A top Louis Vuitton executive is set to join the LVMH fashion group, the division of the luxury conglomerate that houses labels including Celine and Loewe, as the company seeks to prepare the next generation of leaders.

Pierre-Emmanuel Angeloglou, currently executive vice president in charge of strategic missions at Louis Vuitton, will move to the unit overseen by Michael Burke, an LVMH veteran, said people familiar with the move.

Angeloglou, 49, previously reported to Burke when the latter headed Louis Vuitton. Burke, 67, took oversight of the LVMH fashion group earlier this year from Sidney Toledano, another longtime executive at the Paris-based company. The unit also includes brands Marc Jacobs, Givenchy and Fendi.

Louis Vuitton and Christian Dior, the two biggest fashion labels of LVMH, are not part of the unit.

LVMH representatives didn’t immediately respond when asked for comment.

Angeloglou joined Louis Vuitton in 2019 as director for fashion and leather goods, as well as strategic missions, according to his LinkedIn profile. In his role, he’s overseen Louis Vuitton men’s products, women’s accessories, digital innovation as well as communication and events.

He previously spent more than two decades at L’Oréal SA, where his final role was global brand president at L’Oréal Paris. He graduated from business school HEC Paris in 1996.

LVMH, headed by billionaire Bernard Arnault, is seeking to prepare its next generation of leaders as some of the group’s most senior executives near the end of their careers. Arnault’s top lieutenants have also played a role in training his five children, who all work inside the luxury conglomerate.

Arnault turned 75 on Tuesday and the LVMH Moet Hennessy Louis Vuitton SE statutes allow him to stay as chief executive officer until he’s 80.

By Angelina Rascouet

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Michael Burke to Succeed Sidney Toledano at LVMH’s Fashion Group

The former Louis Vuitton CEO will become chief executive and chairman of the unit that houses Celine, Loewe, Givenchy, Marc Jacobs, Pucci and Kenzo, effective February 1.

US investors are facing the growing risk of losing out on Shein’s potentially huge initial public offering, as the fast-fashion giant with Chinese roots considers holding it in London instead. Dealmakers in New York once reaped huge fees from Chinese companies going public; now they wonder whether the regulatory clouds that set in after Didi Global Inc.’s 2021 US IPO turned into a debacle will ever lift. With the first $1-billion-plus IPO in New York by a Chinese-owned company post-Didi safely in the books as of February, investors are watching to see if Shein can also break through the impasse — and what it means for Chinese IPOs in the US if they fail.

How did Shein become controversial?

Shein’s roots in China played a big role in its initial success, but in some ways they’ve have come back to bite it. Founded in 2008, the e-commerce pioneer gained attention in 2021 as it became the most downloaded shopping app in the US, overtaking Amazon. The company managed to more than triple its sales during the Covid-19 pandemic, to a staggering $10 billion in 2020, making it the biggest web-only fashion brand in the world.

Its runaway success has been attributed to its prowess with data, favourable tax treatment for small packages and, more controversially, to its vast network of contract manufacturers that pump out thousands of youth-friendly styles daily at ultra-low prices. Critics and rivals have assailed the company over concerns about the environmental impact of disposable fashion, pay and working conditions for those assembling garments, anti-competitive behaviour and even evidence that some cotton in its clothing was made with forced labour.

A Bloomberg News study in 2022 found that garments shipped to the US by Shein were made with cotton from China’s Xinjiang region, where the US State Department has alleged human rights abuses against the Uyghur people, which China denies. A statement from a company spokesperson said that Shein has a zero-tolerance policy for forced labour and requires its contract manufacturers to source cotton only from approved regions.

Can Shein’s critics stop the IPO?

The potential IPO has been a lightning rod for politicians such as Marco Rubio. The Republican senator asked the US Securities and Exchange Commission in a February letter to consider blocking the listing, following reports that the company had approached Chinese regulators for permission. Rubio said the company needed to disclose more about its operations in China, despite having moved its headquarters to Singapore.

Enter the UK, whose IPO market could use a boost — especially one the size of Shein’s, should it achieve the $50 billion valuation seen in private trades. Shein is considering a listing in London instead, and Britain’s chancellor of the exchequer, Jeremy Hunt, has already had talks with Shein’s executive chairman, Donald Tang, Bloomberg News reported in February. That, too, could draw political opposition, but the desperate need to keep IPO bankers in London busy could outweigh it.

What about other Chinese IPO plans in the US?

Executives of Chinese companies remember when things were different. Alibaba Group Holding Ltd.’s $25 billion New York listing in 2014 was the largest ever at the time, and numerous start-ups from the country were drawn to the large, liquid US market that didn’t require they turn a profit in order to go public.

The decline in relations between the US and China found its analogue in 2021, when Beijing opened a cybersecurity probe into Didi just days after its $4.4 billion US listing, over concerns about foreigners gaining access to data with implications for national security.

The ride-hailing company’s fall, and eventual de-listing, heralded a series of crackdowns on the country’s technology sector that effectively halted sizable Chinese IPOs in the US. About a year and half later, the stance has softened, and regulators have toned down rhetoric about curbs on overseas listings, so long as the firms meet requirements regarding the use of personal data and state secrets.

