Isaac Mizrahi, the long-time and highly successful supplier of cheap chic to Target, heads uphill to become creative director of struggling Liz Claiborne Inc. Meanwhile, Claiborne, which has sold off several brands, has licensed the once-upscale Dana Buchman brand to Kohl's.
Tommy Hilfiger USA has said goodbye to Bon-Ton, Dillard's and Belk in order to give Macy's an exclusive. And, without using his, or the Polo name, Ralph Lauren has designed a new collection, called American Living, for J.C. Penney.
Wal-Mart has hired Normal Kamali, who previously sold to Bloomingdale's. Todd Oldham has signed with Old Navy, and Patrick Robinson, who designed a collection for Paco Rabanne in Paris, has been enlisted to fill the Gap.
"Retail is in turmoil, and when it's in a tough time, one thing happens: Change," says Howard Davidowitz, chairman of Davidowitz & Associates Inc., a national retail consulting and investment banking firm based in New York City. "As pressure builds from shareholders and declining business, retailers have to do something."
Of Mizrahi's move to Liz Claiborne, Davidowitz tells GlobeSt.com that Claiborne "can't just sell off all divisions. It needs to have something to go forward with. They've hired Mizrahi in hopes he could be the next Liz."
The founder and namesake retired in 1989 and died in June 2007. The company has recently sold off Ellen Tracy, Laundry by Design and other brands while adding a Donna Karan International brand men's collection.
"The pressure is on," Davidowitz contends. Not only is this a time of tough business, "but also a time of commoditization," he points out, adding, that the country is also "over-stored."
"There's tremendous pressure on commoditization. Who marks it down first? People buy a look, a color," he contends. Designer names and private labels are both strategies to help retailers differentiate. He notes that private label really is designer merchandise, designed by people the company hires.
The difference is in the name. Davidowitz acknowledges that a known designer brings cache and a following to the retailers, "but stores need a mix," he says. "J. Crew and Urban Outfitters are winning now, and neither has a brand name designer. Their claim is a better alternative for a better price."
Asked if the bidding war for designer brands will be successful, Davidowitz says, "I think it will work for some," but reminds, "we're in a recession."
Among the designers that have set up in new retail locations, he singles out the Ralph Lauren move to Penney. "The product is good, and he (Lauren) has a long record of success. He's done a good job of interpreting for the customer. When all the smoke clears, it comes down to: How good is the product? The consumer is the ultimate judge."
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