a brown leather bomber jacket and the line includes accessories such as ties, messenger bags and a duffle bag for $425.

The Banana Republic Web site has a section for BR Monogram, but the spokeswoman said the buys for the store and e-commerce site are different.

Banana Republic is the least troubled division of Gap Inc., which generally has struggled with declining traffic and negative comps. Banana Republic posted a fourth-quarter comp-store sales gain of 2 percent and total sales of $764 million versus $766 million in the year-ago period. Gap North America was down 5 percent on a comp basis, with sales of $1.3 billion versus $1.5 billion, while Old Navy North America fell 5 percent on a comp-store basis, with total sales of $1.8 billion compared with $1.9 billion.

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