Roslyn Griner’s Post

Ibrahim and #minimalism in the luxury industry... There is a shift towards "quiet luxury" in the fashion industry, which offers hope for smaller brands competing against big players like LVMH and Kering. One example is the Italian brand Brunello Cucinelli, known for its "elegant casual" style and minimal branding. Despite higher inflation affecting luxury buyers, Cucinelli has seen a 29% increase in sales this year, with strong growth in #Europe, the #Americas, and #Asia/#MiddleEast. The preference for minimal logos and timeless clothing pieces, especially in #China, has contributed to this success. In contrast, other smaller brands like Salvatore Ferragamo have struggled to recover from the pandemic. This article also suggests that luxury brands need to adapt to changing consumer preferences, with a focus on quiet revolution rather than flashy displays.

Chanel, the second largest luxury label, reported 16% sales growth last year, with price hikes accounting for more than half of the increase. Luxury companies have increased product prices by 33% on average since 2019, contributing to half of the industry's organic sales growth in the past two years. Chanel designer Virginie Viard's departure has sparked speculation about her replacement, following her success in refreshing the brand' image. Chanel, like other luxury companies, has significantly raised prices since the pandemic, with the classic flap bag now costing over 10,000 euros. Investors are concerned that steep price hikes in the luxury sector may alienate consumers and limit growth opportunities in the short term. Saint Laurent recently reduced prices, showing the difficulty of justifying further hikes. Gucci is expanding its high-priced range while also targeting less affluent shoppers. Larger luxury brands must appeal to both aspirational and ultra-wealthy consumers. The industry needs to find a balance between price increases and proving the value of their products. Luxury executives are realizing that the downturn has reduced the number of shoppers who can afford high-priced luxury items, leading to a need for adjustments in pricing strategies. Larger luxury brands are aiming to appeal to both ultra-wealthy customers and younger, aspirational shoppers by offering a range of products at different price points #chanel #saintlaurent #gucci #luxuryfashion #pricingstrategy

The luxury industry performance continues to be polarised in the first quarter of 2024 : “High-end brands are doing better (Hermès, Brunello Cucinelli), as well as brands with strong momentum (Moncler, Miu Miu). Brands with high exposure to middle-class consumers are at the polar opposite of that (Gucci, Burberry). Mega-brands (Louis Vuitton, Cartier) are somewhere in between.” The industry performance is expected to further decelerate in Q2 before improving in the second part of the year .

What's next for luxury? The industry continued to be polarised in the first quarter, says Luca Solca, managing director of luxury goods at Bernstein. “High-end brands are doing better (Hermès, Brunello Cucinelli), as well as brands with strong momentum (Moncler, Miu Miu). Brands with high exposure to middle-class consumers are the polar opposite of that (Gucci, Burberry). Mega-brands (Louis Vuitton, Cartier) are somewhere in between.” After a challenging end to the year, #luxury’s slowdown continued in the first quarter as challenges persisted for many in China. While there were success stories, some brands — especially those with a more aspirational customer — are battening down the hatches. Here, #VogueBusiness recaps Q1.

🌟Navigating Challenges and Embracing Opportunities in the Luxury Fashion Industry for 2024 🌟 As we approach the dawn of a new year, it's crucial to reflect on the challenges and opportunities awaiting the luxury fashion industry. Drawing upon references and key statistics from leading luxury brands, I'd like to offer my perspective on what lies ahead for 2024. 1. The Looming Downturn in Luxury Retail (2024): The warnings of a potential slowdown in the luxury sector are substantiated by recent data. For instance, LVMH experienced a significant -7% drop in stock price following its quarterly results, the largest decline since early 2020. This, along with analysts' revised estimates, indicates a market correction and slower growth in the coming quarters. The industry is at a crossroads, and adaptability will be paramount in navigating this shift. 2. Post-Pandemic Boom in Luxury Spending: 2023 in Review: Examining the performance of luxury brands in 2023 reveals intriguing trends. Brands such as Hermès, Louis Vuitton, Zegna, Porsche, Rolex, and Brunello Cucinelli, which consistently invested in brand storytelling, client experiences, and quality, outperformed their peers. In contrast, Gucci, Burberry, Ferragamo, and Bottega Veneta faced substantial declines, particularly in the third quarter of 2023. These statistics emphasize the importance of staying true to our core values and client-centricity. 3. The Battle for Survival in the Luxury Industry: The battle for relevance becomes even more significant when considering the forthcoming wealth transfer to Gen Z. This demographic not only represents the wealthiest generation entering the luxury market but also the most discerning. Statistically, Gen Z is poised to overtake millennials as the number one client group for luxury in the next decade. Brands that resonate with their preferences and values will thrive, while others may face challenges or niche status. In summary, 2024 holds both challenges and opportunities for the luxury fashion industry, backed by tangible statistics from the field. To succeed, we must prioritise adaptability, client-centricity, and a steadfast commitment to quality and craftsmanship. By doing so, we can not only survive but thrive in the years to come, ensuring our brands continue to be sought after by discerning consumers. #LuxuryFashion #2024Challenges #Adaptability #GenZ #LuxuryIndustryInsights #Statistics

