BERLIN — Welcome to the promised — or, at the very least, promising — land.
International retail expansion in Germany is proceeding at a feverish pace, as apparel brands, verticals and department store retailers enter or expand their operations in Europe’s largest and most resilient market.
Last fall alone saw the openings of Paule Ka’s and Peuterey’s first German flagships in Frankfurt and Berlin, respectively: Belstaff’s first German store in Munich; Patrizia Pepe’s third German store, also in Berlin, and Bershka’s third German door in Frankfurt, which a spokeswoman said was the best ever for Inditex’s young fashion chain.
German brick-and-mortar debuts also included Agnona and Stone Island in Sylt, and Sessùn, Who’s That Girl and Majé in Berlin, while U.K. retailers Debenhams and Topman launched online stores in the country.
Key roll-outs included Primark’s first Berlin store, which the Irish giant said is its best performing new door. The Berlin branch joined a further eight in Germany, with three more planned for Karlsruhe, Frankfurt and Berlin, and further locations reportedly being sought. Urban Outfitters unlocked its fourth German and second Berlin store, while Abercrombie & Fitch opened its second and third German doors in Hamburg and Munich, and the 16th Hollister store in Hamburg. Barbour’s first Heritage store in Berlin followed Barbour brand stores in Hamburg, Cologne and Sylt. Club Monaco also opened a 485-square-foot store in Sylt in June, as well as a shop-in-shop for Club Monaco in KaDeWe, Berlin, which joined similar set-ups in Galeries Lafayette here and Breuninger Stuttgart. The first Gérard Darel concessions also bowed in six Karstadt department stores, with another six planned for the coming year, and freestanding Darel stores on the drawing board after a test phase of up to one year.
Coming up in the months ahead are German premieres (directly operated or franchised stores) for Belstaff in Munich, French accessories brand Lollipops in Hamburg, with Fornarina following there in spring. Italian underwear and hosiery chain Calzedonia said it plans to add another 50 German doors to its current 10. The first German Façonnable store, a franchise, bowed in Hamburg in December and the brand is reportedly looking for space in Munich and Berlin, while Hollister is planning one of its largest doors in Munich in spring 2013.
Moncler, which opened in Munich in 2010, is seeking venues in “other major German cities such as Frankfurt, Berlin and Hamburg,” executives said. The U.K.’s Karen Millen — which operates three stand-alone stores in Berlin, Hamburg and Düsseldorf, and a concession in Galeries Lafayette Berlin — is scouting for prime shop locations in cities such as Munich, Cologne and Stuttgart.
It was not long ago that the prospect of doing business in Germany seemed to carry more drawbacks than benefits. After the first rush of reunification optimism, German consumers on both sides of the former divide between East and West had a tendency to lock their wallets at every sign of trouble, and there were plenty of those in the Nineties. On the retail end, most of the nation’s department and specialty store buyers lived up to their conservative reputation, showing little interest in taking on lesser-known foreign brands. Then, too, there was the specter of Marks & Spencer’s and the Gap’s German misfires. Styling, service and price issues compelled the British giant to shutter its remaining four doors in 2001 (four were closed in 1999) while the Gap, which had four flagships, pulled out in 2004.
Those, however, may have been exceptions. “The list of companies that failed is not too long. More or less every good concept with a clear position succeeded,” said Andreas Bauer, senior partner of Roland Berger’s consumer goods and retail competence center, listing H&M, Zara, Mango and D’Orsay as clear winners. “It was never the attitude of the German consumer to buy German fashion only. The German fashion [retail] industry was simply not innovative for a long time. It was boring.”
The German market also had “image difficulties. It was known for low returns and high rents, which hasn’t changed. What has changed is the overall environment in Europe,” he added.
Germany is now not only Europe’s largest market, but its most stable economy, he pointed out. German consumers have changed their stripes, remaining in a buying mood, despite the economic crises that seem to grip almost every other country in the Euro zone to one degree or another.
Some of the change is possibly generational as well, Patrizia Pepe’s chief executive Claudio Orrea suggested. “When we began [wholesaling] in Germany, 13 years ago, clients were very conservative, but not only the retailers have changed. The people have too. They like to experiment more,” he said.
Germany is Patrizia Pepe’s third largest market, but the new, 1,800-square-foot Berlin flagship is not only about addressing the German market, but eastern Europe. “We have many stores in Russia and some in Poland, but a lot of people prefer to come to Berlin,” Orrea explained. “It’s like some years ago when the Chinese found it more chic to go to Hong Kong to shop. To reach eastern Europe, Germany — and more specifically Berlin — is the point of reference.”