Despite the softening stance, new Chinese IPOs remain for the most part small and rare. No single Chinese issuer raised more than $200 million in the US last year, a far cry from 2021 when a dozen companies each raised more than that figure.

This year is looking a little better, if not for conventional listings. Lotus Technology Inc., an electric-vehicle unit of China’s Zhejiang Geely Holding Group Co Ltd., went public in New York through a merger with a blank-check vehicle.

Amer Sports Ltd.’s $1.4 billion listing in January is by far the biggest since Didi, but it’s also an outlier. Even though the maker of Wilson tennis rackets, Salomon ski boots and Arc’teryx outdoor gear is majority-owned by a Chinese-led consortium, its roots and much of its current operations are focused in Europe and the US, making it less sensitive from a regulatory perspective.

Amer said in its IPO filing that its counsel thinks they don’t need approval from the country’s securities regulator; by contrast, China’s internet watchdog is subjecting Shein to rigorous probing over its handling of data.

Will things go back to how they were any time soon?

That’s unlikely, considering all the tension even for companies that aren’t receiving scrutiny from members of the US Congress.

The SEC has expressed concerns about the quality of Chinese firms’ risk disclosures and continues to demand more of those to protect investors. New guidance on the issue was released last July. At the same time, Chinese companies are coming under pressure from domestic regulators about so-called “risk factors” warning language in their US IPO prospectuses.

As part of new overseas listing rules introduced in 2021, Beijing prohibits investment banks from including comments that misrepresent or disparage China’s laws and policies, or the business environment and judicial situation of the state, the Financial Times reported in January.

If US and Chinese regulators can’t find a characterisation of the risks of investing in Chinese companies that they can agree on, there’s little chance of the once-mighty China-to-US IPO pipeline reopening.

If not New York, then where?

Shein and other companies caught in the China-US tussle — including TikTok owner ByteDance Ltd. — have options, though none of them are quite as appealing as a spot on the New York Stock Exchange or Nasdaq. Hong Kong would make a better alternative for Shein than London, some investors say, given comparable Chinese peers with huge e-commerce footprints such as Alibaba and Tencent Holdings Ltd.

If a London listing doesn’t pan out as expected, the company could turn to Singapore, whose IPO market is in even worse shape than London’s. Any venue shift would require Shein to submit a new application with Chinese regulators, who would ask for additional materials and clarifications.

By Dong Cao, Yiqin Shen and Pei Li

Birkenstock Holding Plc’s earnings beat analysts’ estimates as consumers snapped up its high-end sandals and clogs while other casual footwear makers struggled.

Adjusted earnings were €81 million ($88 million) before interest, taxes, depreciation and amortisation in the quarter ending in December, the company said Thursday in a statement. That compared with the €75.5 million average estimate.

Since Birkenstock’s initial public offering in October, chief executive officer Oliver Reichert has tried to convince investors that the company can maintain its decade-long hot streak by staying fashionable, expanding its production capacity in Germany and Portugal and targeting previously untapped countries like China and India.

The results “once again demonstrate the resilience of our business model and the strong sustained demand for our products,” Reichert said in the statement.

Birkenstock affirmed its 2024 guidance and mid-term goals of booking a gross profit margin of more than 60 percent and adjusted Ebitda margin percentage in the low 30s.

While sneaker brands including Nike Inc. and Puma SE have raised doubts about consumer spending, Birkenstock has argued that there’s an opportunity to win over new fans.

Revenue in the quarter reached €303 million, higher than the €285 million average estimate, with sales growing at double-digit rates in the Americas, Europe and Asia, the company said.

Traditionally a maker of no-frills sandals, Birkenstock has ratcheted up its offering of higher-end footwear and closed-toe products in recent years, including the Bend sneaker, the Highwood boots and more clogs with shearling. Those products command higher prices, helping Birkenstock boost profits and appeal to a wider array of customers.

While Birkenstock attracted attention from designers as far back as the 1980s, the company has come to embrace the fashion world over the last decade or so, launching collaborations with luxury names such as Dior, Manolo Blahnik and Rick Owens.

That’s coincided with a push to build out its digital sales channels, reducing its reliance on retail partners, and expand its network of factories, including a new plant in Pasewalk, Germany, that has cost more than €100 million.

The investments in the Pasewalk site, and another in Portugal, are weighing on profitability for now, but will be a long-term growth driver, according to the company.

After initially flopping in their trading debut, Birkenstock shares have since climbed about 11 percent above its listing price.

By Tim Loh

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Birkenstock Slumps as Forecast Disappoints Some Investors

The stock slid 12 percent in trading before US exchanges opened. If the drop extends into trading hours, it could erase the gains made since the company’s initial public offering in October.

EBay Inc. posted a strong holiday quarter, giving investors fresh hope that the company can boost profits following steep job cuts.

The company also added $2 billion to an existing stock buyback programme, increasing the total repurchase authorisation to $3.4 billion.

Fourth-quarter profit was $1.07 a share on sales of $2.56 billion, the company said Tuesday in a statement. Analysts estimated $1.03 on sales of $2.51 billion.

