Category Archives: Industry and Commerce

“It is a great truth that industry, commerce and security are the surest roads to the happiness and prosperity of a people.”- Thomas Jefferson

The Modern (Farm) Family

The vintage and modern farm families

Depending on your age, either you or your parents probably formed part of a farm family or knew someone who did.  Stemming from the Great Depression, and moving into the 1940’s and 1950’s, American families continued to feel the effects of scarcity, with government rations on basics like coffee, sugar and flour a not so distant memory.  Seeking a more self-sufficient way of life, one less likely to be jeopardized by a poor economy, living on and operating a farm was a guarantee of two things: a continual source of food/survival, and a big labor demand.  Prior to technological advances that resulted in the creation of machinery to do many of the mundane, yet time consuming tasks required to produce bountiful crops, human labor was required to till the land, sew the seeds, pick the fruit/vegetable, milk the cows, etc. and with a limit on economical resources, hiring migrant workers wasn’t an option then as most commercial farms do today.  So, how does a labor intensive venture operate when there is no money to hire help?  Simple: kids.  Farm families tended to be quite large in the 1950’s, with both parents and every child working and contributing to the survival of the family.  This is what America was built on: the principal that everyone has to pull their fair share and work hard.  If little Jimmy didn’t milk the cow, his family wouldn’t have milk for breakfast the next day. He was directly responsible to his siblings and parents.

Shift 60 years into the future and where do we find ourselves? In political mayhem, ideologically divided as to who should be responsible to ensure everyone has milk for their morning cereal. Some embrace the ‘farm family’ mentality where we as individuals and families are responsible for milking our own cow, and others feel the government should do the work and just send us the voucher to hand to the milkman when he comes on Monday mornings.  Although we could discuss this topic at length (and we will as the 2012 Presidential election draws near), what we find more interesting is the niche community that most embraces the farm- family mentality of  ‘everyone contributes’.

Hollywood. Its a fickle, superficial and money driven world. It’s also very hard working. Everyone has a purpose and is a component of a well-oiled money making machine, known as publicity.  As a society, we are obsessed with knowing who is dating who, what they had for dinner, what they bought at Kitson and any other mundane detail of celebrities lives that make them appear somehow more relatable.  This insatiable hunger translates to big paydays for the rich and famous when it comes to exclusively sharing the big moments of their lives, like marriage, divorce and babies with the weeklies and gossip magazines.  Case in point: the Kardashians.

Led by momager, Kris Kardashian, every family member plays a part in furthering the survival of the unit.  Kim, its star, who recently wed NBA-star (we use that term very loosely), sold her engagement story to People for $300,000, and her wedding photos for much more than that. Khloe, the younger sister, sold her wedding exclusive to fellow NBA star Lamar Odom for close to the same amount and the oldest sibling, Kourtney sold pictures of her son Mason, to Life & Style for 300K just two weeks after giving birth:

Kendall and Kylie Jenner (Bruce Jenner is their dad), are both bringing in their share of the money crop through aspiring modeling careers (Kylie made her New York Fashion Week debut in Avril Lavigne’s Abbey Road show– mind you, she is below the age limit of 18).  Lone brother Rob Kardashian, who has long been criticized for not pulling his own weight by his publicity loving sisters on their reality show, Keeping Up with the Kardashians, has stepped it up and is currently on Dancing with the Stars.   Kris, the mastermind behind the family’s commercial success (the family as a unit is expected to gross $60 million in 2011), is the epitome of the farm- family.

Republican favorite Sarah Palin is another good example  Given her fondness for game-hunting, she may be literally and figuratively the farm mom.  Upon announcing her VP nomination for the 2008 Presidential election, the controversy surrounding who (Sarah or her daughter Bristol) is the real mother to baby Trig, became front page fodder for months.  Not stupid, Sarah and Bristol both saw the opportunity to stay in the media spotlight and make major money by repeatedly selling exclusive coverage of the controversy and Bristol’s on-again, off- again relationship with Levi Johnston, making sure to include Trig and her own son Tripp in every single photo:

Not only did Bristol get a nice check for this cover, but she also used the platform to keep the spotlight on her mother, with a cover mention.

