Latest from Business of Fashion
Business of Fashion
an hour ago
- Business
- Business of Fashion
Maison Kitsuné Is Closing All Its US Stores
Parisian label Maison Kitsuné is closing its physical retail locations in the US. The closures are part of a reorganisation of Maison Kitsuné's retail operations, according to the company. It's refocusing its efforts on its digital operations and wholesale distribution. Despite the uncertainty in the US marketplace due to the Trump administration's tariff policy, which is set to raise costs for many businesses, the brand said its decision to shutter its stores isn't connected to those recent changes. 'This strategic repositioning allows us to optimize our footprint in the North American market while remaining true to our brand DNA,' brand deputy managing director Johanna Lellouche said in a statement to The Business of Fashion. This isn't the first time Maison Kitsuné has pulled back from the US market. The brand partnered with Want Les Essentials in 2012 to open a location in New York City's NoMad hotel. It also launched another location on the Lower East Side in 2015. Eventually, in 2016, the two partners split, and both locations were closed. Maison Kitsuné took a hiatus from the American marketplace before returning with a new flagship location in New York City in 2017. It's unclear whether the brand plans to reopen physical locations in the US moving forward, but Lellouche did say that North America remains a priority for the company. 'We are actively exploring new ways to reinvent our presence, while continuing to offer our collections through our e-commerce platform and a network of selected wholesale partners,' her statement said.
Business of Fashion
12 hours ago
- Entertainment
- Business of Fashion
The Rise of ‘Ugly-Cute' Labubu Dolls, in Four Charts
No one saw 2025's hottest accessory coming. Labubu dolls, cartoonish plush toys designed ten years ago by Hong Kong-born artist Kasing Lung as part of his Nordic folklore-inspired character series 'The Monsters' and now distributed by Chinese toy maker Pop Mart, have become a viral sensation this summer. The figures, which typically cost around $20, rose to prominence after K-pop star Lisa began sporting them as bag charms last year. They've since sparked wraparound queues at malls around the world and have been spotted hanging off the handbags of celebrities including Rihanna, Dua Lipa, Central Cee and Marc Jacobs. Gen-Z and Gen Alpha customers have repeatedly sold them out; earlier this summer on TikTok Shop, a single, eight-hour live stream generated over $1.5 million in Labubu sales. With their flushed cheeks, mischievous eyes, wide grins exposing nine serrated teeth, pointed bunny ears and rotund, fuzzy bodies, Labubu dolls' popularity is baffling to many. But their 'ugly-cute' looks are precisely why they're so beloved among Gen-Z. 'Consumers, driven by the dual desire for emotional comfort and expressive individuality during challenging times, find resonance in Labubus' unique blend of innocence, irreverence, and charm,' wrote Michael Appler, vice president of marketing at Trendalytics, in an email. Their nostalgic and playful aesthetic reflects Gen-Z's disillusionment with the stark realities of adulthood during uncertain economic times. The dolls' rise to prominence is also reflective of the 'lipstick index' at work: As the cost of living soars and consumer sentiment dims, shoppers are more likely to pay for small, inexpensive 'luxuries' that double as unique status symbols. While cuteness has been trending in fashion for months now, with everything from polka dots to fruit jewellery gaining popularity, Labubus in particular have stood out. Though overall viral microtrends have slowed, the Labubu is the most visible success in a series of trending 'blind box' items — or small collectibles whose contents are sealed and unknown to the buyer at the time of purchase — with limited production that includes Smiski toys (green, glow-in-the-dark figures) and Sonny Angels (plastic, semi-nude babies collected by Bella Hadid and Victoria Beckham). The dopamine rush of these limited-edition mystery boxes also gamifies the purchasing experience, and the toys serve as an 'if-you-know-you-know' marker for fellow collectors. The collectibles' ascent has been astronomical, with the Chinese government even commencing efforts to crack down on counterfeit Labubu dolls, or 'Lafufus,' earlier this year. But despite recent bullish growth, Pop Mart's shareholders fear the collectibles will soon begin to lose traction, and that the company's success can't be sustained. Below, a look at Labubu dolls' trajectory in four charts. Trendalytics analysis found that year-on-year Google searches for Labubu soared by 9,800 percent in June. Pop Mart is also benefiting from continuing consumer interest in bag charms, which saw searches more than double this summer since 2024, while average weekly posts related to bag charms on TikTok have skyrocketed over twentyfold. In the first half of 2025, mentions of Labubu alongside Hermès generated almost $30 million in media impact value — a staggering 4 percent of total conversations around Hermès — as bag charms tapped into a desire for greater personalisation. '[The] broader cultural move toward individuality is a perfect backdrop for the rise of bag charms and, in turn, Labubu,' wrote StockX senior director of marketplace Drew Haines in an email. Rare Labubu dolls have been sold for vast premiums at auctions and on resale platforms. Since October, Pop Mart has been the number-one bestselling collectibles brand on StockX, with sales up 748 percent thus far in 2025. The toy maker, which had seen fewer than 100 trades in 2023, generated tens of thousands of sales on StockX last year. Though Pop Mart said it expects a profit jump of 350 percent in the first half of 2025, investors appear to have taken a more cautious outlook on the toy maker, likely because blind box trends tend to be volatile and lack longevity. As Labubu dolls rise in popularity, they can no longer be a secret of the 'in group' or an emblem of personal identity. If early pullback is any indication, Labubu mania may have already hit its peak.
