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Retail Trends 2007: Beauty, Fashion... China

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As consumers take more control over all aspects of their harried lives, 2007 will bring major shifts in beauty, especially organics, and fashion. Expect growth to come from non-traditional sources. For beauty, spas continue as the hotbed of innovation, while fashion growth will continue for those "fast follow" shops that help women take control over how they look.

Finally, Americans will continue their fascination with China. In the next 10 years, as many Americans will be visiting China as traveling to Europe. And, just as they did 20 years ago when they brought back a taste for things French and Italian from their travels, they are likely to embrace Asian themes.

Do-It-Yourself Spas

More and more people want to "spa" on their own. The desire for privacy and their own space encourages them to learn how to incorporate the spa experience into their everyday lives.

Viceroy Palm Springs Resort & Estrella Spa, Palm Springs, CA, offers an "Ice House Treatment"; the guest is provided with all of the necessary supplies and expected to perform the protocol herself. And a new brand, Akhassa, has recently launched with the mission of bringing the Asian spa experience to the American home.


Feeling the Need for Speed: Disruption in Fashion

It no longer takes 9-12 months to "fast follow" runway trends. H&M, Zara, Topshop boast of being able to translate and merchandise runway trends for a mass audience with production times under 30 days. Wal-Mart hosted "Rock the Runway" in September as part of New York City Fashion Week offered clothing that was highly reminiscent of lines shown by Proenza Schoueler and Roland Mouret.

Material Gains—Going Green and Bright

Clothes are about to get a whole lot greener and brighter. Fibers from wood pulp, bamboo, seaweed, soy and corn blended with luscious organic silks and cashmeres are becoming a fashion staple. With Philips' new Lumalive system, swaths of fabric can be turned into glowing, multicolored panels able to display characters or simple animations.

The Rise of the "Precautionary Principle"

Americans increasingly need to take control of their lives. Everything that can be is being tightly controlled, from cleaning products to grooming items to what we ingest. "Precautionists" swap chemical products for vinegar and water. They might leave their shoes at the door so they don't track in contaminants. They sleep on cotton sheets, eat organic food, and buy chemical-free toothpaste and deodorant. Some have banished bleach claiming that they have "given up on their whites ever being white." Balance is the key to alleviating stress. "Precautionists" are cautioned to continue to lobby for a better environment, to be prudent but to live and enjoy life.

Green Is Good

Green is here to stay as evidenced by waiting lists for the Toyota Prius and, notably, the success of Al Gore's documentary "An Inconvenient Truth." Nike recently announced that it figured out how to remove the greenhouse gas from its sneakers and Levi Strauss will introduce Eco Jeans, its first organic-cotton line.

According to Organic Exchange, a nonprofit advocacy group, demand for organic cotton by clothing makers is increasing at an annual rate of 93%, and it projects that sales from organic cotton will total $2.6 billion by the end of 2007. Vendors from American Apparel to Wal-Mart and Zara now offer clothing under the organic cotton banner.

Organic Beauties

The beauty organics market has grown 15-20 percent in sales each year over the past nine years. Increasingly, beauty products are formulated with ingredients that are food-grade, natural, chemically free, organically produced.

Jurlique, an Australian skincare company, has taken this approach since 1985 with the goal to grow the "purest skin care on earth" because "your skin eats too." Von Natur aims to extend vegan living while NOe Cosmetics uses only organic, food-grade ingredients in its formulations. Wal-Mart recently announced it will start selling natural, organic products.

Its interest in natural and organic personal care is indicative of the shift taking place in the mass industry as a whole. The natural organic trend represents a major lifestyle shift.

Asian Chic

In the next 10 years, as many Americans will visit China as will travel to Europe and will likely embrace Asian themes, as they did 20 years ago after visiting Europe in large numbers.

In fact, Shanghai Tang, owned by Switzerland-based luxury-brands holding company Richemont, aspires to be the bridge between East and West. Each collection reflects a China-related theme. The fall/winter 2005 collection was inspired by Beijing's Forbidden City. Design motifs included elements such as symbols from the emperor's robes (sun, moon, five-clawed dragon, the color yellow) and embellishments fit for an imperial court (brocade, jade, lapis, and fur).

Always on the hunt for the newest, the greatest, and the freshest looks, French Vogue recently featured a Chinese model on its cover for the first time.

Chinese medicine is gaining mainstream acceptance in the West and as a result is being incorporated into beauty protocols. Leading hotels in Asia have recruited experts in Chinese medicine to design programs and are offering treatments to their guests. Over the next four years, they expect to offer similar experiences in Chicago, London, and Vancouver.

Activewear as Everyday Wear

Two-thirds of American women dedicate at least half of their closets to activewear and are not saving workout clothes for the gym. They are trading traditional sportswear for activewear as their casual apparel of choice.

Going forward, activewear manufacturers will place much more emphasis on having a fashion point of view, which explains the recent partnerships between Stella McCartney/Adidas and Alexander McQueen/Puma. American Eagle's new retail concept, Martin + Osa, is dedicated to fusing high-tech sport and casual sportswear. And, L.L. Bean, the grandfather of activewear, is creating bricks and mortar shopping emporiums dedicated to celebrating the wearing of activewear in the Great Indoors. Actress Scarlett Johansson will launch a line of urban activewear next year in partnership with Reebok.

With high-tech innovation in performance fabrics and design, activewear is working harder than ever to keep its cool—in the gym and on high fashion runways. Thanks to casual Fridays, activewear has become a uniform for more and more Americans.

The Branding of Private Label

What appears an oxymoron has become true. A Brandweek article (8/21/06) noted that consumers are warming to Wal-Mart private label brands: Great Value, Equate, Sam's Choice, Wal-Mart, and Member's Mark. And 82% of consumers say store brands have closed the gap with national brands. Wal-Mart's Ol'Roy dog food is preferred over Purina. 7-Eleven now sells more of its private label Santiago beer than Corona. About one of two fans sold in the U.S. is Home Depot's Hampton Bay brand.

Retailers are beginning to recognize that they cannot simply rely on nationally branded products to draw consumers into their stores and sustain loyalty. Albertson's supermarket chain has rolled out Essensia, a premium label brand of cookies, crackers, frozen foods and frozen deserts that are "only available at your local store."


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Patricia Pao is CEO of Pao Principle, New York City, and a graduate of the Harvard Business School, with 20 years of experience in the luxury goods, beauty, and retail industries. Reach her at (212) 828-8835.

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