SÃO PAULO — São Paulo Fashion Week’s sponsorship revenue and attendance levels fell sharply in its latest fall edition, hurt by Brazil’s deep recession and the unavailability of the event’s main Bienal Pavilion in Ibirapuera Park due to an art fair.
Sponsorship revenues declined roughly 20 percent to 12 million reals, or $3.6 million at current exchange, while attendance was expected to fall to 70,000 from 100,000 last year, according to SPFW’s founder and chief executive officer Paulo Borges.
He said five new sponsors, including Coca-Cola, Garnier’s Nutrisse Creme and Mercedes-Benz, joined the platform this spring, bringing the total number of backers for the April and October editions to 17 from 12 last year.
“We have more sponsors, but they are investing less,” Borges said.
The Bienal’s hosting of São Paulo’s Art Biennial fair forced organizers to set up the event in a large makeshift warehouse bereft of fashion magazine or business lounges, hurting attendance, said sources at event organizer Luminosidade.
There were 25 runway shows, compared to more than 30 last time, as cash-strapped designers were unable to pay for runway space, said an industry observer.
To shore up its fortunes, SPFW is restructuring to incorporate “see-now-buy-now” strategies and promote e-commerce as Brazil’s apparel sales remain anemic and are forecast to plunge 25 percent this year.
“In the last few years, social networks have been communicating fashion to consumers right away,” Borges said on the sidelines of designer Lolita’s show in Iguatemi shopping mall, adding that the event must support the transition. “In this edition, nearly everyone is getting ready to sell and next year everyone will be presenting and delivering at the same time.”
Designer brand Animale presented on Nov. 6 and was already selling Nov. 7 while Patricia Vieira and À Lá Garçonne, a new label launched by established creative director Alexandre Herchcovitch, followed suit. Other brands were expected to gradually stock their ateliers within a month after their shows.
The event, dubbed SPFWTRANSN42 to convey the changes or “transformation” taking place, also helped publicize fast-growing online retailer Shop2gether, which will double its purchasing budget to $12 million this year and bolster it to $21.4 million in 2017.
Shop2gether is having a good year as online apparel sales are set to surge 15 to 20 percent in Brazil this year, said owner Ana Carvalho.
“We are going to grow 70 percent to around 100 million reals this year,” Carvalho said. “We have the biggest market share in Brazil, we offer exclusive labels and have good customer service with free returns for up to 30 days.”
SPFW’s director Graca Cabral said the “see-now-buy-now” strategy gaining speed across the fashion world will help shore up sales in Latin America’s largest economy, where a deep recession has dented consumption and put hundreds of retailers on the verge of bankruptcy.
This is partly because designers can now sell their clothes online and are striking deals with fast-growing e-tailers such as Shop2gether, archrival oqvestir.com.br (What to Wear? in English) or the likes of Moda Operandi.
That said, the latest edition (which showcased both spring 2016 and fall 2017 collections because of Brazil’s reverse seasons) also saw a decline in international buyers. Normally, Brazilian export lobby Apex brings four to five overseas buyers to the shows but “this year the number is smaller,” according to Cabral.
Emerging designer Lilly Sarti, which made her collection to sell 70 percent on see-now, expects the scheme will help boost sales 30 percent this year. The label, whose dresses can fetch nearly $2,000, launched her online portal during fashion week and sells on Shop2gether, Moda Operandi and Farfetch.
She said see-now will also help designers cut losses from counterfeits.
“We have always been concerned about other brands copying and pasting our collections,” Sarti said from her atelier in São Paulo’s posh Jardins quarter. “They had five months to do this before; now they won’t have a chance.”
Sarti said Brazil must bolster creativity in the downturn.
“We need innovation and to think outside the box,” she said. “People are boring. They don’t think about different ways to do things.”
Sarti’s collection featured 300 items including a range of fine day and evening dresses made of fabrics including silk and chiffon, retro-themed on the Sixties and referencing European painters including Joan Miró.
