Madonna/Lourdes Collection At Macy's Expands

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by David Lipke
From WWD Issue 07/18/2011

Macy's shoppers will be living in a bigger Material Girl world come fall.

Madonna, Iconix Brand Group Inc. and Macy’s, all partners in the juniors brand, are launching a range of new product categories, including beauty, intimates and sleepwear, and expanded programs in denim, outerwear and social dresses.

The first beauty offerings, which include nail polish, lip gloss, body sprays and lotions will be in Macy’s stores Aug. 15, with eye palettes arriving on Sept. 15. The intimates and sleepwear are hitting stores this week, the denim will be available on Aug. 15, social dresses Sept. 15 and outerwear on Oct. 15.

“It was so much fun getting to pick all of my favorite scents for the Material Girl body products and lip glosses,” said Lourdes “Lola” Leon, Madonna’s 14-year-old daughter who serves as a public face of the brand and helps oversee creative direction and design. “The body products have fun names like Wicked Watermelon, Flirty Fruit, Midnight Magnolia and Sinful Sugar. I chose scents that I loved.”

The move into new categories for Material Girl comes as Macy’s expands the brand’s footprint. Material Girl will be in 300 Macy’s doors this fall, up from 200 at its initial launch last August and 250 this past spring. As of July 2, there were 805 Macy’s stores in the U.S.

Macy’s declined to provide total sales figures for Material Girl, but Martine Reardon, executive vice-president of marketing and advertising, said the line was performing well. “If you walk onto the sales floor, you’ll see how prominent a positioning it has on our juniors floor. It is one of our top-five brands in juniors,” she noted. “We are focusing on this youth consumer with fast-fashion that is trend-right and extremely affordable.”

The Material Girl beauty products will retail from $7 to $12. Body washes, body lotions and body mists will come in six scents, the nail polish in 10 colors, and the lip gloss in 12 variations. Eye palettes will come in two variations, including “Soft & Pretty” and “Smoky and Sexy,” and include four eye shadows, a pencil, a dual-end applicator and mirror.

Some beauty items will also be placed near registers to encourage impulse buys. “We have brand-new fixtures to highlight the beauty products, as well as new accessories, within the Material Girl world,” said Reardon.

Intimates retail for $5 to $29 and include solid and polka dot pushup bras, bustiers, boyfriend briefs, rose-print lace panties and cupped cami bras. Sleepwear retails for $14 to $22 and includes tanks, tunics, sweatshirts, boxers and lounge pants.

“The woven waistbands on the underwear have the Material Girl logo on them, so there’s a status feel to them. Girls want to wear this brand and show it off now,” said Lanie List, chief merchandising officer at Iconix Brand Group. Taking a page from Madonna’s “Like a Virgin” and “Express Yourself” days, List expects Material Girl customers to wear some of the innerwear as fashion pieces.

While the brand sits on the juniors floor and has a soon-to-be high school sophomore at its creative helm, the core customer is 18 to 25 years old.

“Lola is 14 but she lives in New York City and has a very famous mom, so she has a very sophisticated eye,” explained List. “Lola is here once a month and sometimes more. She brings stuff from her own closet for inspiration. For the bath and body products she probably had 100 scents in front of her. She has a very mature approach to product development.”

Madonna is a less frequent visitor to Iconix headquarters in New York than her daughter, but she wields final say in much of the product, said List. “Madonna definitely has creative input also. It’s a collaboration between the two. If Lola goes to a place with an idea that Madonna doesn’t think is appropriate for the brand, she’ll veto it. She’s a branding expert,” said List.

While Material Girl already has some denim, outerwear and party dresses in its current merchandise assortments, for fall the brand will blow out those categories with full product assortments, as they have been key sales drivers in the collections. Outerwear will retail for $59.50 to $89.50 and includes cape coats and bomber jackets. Party dresses adorned with sequins, feathers, lace and beading will retail for $59 to $79. Denim, which will encompass 20 trend-driven styles, including faded flares, studded jeans, overdyed styles in vivid colors, acid-wash skinny jeans and suspender styles, will retail from $29.50 to $32.50.

