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FANCY FOOTWORK

Luxe London shoe brand branches out into lifestyle territory

By Maura K. Ammenheuser

Those watching the movie stars arrive at the Academy Awards this year and glancing down to see what literally trod the red carpet would have spotted the Jimmy Choos.

Adorning many of those A-list tootsies were shoes by Jimmy Choo, the London-based design house. In less than a decade, it has become one of the most sought-after high-end shoe lines.

Former Vogue U.K. accessories editor Tamara Mellon is widely credited with turning Choo’s line of skillfully crafted but little-known wares into a high-fashion, ready-to-wear commodity with a worldwide following. The daughter of Vidal Sassoon co-founder Tommy Yeardye, Mellon worked with Jimmy Choo, a London couture shoemaker, in 1996.

At the time of their partnership, Choo was a wholesaler. Mellon, today the company’s president, first expanded sales through department stores such as Saks Fifth Avenue, Bergdorf Goodman and Harvey Nichols.

In 1997 the company began opening its own stores, initially in London, and by 2001, it had four, with sales reaching £11 million ($19.3 million). That’s when U.K.-based Phoenix Equity Partners and Robert Bensoussan, a longtime fashion investor and executive, formed Phoenix Equity Partners, which in turn bought out Choo’s stake, reportedly for $15 million. Bensoussan is still CEO. Within three years the company had added 26 new stores and launched a line of handbags.

The retail chain took off further after private British investment firm Hicks Muse Europe acquired a 51 percent stake in the operation in November 2001. At the time, according to a Hicks Muse press release, the company had reached $70.2 million in annual sales.

Hicks Muse is now known as Lion Capital. Lion’s Web site describes Jimmy Choo as “one of the leading ladies’ luxury brands in the world,” adding that the company sold 180,000 pairs of shoes and 23,000 handbags in 2004, numbers that almost certainly have risen. At the time of the Hicks Muse investment, Choo predicted that it would open as many as 50 stores by 2007.

Through a spokesman, Lion declined to comment about Jimmy Choo, “except to say that it remains very pleased with its investment.” Jimmy Choo spokeswoman Caroline Berthet declined to comment on the company’s finances.

Today Jimmy Choo operates 31 boutiques in 15 countries and seven shops within department stores in three countries. By mid-March, 15 boutiques were open in the U.S., the most recent at Caesars Palace, Las Vegas, in late February. At press time more boutiques were slated for early April at Boston’s Copley Place and for late this month at Ala Moana Center, Honolulu, says COO Anthony DiMasso. Another was planned for Bal Harbour, Fla., this fall. He expects to have 19 or 20 Jimmy Choo stores open in the U.S. by year-end.

With prices from $295 to $1,100, Jimmy Choo is for celebrities and the well-heeled, not Everywoman. So when one of its stores opens in a shopping center, it’s no run-of-the-mill mall. Berthet says about half of the company’s stores are in shopping centers, including The Mall at Short Hills (N.J.), South Coast Plaza, Costa Mesa, Calif., and The Galleria, Houston, among other premium projects.

“It is such a huge store in our center,” said Katherine Wynne LaLonde, marketing director at Highland Park Village, Dallas. Jimmy Choo opened there with 1,100 square feet in 2003, after Mellon approached the center’s ownership, Henry S. Miller Interests.

LaLonde’s a Choo fan who confessed: “I have 16 pairs.”

“You can wear these all day long and your feet never hurt. … They’re gorgeous, sexy shoes, and yet they’re really comfortable,” she raved. As she spoke, she wore a pair of powder-blue Choo pumps with three-inch heels, pointy toes and mother-of-pearl buttons.

“You always see these detailed ones in People,” she continued, but the collection also includes more-conservative offerings, “like a lawyer would wear.” She describes her powder-blue pair as “a business pump with a sexy twist.”

The stores tantalize landlords as much as shoe addicts. Though LaLonde says the Highland Park deal came together quickly after Mellon visited, others say landing Jimmy Choo isn’t easy. According to DiMasso, the company generally takes its time deciding on potential sites.

Larry Horton is principal of Horton Realty Advisors, a Southampton, N.Y., firm that leased The Collection at Chevy Chase (Md.), developed by The Chevy Chase Land Co. The upscale center has 112,000 square feet of retail for Washington, D.C.’s upper crust. Its first tenants, including a 1,670-square-foot Jimmy Choo, opened in November at press time; the center’s grand opening was scheduled for May.

