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Australia Wool Growers Boost Marketing

Increase is the result of a vote in late 2012 to devote more funds to marketing over the next three years.

SYDNEY — Australian Wool Innovation has a record marketing war chest and no shortage of plans for spending it.

For the 2013-14 financial year, commencing July 1, AWI’s marketing budget will increase by 56 percent to 54 million Australian dollars, or $56.6 million at current exchange, the result of a vote by Australian wool growers in late 2012 to devote more funds to marketing over the next three years.

On the immediate to-do list: reestablishing New York and Paris offices after several years’ hiatus in both markets and completing the 2012 International Woolmark Prize.

The latest incarnation of the 60-year-old International Wool Secretariat competition, the International Woolmark Prize final will be staged at London’s ME Hotel on Feb. 16. Finalists Christian Wijnants, Sophie Theallet, Dion Lee, DressedUndressed, Ban Xiao Xue and Pankaj & Nidhi will compete for 100,000 Australian dollars ($105,467) in prize money and the opportunity to have their winning merino collection sold through a global retail network that includes Bergdorf Goodman and Harvey Nichols.

The judging panel is comprised of Donatella Versace, Victoria Beckham, Diane von Furstenberg, Vogue Italia editor Franca Sozzani and Tim Blanks, Style.com’s editor at large, who also produces trend reports for AWI.

Scheduled to run over four years, with a first year budget of 800,000 Australian dollars ($843,736), the event has already recouped at least 10 million Australian dollars’ ($10.6 million) worth of publicity, according to Media Monitors/Cision.

“I could put another five years [of the competition] up to the board tomorrow and they’d approve that, certainly with the numbers that we’re getting,” said AWI chief executive officer Stuart McCullough, who is also juggling numerous other marketing projects, all launched over the past two years. They include The Campaign For Wool, the Wool Lab trends service and Cool Wool, an ultralightweight merino fabric campaign that was unveiled at Première Vision in early 2012 and that launched into the Middle East last month.

AWI is paying particular attention to the industry’s biggest customer, China, which bought 75.8 percent of Australia’s 2.68 billion Australian dollars ($2.83 billion) of wool exports in the 2011-12 financial year.

“Our efforts there will grow exponentially,” said McCullough. “We don’t think it’s the end or the beginning of the end or the middle even. We think it’s the start of the start of the emergence of affluence in that country.”

Gold Woolmark is a China-specific retail and media initiative between AWI and nine luxury European fabric and tailoring brands, including Holland & Sherry and Dormeuil. It is primarily a men’s wear-focussed campaign. According to the CLSA brokerage group, men account for 55 percent of China’s luxury goods market, well above the global average of 40 percent.

No Finer Feeling is a three-year, 20 million Australian dollar ($21.1 million) campaign that has seen AWI partner with more than 30 designers and brands, including Giorgio Armani, Ermenegildo Zegna, Lanvin, Alexander Wang, Marc Jacobs and Vivienne Westwood, via either co-branded media and point-of-sale campaigns in the U.K., Europe, China and Japan or wool ambassadorships. Three new wool ambassadors in the U.S. jeans, outdoor and base layer categories are due to be unveiled in the fall.

Wool prices, meanwhile, hit a record high of 1,436 cents a kilo clean on the benchmark AWEX Eastern Market Indicator in the first half of 2011 and, in spite of fluctuations in the interim, continue to hover above the 10-year average — with the EMI closing at 1,106 Australian cents on Friday.

It’s not only wool growers who believe this might not be coincidental.

“The wool market has been very strong, and it remains strong,” said Malcolm Bartholomaeus, a wool analyst at Profarmer. “It’s the demand side which is allowing the market to hold at its current levels, and that’s been against reasonably significant headwinds in Europe, Japan and China. I think there has to be some merit in the marketing activities of AWI. Certainly they’re moving to more brand- and product-specific partnerships and promotions of consumer products as opposed to just generic ‘Wool is good and unique, wear it because it’s wool.’”