Once an industry pioneer, the San Jose, California-based company has been losing US market share for years to the likes of Amazon and Walmart. In an effort to be “more nimble,” eBay announced last month that it was cutting 1,000 jobs, or about 9 percent of its full-time workforce. That followed layoffs that affected about 500 employees in 2023.

Chief executive officer Jamie Iannone is trying to find niches in which the company can thrive. It sells watches, sneakers and other luxury items to appeal to collectors, and offers authentication services designed to root out counterfeits. EBay also sells refurbished appliances and car parts to appeal to cost-conscious shoppers and do-it-yourselfers.

“Our results demonstrate the strength of our strategy, and I’m proud of our accelerated pace of innovation as we work to fundamentally enhance the customer experience on eBay,” Iannone said in the statement.

Gross merchandise volume, the value of all goods sold on eBay, increased 2 percent to $18.6 billion in the holiday quarter, topping analysts’ average estimates of $18.2 billion. The company said it had 132 million active buyers in the quarter, down 2 percent from a year earlier.

Iannone also is offering more advertising and payments products for eBay merchants in an effort to offset slowing growth on the platform. Advertising revenue of $393 million topped analysts’ estimates of $375 million and helped eBay boost profits even as it lost customers.

The shares rose about 4 percent in extended trading after closing at $44.39 in New York. The stock has increased 1.8 percent this year.

The company projected earnings of $1.19 to $1.23 a share on revenue of as much as $2.54 billion in the current period ending in March. Analysts, on average, estimated profit of $1.10 per share on sales of $2.54 billion.

By Spencer Soper

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EBay Falls After Holiday Revenue Outlook Misses Estimates

EBay Inc. issued a bleak revenue outlook for the busy holiday quarter, suggesting the company continues to struggle as it loses shoppers to larger rivals such as Amazon and Walmart.

A European Union law designed to clean up corporate supply chains has been derailed by some of the bloc’s biggest member states, forcing negotiators back to the drawing board on one of the most consequential pieces of ESG legislation ever attempted.

The Corporate Sustainability Due Diligence Directive would expose companies to legal liability if they fail to address environmental or human rights abuses in their value chains. Parliament and national representatives had reached a provisional agreement in December only for key member countries to withdraw their support on Wednesday.

Lara Wolters, the lawmaker in charge of steering CSDDD through the EU Parliament, said she was “outraged at the political games being played in Council today on due diligence,” in a comment posted on X.

The development represents a “flagrant disregard for the European Parliament,” she said. “Member states need to get their act together because time is running out.”

The fate of CSDDD now hangs in the balance with time running out before EU elections in June. All laws usually need to be finalised around three months beforehand. It’s unclear, however, whether the EU Parliament would accept a substantial rewrite of the text. Wolters said she will hold a press conference later on Wednesday to address the next steps.

Belgium, which holds the EU’s rotating presidency, had been trying to get Italy on side to get CSDDD over the finish line, despite last-minute German objections. Those efforts proved unsuccessful with both Italy and Germany — along with a number of smaller EU countries — citing concerns as to how such a law would affect the competitiveness of European businesses.

France also withdrew its support after insisting CSDDD only apply to much larger businesses than the current text requires, according to a person in the room who asked not to be identified discussing private talks. It’s likely that France’s conditions will be examined closely with a view to taking its concerns into account, the person said.

The outcome of Wednesday’s decision quickly drew condemnation from climate and human-rights activists.

“We now have to consider the state of play and we will see if it’s possible to address the concerns put forward by member states in consultation with the European Parliament,” the Belgian presidency posted on X.

“EU governments’ last-minute sabotaging and postponement of this new rulebook not only disregard the lives, communities, and ecosystems affected by destructive business practices, but also deal a blow to the EU’s credibility as a legislator,” said Uku Lilleväli, sustainable finance policy officer at WWF’s European Policy Office.

“Let’s be clear: the law wouldn’t burden companies with unnecessary red tape; instead, it would secure a level playing field and help firms navigate necessary transitions in an informed and responsible manner,” Lilleväli said.

By John Ainger and Frances Schwartzkopff

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Europe’s Push to Regulate Fashion’s Supply Chains Is in Danger of Being Derailed

A landmark piece of legislation designed to make companies accountable for labour abuses and environmental damage in their supply chains has faltered, reflecting growing political opposition to more onerous climate rules.

Time is running out for Stephen Curry.

The star Golden State Warriors guard says he hopes to have four or five years left in his National Basketball Association career. But with retirement on the horizon, he’s rushing to capitalise on his athletic triumphs by bringing his brand off the court and on to the streets through his partnership with athletic-wear maker Under Armour Inc.

Curry — at 35, one of the greatest stars in basketball history — is still a commanding presence in the league and his performance-oriented basketball shoes single-handedly made Under Armour relevant in the sport. Yet his efforts to come up with a product that appeals to committed sneakerheads haven’t kept pace with those of basketball legends like Michael Jordan or up-and-coming stars including Ja Morant and LaMelo Ball, whose shoes outsell Curry’s on popular sneaker marketplaces like StockX.

Curry discussed his retail ambitions ahead of the NBA’s All-Star game in Indianapolis earlier this month. “What kind of legacy can I really leave? I want to play the game at a high level as long as I can, but this is an opportunity to create more ownership,” Curry, a four-time NBA champion, said while en route to his temporary store that Under Armour set up for the All-Star weekend.