“Lilly’s clothes are improving year by year,” Carvalho said. “She works very well with silk and white and crochet and is the new hot designer.”
Carvalho will also carry Elo Rocha, whose styles capture Brazilian femininity, as well as Animale, which designer Vitorino Campos has helped turn into a successful label.
“Animale does the clothes that Brazilian women want. They are elegant yet sexy and all Brazilian woman want to look sexy,” Carvalho added.
Campos’ range for Animale, which opened SPFW, took inspiration from the Hamptons resort and American painters Andy Warhol and Jackson Pollock, featuring a string of looks made of “natural” fabrics including white linen and cotton with blue-stripped pants evoking the sea and clear, acrylic boots to exude a modern edge.
Sirlene di Santolo, head of buying for Joseph in London, said she would buy Reinaldo Lourenço, another up-and-coming designer, for the retailer’s seven stores in the U.K.
“The show was great, very modern, wearable and commercial,” di Santolo said, adding that she might order 150 pieces including skirts, blouses and cocktail dresses. The clothes “had the kind of Brazilian sensuality and sassiness that’s great from here.”
Gloria Coelho also won praise for a collection featuring Scottish tartan, checked dresses and kilts inspired from a trip to Scotland and Great Britain.
“I love how she constructs her clothes,” said Brazilian TV host Ana Hickmann, who was at the show and modeled for the designer when she was 15.
The week also had an overarching social inclusion and sustainability theme with designer Ronaldo Fraga staging a surprise show supporting transgender and drag queen rights. Rapper Emicida launched a new apparel brand called LAB with an all-black model show timed to raise awareness for the favela struggle. Reebok, which is restructuring in Brazil after ending ties with licensor Vulcabras last year, sponsored the event as part of a campaign to promote its new “Fit Fashion” sneaker and apparel range in fashion and art events. The Adidas-owned brand opened its first São Paulo flagship during the shows, which Brazil brand manager Jullian Salgueiro said will help boost sales 10 percent in 2016.
Valentina Sampaio, a rising transgender model who L’Oréal Paris recently hired to face Women’s International Day, also made a buzz and was present in seven runway shows.
Cabral said Fraga’s show supported SPFWTRANSN42’s goal to convey change through the term “trans,” which means “thinking beyond and going beyond in Brazil,” she noted.
Sustainability was in focus with SPFW and C&A, which was publicizing its sustainable fashion credentials, teaming to launch designer incubator program Estufa. Borges declined to comment on investment targets but Cabral said the scheme will spend significant sums to support new talent, starting with five designers next year. She sad Sebrae, a government entity supporting small businesses, will also likely sponsor Estufa next year.
She said the program is needed to bankroll new talent to sell clothing in the local market, adding that trade lobby Apex is focused on the export arena. SPFW also engages in other social responsibility activities such as taking runway shows to schools in poor communities every year.
Meanwhile, clothing brands including Animale and Herchcovitch, who recently separated from fashion group InBrands to start À Lá Garçonne, are rejigging their operations.
“The whole market is reinventing itself,” Borges said, adding that top luxury labels such as Osklen and Grupo Nohda, which runs the Patricia Bonaldi, Patbo, Lucas Magalhaes and Apartamento 03 trademarks, pursued major reshuffles early in the recession that helped them eclipse rivals.
Nevertheless, Grupo Nohda’s co-owner Luis Morais said same-store sales will fall 5 percent this year. That is better than a 10 percent drop in 2015 and is due to improving consumer confidence on expectations that the new Brazilian government will turn around the flagging economy. On an all-store basis, turnover will be flat at roughly 60 million reals.
Grupo Nohda recently opened two shops for its new “Nohda” multibrand concept to raise its count to eight standalone stores, Morais said, adding that the firm’s international sales, which include department-store doors in New York, London and Paris, “are doing much better.”
Asked about the apparel sales outlook for next year and beyond, Morais said the Brazilian market will take some time to bounce back from its doldrums.
“It’s going to take a while but at least we have some stability now,” he concluded.