The evening of the Yves Saint Laurent presentation in Paris two months ago was hypnotic. After a corporate war fought over a magical name, a priceless archive and the mythical le smoking jacket, Gucci Group had taken fashion's biggest prize, purchasing Yves Saint Laurent Rive Gauche--among a host of other baubles--for just over $1 billion. This night marked the first ready-to-wear presentation from its new designer, Tom Ford.
Within the expansive and manicured courtyard of the Rodin Museum, Ford had designed and constructed a Saint Laurent jewel box. An intimate, rectangular space, black and moody, with purple spotlights, white lilies and downy seats as generously sized and as comfortable as settees in the VIP section of a smoky lounge.
Picking their way down the narrow Rue de Varenne, the guests ignored the tradition of being fashionably late for such events. So much was riding on a single 15-minute parade of frocks: industry bragging rights, corporate history, retail resuscitation, the revitalization of a legend.
And no one waited more breathlessly than Peter Marx, the newly crowned president of Saks Jandel, the venerable collection of fashion boutiques in the Washington area. He sat leaning forward in Row 4, in the center section. He was waiting to see if 30 years of loyalty would yield a big payoff for his family and its two YSL stores. Or if three decades of dutiful dedication would yield nothing at all.
Marx wouldn't learn the answer that evening. He may not know for some time. But on Friday, Oct. 13, he would find out whether he had reason to hope.
A Fashion Nightmare
The Marx family--Ernest Marx, wife Sally, son Peter and two daughters who are not involved in the business--had already watched the celebrated rebirth of Gucci gallop on without them. In 1990 the Gucci family was in turmoil and the company's finances were a shambles. Ernest Marx owned the last Gucci franchises, with one store in Chevy Chase and another at the Watergate; and the contracts would soon be up.
Both stores needed modernizing and Marx had a dilemma: He could spend the money to upgrade the stores--a necessity to keep the business fresh and vital--and risk watching that money evaporate as Gucci disintegrated. Or he could get out. He might have made the investment if Gucci CEO Domenico de Sole would have agreed to extend the franchise agreement for another 10 years. But that's not the way luxury brands operate anymore. They like to keep a tight rein on distribution. That's the only way to be successful: control, control, control.
So Marx sold the franchise back to de Sole. Four years later, Gucci, under the creative direction of Ford, was skyrocketing. The Italian leather goods house blasted from $203 million in net revenues in 1993 to $1.2 billion in 1999. Any regrets?
"You'd have to be stupid not to have regrets," Ernest Marx notes. "In hindsight, there'd have been many things we'd have done differently."
Perhaps it's the advantage of age that allows the father to be so blunt. Posed a similar question, the son justifies and then explains.
"We were looking into an abyss with Gucci," says Peter Marx. "We could have been in real trouble if we'd continued. We would have had stores without merchandise."
De Sole emphasizes that he bought back a hollow shell, not a ripe plum. And contrary to the thinking of an industry that typically assumes devilish motives, it was not a plot to cut the Marxes out of Gucci's now-substantial revenue. "We are not evil people," he says from his London office. "We are not the evil empire."
Now here they all are again. At its peak, YSL had about 30 stores, almost all franchises. The Marx family owns the last two: in Chevy Chase and at the Watergate. In fact, outside New York, theirs are the only YSL boutiques in the country, although a smattering of YSL merchandise is available in department stores.
This is important, because YSL, like other luxury brands, increasingly limits distribution to its own free-standing shops. If and when there are profits, they will be concentrated in YSL boutiques.
And once again, de Sole and Ford--along with YSL President Mark Lee--are the lead characters in a turnaround scenario. History seems poised to repeat itself. And, by God, this time Saks Jandel will be part of it. They've got five years to go on their franchise agreement and the risk to the family isn't as grave.
"We've always made money with Saint Laurent," Peter Marx says. He says the privately held family firm does about $2 million a year in sales volume with Saint Laurent.
But it's not as easy as sitting back and waiting for the new frocks and accessories to arrive. Chanel, for example, recently ended a 20-year relationship with the Marxes. (A Chanel spokesman declined to comment on the decision.) Some in the fashion world suspect that YSL will be the next to pull the plug.
