Dubai: Top-tier US fashion brands are acquainting themselves with the Gulf's shoppers and it's now the turn of Kate Spade New York, which is also into jewellery and accessories, to do so. The first two outlets are now open, in Kuwait and last week at the Dubai Mall, through its franchise partner, the Jashanmal Group.
Plans are being finalised for stores in Abu Dhabi and Qatar as well. And these markets could well be the springboard to launch into new territories, both within the region and, at a stretch, into India. If that happens, it would be a repeat of the strategy the brand used six months ago in the UK, which would be the stepping stone for mainland Europe. "We worked hard to align those launches and, similarly, we think the connectivity between this region and India is important," Craig Leavitt, CEO of Kate Spade New York, part of Liz Claiborne Inc., said.
"And that is kind of the next market we are investigating for a launch in the near term."
While it has dedicated stores at two leading malls for its Gulf debut, the brand is open to being sold in a multi-brand format. But given that the brand is untested here, wouldn't it have been better to go for the second option?
"When we open our own shop in a new market, it allows us to present the lifestyle of a brand in a cohesive way that is often difficult in a multi-brand setting," Leavitt said. "With a mall location, one of the things you are paying for is a high traffic area — so there is a balance there."
New overseas territories are central to the brand's prospects in the mid-term. According to the CEO, over the next five years, two-thirds of its business would come from outside of the US as against the 20 to 25 per cent now. China, where it entered a joint venture recently, forms a key part of that equation with as many as 12 stores expected to open this year.
Last year was particularly good for the brand, with its overall consumer business recording a 70 per cent growth over the 2010 tally. The apparel line represents between 25 to 35 per cent of the business and the rest from accessories, jewellery and leather merchandise.
The brand has also put faith in e-commerce to expand its reach within the shopper base in the US, and this could be replicated even in this region, according to the CEO.
There is also the ‘possibility' that the franchise agreement for these markets could be upgraded to a full-scale joint venture alliance. Such a transition happened in Japan.
"Obviously, our global brand knowledge and the local operator's knowledge of the market is what it takes for success," Leavitt said. "So, based on how we grow the business, anything is open to possibility."
Franchise: seeking out partners
Going by recent history, the Jashanmal Group has been particularly active in seeking out new franchise alliances. Last year, it firmed up one with UK's high-street brand L.K. Bennett and now comes the one with kate spade new york.
This is "one of the fastest growing brands in the US," Tony Jashanmal, group executive director, said. "We are confident that this is an excellent addition to our portfolio of accessible luxury lifestyle brands."
It's a portfolio that also includes Bally, Kipling and Porsche Design.
