But Why Do We Need To Get Rid Of Donna Karan Now?

The decision to sell Donna Karan International is amazing.

group

Roussel, chairman and chief executive of the Department, said it was because the other party first proposed takeover intention.

Business and group business models are relatively low.

LVMH Group, France, recently sold Donna Karan International to the US made and authorized dealer G-III Garment Group (G-III Apparel Group Ltd.), Paris.

The French luxury group has changed its brand in the past few years, so the move is unexpected.

In the past 18 months, Lu Wei Mo Xuan has spent a lot of resources to reboot the brand, release a number of business license agreements, and relocate around the lower price side line brand DKNY, appoint Public School's Maxwell Osborne and Zhou Dao Yi (Dao-Yi Chow) as joint creative director, and the first two series launched by the two people get good public reaction.

The return on investment is also very clear: in April this year, LVMH attributed the disappointing first quarter sales figures of its fashion and leather goods department to two product lines of DKNY Jeans and DKNY C, and the two recorded a loss of 200 million dollars in revenue.

But why do we need to get rid of it now?

According to the Pierre-Yves Roussel, chairman and chief executive of the fashion department of Lu Wei Mo Xuan group, the paction was first proposed by G-III group, hoping to bring the US brand back to the United States again, and proposed that it would buy at an estimated value of 650 million US dollars, not as some people suggested, that the brand was faced with creative and commercial failure in the process of re launching.

G-III group produces garments for Calvin Klein, Tommy Hilfiger, Karl Lagerfeld and other brands through authorization.

"We are not seeking to sell brands," Roussel said in an interview with BoF. "We are adjusting in the right direction. I think we are ready to move forward.

But G-III gave a very high price. "

After further reflection, Roussel indicated that Lu Wei Min Xuan also realized that DKNY's sub line business had not developed well for the group.

The group's core business is rooted in accessories, selected distribution, and fashion show.

But the sub line business usually relies on advanced garments, as well as the extensive wholesale distribution business promoted by department stores.

"The business model of DKNY is very different from ours," Roussel said. "This decision has nothing to do with creative teams.

I still believe this brand can grow bigger, but it's up to them.

Without this acquisition price increase, we may still be able to do DKNY, which can be quite successful in the next two or three or four years, but it may not be as successful as G-III because their core business models are similar.

There's only so much you can do in the end.

We have many brands and brands need to invest, but when we invest in us, we must think about how to make the most cost-effective pactions.

Roussel emphasizes that Lu Wei Ming Xuan is still committed to developing high-end high-end brand. But at the same time, it is also very careful to distinguish DKNY from the secondary line. It also emphasizes the group's success in Marc Jacobs and Kenzo.

"There must be certain characteristics, strong brands and real accessories business.

Kenzo is like this. Its distribution is very targeted and controllable, and has obvious European tradition.

This is very different. "

He added.

"We like this subdivision very much.

We have been learning all the time, "he continued." therefore, we will not divestiture the contemporary price brands in any way. We are really interested in this market segment.

But to upgrade DKNY into a brand, you can only do so much.

You can inject vitality and creativity into the brand, but look at Kenzo...

We haven't fundamentally changed our position.

Actually we can say that we have pulled Kenzo from its original position, and Marc Jacobs, we are reinventing everything about Marc Jacobs brand.

Roussel rethinks the similarity between contemporary price brands and luxury brand business models, and continues: "this is why many luxury brands buy Contemporary brand names.

Whether they are luxury brands or designers at the current price level, they do different jobs and have more crossover, but the sub line business is completely different.

As for the Donna Karan team, Roussel said that the excellent CEO Caroline Brown will continue to supervise the brand during the pition period until it is finally sold to G-III group.

He also added that Brown and Morris Goldfarb, founder of G-III group, are meeting to discuss the future of the brand.

"This is a big event for him, so I am sure he will rely on teamwork.

The related issues will be discussed with the management team and the creative team, which will be their decision. "