Business of Fashion
21 hours ago
- Business
- Business of Fashion
Hoka-Parent Deckers Beats Quarterly Estimates Boosted by Demand in Europe, China
Deckers Outdoor topped estimates for first-quarter results on Thursday, fuelled by robust demand in international markets such as Europe and China for its Hoka and UGG brands, sending shares of the footwear maker up about 9 percent in extended trading. Deckers has been rapidly expanding its international presence, in an effort to counter choppy US demand after several years of strong growth. Similar to rivals such as Nike and Skechers, Deckers relies heavily on Vietnam as a key manufacturing hub. Deckers now expects a $185 million rise in costs of goods sold in fiscal 2026, up from $150 million it forecast in May, taking into account a 20 percent tariff on Vietnam, company executives said on a post-earnings call. It plans to mitigate some costs through strategic product price increases over the remainder of the year, after taking some price hikes earlier this month. The company had scrapped its annual forecast in May in response to macroeconomic uncertainties. Its stock has lost 48 percent of its value this year. International net sales surged 49.7 percent in the quarter, more than offsetting a 2.8 percent dip in domestic sales. 'There's a big opportunity outside of US since Hoka and UGG are underpenetrated compared to Nike, Adidas, and others. This is one of the big opportunities for Hoka to expand its market,' Morningstar analyst David Swartz said. Deckers expects second-quarter net sales in the range of $1.38 billion to $1.42 billion, the mid-point of which is in line with analysts' estimate of $1.40 billion, according to data compiled by LSEG. Earnings per share is expected to be in the range of $1.50 to $1.55 in the quarter, while analysts were expecting a profit of $1.55 per share. First-quarter net sales rose 16.9 percent to $964.5 million, beating analysts' average estimate of $901.1 million. It logged earnings per share of 93 cents, surpassing estimates of 68 cents. By Savyata Mishra; Editor: Alan Barona Learn more: Exclusive: Inside Hoka's Fashion Ambitions In a new collaboration with Marni, the running brand known for its chunky, cushioned midsoles is looking to catch the eye of a new fashion audience — without compromising the performance DNA that's made it an emerging sneaker powerhouse.
Business of Fashion
a day ago
- Business
- Business of Fashion
Luxury's Gulf Between Winners and Losers Is Widening
For Europe's luxury stocks, this earnings season will hammer home the widening gulf between the winners and the losers. The industry got off to a promising start with robust earnings from British trenchcoat maker Burberry Group Plc that sent its stock up as much as 9 percent and better-than-expected sales at Cartier owner Richemont. But upcoming reports from LVMH Moët Hennessy Louis Vuitton SE, Kering SA and Salvatore Ferragamo SpA look less promising. If sales at these companies undershoot already weak forecasts, the shares may extend this year's drop that has wiped out market value of as much as €175 billion ($205 billion). While the outlook for luxury shares is crucial for Europe's stalled equity market rally given the weight of these companies, investors have to be more selective about the stocks they pick. This gap has been widening as a web of ailing China demand, varying brand perception, a weaker dollar and high valuations impacts these companies differently. The season will be critical to determining the outperformers and laggards, with analysts expecting very wide revenue growth outcomes. 'It's not going to be one-tide-lifts-all-boats for the sector,' said Stefan-Guenter Bauknecht, a senior portfolio manager at DWS. 'It really depends on the category and how the brand is perceived in the category. And the VIP certainly helps.' One striking example of the sector's divide is LVMH versus French peer Hermès International SCA. Sales at LVMH's key Fashion & Leather Goods division are expected to have dropped 7.8 percent in the second quarter, according to analyst estimates. The company reports after the bell on Thursday. Hermes, which has been an example of how companies can thrive on selling the highest-end items, is expected to report revenue growth of 12 percent at its leather goods division. Its results are due on July 30. In the case of the Louis Vuitton and Tiffany & Co. owner, the stock has lost roughly half of its value over the past two years, losing its crown of Europe's biggest stock, with investors increasingly worried about an unprecedented demand slump in China. Hermes shares, on the other hand, are weathering the broader industry pullback. After a 160 percent jump since the end of 2020, the stock is little changed this year versus a 7 percent drop in Goldman Sachs Group Inc.'s basket of luxury shares. In the current economic context, pricing power is critical, said Helen Jewell, Europe, Middle East and Africa chief investment officer at BlackRock Fundamental Equities. 