California Apparel News

Kit Marchel is the executive vice president of marketing, business development, for the California Mart, a position she took on when her longtime employer Hertz Investment Group purchased the building last year. When the Cal Mart joined the Hertz real estate holdings—a portfolio that includes about 8 million square feet of space in downtown Los Angeles—Marchel assumed two roles: heading marketing at the Cal Mart and retaining her position as president of Hertz’s Investment Corp. But her dual position has a common theme: To stake a place in the economy of Los Angeles.

The Cal Mart—and Marchel’s—latest accomplishment was the forging of a deal with DMG World Media, the Dallas Market Center (DMC) and California Gift Show manager George Little Management (GLM) to bring a block of gift vendors to the building—effectively bringing the building to 100 percent occupancy with the signing of one deal.

California Apparel News executive editor Alison A. Nieder recently sat down with Marchel to find out some of her plans for the California Mart and the fashion industry, what advantages her background brings to the table and how she acted to land the gift-show deal.

As executive vice president of marketing and business development, what do your duties entail?

Ultimately I’m responsible for everything that goes on in the marketing department, which is imaging, market positioning, branding, tenant relations, corporate communication, retail development and international business enhancement programs—that’s just on the fashion side.

How do you define business development as opposed to retail development?

Business development is business-to-business relationships with downtown businesses that can enhance our buyers’ experience. Part of the business development is specials that are pre-negotiated [and printed in the California Mart Guide to downtown Los Angeles]. For instance, [there is] a promotion I am working on with Checkers Hotel that enables the bearer of [a promotional] card to get one entreacute;e at 50 percent off if they purchase another at equal or lesser value at their restaurant.

[Another planned promotion is also] at the Checkers Hotel. They are building a spa and I’d like to introduce our buyers to that. I’m looking into putting together a spa getaway package in conjunction with Checkers that we could give away at the end of our fashion shows or during our cocktail parties.

My goal as far as business development is to have every person who visits us go away with a redefined definition of Los Angeles, [that the city is] really great, it’s clean, it’s beautiful, there’s fun things to do [and] there are great restaurants [here].

As far as retail relations is concerned, we have developed a special travel package which includes air and two-night hotel for a first-time buyer or a buyer who hasn’t been here in the last couple of years.

We are also announcing a new travel agency, Tzell Travel, that’s going to be handling all of our travel. The introduction of Tzell to our buyer base will include [a travel promotion]. The first 100 buyers who call to register with Tzell will get one free room night with the purchase of one night. And [they] will be automatically entered to win an all-inclusive exotic vacation (the destination has yet to be determined).

This is all part of business development, but it also helps in retail development. I really want to give the buyer a reason to come here in a consumer-based way. The fashion speaks for itself; we know who we are and we’re very proud of our resources here. But this is more of a consumer-based marketing program. It’s fun, and who doesn’t want to try to win an all-inclusive trip to an exotic location?

You sit on a number of local boards. What are they and what are some of the benefits you see for the apparel industry in your participation in these organizations?

I co-chair the Central City Association economic development committee. I’m a board member of the Downtown Center Business Improvement District. I’m vice chair of the Central City Association executive board. I’m a member of the Government Relations/Land Use Committee, a member of the Downtown Center Business Improvement District marketing steering committee (which is the overall marketing and image ofLos Angeles—I put a lot of time and attention into that) and member of the Fashion Business Improvement District image/communications committee [along with Trish Moreno, executive marketing director for the Cal Mart].

My involvement with downtown gives me a broader view of the direction that the city is looking to go both economically and from an image standpoint. I see that direction and I see how viable fashion is and what I’m doing is tying it together.

As I’ve learned about the economic viability of the fashion industry, it’s been my goal for the last eight months to bring it to the attention of people in the downtown area who might not have been aware of that.

What are the Hertz Investment Group’s holdings (properties, square footage, industries)?

[Hertz Investment owns] about 8 million square feet in downtown Los Angeles including [the California Mart,] the Union Bank Building, we own the Oviatt Building, the International Jewelry Center, Banco Popular, the Wiltern Theater [and] Park Plaza Hotel. We have representation in almost every Business Improvement District [BID] in this city.

Unlike previous owners, Hertz has a number of properties throughout Los Angeles. How does the company plan to leverage this power for the apparel industry?

Because we represent so much square footage in downtown Los Angeles, we have a true vested interest in the economics of a burgeoning downtown.With size comes influence in a lot of things. Because BID are funded on a tax-per-square-footage basis, the portfolio represents a very strong statement about a dedication to a blossoming downtown. This dedication gets the attention of civic leaders—people who are also working for the economic betterment of downtown Los Angeles. They know me and they know that I represent Mr. Hertz and the portfolio and I’m an advocate of the fashion industry. From an economic standpoint, from an imaging standpoint, it unifies all efforts.

There are restaurants and hotels that sit in the same BIDs as we do and because we represent so much consumer traffic in the form of buyers and participants and I sit on all these boards, I’m able to say to the board members, “Look at the economics that fashion brings.”

I’m bringing the viability of the fashion industry to the attention of downtown. We are working in the same direction. We all want to promote a safe, clean, fun image of Los Angeles. So people who come and visit will say, “I stayed at a beautiful hotel, I ate at an amazing restaurant [and] the fashion week was amazing—and I’m coming back.”

What was your role in the Cal Mart’s recent deal to bring the gift market to the building?

I had gone to Dallas to discuss fashion week dates for ’02. I came with the board of governors and our own recommendations for fashion weeks on a going-forward basis through 2005. They asked me to lunch and we discussed the economics of real estate. Mr. Hertz was out of town at the time, so I was solely acting as liaison between ownership and this triad—DMG, DMC and GLM. Because prior to taking this position at the California Mart, I was in charge of finance for the Hertz Investment Group, [including] acquisitions, loans and secured relations, I had an economic background from which to speak and to discuss variables about the ability to retrofit an existing structure versus the viability of a build-to-suit.

And that got the ball rolling. I started assisting in evaluating the viability of this [deal during] the entire month of June in Mr. Hertz’s absence—[although] I was in contact with him every day.

Because they worked so fast, it came to fruition very, very quickly. They are a very organized group.

With the recent news about the Cal Mart expanding into the gift market, the building will be at 100 percent occupancy for the first time in a number of years. What are the marketing plans for the building?

Next week I’m going to have an operations discussion. This is new to [the gift-market organizers]; they have taken a different track than originally anticipated, [one] that involves an entirely new group, not the original group that was working on the build-to-suit. Now it’s a retrofit. And [it involves] blended systems of working that will ultimately benefit both industries.

But I do know this: We will be cross-promoting each other within separate industries, and there is the possibility of combining industries for new shows. I will have much more information after we have first discussions, and details will be unfolding throughout the year.