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Viral Racist Video forces Nike to Close Stores in South Africa

Nike temporarily closed some South African stores early last week after the husband of a merchandising director was caught in a racism row over a video he posted while on vacation.

Nike's decision comes months after H&M closed down outlets in South Africa following protests against the infamous ad that featured a black child with a hoodie with the text “coolest monkey in the jungle.” Race remains a highly sensitive issue in South Africa more than two decades after the end of apartheid.

While the company didn’t comment on the temporary closure, it released a statement saying the firm “opposes discrimination and has a long-standing commitment to diversity, inclusion and respect.”

In the online video that went viral last week, a white man expressed his appreciation for the beach he was visiting by commenting that there weren’t any black people to be seen — using an offensive racial slur. He was promptly fired from the food producer that is owned by his family, Eyewitness News reported, adding that his wife works for Nike.

The stores have reopened as of Friday last week.

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What is Sephoria House of Beauty?

Publishers, Beauty of Fashion report, Sephora are organising an event for the retailer’s most dedicated customers to interact with their prized beauty brands. The event will be called Sephoria House Of Beauty, and will take place on October 21st-22nd in LA with installations from over 50 brands for consumers charged between $100 and $500 to explore and shop.

While Sephora cannot confirm which brands will participate in Sephoria, the retailer will likely draw on the many prestige brands in its portfolio, especially the LVMH-owned ones such as Rihanna’s Fenty Beauty. Sephora is joining a multitude of retailers in creating experiences for customers that go beyond shopping in a conventional store. Sephoria will feature a range of set-ups around the "house" theme, including a kitchen where consumers can “play with ingredient-based skincare,” and a laundry room that is the backdrop for cleansers. When it comes to product, Sephoria’s emphasis will be on limited-edition elements such as exclusive colours, packaging design and personalisation, rather than sales. Yeh said the company doesn’t want the event to overlap with the in-store experience.

The goal with Sephoria is to build community and give customers a fun, interactive experience — “lots of juicy experiences that she’s can snap and share and wow her social community with,” said Deborah Yeh, senior vice president of marketing and brand at Sephora. “We’ve been dreaming about something like this for awhile.

Sephora generated between $4.4 billion and $4.9 billion in sales in 2016, according to Coresight Research (LVMH does not break out Sephora's financials).

Nike to make a push into Fashion

Nike is partnering with Matthew Williams, the founder of luxury streetwear brand Alyx, in a conscious move to make its performance category more fashionable. Matthew's work takes cues from the current youth culture and is recognised for his more practical approach to fashion, will launch his 18-piece fashion collaboration with Nike in mid July, which includes outerwear, monochrome leggings and a wide range of accessories such as logo-ed socks, face masks and towels.

Matthew's partnership with Nike, which has men’s, women’s and unisex collections, will be within Nike’s Training category, making this one of its first major collaborations with a fashion designer within the division. He founded Alyx in 2015 and has been working on the collaboration with Nike for the past year and a half.

He has a young fan base, and his brand's roots in merging street culture with practical garment construction, fits well with Nike’s Training division. But the collection also symbolises a wider strategic shift in the sport firm’s ambition to join its performance and lifestyle divisions, as it responds to the buying behaviours of young consumers, who often see less of a distinction between the two categories.

Nike still remains the world’s leading sportswear player in terms of revenue, but its performance-driven approach to apparel and footwear has lost some degree of “cool” in the eyes of young consumers, who often favour aesthetic and lifestyle features over performance and still make up a majority of the company’s clientele. Nike’s designer collaborations, including those with Kim Jones, Olivier Rousteing and Riccardo Tisci, also made a smaller cultural impact than those launched by Adidas.

( Photos Credit: Nick Knight )

Online Shoppers unhappy with Zara's offerings

The recent shift to online shopping isn’t working in the interest of retail brand Zara, as its exposes its issues with the fit, product quality and online service, according to Credit Suisse analyst Simon Irwin.

Comments about Zara products “are poor and declining” on consumer-review websites Trustpilot and Sitejabber, the analyst wrote in a note previewing owner Inditex SA’s first-half results on Sept. 12.

“We believe the ‘treasure trove’ nature of a Zara shop is still a better experience off-line,” Irwin wrote. While online is driving like-for-like sales growth, that can have a negative impact on gross margin, he also said.

The broker estimates that the Web will represent about 10 percent of Inditex’s sales this year, up from 2.4 percent in 2013. It also expects 2018 to be the sixth consecutive year of Ebit margin decline.

Inditex shares had their worst week in seven years last week, falling 8.7 percent after Morgan Stanley published a scathing report saying the retailer has gone from great to good.

Credit Suisse lowered its price target to 24 euros from 25 euros and maintained its underperform recommendation.

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