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What LVMH Did to Score Phoebe Philo, and What Philo Is Doing In Turn for Celine

>> After Michael Kors left Celine in 2004, the brand floundered. To rectify the situation, Pierre-Yves Roussel, chief executive of LVMH's fashion division, traveled to London every other week for nearly a year to persuade Phoebe Philo to come on board at the brand.  The company also agreed to build her a design studio in London, where she lives with her young family.  Eighteen months ago, Philo signed on.

For a fresh start, LVMH destroyed all of the inventory left in stores before Philo's first collection.  All but one Celine store was closed in the United States, ties to less exclusive retailers like Bloomingdale's and Net-a-Porter were cut, the accent was restored to the brand's name, and bag production is no longer outsourced to China — each in a bid to elevate the brand.

Eventually, there will be more affordable offerings »

Celine prices have increased since Philo started designing for the label, and even though department stores usually get exclusives on new brands, Celine got Bergdorf and Barneys to share the rights to Philo's debut Spring 2010 collection in the New York market.  The goal, according to Philo, is to establish a high-end image before ultimately paving the way into more affordable offerings: "I felt it was necessary to establish quality to the brand. Now that we are establishing that and the top of the pyramid is in place, we can open it out."

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