Under Armour also has a lot riding on Curry. Last March, he signed a long-term contract extension with the sportswear giant to take their partnership past signature shoes. As part of the arrangement, he became president of the Curry Brand, with plans to sell streetwear and serve as the face of the label. Detailed financial terms weren’t disclosed, but in April he was granted $75 million in stock as part of his compensation package, according to regulatory filings.

Curry’s involvement is vital to Under Armour’s efforts to reenergise its business after years of sluggish growth. Footwear accounts for about a quarter of Under Armour’s annual revenue, with the segment’s sales totalling almost $1.5 billion last year, but it still trails far behind Nike Inc. and Adidas AG. The company doesn’t break out Curry-specific numbers, but TD Cowen last year estimated the brand accounts for as much as $250 million in annual sales.

Under Armour Chief executive officer Stephanie Linnartz, who took the helm last February, is looking to bring the label into what she calls “sports style” – casual athletic clothes meant to be worn in everyday life. Over the past decade, Under Armour has failed to carve out a significant piece of the booming streetwear market, known for its limited-edition drops and much-hyped collaborations that have sneakerheads lining up around the block.

“I am still digging in deep to figure out exactly how we’ll map that out over multiple years,” Linnartz, a former Marriott International Inc. executive, said of the Curry brand. Executives haven’t yet set specific sales targets. “It’s going to be a really important part of the Under Armour portfolio,” she said.

Since taking the top job, Linnartz has embarked on a three-year turnaround plan for Under Armour, pushing deeper into womenswear and footwear in order to return to growth in its home market. The company raised its full-year earnings forecast in February, but reported a 12 percent drop in North American revenue.

All the major sportswear companies have faced challenges in the past year. At Adidas, management is trying to recoup costs by selling leftover shoes from its Yeezy label that imploded just over a year ago. Nike laid off about 2 percent of its global workforce earlier this month as it tries to cut $2 billion in costs.

Nike still commands the most successful sneaker deal ever signed with an athlete – and it’s not even close. Michael Jordan’s brand, at more than $5 billion in global sales annually, remains the gold standard more than 20 years after the basketball legend sank his last bucket in the NBA. Even Steph would like to be like Mike.

“You look at examples like the Jordan brand — the peak of an athlete taking their platform and presence and turning it into something,” said Curry. “I’m trying to build my version of that.”

Nike’s Blunder

Under Armour didn’t always have the greatest shooter of all time on its roster. Curry once wore the Swoosh.

Curry played in Nike sneakers during his time at Davidson College in North Carolina and signed a four-year deal with the world’s largest sportswear company when the Warriors selected him with the seventh pick in the 2009 NBA draft.

As the deal expired, Curry broke out as an All-Star and made the playoffs for the first time. Nike had a chance to keep him. In a saga revisited years later by ESPN, a sloppy pitch meeting from Nike executives, who mispronounced his name and presented a slide deck with Kevin Durant’s name on it, helped convince Curry to try something new.

In 2013, Curry signed with Under Armour and within two years released his first signature shoe, the Curry I, backed by ads starring Jamie Foxx. Over the next decade, as Curry won two NBA Most Valuable Player awards alongside his championships, Under Armour developed and sold 11 new Curry designs, with the most recent hitting stores in October.

Yet few of those designs won over hardcore sneaker fans. “It’s a challenge for sure,” said Curry. “It’s something that you have to earn over time.”

These days, there is some demand for Curry’s sneakers on the secondary market, where sneakerheads do their trading. Morant, a Memphis Grizzlies guard who has an endorsement deal with Nike, had the best-selling signature basketball shoe in terms of volume on StockX’s resale platform last year, with 40,000 sales. Nike’s LeBron James, Kobe Bryant, Kevin Durant and Giannis Antetokounmpo all had hits, joined by Jordan’s Jayson Tatum and Luka Doncic. Puma’s Ball and James Harden at Adidas had top sellers too. Curry’s shoe came in 10th, with just over 2,000 transactions.

Golf Shoes

Under Armour also plans to develop non-basketball shoes under the Curry name. Designers have so far only dabbled in off-court kicks, with a golf shoe, runners and a line of cushioned trainers touted as soft and cozy.

In apparel, most of Curry’s products are geared toward men and boys, with boxy tees, hoodies and sleeveless shirts, but more women’s clothing is on the way. Curry said there’s “definitely going to be investment” in that space and his wife Ayesha, founder of home goods maker Sweet July, wants to be involved in the process too.

Management is looking abroad for growth as well, trying to take advantage of their star’s global reach, focusing on the UK, France, Spain and especially China. Curry and the Warriors squad have consistently placed among the top spots in basketball popularity polls in China, according to digital agency Mailman Group. He last visited the market with Under Armour in 2019, touring Shenzhen, Beijing and Shanghai for a series of exhibitions.

New Faces

In October, Curry Brand brought on Sacramento Kings guard De’Aaron Fox as its first-ever sponsored athlete, with his first signature shoe line set to debut this year. The tactic is from Jordan’s playbook, but with a twist. Jordan was in retirement when he signed Carmelo Anthony as an additional face of his brand and granted him the first-ever non-MJ signature Jordans in 2004. Curry and Fox faced off against each other on the court three times this year.

