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Luxury Retailers Attract Customers With Rare Discounts,[link widoczny dla zalogowanych]
Whenever a luxury retailer cuts prices too steeply,[link widoczny dla zalogowanych], it threatens its brand's picture of luxury and exclusivity. But with global luxury goods sales likely to decline by 3 percent to 7 percent last year,[link widoczny dla zalogowanych], based on a current Bain Co. study,[link widoczny dla zalogowanych], it is no surprise luxury retailers are now being forced right into a corner. They're slashing prices so severely they end up appearing like discount outlets.
Slate's Daniel Gross took a walk down Fifth Avenue and saw the carnage for himself. In his excellent column, Gross ruminates on the desperate holiday shopping season and is baffled by Bergdorf Goodman's lowbrow sales technique:
A kindly Bergdorf Goodman salesperson invited people in our humble household to stop by and check out the bargains. Now, if you're not a habitu of the his-and-hers luxury department stores on Manhattan's Fifth Avenue,[link widoczny dla zalogowanych], there are a few things you ought to know about Bergdorf Goodman. This place puts the haute in haute couture. It's about as welcoming to the public as North Korea. It is the type of store where the salespeople take one look at your shoes and judge whether you're a big spender. Bergdorf Goodman cold-calling suburban shoppers? It's like college kids canvassing for Obama votes in a National Review conference.
The New York Times wonders where deep discounts on luxury goods leave consumers:
Once consumers become acquainted with slash-and-burn prices, just how can designer fashion regain its mystique? Will shoppers again want to buy luxury goods at top dollar? The depth of the challenge was suggested by the incongruity this week of seeing Prada wallets, usually kept under glass at Saks, dumped into display stands that at Wal-Mart are known as "end-caps"; lizard handbags at Bergdorf Goodman jumbled on counters as though that Fifth Avenue landmark were an outlet of Loehmann's; and Ralph Lauren dress shirts at Lord Taylor thrown together and offered at prices roughly equal to the price of two McDonald's Happy Meals.
I understand the popularity popular is to be trendy, thus the rapidly changing fashion cycles in which something is in for a while,[link widoczny dla zalogowanych], after which quickly out by next season, but with American demographics changing and also the consumer base getting good mature, stocking more classic styles will motivate more consumers to really visit the posh stores.
Sure, the young 20-somethings really are a hot market, since they're most susceptible to trends, but to get the older consumers to really enjoy shopping on a regular basis, it is the classic items which have to be stocked. In some stores,[link widoczny dla zalogowanych], the mannequins switch off certain demographic groups before they can go into the store. Fashion forward should be viewed as Elie Tahari or Donna Karan, not just the "trendy" plaid designers bags draped over the mannequins. Classic never goes out of style, and frankly, some stores stock manufactured goods is simply too tacky to savor shopping. They are viewed as only for the young,[link widoczny dla zalogowanych], possibly because the designers have tended to make use of the young models for such a long time.
Demographics in America are changing,[link widoczny dla zalogowanych], dear retail industry. Women want luxury and style, however they likewise want stuff that make women look good and that will be in style since way back when, not out by next season.
Less fashion victim and much more high style please. America has had enough of tacky modern Hollywood and also the garish over-the-top designer product ads that we have been bombarded within recent years.
Coming back to classic and timeless is overdue. That is what will get consumers back out into the stores again, post-recession. Tacky and garish and gauche just won't do simply because it is the current "trend."
The posh Brands inventory was sold in to the channel about Six months ago, this was when the remaining market was soft but the luxury buyer was still being strong. The forex market floated all luxury brands and made many a success which should not have been. Then with the channel full the financial industry failed cutting right in the Luxury market buyers.
So now we have channel stocked with inventory and deals, deals deals. And expect it to get worst (or better if you're a buyer) in Q1 09 as the mass of excess inventory looks for liquidation.
However what? Smart Luxury Brands will dramatically reduce their production and lower their sell into the channel. The smart luxury brands have this approach built into their DNA, they are fully aware scarcity and brand protection is value. Selling more is not success. The ones who floated up with the marketplace don't have this within their DNA nor do the possess a lasting brand to face behind. I'm not sure if retailers are neglecting this sector of the workforce or when they and the bean counters are interfering too much using what buyers actually want to stock, but regardless of the cause, you will find not many stores that offer exciting,[link widoczny dla zalogowanych], quality products any more.
People will buy when they go to stores, or the on-line equivalent, and also the merchandise rolls their socks upIand down.
I cannot believe the complete dreck that's displayed in many shop windows. Ill-fitting dresses,shapeless jackets, tacky materials in unflattering colors - I'm amazed it sells in happy times. Retailers really should not be surprised when it does not sell in a down economy. Even fine jewelry made of precious stones often manages to look cheap.
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