DONNA KARAN: GLOBAL RETAILER

Byline: Melissa Drier / contributions from Janet Ozzard, New York

BERLIN — Donna Karan marches on.
The designer was in town last week for the openings of her first two stores here, but there are plenty more to come. And on several continents.
This year alone, 15 Collection and DKNY stores are set to open in Melbourne, Rome, Stockholm, Moscow, Amsterdam, Geneva, Brussels, Kuwait City, Rio de Janeiro, Tel Aviv and Hong Kong.
Already in 1997, there have been Collection or DKNY openings in Beirut; Prague; Zagreb, Croatia; Thessaloniki, Greece, and Barcelona.
Last Friday, Karan hosted a party celebrating the opening of a 5,500-square-foot Collection store here, which followed the debut of a 5,000-square-foot DKNY boutique in the same high-end complex eight days earlier.
“There’s a tremendous network of independent retailers in Europe who interact all the time,” said Stephen Ruzow, president and chief operating officer of The Donna Karan Co., in a phone interview from Florence Wednesday, where he and Karan were meeting with mills and manufacturers.
“They talk to each other all the time and ask, ‘How is this selling? How’s that selling? Who’s hot?”‘ Ruzow continued. “The more we’ve been selling in Europe, the more that network has been focusing on us, and we’ve been getting approached for these retail partnerships.”
The Berlin stores are the result of a partnership with August and Anna Jagdfeld, owners and developers of Quartier 206, a high-end shopping mall on Friedrichstrasse, where Karan’s two new stores are located. Other Jagdfeld properties are the Hotel Adlon here and restaurants and hotels throughout the country.
“Marvin Traub [former chief executive officer of Bloomingdale’s and now a consultant] actually introduced me to the Jagdfelds about a year and a half ago,” said Ruzow. “I went to see them in Berlin when there was nothing there. We got along right away.”
Anna Jagdfeld plans a 21,500-square-foot specialty store in Quartier 206 this fall featuring designer collections “from couture to contemporary, special accessories, the most beautiful objects for the home and table top.”
She said she hopes to open Donna Karan Collection stores in Hamburg, Dusseldorf and Munich, and DKNY stores are slated for Frankfurt, Cologne and Stuttgart.
“The key for us is finding the right partner and the right location,” said Allison Riba, president of Donna Karan’s international division, during the party here. “The strategy is to try to open one Donna Karan Collection store a season, whereas we can open five to six DKNY shops in the same period.”
Riba is looking at Glasgow and Birmingham in the next couple of years. A Collection store is set for Barcelona in 1998. As for Paris, “We’re in the midst of looking at a lot of locations,” Riba said, and scouting is set to start in Milan.
But Berlin, still recovering from more than 30 years as a split city, doesn’t have a very active shopping culture — yet. While the city does have some boutiques — including Gucci, Jil Sander and Gianni Versace — it doesn’t boast the luxury store-lined boulevards of Munich or Hamburg.
“It may take two or three years, but it will happen,” said Ruzow. “The Jagdfelds are based there, and they believe it will. There was so much money poured into old East Berlin. And the government is moving back there from Bonn.”
Each site, said Karan, is an evolution in her concept of retailing.
“There’s no question that each store represents another step,” she said Wednesday, from Florence. “I want to make sure I get it right and learn what it is to be a retailer. The Berlin stores are both so great in terms of segmentation, and the layout is so sensible. It makes shopping easy; it has a point of view. London [where Karan opened a flagship Collection store in September] was a highlight of my life, and a tough act to follow, but this is another version of my high expectations. Who would have thought that you could find the same kind of calmness and elegance in a mall?”
At the party for her Berlin store, Karan was bubbling.
“They did such a great job, down to every detail. I’m ecstatic,” she exclaimed in the street-level Collections shop, which is similar in decor to the London shop, although about half the size.
But Karan said the DKNY store in Quartier 206’s lower level is where “we’ve worked out the kinks.” She said, “I want the people from London to come over and see it.”
“This store identifies all the segments we’re in, which the other stores couldn’t do,” she added. “I’m realizing how important segmentation is.”
The store has clearly separated Karan’s D line — which costs about 30 percent more than DKNY and uses more forward fabrics and silhouettes — from the more career and casual looks of the DKNY line.
“It’s like a little department store,” said Karan. “I remember the way Bendel’s was, and it was always my dream to do something like that.”
Karan also made a name for herself as a party-giver during her brief stay here. She took over Quartier 206 for the Collection store party Saturday night and created a nightclub out of raw space, with gold leaf on the concrete walls, white-cushioned banquettes, masses of candles, black and white pillows, orchids and a sushi bar. On the lower level, guests danced to disco on the marble-inlay floor.
About 1,000 Berliners attended the event, including Mayor Eberhard Diepgen, bankers, politicians, artists, film makers and entertainers.
“I just want to open a club in New York!” Karan said, perhaps half joking. The response to the temporary club was so positive that Quartier 206’s management made a snap decision to keep it open for the next three months. After that, it will become another in the series of Bice restaurants that are opening in different cities.
This is not Karan’s German debut by any means. Currently, DKNY is sold in about 100 multibrand boutiques in Germany, and Collection is in the country’s 20 “best boutiques,” said Riba.
There is also a DKNY boutique in Munich. The company’s marketing strategy in Germany and Europe in general “is to get the brand known by choosing the best boutiques” in any given market and then opening freestanding stores with partners in major cities.
But Karan said she’ll definitely be back to Berlin.
“Two and a half years ago,” she recalled, “I sat across the street and saw this being built and had no idea I’d have a store here.”
She first came here because she heard the flea markets and antiques were good.
“The Thirties and Forties clothes are incredible, and I just went to Garage and bought all my colors by the pound,” she said, referring to the second-hand emporium that sells its vintage items by weight.
“I love Berlin. I felt very at home from the very beginning, and I don’t say that easily,” Karan continued. “It’s a very cool city, very creative, and visually Berlin is exciting. People here have a sense of style that’s absolutely personal. I don’t find it ‘German’ in the way I imagined German to be. It’s hipper, has character, and Berliners have a bit of an edge.”

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