Berns Communications Group Unveils 2007 Retail Trends Noted by Leading Retail Experts.

NEW YORK -- Obsessing over the business of fashion was addictive this year with must see TV hits Ugly Betty and Project Runway, and the summer blockbuster release of "The Devil Wears Prada." And with holiday buzz already in the air, Berns Communications Group (BCG) asked some of our retail and fashion experts to comment on their outlook for holiday and 2007.

A shortage of must-have gadgets. The Ipod, Tickle-Me-Elmo and Plasma TV were some of the breakthrough product launches that drove consumers out on Black Friday before the crack of dawn. Some observers have coined this a season of line-item extensions, and the few new product launches (i.e. PlayStation 3 and TMX Elmo) are in short supply for holiday 2006C*which is only one reason some forecasters are predicting the worst holiday sales gain since 2001. "The deteriorating housing market and the timing of gift card redemption will make it difficult to reach the $550 billion in retail sales that was spent by consumers last year," Archstone Consulting CEO Todd Lavieri told CNBC last week.

A return to traditional gifts. And without any new must have gadgets, some experts are predicting a stronger apparel season and a return to traditional gifts. Betsy Thompson, fashion expert for Talbots Inc. said you can't go wrong with gifts that bring comfort and tradition into the home. "Stylish apparel in red and green hues, holiday ornament candles, and cozy warm up suits and pajamas are some of the more popular gift items for the season." But don't get too cozy in the comfort of tradition C*

The unpredictable forces won't curb retail activity. Despite economic, political and consumer confidence uncertainties, "private equity and hedge fund investments in retail will continue, yet new deals will become increasingly selective," according to Financo, Inc. Chairman Gilbert W. Harrison. "We may also see some IPO activity, as private equity firms invested in the sector seek to produce returns for their investors," added Hal Reiter, Chairman and CEO of Herbert Mines.

Expect more CEO changes according to Mr. Reiter who noted that Board of Directors have a shorter fuse for lackluster performance, and seasoned retail talent will continue to seek opportunities in the private equity sector.

Look for more unique strategic initiatives that extend the brand experience like American Eagle's launch of intimates brand aerie, Nordstrom's move into the music industry, and creative partnerships like Dunkin Brands and Jet Blue or even doctors/cosmetologists partnering with retailers to launch new products. Expect these partnerships to reach new levels of creativity C* "LVMH and Apple could merge as electronic gadgets are designed with the look of status brand accessories," predicted David Wolfe, Creative Director of The Doneger Group, in a recent WWD article.

A move toward untraditional real estate adjacencies. From New York to LA, expect more unconventional co-tenancy mixtures like Abercrombie & Fitch occupying space on the luxury corridor of Fifth Avenue and specialty retailer Bebe emerging on the ultra-exclusive Rodeo Drive, according to Laura Pomerantz, Principal of PBS Realty Advisors. Additionally, Pomerantz noted that you can expect to see more retail expansion in the children's business, with new retail concepts emerging like Build-a-Bear and American Girl as well as brand extensions like J. Crew's Crewcuts and kids shoes collections from luxury brands LVMH, Prada and Burberry.

Big fashion changes. According to Mr. Wolfe, there will be big changes in fashion in 2007. "Simple, yet dramatic apparel and accessories will slowly but surely replace the over-decorated over detailed items that have now reached saturation point. The past decade or two of ostentatious luxury is coming to an end, and with it possibly will come an end to society's obsession with low brow celebrities," Wolfe noted.

Major changes in purchasing power. Two new purchase powerhouses will prevail - The Baby Boomers who now control 70 percent of all assets, and women, who are beginning to earn more money than their male counterparts, according to Tobe President Kathy Deane. "Retailers across all categories will need to become more aware of the female shopper and her impact on the business, as women make the bulk of travel purchases, consumer electronics purchases and other big ticket items," Deane noted.

About Berns Communications Group, LLC 

Berns Communications Group (BCG) is a business communications firm providing companies with corporate/financial public relations expertise that helps raise the visibility and stature of our clients by articulating and promoting a well-defined market position. For more information, please visit the company's website at www.bcg-pr.com.