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Qzone

EU Woes and Russian Sanctions Sees Euro Fashion Look to the US

With the European market still reluctant to spend and trade with Russia currently off the agenda, many Italian and French designers are now increasingly looking to North American buyers to make up the continuing shortfall in demand.

Photo: European printed artwork shirts: Can they conquer the US consumer?
European printed artwork shirts: Can they conquer the US consumer?
Photo: European printed artwork shirts: Can they conquer the US consumer?
European printed artwork shirts: Can they conquer the US consumer?

An eclectic mix of fashion folk lined the walls of New York's quirky Tunnel venue for Tranoi New York, the American counterpart to the Parisian family of fashion events. This year saw a number of European exhibitors seeking to test the waters in the US America, with many of them keen to find new customers to replace shrinking sales in the stagnant European economy, as well as to make up for the lost export opportunities brought about by the EU's boycott of Russia.

Overall, many at the show reported a need for a strong 'back story', as customers and consumers expected more than just good looks. Longer established operators also noted that tougher trading conditions continue to prevail, with buyers still unwilling to commit to large order volumes.

Among the many European exhibitors making their debut in the North American market was Bagutta, the Italian shirt manufacturer. Explaining his presence in New York, Ivan Demartis, the company's Retail/Export Co-ordinator, said: "We are here because this is a very important market and, in light of the current economic trends, we are now more focussed on international fairs.

"While, in Italy at least, the economic situation is getting better, we all know that it won't be back like it was before. So it is better for us to approach the international market. This is something of a challenge, though. Because of the variations in taste, you have to present a strong identity, then you have to communicate that identity and the quality of the product."

Enrico Colombo, Owner of Printed Artworks, an Italian fabrics printer based in Milan, also noted that trading conditions were tougher than in the past. He said: "I started working with my father 20 years ago and it was completely different – you just had America, Europe, and Japan and Korea.

"Now the market is worldwide, but the quantity of buying has fallen. In the past I used to have customers who would buy 50,000 per season, now the same customers buy 5,000 or 10,000."

As well as a slow home market, a number of European exhibitors were also feeling the adverse effects of sales lost due to trade sanctions against Russia. Highlighting this, Colombo said: "For fashion, the fight with Russia has been terrible because Russia has supported and sustained the market for 10 years. We have lost all that market."

Breaking into a new market, even for a brand that is well-established elsewhere in the world, was seen as difficult by many. Mahna Mahna is a bag maker that has a strong following in Japan. Originally, a New York brand, it has drawn on this heritage to establish its credentials with Japanese consumers. Haruka Hiroshi, the company's Representative in New York, said: "It has a huge cult following that dates back some 50 years. It's all made in Italy and uses the same leather as Louis Vuitton."

Despite its historic connection with the US, Hiroshi was finding it difficult to break back into North America. He said: "It's not very easy, it's about trying to get it into as many outlets as possible. We are bringing it to Italy, to New York, to Paris as much as we can. It's originally a New York brand, so we are trying to bring it back to America."

Photo: Mahna Mahna: Returning to its roots.
Mahna Mahna: Returning to its roots.
Photo: Mahna Mahna: Returning to its roots.
Mahna Mahna: Returning to its roots.
Photo: Back in black: Luba GnaSevych.
Back in black: Luba GnaSevych.
Photo: Back in black: Luba GnaSevych.
Back in black: Luba GnaSevych.

A good product-supporting 'back story' was seen by many as a must-have for any fashion brand. Federico Sarti, representing L'Accessorio, an Italian art scarf printer, said: "The back story is really important. Obviously we have to offer something more to the customer. It is not enough any more to just print something nice.

"Many companies try to invent a story, but we have been working in this business for 50 years, so it's nice to transfer our experience and our story. For our clients, it's an additional value."

Demartis agreed, saying: "Everything now is about storytelling. You have to be able to say something about your white shirt. We are lucky, even if people don't know Bagutta, "Made in Italy" is a brand in its own right."

Perhaps predictably at an event dominated by European brands, the consensus was that consumers value products made on the continent. Sarah Zafrani, a Fashion Designer with Paris-based Venera Arapu, said: "When you are talking about higher end, the European connection matters a lot. Being made in Europe is definitely seen as a guarantee of high standards and I think that it definitely matters to our customers."

It was a view shared by Ernesto Mattler, Vice-president of Sales for Claetyn Wood, a New York-based fashion footwear brand. He said: "A lot of people will speculate on whether it matters where things are made – I believe it does. Even at this price point – US$200-$350 – to say that an 18-year-old or a 25-year-old doesn't care whether it was made in Italy or China is just way off base.

"So is it more romantic for it to be made in Italy than to be made China at the same price point? Yes. Definitely. We just opened an account a couple of minutes ago and they were only interested in the Italian production."

As well as the perceived cachet of the 'Made in Europe' label, Mattler also noted certain other issues with regard to producing goods in China, especially at the lower volume, higher value end of market. He said: "We manufacture in Italy and in China. The thing about China is that, as the Euro has come down, it is more attractive to go back to Italy for production. This is especially the case for comfort components because they know how to make them better than anybody.

"There's also the issue of the minimums. In the fashion segment, a lot of people want different things, so when you have these huge minimums out of China, it's making it even less attractive to do business there."

Turning back to the domestic market, and Zafrani was just one of many who saw a polarisation in US tastes in both the formal and very informal sectors. She said: "It's a well known fact that Americans like sportswear. The American market is fascinating, a lot of sportswear, but also a lot of higher end, very dressy clothes. I think the decision to bring the higher end clothes to this show was a smart one, because Americans already know how to do sportswear very well."

Although sportswear is still a strong force in the US, there is some suggestion that Americans are starting to feel the need to smarten up a little. With this in mind, Mattler said: "Right now you can see the transition from athletic leisure. 'Athleisure' was sneakers and sport pants, comfort was obviously core.

"I think now a lot of people realise that they dress all wrong. We have seen a lot of interest in going back to the more traditional leather shoe. We are still getting a lot of that sneaker-wearing athleisure customer, but we are also seeing a lot more formal as well."

Luba GnaSevych, Creative Director of the Luba GnaSevych fashion line, based in New York City, noted a difference in tastes around the US regions. She said: "Los Angeles and New York are similar, but then the rest of America is very different. Our style is more on the edgier side, so it's mostly New Yorkers who like it. Also, it's all black. New York loves black."

Photo: Big on the back story: Printed scarfs from L’Accessorio.
Big on the back story: Printed scarfs from L'Accessorio.
Photo: Big on the back story: Printed scarfs from L’Accessorio.
Big on the back story: Printed scarfs from L'Accessorio.

Tranoi New York took place at The Tunnel in New York City.

James O'Donnell, Special Correspondent, New York

Content provided by Picture: HKTDC Research
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