Curry said he is now trying to recruit more athletes to his label. If his own assessment is correct, he’ll step away from basketball when he’s around 40 years old, the same age Jordan did, and Under Armour’s leading man will no longer be on television under the bright lights of NBA arenas 82 times a year.

Until then, he’ll keep juggling responsibilities. Under Armour’s top management holds a business review with Curry every quarter. Most of the meetings are centered around basketball, but lately they have been discussing more golf, running and fashion. Linnartz said they are considering opening permanent Curry stores, though there are no immediate plans.

After 14 seasons in the league, Curry has accumulated a wide-ranging business portfolio beyond Under Armour. He has a production firm, Unanimous Media, that made shows like ABC’s mini-golf programme “Holey Moley” and the documentary “Jump Shot.” There’s also his Gentleman’s Cut bourbon label and an early-stage venture capital firm that has invested in startups such as HiveWatch security hardware and micro food hall Local Kitchens. Under Armour, though, is at the top of Curry’s priority list, he said.

“Right now, it’s about setting the foundations,” said Curry. “I want them to be well-oiled machines so when I’m done playing I can spend more time on them and take full advantage of the platform that I had.”

By Kim Bhasin

Fast-fashion company Shein is considering the possibility of switching its initial public offering to London from New York because of hurdles to the listing in the US, according to people with knowledge of the matter.

Shein, which was founded in China but is now headquartered in Singapore, is in the early stages of exploring the London option as it has judged it unlikely that the US Securities and Exchange Commission will approve its IPO, the people said, asking not to be identified discussing confidential information.

Shein is still working on its application to list in the US as its preferred location, the people said. It would need to file a new overseas listing application with Chinese regulators if it decided to switch to London or elsewhere, they added. Other venues including Hong Kong or Singapore may also be considered, two of the people said.

A representative for Shein declined to comment.

A listing in London would be a potential boon to the beleaguered market, after one of the worst years for IPOs in its modern history. Just about $1 billion was raised in the UK via IPOs last year, the lowest level in decades, according to data compiled by Bloomberg.

The UK is also struggling to stem an exodus of firms to the US and elsewhere. Chip designer Arm Holdings Plc spurned London for a New York IPO last year even after the UK government lobbied for a domestic listing by the Cambridge, England-based company. Already-listed companies are migrating abroad, with TUI AG shareholders voting earlier this month to delist from the London Stock Exchange and move trading primarily to Germany.

Small and Rare

US IPOs by Chinese companies have mostly been small and rare in the years since Didi Global Inc. was forced off the boards in New York, part of a crackdown that essentially closed the market to first-time share sales by Chinese firms. Amer Sports Inc.’s $1.6 billion offering in February was the biggest China-backed IPO to tap the US market since Didi raised $4.4 billion in 2021, and the first to raise more than $200 million in that time.

Read More: Largest Chinese US IPO Since Didi Comes Below Range

Shein has been subject to scrutiny from the US, with Senator Marco Rubio among those asking the SEC to block its listing, saying the company needs to disclose more about its operations in China. Last year, a member of the US Congress asked for a probe into Shein’s cotton supply from Xinjiang. US-China trade tensions have also been simmering for years.

A pioneer of ultra-fast fashion with items such as shirts and swimsuits for as little as $2, Shein filed last year for a US IPO aiming for a valuation of $80 billion to $90 billion, people familiar with the matter said at the time. Private trades in late 2023 valued the company much lower, at about $50 billion.

By Dong Cao, Vinicy Chan, and Pei Li with assistance from Daniela Wei

Learn more:

How Shein Wound Up in the Luxury Fashion Business

The company’s recent introduction of a marketplace model has led to a flood of listings for new, high-end goods by third-party sellers. Some brands aren’t happy, but there may not be much they can do.

Billionaire Kumar Mangalam Birla plans to start selling gold jewellery in the world’s second-biggest bullion market by July as his conglomerate diversifies into new areas to tap the Indian consumer.

The Aditya Birla Group’s branded-jewellery retail business will be rolled out nationwide under a privately-held company, Birla said on the sidelines of an event to announce the launch of his paints business in the north Indian state of Haryana. “The group is moving towards more consumer-facing businesses, that’s where the world is moving,” he said.

The gold jewellery venture will be the Mumbai-based group’s third major move into a new business over the last couple of years following paints and B2B e-commerce for building materials. Birla will be competing in a market that is dominated by small shops and national chains like the Tata Group’s Tanishq and Warburg Pincus LLC-backed Kalyan Jewellers India Ltd.

Birla had earlier earmarked 50 billion rupees ($604 million) for the jewellery business. India’s gold demand is expected to rebound to as much as 900 tonnes in the next two years from 748 tonnes in 2023 supported by increasing incomes as the economy grows, according to the World Gold Council. Wearing and gifting gold is considered auspicious during weddings and festivals in India.

By Swansy Afonso and P R Sanjai

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Is India the Next Frontier for Luxury Department Stores?

Industry leaders are divided on whether Galeries Lafayette’s expansion into India will spur other luxury department stores to enter the rapidly growing market.

