For the Scandinavian brand Filippa K, the new year brings a new identity.
The minimalist label, founded by Filippa Knutsson in 1993, is in the midst of a reboot and is recruiting Liisa Kessler, formerly senior designer at Saint Laurent, to lead the brand as Creative Director in its next chapter.
The creator joined the label at a pivotal moment in its nearly 30-year history. In 2019, founder Knutsson stepped down as creative director just before the onset of the coronavirus pandemic, which hammered the company financially. (Knutsson remains a shareholder.) Today, recently appointed Managing Director Rikard Frost embarks on a broader turnaround plan to upscale the brand and expand its international presence. Kessler, who has also done stints at Lanvin, Y / Project and Chloé, is an important piece of this puzzle.
“His experience in Parisian houses has been very important to what we want to achieve,” said Frost, who joined the Stockholm-based company in March 2021. “We want to create products that have a point of view with a strong emphasis on quality.
The brand’s transition is taking place in a changing landscape. The pandemic has caused sales to plummet, with annual revenues falling from $ 72.4 million in 2019 to $ 58 million in 2020, a drop of nearly 20%. In practice, this meant staff layoffs, retail store closings, and the exit of wholesale partnerships when retailers were unable to pay. Budgets have been reduced to the bare minimum across the company, Frost said.
The brand has since stabilized its sales and the company’s cash flow has remained positive throughout the crisis, Frost said, which means that now Filippa K is in a position to rebuild herself. If 2020 was the year of crisis, 2022 could be its year of opportunity.
“When I joined the business last year, it was a very light operation, everything was really lightened up and in survival mode,” he said. “You could almost see the pandemic as a reset. We have consolidated, and what remains is a very productive business; smaller in size, but more productive and set up for a better long-term future.
As the rapid spread of the Omicron variant shows, the crisis is far from over and today’s unpredictable retail environment is still here. Meanwhile, the clothing market remains fiercely competitive and overcrowded.
In Filippa K’s case, success will depend on being able to create a unique identity, Frost said. He sees an opportunity to build loyalty with a distinct clientele by doubling down on the brand’s unfussy and calmly sensual minimalism. Later this year, Filippa K will launch a new branding, with a new logo, to coincide with the launch of Kessler’s first collection in June.
“We are a niche brand. We have to be a niche brand so that we can reach out and cut through the noise, ”Frost said. “With the resources we have as a midsize brand, we won’t be able to compete for all customers, we have to have a very specific identity and stand for something that is unique to us. “
We are a niche brand. We have to be a niche brand to be able to reach and break through the noise.
The next chapter
Keeping Filippa K’s fundamental DNA rooted in the functional and minimalist design for which he is known is also part of the brand’s sustainability agenda – creating clothes that are not seasonal and, from a trend standpoint, will stand up to the test of time.
“[Filippa Knutsson] was one of the pioneers in establishing the now iconic Scandinavian minimalism look, ”said Kessler. “His original vision of a desirable and sustainable wardrobe is as relevant today as it was to the creation of the brand.
Now the brand will showcase more premium products and play in a more expensive price category. For example, the brand expects prices for coats to be between $ 1,000 and $ 2,100 over the next three years or so; currently, most of its outerwear sells for between $ 500 and $ 1,100. It will also expand its assortment to strengthen the currently underdeveloped categories, namely denim, bags and other accessories like eyewear.
The move upmarket could play in favor of the brand. Currently, Filippa K sits firmly in the contemporary fashion market, below the more expensive “designer” labels, but above the fast and high street fashion brands. Cluttered and competitive space is easily constrained in times of economic uncertainty as affluent shoppers turn to luxury shopping, while middle-class shoppers cut back on spending or focus on more value-oriented offerings. .
“In general, he suffered quite badly [over the pandemic]”said Nina Marston, senior analyst at Euromonitor, of the contemporary fashion market.
Although the broader womenswear market has recovered from the pandemic faster than the luxury segment, this year branded womenswear is expected to experience a boom, with growth expected to exceed that of the larger market in the world. over the next two years, according to data from Euromonitor. This year, the market research company predicts sales will exceed pre-pandemic levels to $ 57.2 billion, a 13% increase from 2021.
Look beyond Europe
To capture market growth, international expansion is a strategic priority for Filippa K. Frost noted that since the pandemic, the brand has suffered due to underexposure in global markets, particularly in the United States. and in Asia, where the recovery in retail trade was much stronger than in the North. Europe. Currently, over 90% of sales come from Europe, and only 1% from the United States. And while the brand had as many as 60 stores five years ago, they were concentrated in Scandinavia and other European countries like Germany, the Netherlands and Belgium.
“Due to the niche nature of what we do, we cannot achieve significant size in a small part of Northern Europe, for example,” he said. “There is someone in every country who can love what you do, and you have to reach out to that person and have a holistic approach to how you communicate that.”
There is someone in every country who can love what you do, and you have to reach out to that person and have a holistic approach to how you communicate that.
The brand is currently reviewing its wholesalers, seeking to partner with leading international retailers. Ssense, for example, is expected to start stocking the brand for the first time this month. Currently, wholesaling accounts for 40% of sales, with the remaining 60% split equally between direct e-commerce and retail operations.
The brand will also begin to expand its store network again, increasing its footprint from 19 stores today to around 35 by 2025. The longer term goal is to have “fewer but better stores” in major luxury shopping malls that serve as billboards for the brand and help build relationships with customers. For now, expansion into the Chinese market is on the agenda for the second half of this year.
Frost, however, says his roadmap to success doesn’t have to happen overnight.
“My ambition is to double the size of the company. If it’s going to take me two years, three years, four years, I don’t really know, ”he said. “I don’t want to build a brand whose only goal is to grow as quickly as possible. I want to build something for the long haul.