Why should anyone care about a girl from Alaska who got knocked up and graduated high school? Here Bristol makes a buck by stressing the importance of abstinence and yet again, gets her mother’s name on the cover.

This cover speaks volumes.  On the upper left hand side, there are the first pictures of Halle Berry’s daughter.  These were taken by the paparazzi who most likely sold them for a very pretty penny and Halle received no compensation. However, Sarah Palin surely got paid for providing access into her own life and those of her children for the Us Weekly cover.  But shoot, can you blame her? A taste of the good life (like a Valentino suit for $1500.00), makes it hard to go back to shopping at Sears, so someone has to bring in the funds to keep it going.

Many celebrities have sold exclusive pictures of their children to the media as a way of benefiting economically from having to live under the microscope of the paparazzi.  When an exclusive is arranged, not only does the celebrity pocket the funds, but it also essentially cuts off all the paparazzi mayhem of trying to get ‘the first picture’ to sell to the magazine.  More money and less stalking?  You see the appeal:

The formula works. Two of the most successful People covers of all times were Sandra Bullock and her son, and Brangelina and the twins, Vivienne and Knox.  Brad and Angelina got a whopping $14 million for the exclusive, which they donated to charity (enough to make sure entire communities get their morning milk):

Jessica Simpson is the latest to follow suit. Already well-established economically thanks to her uber-successful apparel company,  Jess is holding the official announcement of her already obvious pregnancy until her dad can arrange a $500,000 payday for the exclusive story.  This really is the most extreme of family farming mentality.  Jessica’s dad, Joe, and his wife Tina, live entirely off their daughters.  As Jess’ manager, Joe collects 10% of all her income- which would include any money she makes from announcing her pregnancy to the media. Nice Joe. Why not allow the paparazzi to stalk your eldest daughter, trying to get the money shot, until you get make sure a half million can be made from the little one’s existence:

Jessica Simpson in LA on October 21, 2011

What magazine would pay Jessica 500k for an exclusive that is nothing but obvious to everyone?  If I were Jessica’s agent, I would advise waiting and packaging the exclusive to include the first pictures of her newest money making venture baby, the plans for her upcoming wedding to fiance Eric Johnson and a behind the scenes of her new reality show, Fashion Star.  The combination of all three stories has much more potential than her non-secret pregnancy.  Additionally, there are the “sisters and their babies” and the “how I balance work and motherhood” stories to sell in the future. After all, an empire only lives on if the younger generations take a leadership role once the elders become too old, or uninteresting to bring in the big money.

What do you think of celebrities making money off selling exclusive photos of their children? Is it in bad taste or simply a compensation for having to live under the microscope of the press?  Let us know your opinion by posting a comment below the post.

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$9.99, Are You Outta Your Mind?!

Where is the Value?

The answer to that question depends on what you are buying.  A pair of super trendy shoe clips for your tween-age daughter, probably not; its a good buy.  But a presidential economic reform platform? You might want to think twice.

Quite unexpectedly, Herman Cain, GOP Presidential nominee, and his 999 tax plan, have become the focus of a media frenzy.  Cain, a businessman who revitalized the Godfather pizza chain by closing down under performing stores and demonstrating his masterful marketing skills by dropping the cost of a large pizza by $.01 from $10.00 to $9.99, thereby making customers believe they were getting a real value, seems to be proposing the same tactics to transform the U.S. tax code.  His 999 plan contemplates eventually, and only temporarily, replacing the current tax structure with a  9% income tax, allowing no exemptions or deductions (in lieu of payroll taxes), 9% corporate tax rate with no breaks or deductions and a 9% national sales tax.  Unlike most people out there, we aren’t interested in debating if the 999 plan will generate as much revenue as the current plan. Rather, what strikes our interest is what is up with the magic number 9 that grabs our attention and more importantly, our wallets.