Zalando SE, one of Europe’s largest online fashion retailers, has agreed to remove “misleading” symbols that would lead consumers to assume a product is more sustainable than it really is, ending a two-year-long probe.

Following “a dialogue” with the European Commission, the company has committed to adjust its conduct, according to a statement by the EU’s executive arm on Thursday. Undocumented green claims “can mislead consumers about the environmental characteristics of the products,” the commission said.

Officials from Germany, Denmark, Norway and Sweden started a coordinated action in April 2022 to investigate compliance with consumer protection laws, according to the statement. Zalando said it’s been working with authorities for a year and the agreement means the proceedings against the company now “have been discontinued, subject to implementation of agreed changes.”

Zalando supports a “standardised application of existing policies to ensure that no practices are used that could be misleading to customers,” according to a spokesperson.

The commitment from Zalando means that from mid-April, it will no longer display sustainability icons or flags next to products, the commission said. Instead, clear information about a product’s environmental benefits, such as the percentage of recycled materials used, will be provided, it said. Zalando will also be required to submit a report on the implementation of its commitments.

The company is being called out after the European Union imposed a ban on misleading environmental claims by companies regarding their products. Under the ban, businesses can no longer make general statements declaring that a product is “environmentally friendly,” “natural,” “biodegradable,” “climate neutral” or “eco” unless it can provide clear and credible proof those claims are reliable.

“Businesses must provide truthful information to consumers and have to refrain from misleading consumers to influence their choices,” the commission said in its statement on Thursday. “EU rules on unfair commercial practices enable national enforcers to curb a broad range of unfair business practices.”

By Frances Schwartzkopff

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EU Proposes Clampdown on ‘Green’ Claims

The European Commission proposed rules on Wednesday that would require companies in Europe to back up climate-friendly claims about their products with evidence, to stamp out misleading green labels for products from clothing to cosmetics and electronic goods.

In a mansion on a hill with a killer view of Los Angeles, a dozen social media influencers have gathered to bake protein packed muffins, take selfies with giant injector pens and talk about how Ozempic has changed their lives. Welcome to the GLP-1 hype house, sponsored by WeightWatchers.

The day-long experience was a marketing event for WW International Inc.’s new prescription obesity drug service — possibly the biggest brand shift in the company’s 60 year history. WeightWatchers has been enlisting influencers to “help bust the misconceptions and stigma around GLP-1 medications” — as in weight-loss shots like Wegovy and Zepbound — and to “share that WW is here to support you,” according to an email sent out to multiple potential partners viewed by Bloomberg News.

It didn’t go as planned. A social-media backlash started brewing before the posting even began. Back in December, the company reached out to influencers who post their Ozempic, Wegovy and other weight-loss drug use, asking them to hawk their new service. The anger was twofold: Many of those people had negative associations with the brand’s decades-long approach to food and dieting. A few said WeightWatchers’ points system, which assigns number values to food for optimal nutritional intake, led to their own disordered eating.

“Sometimes it’s painful just to hear their name brought up. They have left a lot of trauma, especially in our community,” said Jennifer Witherspoon, who often posts about her GLP-1 use to her nearly 90,000 followers on TikTok.

The other issue was the campaign itself. Alexis Clingenpeel, who documents her journey with Mounjaro on TikTok, said in early December WeightWatchers offered her $750 to post about “the GLP-1 Programme,” a new service meant to support people taking drugs like Wegovy and Zepbound. “They asked me to promote a product I’d never tried,” she said. “They basically asked me to lie.”

The contract, viewed by Bloomberg, also had a non-compete clause barring participants from working with other digital weight-loss brands like Calibrate and Noom, or with nutrition programmes like Whole30 or the Paleo Diet during the campaign and for a week before and after. They also couldn’t go on weight-loss competition shows like “The Biggest Loser.”

When Clingenpeel didn’t respond, the company reached out again, bumping the offer up to $1,200. She ultimately declined. The 25-year-old’s mom did WeightWatchers and she remembers the humiliation of watching her stand on a scale in front of a room full of people — part of the programme’s weekly meetings. At her mom’s urging, Clingenpeel started counting points when she was 11.

The GLP-1 house — which included branded aprons that said “it’s giving protein” and an appearance by the drag queen Kim Chi — only inflamed the backlash. Influencers called it “out of touch” and made parody videos of “low-budget” versions of the GLP-1 House. Some even targeted those who attended. “All it did was make us cringe,” said 32-year-old Ashley Dunham, who has almost 85,000 followers on TikTok. She turned down WeightWatchers’ offer in December, too. “I understand trying to reinvent themselves, but I think that reinvention needs to start with an apology.”

WeightWatchers declined to comment citing a quiet period before reporting earnings at the end of the month. The service still has a loyal following: Hundreds share success stories  on the company’s Facebook page. And not all influencers balked at the offer. At least a dozen posted paid promotions for WeightWatchers’ GLP-1 clinic or from the hype house. Multiple people who attended the event didn’t respond to requests for comment.