The simple fact that the Marx family still owns a specialty store is something of a marvel. The discounts and advantages afforded retail conglomerates overwhelmed a lot of smaller independent businesses--they simply couldn't compete. So if only one thing can be said about Saks Jandel and its owners, it is that they are survivors.
The family has been in the ready-to-wear business since the late '20s when Sally Marx's grandfather Mano Swartz and his brother-in-law Sam Saks, who started out as furriers, added ready-to-wear to their mix of mink and sable overcoats. Over the years, the family absorbed other businesses, shifted locations and even changed the name of the store. (Saks Fifth Avenue was founded by a cousin. The Marx family added the Jandel name--from a furrier they bought out--to end the confusion between the two Saks retailers.)
The patriarch, Ernest Marx, recounts family history in sonorous tones, drifting from one cousin to the next and interchanging given names for nicknames, until it merges into a chaotic family tree of buyouts and mergers. The pertinent point is that the store remained within the family and that more than 30 years ago it established relationships with European fashion houses that still remain intact.
Ernest Marx contemplates his palm and then the floor before looking up and revealing how he came to sell Yves Saint Laurent ready-to-wear before there was really even a ready-to-wear collection.
He went to Paris in the '60s because the now-defunct Garfinckel's had a stranglehold on the American designer market in Washington. Europe was just making the shift from haute couture to ready-to-wear. Marx, a tall, lean man with a reserved demeanor, approached YSL about buying the house's few ready-made pieces, really just little extras mixed into the couture collection.
The French liked this serious gentleman who was not quick to flash an unwarranted smile or to make a careless joke about fashion, which the French hold so dear. He soon had persuaded the Mendes company, which owned the ready-to-wear license for YSL, to grant him a franchise. That was 1972 and the Marxes have had it ever since. Over the years, Saks Jandel gathered an impressive array of designer labels: Emanuel Ungaro, Valentino, Louis Feraud, Chanel, Christian Lacroix, Christian Dior. And along the way, their customers came to include Washington's federal and social elite: Deeda Blair, Nancy Reagan, Barbara Bush, Elizabeth Taylor, even Chelsea Clinton.
This is the Saks Jandel reputation: "Aren't they the best specialty store in all of Washington with the big-gun designer names?" says Susan Rolontz, vice president of the Tobe Report, a New York-based fashion and retail advisory firm.
Now, at 80, Ernest Marx is retiring. Peter Marx has taken over as president, although his father is still Mister and he is simply Peter. The son, 43, who dresses in fashion's uniform of monotone black in contrast to his father's herringbone and tweed, has the challenge of injecting youth, excitement and profits into the company.
"Our biggest concern is we need new, young customers," Ernest Marx says. "Our old customers, many of them are less active socially." Peter, the father says, must make the business grow after several years of flat sales.
Peter Marx is gambling that Washington women are interested enough in fashion to come to his store and see the new designer lines he has gathered. The hurdle, of course, is that while Washington women have an intellectual interest in style, they're not particularly intrigued by trend-tracking. "I find, except with one friend, I never discuss clothes here. I do it in Paris. I do it in New York. Here you don't discuss it. It's considered trivial," says Blair, a philanthropist and fashion aficionado.
But Marx's ultimate wager is that he can convince women that he has an inspired fashion point of view. Lots of folks agree that he is earnest and smart and dedicated. Peter has been "a very important person in that business for a long time," says Marsha Posner, a New York fashion consultant whose company is under contract to Saks Jandel. What's less clear is whether he can reenergize a fashion war horse.
The YSL Cachet
To understand why YSL means so much in the fashion industry, one has to remember the level of esteem in which Yves Saint Laurent--both the designer and his label--are held. "The most consistently celebrated and influential designer of the past twenty-five years, Yves Saint Laurent can be credited with both spurring the couture's rise from its Sixties ashes and with finally rendering ready-to-wear reputable," writes fashion historian Caroline Rennolds Milbank in "Couture."
