The conflict between creatives and financiers never goes out of style.
That tension has ratcheted up in recent years as multi-brand portfolio owners gobble up ailing businesses to squeeze out a few more dollars. It’s a playbook that’s been applied to everything from fashion brands to the media covering those businesses.
The larger the business, the greater that tension point amid pressure to grow and do so with fewer resources as each year passes.
When Liberated Brands, a licensee and operator of several labels, filed for bankruptcy this year, there were two observations of note. One was how powerful the owners of multi-brand portfolios have become as employers, distributors and brands. The other was how little the press seemed to care in pointing that out. That landscape is now an echo chamber that’s allowed speedy start-ups to lap circles around slow-moving Titanics.
The transformation of the West Coast fashion industry in recent years has been stark as new owners take control of companies to amass a collection of businesses. That change has yielded layoffs, homogeneity of product, inability to move fast enough to understand consumer trends and a lack of quality. Meanwhile, many of the industry’s newspapers of record have been charting a parallel course under media conglomerates as they lose market share and talent.
Three companies stand out as prime examples of this shifting dynamic.
Authentic Brands Group, obviously.
Authentic Brands Group is a clear example. That’s due to the sheer size of its portfolio: over 50 brands and more than $32 billion in retail sales. It gives the company leverage no single business could possibly have alone.
On the final day of April, Authentic sent out a release to the media announcing a new licensing agreement with BR South Pacific for over 200 stores and online platforms under the Quiksilver, Billabong, Roxy, RVCA, DC Shoes, Element, VonZipper, Spyder and Volcom brands in Australia, New Zealand, Thailand and Indonesia.
“This partnership marks the beginning of an exciting new chapter for our brands in the region,” said Authentic President of Asia Pacific Wesley Chu.
The prepared statement smacked of the same optimism previously offered when Authentic struck its licensing deals with Liberated last year. It underscored the churn that becomes rote when brands get tossed from one licensee to the next.
The announcement also marked the latest scattering of the former Boardriders brands’ licenses, owned by Authentic, to a new group following the February bankruptcy of Liberated Brands.
As Liberated, which Authentic’s subsidiary owned an equity stake in, was in the midst of its wind down and Chapter 11, the parent stayed largely silent on the bankruptcy. The company’s communications team made sure to send carefully crafted press releases, similar to the one from April 30, to select trade media that lacked the resources and perhaps desire to do anything beyond stenography. One could say the public relations team was doing its job effectively, shepherding the media onto the next story.
Ultimately, Liberated shed about 1,400 jobs – 362 of those at the company’s former Costa Mesa headquarters. That’s on top of the hemorrhaging of positions in multiple preceding layoff rounds, toppling an already challenged surf and skate industry.
VF Corp. and Mixed Signals at Vans
As VF Corp. touts bright spots and headway in its business to investors, more staff cuts at its brands highlight murkier signs on the timing of its turnaround.
The company’s once largest business division in Vans alerted the state on April 29 of another 82 layoffs at its Costa Mesa headquarters. The cuts are expected to be effective June 29.
Morale was already low in the Orange County footwear brand’s halls with multiple rounds of layoffs that came before this most recent filing.
Among the previous layoff rounds were 500 jobs across VF Corp. in late 2023. Last spring, Chief Product & Merchandising Officer Marissa Pardini saw her position eliminated as part of a dozen cuts of senior staff at Vans.
Meanwhile, VF CEO Bracken Darrell has wavered from telling analysts in May 2022 that the Vans reset was “largely done” to saying in late January that he would keep expectations “low” on the skate shoe brand’s turnaround to allow time for improvement.
That’s a lot of whiplash for the public markets. One can only wonder what the sentiment is like in Costa Mesa.
PMC’s Content Strategy: The Gutting of West Coast Fashion Journalism
Penske Media Corp.’s never been shy about moving editors around like chess pieces and reducing headcount. The demands of creating “content” and ambitious traffic goals have been the gameplan for the businesses acquired by PMC.
The media company’s achieved rapid scale at a fast clip through a snowballing effect that’s leveraged existing news sites to quickly onboard and grow the newbies.
The Fairchild Fashion portfolio is a good example.
Women’s Wear Daily, Footwear News and Sourcing Journal are owned by PMC and had at one time separated, even competed, against one another. Now, their staffs are swapping stories, making it easier to justify continually whittling down the masthead. The most recent cut included West Coast Executive Editor Booth Moore back in February of this year. That’s now left WWD’s Los Angeles bureau with one reporter.
It doesn’t much matter, however, when the optics center around treating reporting and journalism as “content” to throw into digital’s ephemeral landscape.
That may be partly to do with how a niche publication such as Vernon Proper was able to beat WWD to reporting the closures of both Ron Herman and Fred Segal stores.
Meanwhile, publications such as Business of Fashion do little to properly cover the West Coast given the lens they view the industry through from their London headquarters and New York staff.
That’s a general truth across most Los Angeles bureaus of any media publication: leadership on another coast or continent thinks it knows L.A. better than the reporters on the ground. However, those same editors more than likely couldn’t tell the difference between Irvine, Bel-Air, La Jolla and Rancho Cucamonga if a Pulitzer Prize depended on that knowledge. The worst part is they don’t seem to care.
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