After three years of declining sales, WeightWatchers is struggling to stay relevant. Last spring, it abandoned its full-throated embrace of lifestyle changes as a means to losing weight when it acquired a telemedicine startup to sell popular obesity drugs, like Wegovy and Zepbound. The news of the deal sent the company’s stock soaring, but it raised questions about how a dieting service could co-exist with the advent of powerful and popular weight-loss shots.

“It is our responsibility, as the trusted leader in weight management, to support those interested in exploring if medications are right for them,” chief executive officer Sima Sistani said in a statement last year.

The “WeightWatchers GLP-1 Program” launched in December. To maintain some continuity between the old and new business models, the company said in a press release that it’s offering “tailored behavioral support” for people taking weight-loss shots. In January, WeightWatchers suffered its worst month on record — wiping out a year of gains since the acquisition announcement.

The company has long used grassroots online campaigns and bloggers to tout its services, said Erin Willis, a professor at the University of Colorado at Boulder who studies how health messaging affects consumers’ behaviour. Now that much of the conversation around weight-loss products has moved to social media, WeightWatchers has, too.

Sistani has 39,000 followers on TikTok, where she does “myth busting” about her company and posts diet-friendly snacking tips. (Sistani founded group video-chat app Houseparty, which was later bought by Epic Games.) Medical Director Spencer Nadolsky has an impressive 396,000 followers on Instagram. The former NCAA Division 1 wrestler-turned-doctor shares weight-loss memes and news about GLP-1s. He’s also active in the comments, where he corrects medical misinformation and occasionally defends himself from accusations of being a “sell out” for jumping on the weight-loss drug train.

The GLP-1 house was part of a larger social media marketing push for WeightWatchers’ new obesity drug service. In December, Nadolsky did an interview with running influencer Kate Mackz. That same month, the company rolled out a “pop-up coffee cart busting the BS about weight & GLP-1s” in New York City. It brewed “WeightWatchers Truth Serum Coffee” and specialty drinks with sugar-free syrups like “the Stigma-chino” and “the Myth-acchiato.”

Branded experiences are part of the fabric of social media. Tarte Cosmetics reportedly spent hundreds of thousands of dollars last year to fly 50 US-based beauty influencers to Dubai. Sunglass Hut recently hosted a summer camp-themed event in upstate New York. Clothing brand Revolve sends influencers to Coachella every year.

WeightWatchers, however, may have underestimated the difficulty of its attempted makeover. Sistani told Bloomberg Businessweek last year that she was fine rubbing loyalists the wrong way to win over a new crowd. She figured she could replicate the community WeightWatchers had created with dieting, but around weight-loss drugs.

Some don’t see why they need WeightWatchers for that. “Once you’re on the medication, you don’t need a points system telling you how to eat,” Dunham said.

By Madison Muller

Donald Trump is marketing a self-branded $399 metallic gold high-top sneaker after being ordered by a New York judge to pay $364 million for lying about his wealth.

The “Never Surrender” sneakers, which have a bold-faced letter T on the side, sold out in less than a day after Trump’s appearance at Sneaker Con in Philadelphia on Saturday, according to the website. It said 1,000 pairs will be produced, with a limit to three per customer. At least 10 will be autographed by Trump, the website says.

Over his business career, Trump has seen several corporate bankruptcies, rough times in Atlantic City and dead-end brand journeys for Trump Steaks, Trump Vodka and an airline. “I’ve wanted to do this for a long time,” Trump said of the sneaker line. “I think it’s going to be a big success.”

Trump is the likely Republican opponent to President Joe Biden in the 2024 presidential election, polling in first place above former South Carolina Governor Nikki Haley.

The former president is facing mounting legal fees as he simultaneously campaigns across the country and defends himself in a series of court cases, which risk wiping out most, or all, of the billionaire’s cash on hand. He’s expected to appeal the ruling in a civil fraud case in New York handed down last week that ordered a hefty fine and barred Trump from operating any business in New York State for three years.

Upon Trump’s entrance to the stage at Sneaker Con, which calls itself “The Greatest Sneaker Show on Earth,” the crowd erupted in simultaneous boos and cheers.

The website also sells the “POTUS 45″ and “T-Red Wave” sneakers, both priced at $199. “Victory47″ cologne and perfume can be pre-ordered for $99.

Biden’s campaign took a jab at Trump’s new product.

“Donald Trump showing up to hawk bootleg Off-Whites is the closest he’ll get to any Air Force Ones ever again for the rest of his life,” Biden’s campaign communications director Michael Tyler said in a statement.

By Alicia Diaz

Learn more:

How Fashion Brands Can Survive the 2024 US Election Minefield

Few companies see an upside in wading into what’s shaping up to be a long, toxic campaign. But after years of socially conscious messaging they can’t fully disengage either.

When so-called BNPL — buy now, pay later — apps took off at the start of this decade, their appeal was easy to understand, since buying stuff is always easier if you don’t have to put up all the money right away. Their target audience was also pretty clear — Gen-Zers and Millennials who enjoyed making impulse purchases but who disliked credit cards. These days, retirees and others on fixed incomes have become some of the fastest growing users of the apps, and high interest rates have killed off some entrants into the field. What hasn’t changed? A lot of uncertainty over how BNPL companies can make money in the long run, and whether they’re actually providing a cheaper alternative to credit cards or just a new way to lure borrowers into unwise levels of debt.