Macy’s and Iconix are supporting the expansion of Material Girl this fall with an advertising campaign that features Kelly Osbourne for the second consecutive season. The fall media buy includes People StyleWatch, Nylon, Seventeen, Teen Vogue and Cosmopolitan, in addition to outdoor — including a Times Square billboard and the Macy’s Jumbotron in Herald Square — and online celebrity and fashion blogs.

Mike Boylson Leaves Penney's

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by David Moin
From WWD Issue 07/18/2011

J.C. Penney Co. Inc.’s marketing team has experienced a string of departures, among them its top official, Mike Boylson, executive vice president and chief marketing officer.

Boylson’s exit has raised speculation that incoming chief executive officer Ron Johnson has already begun cleaning house at Penney’s. Johnson is expected to bring a lot of change to the business, just as he did at Apple, where as senior vice president of retail he orchestrated the brand’s fast-paced, innovative and highly productive retail strategy from its inception in 2001 to more than 300 stores currently in the U.S. and abroad.

Boylson left Penney’s at the beginning of July, though Penney’s did not announce his departure despite his stature and long history there. Boylson joined the retailer as a management trainee in 1978, rose up the ranks to store manager, district manager, vice president and director of marketing planning and promotions, and finally executive vice president in April 2003. He oversaw a huge, high-profile marketing program with an annual advertising budget estimated at around $1 billion.

Two other marketing executive also recently left Penney’s: Nick Bomersbach, vice president of marketing for jcpenney.com and a 10-year veteran of Penney’s, and Christine Laczai, director of digital marketing who has been with Penney’s for two years and previously worked with VF Corp.

In confirming Boylson’s departure Friday, Penney’s said it has begun a search for Boylson’s successor. “Mike Boylson informed J.C. Penney in early June of his intention to retire on July 1,” a Penney’s spokeswoman said. It’s expected that Penney’s will hold off on filling the other vacancies until a new executive vice president of marketing is determined. Bill Gentner, Penney’s senior vice president of marketing planning and promotions, is acting as interim chief marketing officer.

Johnson joins Penney’s board on Aug. 1. and becomes ceo in November but has already been getting his feet wet. He accompanied Penney’s current ceo and chairman, Myron E. “Mike” Ullman 3rd, to Hong Kong for the chain’s annual supplier summit, where key suppliers learn about the state of Penney’s business and long-range plans.

In addition to making organizational changes, Johnson is expected to drive Penney’s Web presence, introduce new products and get the Penney’s team to think differently. Penney’s close to $18 billion in sales last year is still under prerecession volumes, but the company has the potential for growth and for elevating its image to attract younger customers. Johnson was lured to Penney’s by the prospect of reinventing another slice of retail, just as he did with the technology sector, and by the opportunity to be the top gun at a multi-billion dollar corporation.

Brooklyn Lease Negotiations Continue For Walmart, Penney's

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Wall Street Journal
By Eliot Brown and Joseph De Avila

The Related Cos. is in advanced lease negotiations with Wal-Mart Stores Inc. and J.C. Penney Co. about anchoring a mall in southeast Brooklyn, according to people familiar with the matter.

Wal-Mart has long been considering the site overlooking the Belt Parkway just west of Howard Beach. But talks have intensified in recent months as the company has expanded a publicity campaign and taken steps to mollify potential critics, the people said.

The outlook for the 630,000-square-foot development—which would accomplish Wal-Mart's longtime goal of opening a location in the city—was boosted by J.C. Penney's strong interest. The combination of the two large stores would likely give the project sufficient financial viability to move forward despite the uncertainties that continue to cloud the slowly recovering economy.

J.C. Penney, which was based in Manhattan for about seven decades before moving to Texas, already has stores in all four other boroughs. But Wal-Mart doesn't, and its possible entry into the city has sparked strong opposition from labor unions, community groups and some elected officials.

Hurdles to Wal-Mart's beachhead remain. For starters, Related has yet to finalize a purchase of a portion of the site from the state, the price for which has come under criticism from Wal-Mart opponents.

But the project doesn't require further approval by the City Council, typically a major obstacle for developers. Given a 2009 rezoning, Related is free to build any big-box store on the site once it takes control.

Representatives for Wal-Mart, J.C. Penney and Related declined to comment on lease negotiations. "We still have not signed any leases anywhere in the city," Steven Restivo, a spokesman for Wal-Mart, said last week. "We continue to evaluate opportunities across the five boroughs."

