Months of heavy discounting at department stores have taken away some of the glamour and prestige from the premium denim market. 7 for All Mankind and J Brand have been the most notable labels to come out with specialty store-only brands for fall. J Brand Boutique features new exclusive washes and wholesale prices that run at least 11 percent more than the starting price for the flagship line.
7 for All Mankind will introduce Premiere 7 (shown in the photo above) exclusively to independent retailers, offering jeans priced between $174 and $198 and featuring specialty fits, washes and labeling. Boutiques perhaps have been hit hardest by the economic downturn due to the discounting at nearby department stores – and many have had to close their doors. The real measure of exactly just how bad things had gotten was presented in True Religion’s financial results for 2008.
“Sales to [U.S.] boutiques in the fourth quarter declined 36.3 percent compared to the prior-year period,” said Michael Buckley, president, during a conference call with analysts. True Religion’s U.S. boutique sales were down 11 percent for 2008 and management anticipates its American wholesale business will fall between 17 and 19 percent in 2009, again driven largely by declines in the specialty store channel.
The boutique-only collections from J Brand and 7 for All Mankind are appealing to owners and it is expected that the denim companies will offer marketing support that emphasizes the limited nature of the product. However, this whole nasty cycle could start again. If the specialty lines do well in boutiques – the department stores will put pressure on the brands to buy them too – and eventually undercut the boutiques. It will be interesting to see how this plays out, and whether other major denim designers will also release a boutique collection. (Source: WWD)