The mating dance between fashion retailers and like-minded brands has produced another partnership, this time between Nylon magazine and Urban Outfitters. Nylon in September will launch in-store shops featuring apparel, music and books in Urban's 113 locations.
"I always thought Nylon could have a store," said Marvin Scott Jarrett, the magazine's editor in chief. "I always wanted to have a store. To immediately have 100 stores is exciting."
Kevin Lyons, creative director of Urban Outfitters, said the idea of a Nylon shop appealed to him on several levels. "The big thing is that we've always been fans of Nylon and see it as the magazine representation of our stores," he said. "Our customer reads Nylon. We don't do marketing or advertising, so we don't really seek partnerships, but when this opportunity came about we jumped on it. It seemed to really work."
"[Urban] is targeting smart, hip, urban customers, as we are," Jarrett said. "Their target is 18- to 25-year-olds. We talk to people in their 20s. The psychographics are very similar. They have stores in cities that we do well in."
Nylon created a limited edition artist series of T-shirts for men and women ($36) for the shops. CDs reviewed in the magazine's most recent issue will be on sale, along with DVDs and books. "We're going to do a hoodie for holiday," said Jarrett. "There's talk about us doing housewares and we're naturally growing into other areas such as jewelry. We're also doing something with the MP3 player rival to the iPod, the Zune. We did a customized pink Zune that's covered with graphics."
Lyons said Urban is open to any product category Nylon suggests. On the drawing board are cut-and-sew sweatshirts, T-shirt dresses, hats, customized plates, pillows and other artist-series items. "As the line grows, both of us can grow together," he said.
For Urban, part of the fun is Nylon's ability to "get artists to do great things," Lyons said. "We're taking advantage of Marvin's love of music and Nylon's affinity for music."
Jarrett, for example, arranged for "one of my favorite Paris bands, the Plasticines" to perform on Sept. 6 at Urban Outfitters in Manhattan's SoHo to kick off the Nylon-Urban partnership.The challenge for Nylon, which has a rate base of 225,000, will be to keep its products special and avoid the pitfalls of commerciality. "I've seen other magazines do branded items and licensing," Jarrett said, noting that not all attempts were successful.
Meanwhile, the retailer's parent, Urban Outfitters Inc., on Thursday said second-quarter earnings rose 24.2 percent, propelled by solid sales at its Anthropologie and Free People divisions. The Urban division was a drag on both comps and margins, with excess markdowns limiting gross margin expansion.
For the three months ended July 31, earnings at Urban Outfitters Inc. rose to $31.9 million, or 19 cents a diluted share, from $25.7 million, or 15 cents, in the same year-ago period. Sales climbed 22 percent to $348.4 million from $285.6 million, while same-store sales grew 5 percent.
Earnings for the six months increased 33.2 percent to $61.2 million, or 36 cents a diluted share, from $46 million, or 27 cents, in the year-ago period. Sales jumped 19.3 percent to $662.9 million from $555.6 million. Same-store sales at Anthropologie advanced 14 percent, and at Free People, 28 percent, while comps at Urban fell 3 percent.
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