Wal-Mart and J.C. Penney would take around 150,000 square feet each in the planned Gateway Center II mall, according a person familiar with discussions. The project would sit just north of Related's Gateway Center mall, which was completed in 2002 and houses a Target and a Best Buy.

Wal-Mart, which has unsuccessfully sought to break into the New York market in the past, has been investing considerable resources in an attempt to pave the way for an entrance over the objections of a powerful set of unions and elected officials.

Two labor groups, the United Food and Commercial Workers and the Retail, Wholesale and Department Store Union, have been particularly aggressive in combating Wal-Mart, which has long been opposed to a unionized work force. They are joined by elected officials including Council Speaker Christine Quinn and community groups worried about the giant discounter's impact on local merchants.

To counter the critics, Wal-Mart has launched a public-relations campaign to tout the retailer's virtues through fliers and newspaper and radio ads.

In the first four months of the year alone, Wal-Mart spent more than $1.7 million on consultants, most of which was directed at firms that do advertising and polling, according to lobbying records.

Earlier this month, the company announced a $4 million donation to a New York City job program at a news conference with Mayor Michael Bloomberg. Wal-Mart also recently signed up as a $150,000 sponsor for a summer concert series hosted by Brooklyn Borough President Marty Markowitz that includes performances by such artists as Queen Latifah.

The sponsorship drew praise from Mr. Markowitz, who has been critical of Wal-Mart in the past. In a statement on Sunday, he said he isn't "philosophically" opposed to Wal-Mart, but declined to comment on Related's plans. He said he believes the retailer should pay "a fair wage" and allow workers to unionize.

The push seems to have created a sense of inevitability among many elected officials, particularly given that the company has said it only intends to take space in stores where City Council approval isn't necessary, making it difficult to block. Earlier this year, Wal-Mart also won some labor support by signing a five-year contract with the Building and Construction Trades Council of Greater New York that guarantees that any of the company's store construction would be done with union labor.

Even Ms. Quinn, a vocal Wal-Mart critic, earlier this year offered to broker a deal between the company and the Hunts Point Terminal produce market. Under the deal, Wal-Mart would have committed to buying at least 5% of its produce from the market, although talks fizzled.

Aides to Ms. Quinn last week downplayed the potential deal and said Ms. Quinn hasn't changed her position on Wal-Mart and that she continues to oppose the company coming to New York.

Critics of the possible Wal-Mart Brooklyn development have recently stepped up efforts to block Related's purchase from the state of a 21-acre piece of the mall site. Related already controls the rest.

Last week, critics released a state memorandum from the Office of General Services that detailed how Related had renegotiated the purchase price for the state-owned land. The price was reduced in 2010 to $14.5 million from the $32.5 million it agreed to pay in 2009.

According to the memo, the price was changed partly because of an appraisal that showed a lower value for the site. Also, Related had been counting on at least $7.5 million in expected government incentives that proved unavailable. The mall is part of a larger 227-acre development that includes low-income housing, retail and parkland.

"The Gateway 2 development will expand on the enormously successful project that has already brought great economic benefits to this area," creating thousands of jobs, said Joanna Rose, a spokeswoman for Related, last week.

The land sale must be approved by state agencies and the state comptroller. A spokesman for the comptroller's office said last week that it hadn't yet received the proposal.

JLo, Anthony Lines Will Continue At Kohl's

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Wall Street Journal
By Karen Talley

Singer and actress Jennifer Lopez remains committed to launching a clothing line at Kohl's Corp. with husband Marc Anthony despite recently announced plans to divorce.

Mark Young, Ms. Lopez's publicist, said the Kohl's launch in September "will proceed as planned." Mr. Young called Ms. Lopez's line "distinctive" and said it represents style in an accessible way.

The star couple announced over the weekend plans to split after seven years of marriage, and retail-industry watchers said it is bad timing for the planned apparel rollout. Over the weekend, after the couple's announcement, Kohl's also said the launch would continue and that the lines can stand by themselves.

"The Jennifer Lopez and Marc Anthony brands have always been positioned as two separate, distinctive collections," a spokeswoman for Kohl's said.

The retailer calls the lines the largest launch of exclusive merchandise in the company's 49-year history. Kohl's has been talking up the lines and planning a big publicity push as the retailer looks for the brands to boost sales.

