Fashion is, by nature, all about change, and nowhere is that more true than in the accessories category, according to Dina Battipaglia, president of the Liz Claiborne brand and contemporary accessories at Liz Claiborne Inc.
“There is no doubt about it, it’s a challenging environment out there,” said Battipaglia. “The category is an attractive area to be in, so the competition has grown exponentially. Therefore, it’s necessary to keep being innovative with your brands. This is why we never stop. We are always looking for the next opportunity, and that is what has helped us become successful.”
Since 30-year-old Liz Claiborne introduced its first accessories — handbags, small leather goods and fashion items like scarves, belts and hats — in 1980 under its namesake label, it has moved deftly to find new opportunities under not just the Liz Claiborne moniker but its growing portfolio of brands. Today, the $4.85 billion firm offers everything from handbags to small leather goods; scarves, belts and hats; cold-weather products; hair items; women’s and men’s jewelry, and even dog sweaters and canine carriers from a full range of brands. These include casual resource Sigrid Olsen, denim line Lucky Brand Jeans and contemporary collections Juicy Couture and Laundry by Shelli Segal, among several others that target retailers from the midtier to the high end.
Besides fashion accessories, the company licenses bedding, blankets, throws, table linens, decorative fabrics, furniture, flooring and home storage under the Liz Claiborne brand; bedding, bath goods and table linens for Sigrid Olsen, and bath goods and table linens under the Villager name, a midtier line.
Much of Claiborne’s strategy has evolved from the concept of the multicategory brand, something the firm helped pioneer in the U.S. in its early days, when it extended its apparel label by adding handbags, then small leather goods, fashion accessories and, finally, jewelry under the same name.
“[Managing] many categories under one brand and one organization…was the vision of just a couple of people at the time, but now it’s become conventional wisdom for many companies,” said Bob Conrad, president of modern and classic accessories at Liz Claiborne.
As the firm seeks to acquire other apparel properties, he said, it is focusing on niche businesses that aren’t yet mature and have names that resonate with the consumer so it can develop them with the same concept in mind.
“If it has potential for extensions, it offers a great opportunity for us,” he said.
The Liz Claiborne brand is a driving force in accessories for the firm, ranking as the most recognized label in the category, according to the 2005 WWD100 consumer brand awareness survey. And the company’s recent acquisitions have moved beyond apparel to offer an array of accessories that are creating a buzz at retail.
Juicy Couture, which was founded in 1997 by Gela Taylor and Pamela Skaist-Levy, and purchased in 2003 by Liz Claiborne, has evolved from offering T-shirts and trendy velour jogging suits to retailing a full line of apparel, including a high-end collection called Couture Couture. In spring 2004, it introduced handbags accented with signature hardware and jewelry based heavily on girly, whimsical charms. The debut earned Juicy the Accessories Council Excellence Accessory Brand Launch award in 2005. This fall, the brand will continue to build its mix with the introduction at retail of a cold-weather collection comprising knitted gloves, scarves and hats, as well as leather gloves. Retail prices for Juicy accessories range from $25 for a charm to $850 for handbags.
“Juicy was attractive to us because it had the potential to be a full lifestyle brand,” said Susan Davidson, group president of denim and nonapparel at Claiborne. “It’s a fun brand and there aren’t a lot of other brands like it. There’s a lot you can do with it.”
Davidson said when Claiborne bought Juicy, it was looking to expand its footprint in the contemporary zone.
“We needed to expand in contemporary so that we could play with Saks Fifth Avenue, Neiman Marcus or Barneys New York,” she said. “We like to address every consumer and sell in every marketplace in every country.”
The brand has also grown through its freestanding stores, where customers can purchase the Juicy look from head to toe. Juicy has three boutiques in the U.S. and plans to open 10 to 15 more in the U.S.; several European flagships, and a global lifestyle store in Tokyo next month.
“We are getting growth out of the traditional department stores,” said Conrad, “but the freestanding stores are also providing growth, so one of the company’s thrusts is to grow our own retail, and accessories are integral to completing the assortment in that venue.”
