LVMH CEO Roussel: Will Sell Donna Karan

Paris, France -

LVMH Group recently sold Donna Karan International to the US manufacturing and authorized dealer G-III clothing group (G-III Apparel Group Ltd.).

The French

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

In the past 18 months,

It has spent quite 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 co creative director, and the first two series of the two launched a good public reaction.

The return on investment is also clear: April this year.

The disappointing first quarter sales data of its fashion and leather goods department were partly attributed to DKNY Jeans and DKNY C two product lines, 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 group's fashion department chairman and chief executive officer, Pierre-Yves Roussel, said that the deal was first proposed by G-III group, hoping to bring the US brand back to the United States and propose that it would buy at an estimated value of $650 million, not as creative as some people suggested.

G-III group is authorized to license Calvin Klein, Tommy Hilfiger, Karl Lagerfeld and other brands.

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"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 said,

It is also realized that DKNY's sub line business has 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 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

We are still committed to developing high end and contemporary brand, but at the same time, we also pay attention to distinguish DKNY from the secondary line. We also emphasize that the group has been successful 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 on contemporary price brands and

Reflecting on the similarity of business models, it continued: "this is why many.

The reason why the brand buys the contemporary price brand.

Whether it is

Cards are also designers of the contemporary price. 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.

Related matters will be discussed with management team and creative team. This will be their decision. "