As not to beleaguer the point of how retailers choose to price their goods, we can skim down the process to competitor-based and consumer-based pricing.  Competitor pricing is exactly what it sounds like, selecting a retail price that is based in a comparison to the price of similar products being sold by other companies.  A good example of this type of pricing strategy is Walmart. As the leader of ‘everyday prices’  Walmart looks to offer the lowest prices on goods also available at other retailers such as Kmart, Amazon and Target. The biggest problem with this pricing structure is the constant need to find new customers to stimulate increasing revenue.  Why might Walmart have a problem increasing its customer base if its prices really are that low?  Ego.  Walmart is not exactly the mecca of style and taste. It reeks of cheap.  Michelle Obama may have gotten ‘caught’ shopping for dog food at Target, but she isn’t coming out of a ‘value’ driven store like Walmart.  Target has Missoni, Walmart has Hanes tube socks 5 for $10.00. There is clearly a fashion quotient distinction.

Yet, fashionable or not, value is what consumers most seek out in their purchases these days, independent of the price point.  A luxury handbag costing $5000.00 that last forever given its superior quality has more value than a $29.99 bag from T.J. Maxx that falls apart after two uses.  Customer- based pricing strategy supports this fact.  Simply put, the customer-based, psychological pricing strategy implies there is a mental price barrier that limits what a customer is willing to pay for a certain item.  Research reveals when humans deal with numbers, we place a primary focus on the first number and significantly less on the subsequent digits.  This means that a t-shirt priced at $9.99 is the equivalent to 10% less than a one for $10.00 even if the real difference is only $.01.  The vast retail implementation and success of this pricing strategy is not only limited to Cain and his pizzas.  Sixteen of the top 20 best sellers of Kindle e-books on Amazon are priced with the $.99 strategy.

The underlying principle of psychological pricing is value (the ratio of benefits received from a product or services compared to what it costs to obtain them), and with products that offer awesome, or unique benefits like the iPad, the psychological assignment of value can skyrocket and therefore the price barrier as well.  As important as value is in today’s marketplace, should it be the primary concern when ‘buying’ a candidate to be President of the United States for the next four years?  That really is what we are doing here, buying one persons’ plans, visions and programs that will directly affect our quality of our everyday lives. Perhaps a bit of comparison shopping to see what the other candidates might cost and what their benefits are  before declaring Cain’s 999 plan a magical retail formula.  If you want to learn more about Cain and his programs, tune into Piers Morgan tonight on CNN as he sits down with Herman to discuss Tuesday’s CNN GOP debate held in Las Vegas and his plans to rule the GOP and possible the USA.

On a side note, someone should run now to TJ Maxx and grab that Dolce & Gabbana leopard print dress shown above on super discount. It is soo worth it!

Saudi Women to Drive Up Luxury Car Sales?

Manal Al-Sharif, arrested for driving in protest in June, 2011, loves her Lexus

Pardon the pun, but as Saudi women continue to fight the religious edicts that prohibit them from driving, luxury automotive brands are jockeying for position to reap the benefits that ‘equality’ and the well known love of luxury brands in the Middle East country may soon appear.  While there is no specific law that prevents Saudi women from driving, their position as minorities doesn’t allow them to open bank accounts, apply for a passports or even go to school without the permission of a male family member.  However, earlier this year, a well known Saudi blogger, Eman Al Nafjan, decided to take a stand by creating Women2Drive 17th June, a program encouraging women to drive on June 17th, 2011,  in support of promoting and encouraging King Abdullah to pass legislation allowing women the right to drive (he has gone on record saying such legislation is not far away). In fact, Women2Drive 17th June has a very active Facebook page, gaining significant attention and traction from national, and international audiences:

