Did the gamble pay off?
This story first appeared in the April 13, 2016 issue of WWD. Subscribe Today.
Consumers want to be on the inside of everything in this era of instant access, and the move to include them in the fashion frenzy — from offering show tickets to selling product immediately after it sashayed down the runway — was greeted with gusto from some quarters, groans from others.
A number of designers participated during this round of ready-to-wear collections. With the exception of Rebecca Minkoff — who broke ranks and showed her entire spring collection on the runway — houses including Michael Kors, Tory Burch, Rag & Bone, Diane von Furstenberg, Burberry, Prada, Proenza Schouler and Lela Rose offered capsules to get in on the immediate sales action — or at least the conversation — that swept the industry this season.
As quickly as the merchandise was ready for purchase, debate stirred up: Was this a real business strategy, or just a gimmick to drum up fast sales?
While no one raved about results except for Minkoff, and others such as Prada, DVF and Kors sold a few bags or dresses, companies said the experiment provided insights into their customer, drew people to their Web sites during fashion week — and the bottom line is they would most likely do it again. Most agreed the effort was more about communication with the consumer than about actual sales.
Among the obstacles to the “see-now-buy-now” trend and a shift in the fashion cycle to ship merchandise closer to seasonal needs:
• Can factories switch gears to facilitate “immediate” production for capsule collections, while working on regular production? Does it cannibalize regular production and the supply chain?
• If the calendar shifts and more production is done closer to the actual season, will Italian factories, for example, stay open in August to facilitate earlier production? Can Asian factories retool and shift ahead?
• Will New York be completely out of sync with Milan and Paris and thereby further confuse the customer?
• Do in-season shows dilute critical feedback and the ability to react to trends?
• Do they double the creative process, and have designers already moved on from the collection they designed six months earlier?
The move toward instant selling was prompted by the Council of Fashion Designers of America’s initiative to explore new models for fashion shows. Last December, the CFDA retained The Boston Consulting Group to study the effectiveness of New York Fashion Week and whether changes were needed. While the CFDA wouldn’t divulge how much it paid for the study — sources estimate the cost at around $300,000 — the general conclusions were that fashion week is at the beginning of a seismic shift, and “in-season” relevance, the delivery cycle and the subsequent markdown cadence at retail are critical issues that need to be addressed. But instead of making a firm recommendation on how to proceed, the CFDA said approaches in the future will depend on each brand, its tier and in-house strategy.
Phillip Lim, for example, is one designer who’s wary of the “show-now-buy-now,” trend, telling WWD, “You’ve got to think about how this affects the supply chain. Can we say to the cows: ‘Hey, get fatter faster’? Can we say to the trees: ‘grow faster’? You know, it’s impossible. It’s gluttony. Just because you want it now, maybe you shouldn’t have it now.”
The conversation also created two camps in firm opposition: New York and London, which seemed to be in favor of more in-season shows, versus Milan and Paris, which are against the idea and are sticking to the current format. But even before the study’s results were released, several designers jumped on the buy-now bandwagon, albeit with capsules or a few items.
An hour after her show ended, Lela Rose offered three looks straight from the runway for sale online.
“For a few reasons, this was a very good thing for us to do,” said Rose, owner and designer. “Number one, it drove traffic and interest to our site. We produced a very small amount of the three looks that we had available for a few reasons. The looks were made in a size run — five sizes per style. It was an extremely limited amount. We sold pieces, but it was not our higher volume sales.
“The one downside, which was pretty minimal, was having to stop our production cycle. Maybe it delayed our regular production by a day-and-a-half or two days. It was minimal, considering what we learned about it, and the amount of traffic we were able to direct toward our site,” she added, noting that the brand’s mostly New York manufacturing allowed it to react quickly.
“I think there’s a customer who wants to see now and buy now,” said Robert Burke, chairman and chief executive officer of Robert Burke Associates. “It can be different for each brand. What the industry has found is that there’s no simple solution to move the calendar, and doing a capsule is one way to address it. Each brand is different in its evolution and ownership of stores, and wholesale versus direct, and the consumer relationship. There’s no pat answer. Everyone wants to gain traction and attention.”
Prada offered two bags for immediate purchase and said results were positive. But Miuccia Prada herself hasn’t bought into the whole “see-now-buy-now” movement. She told WWD last month, “We’ve thought about it a lot, but journalists need to see [the collection], buyers need to buy it. So far, we don’t see any sense to it. In six months, everyone knows everything. Surely, the way we work, with fabrics made for us, it takes two months for the fabrics, two months for the production…it takes around four months from the presentation to the store, to do it well. You can do it anyway and take it out at the last moment, pretend it’s just been done, but with a collection that you know by heart — what kind of enthusiasm can you have to show it on the runway? You freeze it? In the meantime, I have moved forward. It’s a bit strange. And then, you buy only safe [merchandise]; it’s less creative and less interesting. It’s true that creativity is at risk. Or else you have to block out communication, but this is against the trend. Everyone should be silent for four months, from producers of fabrics to buyers, journalists? I have yet to understand how this can work.”
As for the results of their small test, Stefano Cantino, Prada Group strategic marketing director, said, “Speaking specifically of the two bags — Prada Pionnière and Cahier, presented during the show and immediately available after it — we believe the experiment was greatly successful, as was the response from customers. We think this is an opportunity to communicate, which benefits the image of the brand, while we continue to keep the seasonal rhythms for the majority of the products.
