LONDON, United Kingdom — At the Luxury Briefing Conference held in London last month, Claire Kent, former Morgan Stanley analyst and current luxury goods consultant, spelled out her thoughts for the future of luxury.
"Regardless of the credit crunch there was growing fatigue about luxury brands," she said. "People want a redefinition of luxury. People don't want to be buying the same brands as the people they have working for them."
So, what are the key elements of the new luxury?
Brands need to focus on innovation, creativity, individuality and service. (She noted that it's been hard to convince the sharpest minds to mind the shop floor, something that may change with the number of layoffs we've seen.)
The 'It' handbag, she says, is over. Carrying a bag because Gwyneth Paltrow carries one means that you don't have your own point of view, stylistically speaking. This of course is why people started following celebrities in the first place — because it was easy. But now we're going to have to fend for ourselves.
For evidence of this impending change in attitude, she pointed to the car industry where the groovy people (Ok, some of whom may be celebrities) are driving cars not much bigger than their dogs, while the SUV has become a symbol of shame.
Aside from better-made things, there are a few sectors Kent sees as ripe for rapid expansion. The categories are hers, the reasons why are mine. (Budding luxury entrepreneurs, take note):
1. Jewellery. Although we've sent the big groups and the watch brands get more active in this area, the vast amount of jewelry sold is still unbranded and comes from mom-and-pop shops, not big chains.
2. Men's Shoes. Where, oh where, is the Christian Louboutin of men's footwear?
3. Men's Grooming. Yes, there are more men's products on the market than 10 years ago, but none dominate.
4. Eco Luxury. Along with Eco everything else.
5. African Culture. Obama, Obama, Obama. Did someone say Obama?
6. High-end Food. Because once you experience the difference, it's impossible to go back. Just like with Louboutins.
According to Kent, one element is a return to craft. Her big problem with fashion apparel is that, if it's not based on craft, these days it's simply too hard to compete with the Zara's of the world. Therefore, luxury consumers will become more discerning and spend more per item, but buy fewer items. It is the 'masstige' brands that will suffer most.
And, based on personal experience, I have to agree with her. It is increasingly hard for me to justify a designer purchase. The fact that I know margins have been improving (for the brands, not for the consumers) does nothing to quell those fears. So this winter the few things I bought from anyplace outside of Zara and its ilk, I bought from Bamford & Sons.
The brand is owned by the family that made its money selling JCB diggers (or tractors) and also produces the Daylesford Organic range of foods — clearly a family with their finger on the pulse of what luxury shoppers want. I was particularly impressed by the men's offerings and I thought I'd tell my boyfriend never to shop anywhere else. Now I am not so sure.
For the prices, one would expect it all to be of impeccable quality. But within a month, the tassel on a pair of £400 Bamford boots I bought fell off and a £225 cashmere scarf I bought my boyfriend was looking a bit worse for wear.
The quality versus price conundrum is a tough one for designers. They're supposed to be selling a vision, but Kent, and I, think that increasingly people are going to want value for money — in the old fashioned sense of the word.
This should make second lines all the more important. If brands will still have value in the credit crunch future, it holds to reason that consumers will shift down to Marc by Marc Jacobs before landing where I am, at COS (Collection of Style, the upper end of H&M).
This makes the recent decision of Zac Posen to shutter its Contemporary line all the more puzzling. The company only recently brought in a team to produce it, but they've all been fired. The remaining 70 percent of employees have been told they will be taking a 15 percent pay cut and, as for bonuses, forget it.
To be fair, the decision wasn't made purely on market decisions. An expected influx of cash from their backer, Ron Burkle, never materialised. As with many other brands, Zac's fashion show sponsors have backed out, putting his runway show, like many others, in jeopardy. Will the world weep? Doubtful. I think that everyone, from the buyers to the editors to the consumers were sick of the fashion show circus.
It's hard to know what to do — particularly for the majority of luxury goods executives who have never had to live through times like these before. But I wonder if, finally, we're about to see a return to an idea of luxury that's more, well, luxurious.
The Business of Fashion welcomes Lauren Goldstein Crowe, our new Friday columnist.