One of those audiences is luxury car manufacturers.  After all, Saudi Arabia has no shortage of disposable income (understatement of the year) and with a new market likely to soon emerge (no woman wants to share a car with her husband after all), the demand for high end vehicles has the potential to skyrocket, similar that what has taken place in China.  With the economy growing by leaps and bounds, Chinese women are increasingly taking on jobs traditionally held by men. Along with these jobs come hefty paychecks, ones that are being taken straight to the Maserati and Ferrari dealerships.  Among Chinese ultra luxury car owners, 25 percent are women, three times that of their European female counterparts.  Global management consultant firm, Bain & Co. draws many parallels between China and the Middle East (Saudi Arabia and the U.A.E. in particular) in their shared desire for luxury goods and the sheer mass of wealth.  So much wealth, the Middle Eastern market, worth €4.1bn in 2010, is likely to grow 10-12 percent by 2013.  That is a lot of money to spend on Jaguar, Bentley, Audi, BMW and Mercedes.

Come to think of it, it might be a good time to reevaluate stock positions in the automotive market, especially in the luxury and ultra-luxury sectors, wouldn’t you say?

The Devil Wears… Zara? The Changing Face of Luxury

Well she might as well be because Prada is slowly evolving into a ‘luxury’ brand that won’t be able to affix the desired “Made in Italy” label to its goods and instead, will feature that same ‘Made in China’ label so many of Zara’s products carry.  Although the brand has an established reputation for its unique design vision and superior quality (Marc Jacobs recently went on the record that Prada is the brand he most respects and wears himself), and even got top billing in 2006’s box office success, The Devil Wears Prada, leading to a massive increase in brand awareness and social relevancy as to its relationship with high-end fashion.  However, it recently came to light that Prada is upping its outsourcing of production to developing countries with less expensive labor.  Having already shifted a portion of its material sourcing to China and India years ago,  citing the parallel quality of fabrics and findings as those from Italy without the corresponding hefty costs, the brand shifted 20% of its production of products ranging from bags and shoes to clothes for men and women to China this past July and recently announced similar plans to further outsource production to India.

What impact with this shift have on Prada’s positioning as a ‘luxury brand’?  It depends on the definition of luxury.  If it is all about limited quantities and exclusivity, then origin shouldn’t make much of a difference to the bottom line. After all, the same 400 bags will hit the market and fashionistas, fashion editors and rich ladies who lunch will  be pulling trump cards to get one.  However, if luxury is defined by scarcity and the level of quality, then the discussion becomes much more interesting.

If beauty is in the high of the beholder, then so is quality, at least in principal.  Why? Because quality is not a set value, its a subjective one. given the element of perception.  A fabric’s hand (how a fabric feels when you touch it) denotes its quality, the softness of a leather indicates its worth,  how many stitches a garment has will affect how it fits, thereby directly influencing our opinion of its quality (the higher stitch count, the better fit you usually will get.  This is why clothes from economically priced stores like H&M and Old Navy rarely fit well) and it’s also the reason ‘Made in China’ has become synonymous with ‘cheap crap’. As the largest global exporter of low cost goods, the association between Chinese goods and “low quality” is a strong one.  Now, slap that label on this $1540.00 handbag and people aren’t going to pause before putting down the credit card?

Prada designer Miuccia Prada, doesn’t think they will.  When asked what effect the shift of production will have on the demand for her products, she said any change will be negligible because branding is about consistency and  “Chinese production is extremely high quality ” and a “Made in India” label translates to luxury in the mind of the consumer”, similar to that of  Italy.  Hmm, not sure I would stand behind those statements but for them to be proven true, the Prada customer has to care less about the origin label inside the bag than the brand label on the outside. After all, that is what everyone else sees; the aspirational triangle.  What value that triangle has is where the value really lies, whether its made and sewn on in Italy, China, or India.

