After an early silence, more luxury brands are moving away from Russia following the invasion of Ukraine

In the days following Russia’s invasion of Ukraine, most luxury brands remained silent as they watched their stock prices plummet and the European Union swiftly imposed sanctions on companies. exports and imports.

For Giorgio Armani, silence was in order. During Milan Fashion Week, he cut his show music, one of the first designers to take a stand against the war, according to Vogue.

In a March 1 Instagram postVogue Ukraine called for concrete action from the industry, urging “all international fashion and luxury conglomerates and companies to immediately cease all collaboration” with Russia, checking the names of several major fashion companies.

“Vogue UA calls on the global fashion industry not to remain silent in these dark times because it has the loudest voice,” the magazine said.

Support for Ukraine

Overall, Russian sales account for around 5% of the global luxury market, according to Vogue businessciting Bernstein Research, and has been in development for two decades.

“The presence of Western brands has only grown stronger over the past 20 years, which means that Russians love luxury and they buy a lot of it,” said Thomai Serdari, professor of marketing and branding at luxury at New York University’s Stern School of Business. by email. Serdari questioned the exemption of luxury goods from sanctions against Russia “while human lives are threatened and democracy as a whole is under attack”.

“What brands should do instead is show their consumers how they are helping Ukrainians,” she said.

In recent days, more and more high fashion brands are finding their voices, although, contrary to recent statements by the chief executives of a few US retailers, they tend not to be attributed to one person.

From the start, rumors of exclusion for luxury goods swirled, prompting the Italian government on February 25 refute the suggestion that he was pushing for such an exemption. Last week, several fashion brands, some of which have operations in Russia, condemned the incursion, offered aid to Ukraine and, in some cases, even suspended certain Russian operations.

Wednesday, Tapestry, (whose brands are Coach, Kate Spade and Stuart Weitzman), said in an email that she had no “direct business” in Russia or Ukraine and announcement a $100,000 donation to the United Nations Refugee Agency, also known as UNHCR; Kate Spade’s foundation also donated $25,000 to a nonprofit helping displaced Ukrainian families.

LVMH, (whose many brands include Christian Dior, Givenchy, Louis Vuitton, Marc Jacobs and Tiffany), said in a statement it would make a “first emergency donation” of 5 million euros to the Red Cross and that it was “constantly monitoring the situation and will adapt its measures as necessary.” In addition, the company is activating a fund created last year to provide financial, operational and psychological support to its employees, “especially those directly affected by this conflict”. An LVMH spokesperson did not immediately confirm reports that the company has since decided to close its stores in Russia.

Unless otherwise stated, the companies have not provided Retail Dive information on their sales in Russia.

Prada in an Instagram post said that “the war in Ukraine is very worrying and of great concern”, and that it is make a donation to the UNHCR; the brand has would also have suspended operations in Russia. Keringwhose brands include Gucci, Saint Laurent, Bottega VenetaBalenciaga and Alexander McQueen, said on Instagram Thursday that he would make a “significant donation to the UNHCR.”

Balenciaga, however, went further. In a letter uploaded to Instagram, creative director Demna posted a very personal letter, saying that the war in Ukraine evoked the trauma of his own experience as a refugee, that he was considering canceling the recent fashion show of the mark in Paris, but then realized it. would be “to surrender to the evil that has already hurt me so much for almost 30 years”.

“This show needs no explanation,” he also wrote. “It’s a dedication to fearlessness, resistance and the victory of love and peace.”

The brand is also work with the World Food Program to help Ukrainians fleeing their homes.

Abandon the Russian market, at least for a while

Some luxury players are ceasing or reducing their activities, at least temporarily. With several Russian banks cut off from the international monetary exchange system and senders like DHL, fedex and UPS suspending or limiting deliveries, many seem to have little choice.

Burberry, which noted he donates an unspecified amount to the Red Cross, said in an email: “Due to operational challenges posed by the current situation, we have suspended all shipments to Russia until further notice.”

Premium marketplace Net-A-Porter has also notified its Russian customers that orders are not being filled, “due to the current situation”. Rival Farfetch posted a similar note on its russian websitecorn on Instagram used stronger language, saying he would contribute a certain amount to UNHCR and wrote: “We abhor war in all its forms and are devastated by its effects on innocent communities around the world.

In an emailed statement Friday, Chanel, citing the safety of its employees, “growing uncertainty and complexity to operate,” said it has temporarily suspended operations in Russia, including closing stores and halting deliveries. The fashion house has donated 2 million euros to organizations organizations and her foundation “will also work closely with partners to provide essential future medium- and long-term support to women and children affected by this evolving situation.

Friday via LinkedIn, Hermès said it was deeply concerned about the situation in Europe and said it had temporarily closed its stores in Russia. Also on Friday on LinkedInRichemont, whose brands include Azzedine Alaïa, Cartier, Chloé, Piaget and Van Cleef & Arpels, have promised “a significant donation” to Doctors Without Borders and said some of its brands also support humanitarian efforts with their own contributions. The company also said it halted operations in Ukraine on February 24 and suspended business activities in Russia on Thursday. In an email, Richemont said so has not disclosed its sales to Russia since 2016, when they fell below 2% of sales.

These companies may appear to be in dire straits, given that as the ruble plunges, the Russians are buy high end jewelry and watches in order to preserve their wealth, with the boss of Bulgari, owned by LVMH tell Bloomberg that the situation “probably boosted the business”.

What matters

However, any short-term sales increase or loss in Russia should not be the top priority for these brands, according to Alan Behr, fashion industry lawyer and partner at Phillips Nizer.

“The moral imperative not to trade with Europe’s first autocratic and imperialist regime since World War II makes participation in a de facto luxury boycott better – perhaps essential – both for reputation and, in ultimately, for the results,” he said via email. “Besides something that tends to get lost in business calculations: it would mean doing the right thing. Since luxury is about perception as much as business, and a lot of it is perception business is generated, staying out of Russia for the foreseeable future seems prudent.”

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