By  on November 21, 2007

NEW YORK — Jones Apparel Group is saying goodbye to the Anne Klein designer collection and its creative director, Isabel Toledo.

On Tuesday, the apparel conglomerate said it was pulling the plug on the collection after just two seasons to focus on growing the bridge Anne Klein New York and better-priced AK Anne Klein collections.

The move signals a major reversal of strategy for Jones, which launched the designer collection with much fanfare in February for fall retailing. While the upscale line was never viewed as a volume business for Jones, it nevertheless promised to set a much-needed new tone for the brand and serve as a halo for the other divisions.

Toledo's efforts were praised by the fashion press and opened up new retail opportunities for Anne Klein in stores such as Barneys New York (which Jones sold to Dubai investment firm Istithmar for $942.3 million in September), Neiman Marcus and Nordstrom, as well as specialty store Ikram in Chicago. Resort, which typically hits stores next month, will be the last shipment. The spring season, which was shown on the runway during New York Fashion Week in February, will not be produced.

The move is likely to send shock waves through the industry, since Toledo and her illustrator-husband, Ruben, are well liked and highly respected for their creativity.

Jones' choice to shutter the collection business also underscores the growing challenges of launching a designer brand with costly runway shows and marketing campaigns in today's tough retail climate.

Toledo is expected to help wind down the designer business and remain on board until her contract ends. While Jones executives declined to disclose details of Toledo's contract, a source close to the company estimated that she was contracted to stay on for approximately one more year.

"We appreciate all that Isabel has done for the Anne Klein brand through her creative direction and her vision of the Anne Klein woman," said Wesley R. Card, Jones' president and chief executive officer. "Anne Klein is perfectly suited for today's environment, and that's why we continue to focus on Anne Klein's better and bridge lines, as well as footwear, handbags and accessories."Toledo couldn't be reached for comment.

The development marks another blow in the storied and often challenging history of the Anne Klein brand. Once considered one of America's most iconic sportswear brands, it has gone through multiple identity crises after Anne Klein's death in 1974 and just as many designers, who have made the house's revolving door the stuff of Seventh Avenue legend. Among the designers walking in and out of Anne Klein's showrooms were Donna Karan, Louis Dell'Olio, Richard Tyler, Patrick Robinson, Ken Kaufman and Isaac Franco, Charles Nolan and Michael Smaldone.

Jones bought Anne Klein as part of its purchase of Kasper A.S.L. in 2003, and recently singled the brand out as a major opportunity for growth. To that end, it masterminded a strategy to create a designer tier that could serve as a marketing vehicle and bring a consistent vision to the other divisions. Jones beefed up its management team for Anne Klein, and conceived a striking advertising campaign photographed by Philip-Lorca diCorcia and featuring models Carolyn Murphy and Stella Tennant. There was just one snag. The "designer tier" idea was conceived by Peter Boneparth, Jones' then president and ceo, and Lynn Cote, then ceo of wholesale sportswear, suits and dresses. The duo departed last summer and were replaced in essence by Card and Susan Metzger, ceo of women's better sportswear. The new regime was left having to grapple with a costly designer venture that hadn't proven itself at retail at a time when Jones had to make tough decisions about its own future.

Toledo managed to quickly set a new tone for Anne Klein, giving the brand renewed credibility with a focus on innovative fabrics and new cuts. She told WWD in August that she wanted to establish a new DNA for the brand that homed in on the "clean and extreme vision of a woman." For spring, she offered romantic and ladylike dresses in multiple variations, from ones smattered with multicolored pixels or hand-painted flowers to striped versions and draped jersey dresses.

Her designs served to steer the creative directions at the better-priced AK Anne Klein collection, which Jones relaunched as a lifestyle label this fall with handbags, jewelry, denim and footwear and activewear, and the bridge Anne Klein New York label, which was slated to be upgraded with the Toledo touch next spring. Now that Toledo will depart, the future creative for the two divisions, which currently generate a total volume of about $525 million, including wholesale, retail and licensing revenue, remains unclear. According to a Jones spokeswoman, Jones will rely on its management and design teams to continue the brand efforts, including Metzger and Jones' chief merchandising officer for bridge and apparel lifestyle brands, Susie Rieland.

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