The lines will encompass virtually every merchandise category that Kohl's carries. The brands will be a move by the department-store chain to step up its so-called aspirational, or higher-quality, offerings.

The products, with Ms. Lopez taking a big hand in the women's offerings and Mr. Anthony involved in the men's, were expected to be promoted around their lifestyles and publicized together.

"These kinds of situations create consumer disappointment and disengagement with the celebrity," said Robert Passikoff, founder of Brands Keys, a brand-consulting firm. "Right now, Kohl's has to go through with it. They have made an investment in the merchandise and the licensing fees."

In good news for Kohl's in terms of the couple shooting for an amicable divorce, they have said they will go through with their Latin talent-search show. "The best thing [Kohl's] can do is sit very quietly and hope there is no more bad news about Marc or Jennifer," Mr. Passikoff said.

New Chairman To Head Zara's Parent Company

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by Barbara Barker
From WWD Issue 07/19/2011

Inditex will today enter a new era.

The parent company of Zara, Europe’s largest apparel retailer, will today see a change in management when chairman and founder Amancio Ortega, dubbed “the inventor of the Zaravolution,” steps down and hands the reins to Pablo Isla, who had been the group’s chief executive officer and deputy chairman since 2005.

But while the 75-year-old immensely secretive and low-key Ortega may be stepping down, he is hardly out — especially since he still controls the majority of the company’s shares. “Nothing has changed. He still controls the company and he still has a lot to say — and nobody doubts that he will say it,” said Sofía Vázquez, a reporter for La Voz de Galicia, a regional newspaper in the north of Spain, which is the company’s home base.

“Amancio is making another smart move, preparing for the future with similar logic and the same intelligence he has always used to run the company, but I think he’ll remain very close by,” added Linda Heras, international development director of Roberto Verino, a high-end apparel label and geographical neighbor.

Inditex operates 5,154 stores in 78 countries, with net profits of 1.73 billion euros, or $2.29 billion at average exchange, for the 2010 fiscal year on sales of 12.5 billion euros, or $16.5 billion. With eight chains led by Zara, Ortega’s empire has a workforce of roughly 100,000.

Under Isla’s watch, Inditex rolled out more than 2,800 stores with the top priorities being expansion in Asia and Eastern Europe, as well as growing e-commerce.

Pending shareholder approval, Isla will receive a hefty block of shares, worth 13.7 million euros, or $19.6 million at current exchange, as “a welcome gift” from Ortega, a company source confirmed.

About his succession, Isla said, “It is not a drastic move and there won’t be any major changes. I feel enormous responsibility and motivation to strengthen Inditex, and it’s the right moment. The transition will be smooth and very natural.”

Outside Inditex’s corporate inner sanctum, little is known about Ortega except that he’s the richest man in Spain — and the seventh richest (up two notches over last year) in the world, with a net worth of $31 billion, Forbes reported in March. His fortune includes Inditex stock — he has maintained a 59.3 percent stake in the company since it went public in 2001 — and luxury real estate projects in the U.S., Florida in particular, and in such major European cities as London, Paris, Lisbon, Berlin, Madrid and Barcelona. He has additional investments in banks, gas and tourism and owns a horse-jumping circuit and a soccer league.

Ortega is not much for fanfare and personal public relations is not in his DNA. He’s been quoted as saying, “Talk about my company, but not about me,” and he rarely appears in public.

One of the few to penetrate company walls is avant-garde Spanish artist Alicia Framis, whose filmed performance “Secret Strike — Inditex” (2006) chronicled a day in the life of Zara. “Inditex employees were very involved in the film,” Framis said. “Everybody wanted to be a part of it — except Amancio Ortega.”

Ortega’s is a rags-to-riches story. In the early Sixties, he came up with the idea of making basic garments like housecoats and underwear cheaper than anyone else. Production took place on his kitchen table, and the first item cut from cardboard patterns was a quilted pink robe with blue piping. In 1975, he opened his first store here, selling bathrobes for about 50 cents each.

Working from the age of 13 in local men’s wear shops, he had little formal education. “I couldn’t work and study at the same time; it’s that simple. My university was my profession. I wanted to be a different kind of impresario, one with a social conscience,” he told Covadonga O’Shea, onetime director of Spain’s prestigious fashion magazine Telva, in an authorized biography published in 2008.