Things That Don’t Pair Well: Porn Creep and Teen Fashion

Unlike Bert & Ernie, peanut butter & jelly or Tom and Jerry, some things just aren’t better together.  At the top of that list is porn culture and America’s youth.   Its everywhere you look, from movies to toys (Bratz dolls outfits for example reek of sexual references) to fashion advertising.  Urban Outfitters, an apparel retailer popular with teenagers and young adults recently got sued by the parent of a fifteen year old model whose image ended up on a t-shirt the retailer designed and sold to adult men.  Although some models may believe being featured on t-shirt is a sign they “made it”, neither this model nor her parents were (they are suing UO for $20 million). Considering the pose and the fact that she was fifteen years old at the time, their discontent is pretty justified:

The model pose

The t-shirt

Sure, many may ask what kind of parents allow their daughter to even take a picture like this on set.  Having produced many fashion photo shoots, I can say first hand that there are always pictures that get taken and are not used for a myriad of reasons.  This is one of those pictures.  The real issue shouldn’t be how the picture got taken, but rather how in the world the Urban Outfitters merchandising team ever let a t-shirt like this get into its stores?  Clearly the retailer stated it did not realize the model was only fifteen, but that is hardly the point. More interesting is figuring out how we have gotten to a place of such desensitization that the appropriateness of an obviously young girl in an extremely sexual pose screened onto a men’s t-shirt is not questioned.

Urban Outfitters isn’t in the boat alone.  A few years back, Abercrombie, well known for the sexual and suggestive nature of its advertising, sold thong underwear embellished with phrases such as “eye candy” and “wink wink”.  At first glance, this doesn’t seem to be such a big deal,  especially because if the same design was sold at Victoria’s Secret. In this case,  girls all over would be snapping them up for bachelorette parties. But, they were sold at Abercrombie, and for girls  age 10-14:

If questioned, its fair to say the majority of fathers would probably take issue to their ten year old daughters wearing thong underwear, especially given its roots in sexual fetish apparel, but what is more alarming is that retailers have apparently forgotten parents’ role as the gatekeepers for their childrens’ purchases and perhaps parents themselves have forgotten.  If life is so busy that  parents aren’t paying attention to what their kids are buying Saturday afternoon at the mall, or simply chose not to contest a purchase because fighting with moody teens can be exhausting, or there may be bigger issues with more dangerous consequences to deal with, we as a society might be well reminded that most floods aren’t caused by a tap left on full force, but rather by a faucet not fully shut off, that drip by drip, fills a sink, overflows, and floods the bathroom, at which point, the damage is done.

Berlin: Fashion Destination. Plus, Where to Go When You’re There

Quick word association game:  Fashion.  What comes to mind?  A favorite trend? A specific designer?  A celebrity whose style you admire and try to emulate? Or maybe a city like New York or Paris where fashion is an essential component, driving life and energy through its cultural lungs?  All of these would be logical options and if the German government has anything to say about it, Berlin will be the next obvious answer.

Although Dusseldorf has long been the commercial hub of Germany, Berlin is the cultural capital of the country. Bursting with artists, journalists and musicians, fashion seems a logical platform for the city to demonstrate its unique, unexpected and forward-thinking young talent.  This was precisely the idea when the city government founded the official Mercedes Benz Berlin Fashion Week in 2007, which has since consistently grown to be the world’s fifth largest show with over 120,000 attendees for the 2012 Spring Summer show held this past July.

In addition to the more established brands showing on the official calendar,  Berlin’s talent is so deep and varied, additional events are held throughout the city during the same week, providing the necessary exposure and access to the brands international journalists and buyers are interested in.  For example Bread & Butter, the international trade fair for street and urban wear, and PREMIUM, a stage for exclusive collections of various labels, together accounted for incredible growth representing more than 1500 brands and seeing upwards of 100,000 visitors.

Premium market in Berlin

One of biggest draws for a government to create a sustainable and successful Fashion Week program is the revenue it can create for the community.  Mercedes Benz  Berlin Fashion Week alone brings in 119 million euros as calculated by the Investment Bank Berlin (IBB)  in addition to creating close to 700 jobs, 50% of which are permanent. For a country that bears the weight of being an economic pillar for the rest of the Eurozone (a role it shares with France) even while GDP posted close to zero in August, Chancellor Merkel has to be relying on each city pulling its weight by converting its talents into revenue.

