When it comes to innovation, two industries come to mind: technology and fashion. Not surprisingly, in New York City, one has plenty of opportunities to partake in discussions on that very topic: where do fashion and technology intersect? And how does one define innovation as it pertains to retail?
On March 29, I attended one of Yuli Ziv’s, (Fashion 2.0 Entrepreneur and Founding Member of Style Coalition) successful meet ups. Ziv brought together a panel of experts to discuss the trends of E-commerce, a sector that seems to be constantly in flux both because of the rapid advances of technology today but also because fashion itself has become fast. The following day, I found myself in the second row at the amphitheater of the French Institute /Alliance Française (FIAF) where renowned French jewelry designer, Lorenz Bäumer spoke about his work (http://www.lorenzbaumer.com/).
When I booked the two events I had very different expectations from each one. In retrospect, I realize that both evenings offered uncannily similar points. This validated for me the direction the market seems to be taking these days, especially as this direction manifests itself in mergers, acquisitions, and generally speaking, intense market consolidation.
Ziv’s Fashion 2.0 event took place on March 29 at a venue in the Flatiron District of Manhattan. While the 200 attendees who crowded the space were primarily bloggers, developers, and fashion enthusiasts (with the occasional investment banker hiding near the bar), the panelists represented a very specific sector of the industry, namely small to medium size private companies in the retail business. They are presented here in alphabetical order: Katia Beauchamp - Co-Founder, BirchBox, a subscription retail company that combines a curated physical product with online editorial and ecommerce that was launched in September 2010. Michelle Madhok - Founder and CEO, SheFinds Media, an editorial website that aims to make shopping online easy and fun for busy women, highlighting only the best products with independent reviews and links to buy. SheFinds was founded in 2004. Pranay Mehra – Head of US Web Marketing, YOOX Group, the global Internet retailing partner for the leading fashion and design brands and has established itself amongst the market leaders with its multi-brand stores yoox.com and thecorner.com, as well as with several mono-brand stores, all "Powered by YOOX Group. YOOX was founded in 2000. Erik Lautier - Director of Ecommerce, Lacoste, a high-end apparel company founded in 1933 that sells high-end clothing, footwear, perfume, leather goods, watches eyewear, and tennis outfits. The company can be recognized by its green crocodile logo.
In contrast, the event at FIAF was more formal. It addressed an equally large audience that comprised corporate executives from major department stores in New York City, salespeople in jewelry retail, journalists from major fashion publications, but also those genuinely interested in art. The difference of context was justified by the mere fact that Lorenz Bäumer is a luxury brand within the world of jewelry. The brands that presented on 3/29 are not part of the luxury sector with the exception of Lacoste (which is an upscale brand trying to reposition itself at the upper tiers of upscale). Finally, Lorenz Bäumer did not address Ecommerce because it does not apply to precious jewelry but he spoke as passionately about social media as the four panelists did the evening before.
Despite the differences, the main point of convergence for both events is the fact that smaller, younger, and specifically private companies are often forced to be innovative in order to compete with the giants of the industry and their exorbitant budgets. Innovation therefore derives from the need for better and faster technology, original content, and genuine dialog with the customers. When one is small, young, and private the opportunities to pursue all of the three aforementioned avenues that lead to innovation is relatively easy. And the more one hones in on these particular skills, the more agile the company becomes. More agility ultimately means greater market share.
These were exactly Lorenz Bäumer’s challenges when he began his career as a jeweler working with precious stones and had to measure up to the legends of Place Vendôme in Paris. He focused on providing personalized service to his clients, original content (which is how he differentiated his product), while he kept a genuine dialog going—in person and online. But these challenges presented also an opportunity for him to clearly articulate his brand, which he has accomplished with great precision, coherence, and flair. This is exactly why he was hired as the creative force behind the newly launched LVMH jewelry line. LVMH recognized in him the agility, imagination, and closeness to the market that a big group cannot have—unless it acquires it. This is what several of the Fashion 2.0 entrepreneurs confirmed as well. The retail industry is undergoing major changes, not only because of the innovation in content and technology, but also because innovation becomes very desirable to those who have not been able to generate and implement new ideas on their own. As a result, the retail industry will be undergoing intense consolidation in the next two to three years and until some very powerful, large groups have been formed. The questions that we will be exploring at that point in time will concern perhaps issues of synergies and how those will keep the wheels of innovation going.
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