To lease the Collection, Horton’s staff placed cold calls to potential tenants, including Jimmy Choo, he recalls. He gradually developed a working relationship with DiMasso. “The conversations continued until he made the tour,” Horton said; it was a two-year process to clinch the retailer. Four months after Jimmy Choo opened there, “it’s doing well. It’s certainly meeting their plan,” Horton said. “It’s a beautiful salon. … [I]t’s one of the prettiest shoe salons I’ve seen in recent years.”

Jimmy Choo seeks “top retail markets with other luxury brands,” Berthet said. “It’s also where we have a lot of customers” who buy Choos online or in department stores. Stores are typically 1,500 square feet, she says.

The company wouldn’t reveal sales figures, but LaLonde says it’s one of Highland Park’s top five stores. Jimmy Choo’s sales grew 30 percent in its second year there over its first, and 65 percent in the third year over the second, she says. “They are doing phenomenally well,” agreed Brenda Lounsberry, marketing director at The Mall at Millenia, Orlando, Fla. Jimmy Choo opened with the mall in 2002. The center is also home to luxury brands Gucci, Louis Vuitton and Chanel.

“They are a great store, great product. The whole Sex & The City and Manolo Blahnik and focus on shoes has helped that whole industry,” Lounsberry said, referring to the popular HBO TV series whose characters craved Blahniks and other designer heels.

The buzz over Jimmy Choo is due to hot styles — Sandra Choi, Choo’s niece, is head designer — and Mellon’s marketing talents, observers say.

Jimmy Choo is “very trendy, high-end. It’s a New York City wardrobe-builder,” said Candace Corlett, a principal of New York City-based consulting firm WSL Strategic Retail. “What’s really hot are the watersnake skins,” LaLonde said, adding that colors such as fuchsia and tobacco are popular, and jeweled styles are top sellers.

Customers are between 25 and 55 years old, with minimum household income of $100,000, LaLonde says. They tend to be upper middle class and familiar with luxury brands, according to Patricia Handschiegel, who runs a fashion Web site, Stylediary.net, that gets 3.5 million visitors per month. But many are simply “fashionistas,” she says.

Jimmy Choo turns out strappy stiletto sandals but is also known for boots. Handschiegel’s favorite item is “definitely the knee boot,” which is “hot,” she said. It’s a black, rear-entry number with a two-inch heel, bought three years ago. “I don’t spend $800 easily,” she said, but these were worth it: “It’s classic.”

Not that Jimmy Choos are the only high-end high heels out there. In terms of style, the line competes with Manolo Blahnik, sources say, though Corlett notes that Blahnik’s prices are far higher, typically in the thousands of dollars rather than the hundreds. Handschiegel cites Michael Kors, a “conservative” shoe line, as a Choo competitor “in terms of design, price point — the whole shebang.”

Berthet cites Dior, Louis Vuitton and Gucci as the competition, which Horton says includes Prada and Chanel too. Jimmy Choo, he says, “can go up against any one of those.”

Jimmy Choo enjoys the advantage of fame. “Obviously they have global, huge, brand recognition. They’re associated with A-list stars,” LaLonde said.

“Price point does not limit our clientele,” said Berthet, adding, “we have a very strong brand with great product.”

Asked about challenges, Berthet indicates that counterfeiters always pose problems for luxury brands. But there’s a worse threat to couture labels. For any of them, “as you expand and you go into more markets, [the risk is] being overexposed,” Berthet said.

Corlett agrees, but notes a paradox for luxury retailers expanding their own chains: “You have to broaden that appeal to support that real estate,” she said, but venturing too close to the mainstream will kill the cachet of a high-end brand.

“As it is right now, [Jimmy Choo] is a bit too much of a niche player to drive much traffic into even the trendiest strip malls,” Corlett said. And as it adds more locations, “it needs to become a bit broader in [its] reach.”

LaLonde sees no major obstacles for Jimmy Choo. “They have zero weaknesses,” she declared. That may well be true so long as the company can continue churning out designs the glitterati — or at least the financially comfortable — seek out.

In its first decade Jimmy Choo proved adept at that, Horton notes. For proof, just look at the footwear at the Academy Awards. “They built an incredible brand awareness,” he said. “in a short period of time.”

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