How does BNPL work?

Typically by letting consumers pay for purchases in three or four installments. Most BNPL services spread them out over the course of a few weeks, often without interest, although many charge fees for late payments. Spending on BNPL purchases jumped from $33 billion in 2019 to $300 billion by 2023, according to GlobalData, a research provider; it projects that figure to rise to $570 billion by 2026.

Is This a New Idea?

Not really. The “installment plan” is a type of credit that really got going in the 19th century, as the Industrial Revolution offered consumer goods to the masses — if they could pay for them. Most famously, Singer sewing machines were sold for a “dollar down, dollar a week.” The practice of offering weekly or monthly purchase plans spread, as makers of furniture, pianos, farm equipment and automobiles looked to make products more attainable. Credit cards then broadened the practice of delaying payments to cover smaller purchases. But credit cards tend to be disliked by the young people attracted to BNPL; as a group, young shoppers are wary of providers that profit when customers don’t pay their balances.

Why Did BNPL Take Off?

Several reasons. For one, online shopping exploded during the pandemic. And investment poured into a roster of new startups that offered apps that were user friendly and targeted at young people making purchases for items costing $200 or less, including Klarna, Afterpay, Affirm, Zip and Zilch. Most BNPL isn’t about buying big-ticket items; it’s about using an app to snap up that must-have jacket in the expectation that you’ll pay it off quickly. The fact that there generally aren’t rigorous credit checks slowing down an initial purchase also helps. Finally, this corner of the fast-credit industry was able to grow at a blistering pace partly due to the lack of regulation.

How Has the Industry Changed?

BNPL started off with a focus on fashion and with a Millennial and Gen-Z consumer base. But the audience for such fast-credit apps has expanded. By December 2023, Klarna said the 60-plus group was the fastest-growing age segment —  with home and gardening climbing to one of the most popular categories for shoppers to use the product for. That’s seen as in large part being a reaction to inflation’s spiraling rise in recent years, which has many consumers of all ages looking for ways to stretch their money or put off paying bills a bit longer. To the dismay of regulators, people are using BNPL apps not just for one-time purchases but to pay for recurring costs such as energy bills, takeaways and even groceries.

How Are BNPL Companies Performing?

After initial rapid growth that led to heady valuations for some newcomers, they hit a rough patch. In 2022, Klarna saw its value plunge from $46 billion to $6.7 billion, while Affirm’s stock tumbled 90 percent by the end of the year, while Zip had shed about 95 percent of its value. (The firms have picked up to an extent since then.) That reflected three trends. One was a rush of new competitors into the field, including big tech companies like Apple Inc. and Amazon.com Inc., retail banks like HSBC Holdings Plc and Barclays Plc, Wall Street firms like Goldman Sachs Group Inc and Citigroup Inc and new major players in previously underserved markets, like Gulf-based Tabby and Huabei in China.

Another factor was the rise in interest rates engineered by many central banks to fight inflation. That raised costs for BNPL firms that were borrowing the money with which they made payments to merchants or lent to consumers, a burden that increased with the volume of loans. The inflation squeeze also meant that more BNPL loans went bad. In the first half of 2022, Klarna reported that its losses had tripled with high operating costs and credit losses. Since then, the firm has said that more people are paying back on time and default rates are at their lowest, at 1 percent. Still, nearly a quarter of BNPL users missed one or more repayments in the six months to December 2023 in the UK.

What is the BNPL Business Model?

There are several, but they all share one thing: When a customer uses buy now, pay later as a payment option, the BNPL provider foots most of the bill up front, paying the merchant the full amount. The customer then pays back the BNPL provider in installments. Since BNPL firms typically don’t charge interest, they turn to a variety of revenue sources: Some BNPL apps make money by charging retailers a small fee. Some also charge consumers late fees. Others make money off of advertising or have opened up subscription models for extra channels of revenue. Major partnerships with the travel and hospitality sector have been struck, and some have launched debit services too.

How BNPL Businesses Financed?

BNPL players often use partner banks as a source of funding. Some startups also secure debt financing from investors to pay for purchases in advance. For example, Zilch’s debt facility is funded by Goldman Sachs. Klarna is a bank, so it can use customer deposits from conventional bank accounts it offers in Sweden and Germany to fund its activity.

What Are the Downsides of BNPL?

Regulators and consumer advocates worry that it could be a form of irresponsible lending. Consumers grappling with accelerating inflation and rising interest rates could load up on debt using different apps and then overdraw their bank accounts or take on credit card debt to service their BNPL accounts. The Citizens Advice Bureau in the UK found one in five BNPL users had missed or made a late BNPL payment in the last twelve months, and almost a third who were due to make a payment in the last month borrowed money to repay their installments. More broadly, the possibility that BNPL leads people into a chain of borrowing could create hidden risks for the banking system.

Britain’s FCA says the sector must be regulated, while Australia’s BNPL firms will need to adhere to responsible lending obligations and hold Australian credit licenses, and California has fined unlicensed lenders. The companies themselves say they offer a cheaper alternative to the high interest rates on credit card bills, bank overdrafts, and revolving debt that are alternatives sources of funds for their customers.

By Aisha S Gani