“Of the two bags, the Cahier, a model that has never been seen before, has drawn significant curiosity from customers, despite its high price, retailing at more than 2,000 euros [$2,283],” he added.
Several houses acknowledged that the shift in strategy is part of an evolution in the overall process.
Rag & Bone offered five men’s items for sale immediately after its show and women’s jeans, a new silhouette introduced for fall, for pre-order on its site, according to Marcus Wainwright, co-ceo.
“For us, this wasn’t about sales. The reality is that our industry is changing. We wanted to create an opportunity for consumers to have immediate access to some key pieces from the runway,” he said.
Burberry offered fall outerwear, bags and scarves from its January men’s and February women’s collections for purchase as soon as they appeared on the runway, as part of its Runway Made to Order service. Bestsellers for both genders were military-inspired coats, followed by heritage check scarves for men, and the Patchwork Bag for women, which sold out of the one-of-a-kind designs available for pre-order, according to the company, which declined to disclose sales or number of units sold.
But Burberry is undergoing a larger transformation. As reported, last September the house revealed plans to change the way it creates, presents and sells its runway collections. Starting next September, it will replace its current four-show calendar with two shows. Seasonless, immediate and personal, the new format and calendar have been designed with a global audience in mind. The collections will be available to buy in-store and online right after the show, significantly shortening the traditional gap between runway and retail.
Diane von Furstenberg offered three styles for immediate delivery, and ceo Paolo Riva said results were better than expected. “Like many fashion brands, we are at a point where as a brand we are experimenting and testing what resonates most with our women,” he said. “It was important for us to allow the DVF woman to be part of our collection experience this season alongside celebrities, guests and models, by being able to instantly buy and wear select styles from the fall collection, in the moment when they [appeared]. Our sell-through for each of the three styles was consistently higher than our average, and the results were far better than we expected.”
Michael Kors offered 11 pieces — five apparel, three shoes and three bags — for purchase a few hours after the show, but only in the Madison Avenue store and on the brand’s Web site.
“For us, it’s always about giving the customer something new that she can be excited about — a few key pieces that she can mix into her wardrobe right away for an instant mood-change — so this model felt right,” Kors said.
In one of the season’s more dramatic shifts, Rebecca Minkoff showed an all-in-season collection to an audience that was one-third consumers. The experiment paid off, according to ceo Uri Minkoff, who noted that in the last two weeks of February, the company had a 212 percent increase in rtw at wholesale — Saks Fifth Avenue, Shopbop, Bloomingdale’s, Neiman Marcus and Nordstrom — and a 150 percent spike in full-price in its three U.S. stores and online.
“Moving into March, we are significantly ahead versus our business last year and in our plans for the rtw category, both in direct-to-consumer and wholesale channels,” Minkoff said. He attributed it to the fact that it had 10 days of messaging about the current spring season. Celebrities who attended the show, such as Kate Bosworth, were photographed for weeklies wearing Minkoff’s spring merchandise.
The company showed retailers and press its fall collection in the showroom, and Minkoff said fall orders were running 35 percent above plan.
Tory Burch offered seven styles for immediate sale on toryburch.com: a Gemini Link bracelet as well as two colorblock track suits in red and navy, a white warm-up jacket and a navy performance piqué polo shirt from Sport. “For us, it was really about styling our collections and experimenting with the buy-now-wear-now concept,” said Tory Burch, cofounder, co-ceo and designer.
After offering buy-now opportunities in its fall 2015 and spring 2016 collections with strong online sell-outs, Tommy Hilfiger didn’t have any immediately available product for fall 2016. In September, Hilfiger plans to show — in-season — the fall Tommy x Gigi collection created with Gigi Hadid on the runway, with everything available for immediate purchase. The company has already shown and sold the line to its own stores, Web site and select wholesale accounts globally.
The designer will present his spring 2017 Tommy Hilfiger collection in the showroom, and then in February, will show it on the runway for the first time.
Even retailers are experimenting with the notion. Neiman Marcus is teaming up with Alice + Olivia by Stacey Bendet to present its Alice + Olivia x Grateful Dead capsule collection paired with limited edition items from the spring 2016 collection at a fashion show at NeueHouse Hollywood in California April 13 leading up to Coachella. “This is unprecedented, showing never-before-seen merchandise in a fashion show, with the ability for customers to shop immediately online,” said Ken Downing, Neiman’s vice president and fashion director. “We often present season-ahead fashion shows [that allow] customers to pre-order selections to be delivered later but never see-and-get.”
Industry veteran Susan Sokol, founder and ceo of Susan Sokol Consultancy, thinks there’s value in the idea of immediate selling, but it doesn’t solve larger problems at retail. “I definitely think there’s some validity to [see-now-buy-now]. I look at it as a Band-Aid. It addresses some issues and it gives the customer that instant gratification — which, as we know, is really important. She sees the clothes and is enticed and seduced and now can purchase these pieces immediately and doesn’t have to wait five or six months.”
She said, “There’s a bigger issue here: the fact is the retail business has been really challenging the last year to 18 months. From a wholesale perspective, there needs to be disruption and people need to think differently. Deliveries arrive way too early in the stores. Retailers have a significant stake in this. They’ve been a proponent of earlier deliveries.”
Sokol added that merchandise is delivered too early when the consumer wants something else. “The whole cadence is off, and it leads to a tougher retail environment with weaker sell-throughs, higher markdowns and then reduced profits.”