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The Luxury Market Rebound…What Next?

Understanding the new world we live in today can be taxing. When it comes to the fashion industry; the impacts of covid are evident. Having to pivot in business protocol, and mission documentation are two ways retail related business found could help them flourish. Now that some sort of stability, even progression has been established in fashion; what’s next?

Regardless of the obstacles, these retail businesses had to face; there was a snap back from setbacks. Who or what can maintain the fashion industry in the near future? What should the focus be for fashion luxury businesses? What can society as a whole expect in the upcoming future from retailers, and independent fashion professionals? Only time will tell, but this article will serve as a prelude for the times to come.

If the future still seems glum for fashion, it’s certainly not a hunch. Notice the subtle yet beneficial changes in the industry. Before the Covid-19 pandemic started, the fashion industry had its fair share of sustainability issues anyway. Years ago, when the editor of Vogue U.S. Anna Wintour organized charities to save fashion, it brought awareness and helped pull Luxury brands out of the ditch. It was a scary time, yet they pulled through.

There is hope for the future; businesses just had to pivot in priorities. During 2020, the main focus was employee safety. Many retailers found themselves converting production to mask creation. According to this post on March 26, 2020, at mckinsey.com; upon the burgeoning of covid; companies lead with compassion and protected their people. Immediately they understood that the survival of their employees and their best interest mattered more than money. No business analyst could anticipate Covid. It’s commendable how Luxury brands managed to still operate as a business. The fine details of Luxury fashion are usually crafted by people. Hermès has a factory of workers who custom-make all their luxury bags. Due to covid, the company had to restructure its entire work standards and regulations to accommodate the welfare of its employees.

This seems to still be the case, as the Luxury fashion industry continues to rebound. The article also outlined how even before the pandemic really hit; most fashion retailers were struggling in Quarter 4 of 2019. Going into summer 2021, copious amounts of merchandise online and in stores were heavily discounted. This jeopardized consumer value expectations and brand perception. Luxury retailers are known for the limited quantities of their goods. Brand methods to relive inventory in that manner could put shoppers in a different mode. Most retailers aimed to release, while luxury goods tried to gain. The psychology of spending came heavily into play during the Covid-19 pandemic.

Operating a Luxury Fashion brand business in Covid’s unpredictable landscape is a challenge in itself. Brands had to still be sensitive to the times occurring, and still have a business mind. They also had a responsibility to the public and their workers to fulfill. Accountability is also the magic word; practicing mindfulness. Luxury fashion brands need to acknowledge the fact that shoppers do have more to consider right now; essentials are the key. With so many layoffs, furloughs, and growing health issues; naturally people will be applying their money to means that promote survival; saving, and investing for the future.

What was fashion years ago is still honored today. Style, and especially business aptitude is as profitable as it was at it’s inception. Standards of quality, and the never ending pursuit of giving people the power to express themselves, as they wish to be, high-end and luxurious is still the goal. To those who are enthusiasts; integrity and reputation are imperative. Due to Covid, fashion focused businesses struggle to stay loyal to their original business construct. The reason why this may be true is the millennial market.

There is a very real concern for the Luxury Market in reference to the new versus the old. Secondhand Luxury goods and gently worn items are doing remarkably well since the Covid-19 pandemic began. According to this article by CNBC.com, people don’t feel it’s necessary to hold on to clothing for a lifetime. The whole point of Luxury fashion is quality and timeless wear. Covid made shoppers shy away from spending money. Instead of holding on to their high-end fashion, they’re more likely to sell or even buy them used. There may not be a need to continue to use manpower or precious resources for a slew of savvy shoppers trying their best to make ends meet during unpredictable times.

Luxury brands have combated this by rolling with the times. They have discovered new ways to revamp the old. A method to get the H.E.N.R.Y’s (high earners not rich yet) to buy luxury goods is to make a trend of their classic inventory. If luxury brands are going to continue to supply goods, then they should use re-purposed textiles, and create goods inspired by the past. The growing trend is secondhand fashion. It’s still unique, high in demand, and one of a kind. It’s a clever way for high-end brands to still appeal to the young and trendy. This method inspires sales, and maintains brand integrity. 

The same CNBC.com article states that although apparel sales have staggered, handbags and jewelry purchases have gone up. Seems as though now, shoppers are investing in higher valued items, when they actually do decide to spend. They can no longer afford to take their financial states lightly.

Luxury brands like Swarovski crystals are vested in timeless quality and eloquence. Their recent advertisements feature the same precious goods, but in a more energetic, youthful, and modern light. The regal sophistication of the brand will slowly transform due to the new evolving target consumer. Millennials are what will keep all industries thriving. Fashion cannot survive without catering to them in some form. It’s a necessary evil. They are the new high earners of today. The millennials are set to have more than one income to dispense, and higher paying jobs. Covid, however, will still be a hindrance to businesses like fashion, in regard to sales.

