Thursday, 2 April 2009

Stapler's Thoughts: Luxury During a Recession

Not quite sure what happened to posting in March - I got a bit obsessed with following Twitter and doing the crossword - but I'd been meaning to reply to StyleSalvage Steve's 'Luxury during a Recession' post, so here it is:
It dawned on me at the Burberry sample sale just how much luxury goods have ingrained themselves into the British consciousness. As I waited in line with my mate to pay for our jumpers and shirts (after queuing for half-an-hour to get in, rummaging through huge baskets of cashmere and flipping trenchcoat after trenchcoat, amid an atmosphere of silent, frantic competitivity), a comparison dawned on me; throngs of people in Communist Russia, lining up for hours to get a loaf of bread. It seems an odd association to have made, given the extreme Capitalist activity in which we were engaging, but it seems that for so many people, what was once a luxury (an expensive handbag, say) has now become an essential. A decade of aspirational, glossy media has demolished the traditional idea of luxury; where once a designer jumper might have been a rare privilege of the wealthy, now everyone’s got a bit of something posh in their wardrobes.
As the recession starts to bite, we see that this appetite is not sated by a lack of disposable income; conversely, it is amplified. We treat ourselves for ‘being good this week’, because it’s reduced by 80%, because it’s Friday, because we’re worth it. From a retail point of view, the massive sample sales and emptiness of stores show that 10 years of building brand loyalty with fairly rampant consumerism mean that most fashion-oriented customers already have full wardrobes, and are ‘shopping in their own closets’ rather than toting stiff paper bags or taking online deliveries. Cult stores and high-end labels will survive the squeeze (even though the Burberry sale’s two enormous floors was fairly alarming, the label itself has not tried to expand too far beyond its remit), as they offer something a little different to the sort of consumer who will go without in order to keep their wardrobes alive and full of quality, unusually-cut items; but the more vulnerable brands could fall.
Take the automotive industry as a model, where most manufacturers are under an umbrella group, less profitable branches are being sold off, effectively nationalised, or closed altogether. Even the bread-and-butter brands are having to modernise and look at a new business model. This has affected the car industry as, after housing, it’s the next most expensive thing you’ll buy. And after that? Consumer goods; food and clothes. Survival is possible for some fashion brands, but this will come one of two ways: democratisation or (more likely) reduction. Smaller brands within the LVMH or Gucci stables like Fendi, Givenchy or Jil Sander will (and in some cases have already) reduce their shows, focus more on high-profit items like accessories, and close stores; reductions ensuring the long-term survival (aka profitability) of the label. Democratisation could come from a focus on more affordable diffusion lines (look at D&G, whose prices are comparable to Reiss), or as is at the moment, massive sample and end-of-season sales, or clearance outlets like Bicester village. Can you recall the last designer item you bought full-price? The bargain-hunter approach appeals to fashion one-upmanship; invite-only sample sales and cardholder events reinforce the label’s exclusivity, and are already widespread and popular – Liberty’s 15%-off events are jam-packed.
The key to future survival is flexibility. Fashion, especially for men, is going through a period of renewed interest. LFW’s Menswear day, an explosion of menswear-specific media (both printed and online) and a resurgence in men taking care and pride in their appearance have all contributed to what amounts to a highly-profitable market as men talking about cut and fit of clothing becomes mainstream. Menswear (outside Hoxton Square) is also much less trend-led, and is primarily based on subtle differences in staple pieces like shirts and jeans. This is why shops like Bstore and Oki-Ni have done so well - catering for a man who appreciates a well-cut or unusual shirt, but isn’t showy about it. It’s the same reason that the Pineal Eye closed so quickly. Rick Owens has just opened a new store. As long as the cult brands continue to innovate whilst focusing on what made them great, they will survive.
While it is clear that something’s got to give at some stage, no-one knows what, or where it will be. No-one wants to have to adapt to a changing economic climate; neither consumerism nor the labels that feed it, but the ones that will survive successfully will be those that innovate within the fields that they already have. Look at Uniqlo, whose template of bright knitwear and simple jeans are universally popular, and with three stores on Ocxord Street alone (4 if you count the newly-opened Selfridges menswear concession). While not a luxury brand, their clothes are luxury products at an affordable price; colourful cashmere and merino are their staples.
As with the economy, the only hope is that the effects won’t be too personal or long-lasting. But fashion’s creativity will certainly be tested in the coming months, on both the design and business sides; if you still have a hankering for luxury during this recession, then get out and get some – it’s never been a better investment.

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