“His success has not changed him,” O’Shea said. “His values are the same; he’s humble, affectionate, generous, and he loves the people he works with.”

Ortega lives with his second wife, Flora Pérez Marcote, in an apartment in La Coruña, an unpretentious seaside town about six miles from Inditex’s headquarters in the industrial zone of Arteixo. He doesn’t speak English and, according to an employee, “he’s approachable and into everything. He lives the product,” she said.

It remains to be seen how involved Ortega will be in the company he founded, now that Isla is taking over. But the next generation of the Ortega family already is involved: The founder’s youngest daughter, Marta Ortega, was last fall brought into company headquarters, and although she has no concrete job, department or title, she’s in on all major decision making. An Inditex spokesman said her arrival and the pending management succession are unrelated, however. “She will continue her training program, a mix of creative and commercial activities, within the group and, logically [as Ortega’s daughter], she’ll have a role but so far she isn’t officially involved in the company. We don’t know anything about her future.”

Prior to Isla’s promotion, Marta Ortega was considered the heir apparent, and she’s been well groomed for it. With a degree in business administration from London’s European Business School, she speaks four languages — including English, French and Italian — and to date has interned for company stores in London and Paris, with office stints in Asia and Barcelona.

In private, she is an accomplished equestrian, taking part in international competitions with rider-boyfriend Sergio Alvarez Moya — and as socially shy as her father.

WCI, developer of Westshore Yacht Club, files reorganization plan - Business Courier of Cincinnati:

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The company filed a plan of reorganizatiohn with the for the District ofDelaware Monday, about 10 months after it Chaptetr 11 bankruptcy protection. Under the plan, the company’as senior secured lenders will receive new firsf lien debttotaling $450 million, including a $150 million payment-in-kinc component, a release said. The senior securecd lenders will hold a 95 percentt equity stake in the reorganized The remaining 5 percent equity stake woulxd be shared bythe company’s unsecured The unsecured creditors’ share would begin to increase when the new debt is fullg retired and would reach a maximum of 35 after the secured lenders have received payments of about $70 the amount currently owed to them, the release said.
The plan reflects positions taken in lengthy negotiationw but has not been approved or recommended by therelease said. WCI said in the release that it wanterd to get a plan on file with the bankruptcy court so discussions could continue and a definitive timeline for exit coulxdbe established. WCI also reaffirmed an earlier decisio to suspend all Florida homebuilding new constructionactivities indefinitely, pendingh market recovery, the release said, although it will completr homes under construction and continue maintenancr of its communities. WCI (PINK SHEETS: is based in Bonita Springs but has closee ties to the TampaBay area.
WCI communities in the Bay area includs inHillsborough County, in Tampa, in Bradenton and the in

Fred

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The Memphis-based discount retailer reported net incomeof $8.6 or 21 cents per diluted share, for firsyt quarter 2009, up 17.8 percent compared to net incomde of $7.3 million, or 18 cents per diluted share in first quarter 2008. The company had totall first quarter salesof $458.4 million, down 1.3 perceny compared to $464.3 million for firstf quarter 2008. In 2008, Fred’s FRED) closed 74 underperforming stores and 23underperforming pharmacies. Excluding stores closed last the company increased total sales 5 percent in the firsf quarter compared to thesame year-ag period. On a comparable store basis, year-to-datw sales increased 2.8% compared with 2.
1% in the same period last Fred’s CEO Bruce A. Efird said he expectefd to see more improvement in theseconxd quarter. “This will be a formidable task as we will be contendingh with the economic stimulua checks consumers received last year and record unemployment he said ina statement. "Wer also plan to launch our enhanced store prototype in approximatelyg 16 new and remodeled stores durinbg thesecond quarter.
" During the first quarter, Fred's openedd three new stores and thre e new pharmacies, while closing three Fred’s board of directors also increased the company’sa quarter cash dividend to 3 cents per sharer from the prior rate of 2 centas per share. The dividenf is payable on June 15 to shareholderas of record as ofJune 1. Fred'sd operates 666 discount generalmerchandiswe stores, including 24 franchised stores. Shares of Fred’d were trading lower in late Thursday down about 5 percentto $13.
14 per