Dylan Jones, editor-in-chief of British GQ, goes on to explain their attempt to help independent young British designers. The magazine spent a good bit of time organizing funds and charities to get through the first few months of covid shutdown. Immediately industry insiders like him could sense a great amount of stress about purchasing Luxury brands. There’s plenty of talk about business bailouts, but little in regard to fashion. Regardless of that, Luxury retailers made headway. Attempts from high-end luxury media sources allowed a cushion from the blow of Covid-19, on fashion.

Social distancing caused a decline in the need for a formal wardrobe. People spent more time online for entertainment and communication. At this time marketing teams for luxury brands promoted intensely online, while still bringing awareness to the safety standards for Covid. Most events during covid were outdoors, or in areas that supported a properly ventilated atmosphere. Shoppers gravitated to a more casual atmosphere. On the other hand; there are droves of highly intelligent and career bound millennials taking their new place in the work world. They need a wardrobe that reflects a more professional aesthetic. Luxury brand marketing directions are geared more towards millennial professionalism and less towards their social life. This direction proved that there was still space for Luxury fashion brands to thrive. It even gained sales momentum for them. 

It’s important also to note the mindset; state of the world. Fashion is deeply impacted by society’s focus in the now. Countries that are experiencing strife like Afghanistan and Haiti are in desperate need of assistance from any facet. Social unrest is also blatant in the U.S. Fashion retailers who are mindful of the problems and weight of the world have given back. They show the new wave of socially conscious consumers that the well-being of mankind is the top priority. Luxury brands that do this have also prevailed through the Covid pandemic.

Luxury fashion retailers have faced the possible reality that Covid may be here for a while. It’s the old adage of hoping for the best, but planning for the worst. The pandemic has rocked the foundation of the fashion industry along with many others. There is no choice but to move into the age of technology. The millennials, and generations after, are the leading force of technology today. They understand it better than the past generations, and they rely on it heavily. To combat the issues of physical retail store chains closing, there must be some element of technology within their Brick & Mortar stores.

Luxury retailers have incorporated an experience with coming to purchase merchandise from their stores. Society is becoming more confident now with the vaccines available. Regardless of the opinions shared, millennials find a way to still be social and commune together. It’s only natural that businesses now started creating events online that will support their shopper’s need to share and communicate. It’s time to be more proactive in reference to marketing. Word of mouth is still the most powerful type of marketing, but there must be an advancement there too.

The trust in loyal luxury brand shoppers shows in the goods they purchase. What would be even more impactful is showing shoppers the real faces behind the magic of what they buy. Who are the ones in charge of production, decision making, design, and so on? Featuring Luxury retailer brands in a positive way: gaining trust within the vast millennial market. The less they have to research the better. The communication boundaries must be broken if there is to be any longevity in luxury retail.

What can we expect from upcoming retailers?

The aim is to keep Luxury fashion alive. The only thing that will inhibit that is stubbornness. The core of any fashion business should be its mission statement. The anxiety of going against the original essence of their business will prevent their goods from appealing to the new market. The idea is not for them to change, but to evolve. The pressure for fashion to evolve is real. Evolution in the way things are made: justification for high-quality material to be used, and philanthropic pursuits. Showing good faith in people by revealing the faces behind what makes Luxury fashion amazing is a start. The suggestion is not to show all the secrets but being discrete and strategic is the key.

Reflection…

This article shows by introspection that certain changes can prove to be effective. Will Luxury retailers comply? The most impactful consumer is the millennial. They are open to sustaining Luxury fashion. They are key, and if not taken into heavy regard; a luxury brand is sure to fall. 

Mckinsey.com emphasized maintaining connections with consumers. Communication is always a good idea. Businesses that are constantly making strides to maintain a connection with their customers will survive. Luxury brands do need to band together too. There is a real threat that the Luxury segment of fashion could struggle greatly as consumers choose to re-purpose clothing. On the other hand, Luxury brands have been known to do their best during times like recessions and economic strife. It’s no telling where the tides will shift.

The state of the world has brought everyone and every industry on edge. It’s time for a change in how business is viewed. It’s no longer about competition, or which company will be “on top.” If the industry doesn’t band together, there may be no platform to compete. It’s interesting to note that the same efforts made among the people are not being expressed in retail or its subgenera; Luxury. Covid has caused strife and inspiration. People have come together and helped one another in times of need, yet when it comes to business it’s not as prevalent. More collaborations need to be made among luxury retailers. The collaboration of minds, re-evaluation of business formats, and an evolution for the “New Norm” is how Luxury fashion has bounced back.