“It’s almost like luxury is about rich people again,” Thom Bettridge, VP of Creative and Content at everyone’s favourite online luxury retailer SSENSE texted us over the weekend. That statement requires context. Last week, quarterly earnings reports from the biggest names in luxury revealed a landscape of declining revenues, driven by macroeconomic factors, a widespread slowdown in luxury purchasing in China, and changing consumer behaviours. Gucci, BALENCIAGA, Saint Laurent and other Kering brands were down. So were Giorgio Armani, HUGO BOSS, Richemont, and Burberry. The latter even experienced a 22% drop in quarterly sales, leading to its shares hitting their lowest level in nearly 15 years. A simple explanation might be to blame these drops on the super wealthy, but a closer examination reveals a more nuanced understanding of the situation. Hermès, for example, showcased stamina among its wealthiest shoppers, reporting a 13% rise in second-quarter sales, even as other brands struggled. How? →  Focus more on the very rich: Ultra-luxury brands like CHANEL and Hermès are doubling down on their most loyal VIPs, embracing the fact that across luxury, roughly 40% of all sales are driven by the top 2% of luxury customers. → Increase prices: Despite slowdown, the most luxurious brands hiked prices in a strategic attempt to drive growth with these top spenders. The average price of personal luxury goods in Europe has already increased by a staggering 52% since 2019, according to HSBC. CHANEL’s classic medium 2.55 flap bag, for example, now sells for roughly €11,100, a 91% price increase since October 2019. → Focus (slightly) less on the aspirational customer: Hermès Executive Chairman Axel Dumas mentioned during the recent earnings report that they were seeing less traffic from aspirational clients, impacting higher volume products like silk scarves. “What we've been doing for 30 years isn’t coming to an end just because the aspirational customers are a little under pressure,” said LVMH’s Chief Financial Officer Jean Jacques Guiony, echoing Dumas. But there's more. To explore in full, read this week's SOTA's analysis: https://lnkd.in/gmQb8PFs #SOTA #aspirational #customer #brand #kering #lvmh #richemont #fashion #luxury

🔍✨ Exploring the Divergence in Fashion: Quiet Luxury vs. Conspicuous Branding The landscape of luxury fashion is witnessing a compelling split, catering to distinct ideologies and socio-economic groups. 2023 saw a notable lean towards 'quiet luxury', with North American retailers reporting a 40% decrease in sales of heavily-logoed items. This shift towards understatement is redefining luxury, with brands like Gucci and Bottega Veneta adopting a more casual narrative in their campaigns. The trend extends to 'uniform dressing', emphasising quality over quantity, and sustainability through creative reuse. On the other hand, we are seeing 'loud luxury' continue to appeal to those seeking to project wealth and status through bold logos and traditional status symbols. This perspective suggests that certain consumer segments, potentially from different socio-economic backgrounds, might be drawn to conspicuous consumption as a way to demonstrate social mobility. As we navigate into 2024, the industry stands at a crossroads, tasked with satisfying both the minimalist and the maximalist. This dynamic nature of luxury fashion reflects the diverse preferences and evolving identities within society. ~ #LuxuryFashion #QuietLuxury #ConspicuousBranding #FashionTrends #IndustryInsights | FLANNELS | FARFETCH | LVMH | Gucci

Luxury Fashion Seeks to Break Down Social and Economic Barriers The luxury fashion industry is taking steps to address its long-standing issues of exclusivity and lack of diversity. Historically, the industry has been dominated by a select few, limiting opportunities for individuals from diverse backgrounds. However, there is a growing recognition of the need for change, with brands starting to prioritize diversity in design, modeling, and leadership positions. While progress has been made, there is still much work to be done to create a truly inclusive and accessible industry. By breaking down social and economic barriers, luxury fashion can become a more vibrant and diverse sector that celebrates individuality and creativity. This shift has the potential to bring fresh perspectives and talent to the industry, ultimately enriching the world of luxury fashion. #luxuryforall #diversefashion #representationmatters #sustainableluxury #breakingbarriers

Luxury Fashion Seeks to Break Down Social and Economic Barriers The luxury fashion industry is taking steps to address its long-standing issues of exclusivity and lack of diversity. Historically, the industry has been dominated by a select few, limiting opportunities for individuals from diverse backgrounds. However, there is a growing recognition of the need for change, with brands starting to prioritize diversity in design, modeling, and leadership positions. While progress has been made, there is still much work to be done to create a truly inclusive and accessible industry. By breaking down social and economic barriers, luxury fashion can become a more vibrant and diverse sector that celebrates individuality and creativity. This shift has the potential to bring fresh perspectives and talent to the industry, ultimately enriching the world of luxury fashion. #luxuryforall #diversefashion #representationmatters #sustainableluxury #breakingbarriers

The business model of luxury is heavily dependent on a relatively small number of high-end spenders, and to reach them brands like Gucci and Tiffany & Co. are relying on exclusive access to their designers or one-of-a-kind offerings that money alone can’t buy. A new market study from Bain found that just 2% of customers make up 40% of luxury sales. In other words: A small number of extremely wealthy people are spending a lot of money on fashion. The consulting firm suggests that luxury brands cater to these clients with things like personalized, exclusive products or experiences.