For Club Monaco, the shop-in-shop route with “iconic, strong retail partners” has given the brand “direct access to a receptive customer who can experience the brand in a familiar shopping environment alongside brands within our competitive set,” Ann Watson, vice president of marketing and communications, said. “The distribution model allows immediate customer feedback and insights to the marketplace while allowing us to be sensitive to cultural nuances.”
For many brands, particularly those already present in Germany on a wholesale basis, stand-alone stores have been the logical next step. Peuterey, for example, plans to tighten its existing retail partnerships with high-end specialty stores and department stores. But president Francesca Lusini said the Italian outerwear specialist will follow-up its recent Berlin flagship opening with five additional stores in Germany over the next five years. “We think this is fundamental to establish a more intense relationship with our customers, and put them in direct contact with the ideas and lifestyle behind our product,” she said.
E-commerce has also significantly altered German market entry and expansion strategies. Richard Lowe, head of retail and wholesale at Barclays, noted the Internet now allows retailers to test a potential market. “The cost and risk of entry [to the market] is a lot lower these days,” he said. “And I genuinely think we are much more international people than we were 10 years ago.…The chances are [a German consumer] will have seen a lot of these U.K. brands, through travels or maybe just over the Internet and looking at U.K. Web sites.”
Debenhams, which soft launched its German online store in August, is a case in point. Online director Simon Forster said opening an online store was a more attractive and lower risk option than opening a brick-and-mortar store, which the firm currently has no plans to do. “It gives people access to our brand, but gives us a chance to build a business [in Germany] without having to commit large amounts of money up front. And that’s generally where [other retailers] have come unstuck before,” said Forster.
Prior to the launch, Debenhams tested the market by shipping its wares to Germany. “We knew that the German public had an appetite for Debenhams, and if felt like a reasonably close fit from a fashion point of view, because obviously the climate is very much the same,” he said.
Barclays expects other British retailers to follow suit, according to a recent company report projecting that Germany would move from the number four to the number one overseas market for U.K. retailers in five years’ time. And they’re betting on the long term. “[Retailers] are not just saying, ‘What’s [the economic climate] like today?’ but, ‘Where has it been and where is it likely to go?’” said Lowe, adding that he feels Germany’s economy “will remain a strong one within the euro zone.”
Taking the final spot on the mens’ portion of New York Fashion Week calendar next month will be none other than @tomford. Though he’s shown his men’s wear in New York in the past, this will mark the first time the designer has shown his men’s collection alone during New York Fashion Week: Men’s. His runway show will debut on February 6 at the Park Avenue Armory. #wwdfashion
London-based couture house @ralphandrusso has certainly been in the spotlight, having its dresses worn by @beyonce, Angelina Jolie, Meghan Markle in her engagement photos and more. For couture, Tamara Ralph focused on ornamentation — think: feathers with chain mail, jet embroidery and clusters of pearls and crystals. See the rest of the collection on WWD.com #wwdfashion #couture (📷: @giovanni_giannoni_photo)
Minnie Mouse celebrated her 90th birthday by getting her own star on the Hollywood Walk of Fame. For her celebratory luncheon, @coach’s creative director @stuartvevers dressed her in a custom made prairie dress, complete with Vever’s take on the polka dot – black sequined versions – under a cropped motorcycle jacket. The designer also put his own mark on Minnie’s classic red shoes, infusing the color with sparkles and adding some Coach crystals. “We chose colors that were very Minnie and also represented quintessential Coach elements,” said Vevers. #wwdfashion #nationalpolkadotday (📷: George Chinsee)
@nickjonas is unveiling his first-ever apparel collection through a partnership with John Varvatos. The limited-edition capsule, which makes its debut in spring, also marks the first time the designer has collaborated with anyone on a line. “The process in working with Nick is amazing. It’s inspiring to be around someone who is not only connected with the trade that they do, but also with what’s happening in the environment around him, and how that connects to what we do with style,” said Varvatos. (RG: @johnvarvatos) #wwdfashion
@margotrobbie steps out onto the red carpet wearing @miumiu. The actress is nominated for “Outstanding Performance by a Female Actor in a Leading Role” in “I, Tonya” at the #SagAwards. (📷: Stewart Cook) #wwdfashion
For @massimogiorgetti of @msgm, the Nineties are his favorite decade. “They had a huge impact on my personal growth. What I like of the Nineties is that they are not so precise in terms of style as other decades…there was actually a bit of everything,” he said. As seen on MSGM’s Spring 2018 show: tie-dye and a bit of grunge, two styles that are synonymous with the decade #wwdfashion #wwddecades (📷: @kukukuba)