In his heyday during the late '60s and 1970s, Saint Laurent introduced women to the beauty and strength of trousers, incorporated ethnic costumes and modern art into the language of the atelier and blurred the line between masculine and feminine. He not only offered a new way to dress, he suggested a new way to think.
Saint Laurent's name is murmured like a mantra among today's generation of designers as one of their greatest sources of inspiration. They look to Saint Laurent in the way actors deconstruct the work of Robert De Niro, basketball players stand in awe of Michael Jordan and investors scrutinize every move of Warren Buffett.
The spirit of Saint Laurent has been particularly evident in Ford's collections for Gucci. And now, after a series of financial twists and turns, coups and aborted takeovers, Ford's Gucci Group owns Yves Saint Laurent Rive Gauche, the ready-to-wear division of the esteemed house. (The haute couture line remains under the control of Saint Laurent himself, along with company co-founder Pierre Berge.)
As creative director of Gucci and now YSL, Ford has an entire industry waiting to see if he can bring YSL back to both profitability and glory in the manner in which he and de Sole resurrected Gucci. Before the spring 2001 show, the only hint to Ford's upcoming work had been in an earlier, small resort collection for YSL. In that collection, Ford reworked the tuxedo--a YSL signature--cutting it sleeker, widening the satin stripes on the trousers, making it sexier. And to emphasize the importance of the tuxedo in his plans for YSL, a gantlet of models wearing the splendid suits--with one lapel self-consciously flipped up--greeted arriving guests at the October show.
"When I walked into the courtyard of the Rodin Museum and I saw this phalanx of models in tuxedos and the men with no shirts, I felt very reassured," says Gary McFall, director of YSL stores for Saks Jandel. "I knew [Ford] was sticking to Saint Laurent."
As the audience milled about, surreptitiously taking note of which Saint Laurent loyalists were in the crowd--Pierre Berge, Betty Catroux, Bianca Jagger, Diane Von Furstenberg--there was Marx in animated conversation. He loves information and he can pepper his prey with questions about what they've seen and what they think of what they've seen. His interest comes across as sincere and urgent, as if he's looking for the one strand of news that he has failed to consider, the one morsel of information that has yet to be consumed.
At showtime, the lights dimmed, and a single model emerged from the darkness in a white trouser suit with a shaped jacket, wide pants and low-cut vest sitting on the waist like a cummerbund. That moment was evocative of YSL, but it also spoke of Gucci, of Ford's love for the erotic and of his celebration of youth and of stark black and white. The collection was applauded but not celebrated. In the end, it was a solid beginning.
But for retailers, the test is not in the volume of the accolades but in far more mundane matters. "I could see that the cut was very fitted, with more darts in the front and more darts in the back," McFall says. Fit concerns him. The new YSL is a collection with a slim cut and is sized no larger than an American 14, which, truth be told, is really more like a 12.
"That young customer is going to get older and put on weight," McFall says. "If [Ford] understands that a 16 woman can be well proportioned, well, I think he should rethink it. I think he's limiting the customer base by only going to a size 14."
McFall also hopes for more variety in the line. "I know he's a minimalist at heart but I hope we get a little more embellishment," he says, knowing that stark can be a hard sell here. "I would hope that he would introduce more color. But it was an initial collection and he didn't want to shock people."
After that night, the YSL trio--Ford, de Sole and Lee quickly moved forward to production, advertising, and re-creating the YSL image and its stores.
Lee met with Marx just after Thanksgiving. They spent the day looking at the stores, with Lee noting everything from fixtures to the merchandise mix to the sales representatives. In the luxury market, environment--right down to the background music--is a perpetually scrutinized component of the sales pitch.
Vendors have to like your store. As de Sole says, an outlet is either "an enhancement to the brand or a detraction from the brand. I don't care how much money it makes. The integrity of the brand is everything."
So a vendor could walk into your store, decide he doesn't like the carpet and stop selling to you. That's extreme and it certainly matters what sort of written agreement might exist, but it happens.