Convinced?  Your next chance to check out the official Fashion Week wont be until July 2012, but you can start organizing your agenda with our top picks for the best places to dine, dance and debauch in this edgy German city:

Courtyard Kantine

Kantine, photo courtesy of T magazine

Featuring a menu of pan European dishes made from locally sourced ingredients such as sand pike and schweinebraten, chorizo and crispy, flavorful vegetables; restaurant owners Merin and Gary are cool, hip, twenty-somethings, popular with the art and fashion crowd alike.  Given Kantine’s insider status, we recommend you call ahead to get a reservation. Kantine, Joachimstrasse 11, Berlin

Afternoon Delight:  After a long day of shows, a glass of champagne and oysters can really hit the spot, especially before the many post parties that go on  into the early morning hours.  Head over to Fishtake Zu Copernick, Berlin’s premiere raw bar.

A Dining Experience:

Designed by Karl Lagerfeld (Chanel), its no wonder Schlosshotel is the choice destination for fashion editors, models and celebrities alike.  It also houses one of the best restaurants in the city, Vivaldi.   Having served as the meeting point of Berlin’s upper crust in days past, Vivaldi now draws a diverse crowd, all in search of a true dining experience featuring regional ingredients prepared in a modern, young and fresh approach. Brahmsstraße 10 D 14193 Berlin, Germany
T +49 (0)30 / 895 84 0

Dance the Night Away:

Cookies Berlin

What began as a weekly dance party held in a different location every week has now transformed into the best nightclub in Berlin. If you are lucky enough to get into Cookies on either Tuesday or Thursday night, you’ll be treated to a live performance from top national and international artists and DJ’s.  Cookies has a cult following with the cool crowed, so don’t be surprised if you find yourself writhing on the dance floor next to the blonde catwalkers you saw strut the runway earlier in the day.   For a complete schedule of upcoming artists, visit Cookie’s Facebook page: http://www.facebook.com/pages/Cookies-Berlin/35577668480

Bridal Goes Big Box

Finding the perfect dress is the bride’s number one concern when it comes to planning her big day.  On average, a bride will try on twenty different dresses before finding “the one”, somewhat similar to the dating process leading up to marriage, no?  The bride-to-be gets her closest friends and family together and sets out to bridal salon which awaits will chilled champagne and plenty of tissues for the guaranteed weepy mother (isn’t this the entire purpose of TLC’s Say Yes to the Dress?).  It has always been a wonder to me where women who don’t care for the pomp and circumstance of the whole wedding dress experience go to find their dress.  Well, now we have an answer.  Costco.

Yup, that’s right. The big box retailer has added designer wedding dressed to its merchandise mix.  Designed by Kirstie Kelly, the collection is priced to compete with White by Vera Wang (available at David’s Bridal) with dresses ranging from $600.00 – $1800.00.  Understanding the most women don’t want to try a dress on in a huge warehouse with cement floors and fork lifts scattered everywhere, Costco says it is building luxurious and fancy dressing rooms with all the extras expected for the comfort of such a special day.  That takes time, so you may have to wait for your local Costco to be brought up to snuff.  I myself, as a woman who values efficiency above all else, simply love the idea that I can pick up a dress for the biggest day of my life at the same time I stock up on booze and snacks for the wedding reception.  Not only do I  save on gas running around from place to place, but given Costco’s members only policy, surely it is unlikely that someone else will have the same dress, right?  Exclusivity and a discount?  I just might marry Jim Sinegal, founder and CEO of Costco, brilliant man that he is for having come up with the idea.   Then again, he did just announce today that he will be stepping down as CEO and handing the reins over to company veteran, Craig Jelinek.  How sad.  I wonder if his resignation is foreshadowing the success of the retailer’s bridal program. After all, even if you were able to find the dress of your dreams at Costco, would you ever actually admit to anyone?  I can just see it at the reception, “Oh my,  you make such a beautiful bride. Wherever did you find your dress?”,  “Well aunt Itsnoneofyourbusiness, I bought it at Costco, I saw it sitting right next to the 30 gallon tub of mayonnaise and thought, its perfect!”.

I may be a cynic, but time will tell how far betrothed women will go for a good deal on a designer (I use this term loosely) dress.