Can Topshop become the toast of Broadway?
As Sir Philip Green takes a massive gamble in New York the question is will he end up as toast?
Never mind the G20 summit in London on April 2. Ask any party girl in New York and she'll tell you the real action that day is in the Big Apple where the flamboyant British retail magnate Sir Philip Green will finally open Topshop USA, in the heart of SoHo, on Broadway at Broome.
Manhattan's online rag trade pundits and fashion magazines are having a field day. Who will be there? Will Kate Moss get out of bed? Rapture and the Misshapes are due to provide the music – but will Mark Ronson be there too? Will Lady Gaga be performing, as rumoured? Who's invited to Green's celebratory dinner at Balthazar and the after-party at the Box?
Then there's the bigger question – the one that interests the Wall Street analysts tracking retail's downward spiral: has Green finally bitten off more than he can chew? When the thrill of the opening weeks is gone, when Topshop USA is no longer giving away promotional coupons on Manhattan street corners, and when New Yorkers have discovered that, however cool it may be, Topshop is more expensive than many of its Main Street rivals, will Green be the toast of Broadway? Or just toast?
The New York store has been a long time coming. Initially scheduled to open its doors last autumn, the project suffered a host of setbacks that saw the date pushed back to October, then March and finally April 2.
Opening a flagship store on Broadway during a recession is a colossal gamble
Arcadia, Green's retail holding company, is notoriously secretive about plans and costings and will not disclose what it has invested in the new store. But rag trade observers believe it can be nothing less than $20m. And two years ago, when Green first boasted of his plan to move Topshop into America, he mentioned the figure of $50m and said Arcadia could "certainly afford that".
But that was well before the credit crunch took hold. American consumer spending fell one per cent in October 2008, its largest drop since 2001. On both sides of the Atlantic, the only good news is coming from the online retailers like ASOS and Net-A-Poter. Sales at ASOS have doubled in the last 10 months while Net-A-Porter's sales are up 50 per cent – and research analyst Mintel predicts that online retailers will grow by 23 per cent this year.
Opening a 40,000 sq ft retail outlet in the depths of recession, even if it is in a prime spot on Broadway, is a colossal gamble.
Not that Green will admit it. At a press conference in New York last month, he reacted with anger when a journalist came out with the D word - "downturn" - and asked whether the store was doomed to failure. "Don't be so negative!" he fumed, before storming off.
The store is not as big as Topshop's famous flagship on Oxford Street, but if Green has his way, it will make just as much noise among the teenage girls and young women he needs to entice. The interior, which retains the building's original beams and wood floors, has been designed by Dalziel and Pow, the brains behind stores such as Gap and HMV. Shoppers will be able to dance their way to the tills courtesy of a record-spinning DJ in a booth suspended from the ceiling.
Topshop's head of PR, Andrew Leahy, has clearly been stacking up the Air Miles with trips to New York to keep the pre-opening banter flowing. Kate Moss, the supermodel turned designer whose ninth collection for Topshop will be unveiled in London and New York on Thursday, may be the store's chief ambassadress, but there's also a team of British socialites living in New York who have been talking it up a storm.
Manhattan-based model Poppy Delevigne, 22, told the New York Observer about her favourite Topshop item, an emerald green one-shouldered dress designed by Moss. "They did it in red and I missed it in my size and I literally cried for days, and I wear that pretty much twice a month, especially when the sun comes out," Delevigne trilled.
Fashion writer and novelist Plum Sykes tried to explain the Topshop magic to New Yorkers this way: "It is very cool, it's very edgy... It isn't like that sort of American Main Street brand, like a J. Crew or a Banana Republic, that is very much trying not to be too cool, do you know what I mean?"
Well, not exactly. Maybe socialite and photographer Poppy de Villeneuve – not to be confused with Delavigne - can help: "It's like H&M but it's more... It's very British."
Then there are the New Yorkers who knew about Topshop all along – who never visited London without dropping in at Oxford Street, whether they were stars like Beyonce and Shakira, with their entourages in tow, or hip young tourists who just knew.
All these girls are essential to Topshop USA's success. "Parties are their strategy," one London retail watcher told The First Post. "The more party people they get on board, the more of a party atmosphere they can conjure, and the better for sales and image. Parties - and press coverage of parties – sell more clothes than conventional ads."
Kate Moss has cachet in Manhattan, but that means nothing in the Midwest
But there's a catch. "Kate Moss does sell clothes - not as many as she or Topshop claim - but she does still sell. [Her eight collections so far are thought to have brought in £40m in added revenue]. But while she has a lot of cachet in New York, that doesn't mean a thing in the Midwest. And this is an issue. If Topshop is to win big in the States, they have to crack online sales - and the competition is mind-blowing."
The fact is, while Green relies on London's number one party girl and her Manhattan acolytes to deliver, he no longer enjoys the expertise of the women who made Topshop a success. Brand director Jane Shepherdson, marketing director Jo Farrelly and buying director Caren Downie have all quit over the past two years and are watching from a safe distance – the first two at Whistles, Downie at ASOS.
As one fashion pundit, seeking to explain in part their decisions to leave Green to his own devices, told The First Post: "He was never a good listener."
But to be fair to Green, what gutsy entrepreneur ever got anywhere by listening to his nay-sayers? ·
Comments are now closed on this article