'The challenge for investors has been some of the names that we thought had greater brand strength, and it turned out they actually didn't,' she said, adding that there could be some buying opportunities after the selloff in the sector 'but you do need to be selective.' For the sector as a whole, the difference is stark between now and the 2021 to 2023 boom times, when investors were rushing to snap up any European luxury shares as they reaped the profits from shoppers on a post-pandemic spending spree. But with China's sluggish economy putting a dent into demand for pricey handbags and watches, investors are buying shares in the brands that can captivate consumers and selling the ones that can't. Among this year's winners, shares in Burberry have surged more than 30 percent. The UK fashion brand is gaining traction with its turnaround plan and winning new customers through its outwear push. To some investors, luxury valuations are still too high overall even after this year's plunge in a number of stocks. The industry has an average forward price-earnings ratio of 27, according to data compiled by Bloomberg. That's a near 85 percent premium to the broader market and above the long-term premium from the past 10 years. 'This is a sector that is fully exposed to tariffs and fully exposed to the weaker dollar,' said Roland Kaloyan, head of European equity strategy at Societe Generale SA. 'It's going to be quite difficult, so I stick to my underweight.' By Sagarika Jaisinghani, Michael Msika, Julien Ponthus Learn more: Opinion: When Will Luxury's Perfect Storm Pass? The luxury sector is probably closer to the end of the storm than the beginning, but many valuations are pricing in the worst, writes Andrea Felsted.
Business of Fashion
2 days ago
- Business
- Business of Fashion
The Executive Briefing: Reading the Tariff Tea Leaves
Tariffs Have Retailers Bracing for a Potentially Grim Year The story: Major US retailers including Macy's, Victoria's Secret, Abercrombie & Fitch and Lululemon reported strong holiday sales. But they also said the year was off to a weak start. As they contemplate whether to pass on the cost of tariffs to consumers, many downgraded their outlook for the remainder of 2025, sparking a selloff in retail stocks. It's not all in their heads: Consumer sentiment has also nosedived, with the Conference Board's closely watched index hitting a 12-year low last week. Tariffs are largely to blame, fuelling renewed inflation fears (even though few brands have actually raised prices, predictions of hikes to come from CEOs, economists and investors are percolating into consumers' consciousness). Not everyone agrees: 'We have to distinguish between feelings and reality,' said BMO Capital Markets analyst Simeon Siegel. 'It's not to say one can't turn into the other, but it hasn't yet. The idea that consumer sentiment is a survey and doesn't always align with retail sales.' Indeed, a similarly grim outlook this time last year turned out to mostly be a false alarm. Pain now, gains later: In our executive memo on tariffs, experts recommend keeping inventory 'lean and mean,' eating the extra cost – for a little while at least – and investing in high-quality products and experiences that help brands stand out at any price point. Materials and product features can be tinkered with to reduce duties at the border. In other words, the only way to win a tariff-induced price war is not to play. ADVERTISEMENT AI Marketing Campaigns Are Here. Not Everyone Is Happy About It The story: Brands have quietly been inserting AI models and art into their ads, social accounts and websites for a couple years now. But this month, that practice broke out into the open. The Estée Lauder Companies is partnering with Adobe to use its AI platform, Firefly, to create and edit imagery. H&M will use digital twins of its models in generated photoshoots that appear indistinguishable from the real thing. And Sybille de Saint Louvent's fake AI-generated campaigns are starting to get attention from the luxury brands she's mimicking. Heading off criticism: The business case for AI is obvious: why send a model to Fiji when you can insert their digital likeness into a generated image of an island paradise? However, it's telling that both Estée Lauder and H&M emphasised that they took great pains to incorporate AI in a way they believe will minimise potential harm. Estée Lauder is only using AI to generate images of objects, not people. Models will own the rights to their AI doppelgangers created by H&M. Good luck with that: It's still a tough sell. BoF's Instagram post on Sybille de Saint Louvent received over 1,000 comments, the vast majority negative. In 2023, Levi's quickly backed off plans to use AI models. Makeup artists, stylists and others who work on photoshoots were quick to point out that H&M's plan will do little to help them if AI puts them out of work. Maybe it's inevitable: The industry isn't exactly ignoring all those Instagram comments, but it clearly sees itself moving towards a world where AI and human models co-exist. Fast fashion is well on its way to embracing its generative future; perhaps then real humans shot by real photographers will become another luxury signifier. Succeeding in China Is Harder in 2025, but Not Impossible The story: BoF's latest case