Indeed, de Sole's "terminator tours" are business legend. In 1996 he was visiting Hong Kong. "Our duty-free location in the airport was absolutely disgusting," de Sole recalls. "This place was a disgrace to the brand." He shut the profitable Gucci store down that very day.
"Loyalty means everything to us, but once we give direction to the brand, we want to make sure the brand is properly presented," de Sole says. "We don't want to kick [the Marxes] out as long as we're in agreement with the vision for the brand.
"We only want to make sure the brand is treated very well."
What does that mean? At the very least, it's millions spent on renovations. For the Marx family, the Washington area stores will be their personal responsibility. "Eventually, obviously, we have to renovate both stores to update the image," Peter Marx says.
Lately, Peter Marx has been inspired by the potential for growth in sportswear. He has taken to accompanying buyer Dina Garber on her appointments, supporting her when she's hesitant to take a risk, but sometimes sitting silently when asked which color he prefers.
"I try to buy the collection and have a good representation on the floor, and that means taking a risk on something that's a little on the edge or too expensive. But I do it because we're in the fashion business," Garber says. "Peter will tell you that I'm a bit of a chicken. . . . He's got the courage I need."
They've added the coquettish Blumarine line, the critically acclaimed Veronique Branquinho, the revamped Emilio Pucci and Courreges and the current darling of New York, Miguel Adrover.
The problem, however, is that Blumarine, with its fur-trimmed sweater sets and Adrover with his downtown preppiness, are overwhelmed by a beige room in the Saks Jandel store that lulls the senses instead of providing a visual drumroll. The glowering boxy red jackets of Louis Feraud contradict the chic simplicity of Dusan and Rebecca Moses. The flat lighting creates a setting more conducive to buying insurance than fashion, and the energy level encourages whispering rather than enthusiastic requests for a fitting room.
Many of Saks Jandel's sales representatives have been with the store a decade or longer. There's plenty of wisdom but not much fresh-faced verve. The Right Stuff, a section of younger, less expensive lines, often feels like the children's table at a holiday dinner. It's tucked off to the side and stocked with racks uninvitingly full. The store's grand European designers are often viewed as stuffy or out of touch by many fashion observers. And its high-profile customers are associated with clubby society rather than either Hollywood or high-tech derring-do--the fairy dust of personality columns. None of that works to attract the younger, more adventurous customers the store needs.
"Unfortunately, Peter trained at the foot of his father and he doesn't understand that today it's not just merchandise, it's theater," says Vicki Ross, a fashion consultant who formerly worked with Saks Jandel. "Peter needs a crash course in making the environment modern."
While Ross guesses that the family-owned business turns $20 million in volume, Ernest Marx puts annual sales volume at about $13 million, precisely what the store was quoted as producing in 1988. It's falling short of potential, says Ross. "It's an old store, with an old mentality."
Washington communications executive Marina Ein, an avowed fashion addict, should be a major Saks Jandel customer. Instead, her favorite specialty store is in Boston. "The main store has never overcome that sort of dowdy quality," she says. "It's just no fun. I know what I'm going to see before I go in.
"There's no sense of what appeals to a woman: not something she needs, but something she wants," Ein says.
Of course, no merchant can please all customers. Saks Jandel has more than its share of supporters. "I'm sorry that they apparently lost the Chanel boutique. They did a wonderful job. I think the whole store is tremendously attractive," says Blair, a veteran of the haute couture shows. "I don't think [Peter Marx] has to change very much. . . . The Marxes always go to Paris regularly. They've always kept up with changes."
But Ein pinpoints several of the key issues that Peter Marx is addressing. In addition to the growing list of new labels, he has added another buyer in evening wear--one of Saks Jandel's strongest areas, for example. There's also a new store manager and publicity director.
No one is saying specifically what will be necessary to keep the Saint Laurent business. "We have a great respect for the long-standing work the Marxes have done with the brand in Washington and we're looking forward to working with them on future brands," says YSL President Lee from his Paris office. And Peter Marx is enthusiastic in his support for YSL.
But this much is clear from the sensual runway presentation: Tom Ford is constructing a sophisticated image of controlled sexuality, elegance and boldness.
And it does not go with beige.