In light of this week’s limited general release of the new Halston documentary, Ultrasuede: In Search of Halston, Diane Von Furstenburg shed light on what she thinks caused the downfall of Halston. DVF says, “We all make mistakes – sometimes you associate with the wrong names – his was working with JC Penney: he never recovered from that.” While DVF may have been speaking only of the designer himself [Halston died at an early 57], her comment sheds light on a larger issue in the luxury fashion world as a whole: the double-edged sword of licensing and branding.

In the 1970s and ’80s, Halston was one of the first luxury designers to embrace licensing. Today the tale of Halston serves as the face of the early roots of designer-retailer collaboration and also as a cautionary tale for design houses that are contemplating licensing. Through his licensing agreement with JC Penney, Halston’s designs were accessible to women at a variety of income levels, a very edgy and highly controversial move at the time. The JC Penney line was a big hit, which promptly downgraded the Halston brand in the eyes of elite New York stores like Bergdorf Goodman, who, along with others higher end department stores, stopped selling Halston on its floors.

As the companies who licensed his name grew, Halston was unable to control the many license deals in existence [agreements for products including eyeglasses, towels, luggage, uniforms for the Girl Scouts, a clothing line for J.C. Penney and, of course, perfume]. Halston eventually lost the rights to his own brand and fought to buy them back until he died but was unsuccessful.

The brand was revived in fall 2008 by Harvey Weinstein, Jimmy Choo’s Tamara Mellon, and actress, Sarah Jessica Parker, only to fall again when Weinstein sold his ownership of Halston to co-owner, Hilco. Next to go was Halston’s designer Marios Schwab, then Tamara Mellon, and Sarah Jessica Parker. Currently, Halston is focusing exclusively on its lower end line, Halston Heritage.

Moral of the story: be careful not to go overboard with the licensing. Even though consumers today are much more forgiving as a whole than they once were [Proenza Schouler has done lines for Target and still sells in Bergdorf and Barneys NY], selectively grant licenses for the manufacture and distribution of goods, and if you do, try as hard as you can to nourish your brand’s identity and culture because at the end of the day, fashions change every season but your brand could last much longer.