study goes deep on how Western brands succeed in China today. The old days of rapidly expanding demand and even middling American brands enjoying a certain cachet with Chinese consumers are long gone. Who's Winning: At first glance it's hard to draw links between Lemaire's quiet luxury, Lululemon's yoga pants, Hermès' craftsmanship and, well, Crocs. Flood the zone: Instead of diving in with Tmall, the most successful brands in China are often establishing a presence through Xiaohongshu and Douyin first. But establishing real world storefronts alongside digital ones is proving a key differentiator. That's true for big brands like Ralph Lauren, but smaller labels like France's American Vintage have found success with their own stores too. Second-tier cities, historically ignored by many Western brands, are particularly promising. Don't coast on reputation: Brands can no longer count on selling the same products in Shanghai that they do in Paris or New York (or worse, using China as a dumping ground for whatever fails to move in their home market). More than one-third of Luluemon's assortment in China is modified in some way to specifically appeal to shoppers there, including plenty of items made exclusively for the Chinese market. The same is true behind the scenes: Crocs struggled in China for years with a traditional strategy built around joint ventures with retailers. Once it built its own team on the ground, armed with the same data and insights used in other markets, sales took off. ADVERTISEMENT Jolting Luxury Out of Its Creative and Commercial Rut The story: This year may feature more designer debuts at major brands than any in the history of modern luxury. Why? Because the sector is in crisis, and it's not just a macroeconomic issue. With prices sky-high, many believe big luxury's value proposition is broken and key players are betting on new creative energy to boost desirability and kickstart growth cycles. More than musical chairs: Speculating about who will land where has been fun. But now that most of the big jobs are taken, industry watchers are wondering, when global luxury sales fell 2 percent last year, and consumers seem simultaneously overwhelmed by the amount of noise brands emit, and underwhelmed by what they sell, how much any one designer can do. Veblen goods no more: The term refers to items that become more desirable the higher their price. Most luxury brands flattered themselves that they fell in that category as they doubled or even tripled prices on their most coveted products. But in doing so they turned an aspirational dream into an impossible one for most consumers. Higher prices and the ubiquity of the biggest brands have also given some teeth to the gripe that luxury goods aren't worth the money. Shoppers get less of a thrill owning a $5,000 bag if they know it was mass produced, and potentially in a sweatshop. The Loewe method: It's no coincidence Jonathan Anderson is headed to one of fashion's biggest brands. His method of building buzz around Loewe – one tomato-scented candle and Luca Guadagnino film at a time – is widely seen as a template for the industry to escape its current treadmill of cookie-cutter runway shows and ad campaigns. It's an example of turning a luxury brand into a 'cultural brand,' a badge that says you have currency because you've navigated a cultural maze, and not just that you're rich enough to afford the clothes. Fashion's Innovators The Story: In a sea of sameness, designers who dare to try something different can still make a splash – even if what they're creating is as simple as a sweatshirt. In a series of stories this month, BoF took a look at how designers and brands are rethinking three categories that haven't seen much innovation of late: handbags, dress shirts and, yes, sweatshirts. Innovation with purpose: In the high stakes game of handbags, which drive the lion's share of profits at plenty of luxury brands, finding the balance between trying something new and staying true to a brand's codes is key. That's why the Alaïa Teckel became a sensation last year, its elongated shape standing out amid all the totes and helping establish Pieter Mulier's ultra-femme, yet modern vision for the brand. A style evolution: It's no coincidence that dress shirts are making a comeback just as companies are forcing more workers back to the office. But like so many other things, the white collar uniform was changed by the pandemic. Dress shirts now prioritise comfort, coming in oversize fits that appeal to Gen Z, or taking a page from the activewear boom's obsession with fabric innovation. About those sweatshirts: Speaking of Gen Z, they're setting alarms and lining up outside pop-ups to snag limited edition sweatshirts. The phenomenon is almost entirely a creation of TikTok, where popular creators have launched their own brands, which they flog ceaselessly to followers. Here the innovation is mostly marketing. If they want staying power they'll need to find ways to differentiate their product. Otherwise they may end up like the countless luggage brands struggling to sell slickly branded hardshell suitcases even amid an unprecedented travel boom.