Laundry, acquired by Liz Claiborne in 1999, introduced handbags and jewelry for holiday 2005. Battipaglia said this is also picking up steam. The line’s satchels, clutches, shoulder bags, dangling earrings, necklaces, bracelets and rings play off Laundry’s feminine, day-into-evening sensibility at retail prices ranging from $20 for a piece of jewelry to $468 for a handbag.
The 20-year-old Sigrid Olsen brand fell under Claiborne’s umbrella in 1999 when the apparel giant acquired a percentage of Olsen owner Segrets Inc. Olsen’s accessories are broadening its reach, too. It added handbags in February 2003, jewelry in August 2005 and, beginning this month, scarves and cold-weather goods. The firm has announced new licensed categories in optics and sunglasses for 2006, and plans to expand its domestic retail presence by about 20 to 25 boutiques annually, with a goal of over 150 stores. Sigrid Olsen now has 45 boutiques.
“Diversity is our competitive advantage,” said Battipaglia. “It mirrors what the company has set out to do.”
To maintain that diversity and ensure that a Juicy clutch doesn’t start looking like a Liz Claiborne purse, or a Lucky Brand Jeans necklace like a Sigrid Olsen choker, the parent stays focused on each brand’s individual identity.
“We have very separate, dedicated design teams that work for each brand and are entrenched in that brand’s DNA,” said Battipaglia. “When the original owners are still involved, like Sigrid Olsen or the Juicy founders, we work closely with them and keep them engaged in the business. When you are clear about the brand identity, it’s easy to keep them distinct. Even the advertising approach and retail approach is very different for each brand.”
Claiborne executives would not divulge which brand brings in the biggest revenues, but it did say jewelry continues to be a leading category, boosted by the Monet, Estate by Monet, Kenneth Cole New York and Reaction Kenneth Cole brands.
Acquired in 2000, Monet was the first accessories-only brand Claiborne bought and it has become one of the largest domestic fashion jewelry lines, according to Conrad.
Monet features classic looks; its fall collection includes a grouping inspired by Japanese paper. Retail prices range from $22 to $95. Estate by Monet, which was launched in top department stores last fall, seeks to create red carpet-ready pieces inspired by the brand’s archives. Prices range from $24 to $175.
Kenneth Cole New York and Reaction Kenneth Cole offer luxe looks, like a bracelet formed from a stack of gold and black bangles finished at the back with a cascade of gold chains, or long necklaces with bold, hammered pendants. Retail prices for the more refined Kenneth Cole New York range from $32 to $280 and for Reaction, $22 to $125.
“With the jewelry business, it has been slower than it has been in the past,” said Battipaglia. “We had come off of a brooch cycle, where we did really well. Now it’s less specific. It’s the same with fashion accessories. Instead of it being about the poncho, it’s more about the category of wraps. We’re walking away from the ‘It’ item, which makes it more challenging. But out of any changes always emerge new opportunities. This is one of the reasons it’s important to be flexible.”
That flexibility is paying off. In an early March post-earnings conference call with Wall Street, Claiborne reported that the accessories category had double-digit increases year-over-year for the fourth-quarter fall-holiday season. Sales in the wholesale nonapparel segment, which includes accessories, cosmetics and licensing, totaled $174 million, an 11.9 percent increase over last year. (An annual sales figure for the segment was not available at press time.) Net sales for Liz Claiborne overall in the same quarter were $1.2 billion. In the wholesale nonapparel segment, the company expects net sales to increase by the midsingle digits in the first quarter of the new fiscal year.
Overall sales in the accessories category in the U.S. jumped to $30.29 billion in 2005 from $28.85 billion the previous year, said Britton Jones, chief executive officer of Business Journals Inc., based in Norwalk, Conn., and producer of AccessoriesTheShow.
“The thing that is most exciting about accessories is that there’s a real emotional connection with the consumer,” said Battipaglia. “There’s an energy about accessories. Consumers just love them. We see the category only continuing to grow.”