Modest fashion the new growth driver for luxury labels
Faced with changing consumption behaviour and market uncertainty, the luxury industry needs to learn how to step away from the traditional business models which have prevailed until now, and carve out new market niches by adapting to the increasingly diversified, nuanced expectations of a clientèle which is becoming larger. This is one of the most interesting lines of thinking emerging from the debate organised in Milan on Thursday by Altagamma, the association of Italian luxury goods companies, to present the findings of the ‘Luxury Goods Worldwide Market 2018’ report by consultancy firm Bain & Company.
“We are witnessing a huge change in the attitudes of labels, which are increasingly marketing products targeted to consumers they barely considered in the past. A category we are calling ‘modest-accepted fashion’. Luxury labels aren’t making this change explicit, of course, but it can be perceived by looking at their collections,” said Claudia D’Arpizio, a partner at Bain & Company and the author of the study.
What this means is that luxury labels now have a greater awareness of the demands of new consumer segments they previously ignored. From the cultural preferences of various ethnic groups and religious creeds, to minority-linked sub-cultures and differences in morphology and sizes. In other words, a revolution for fashion labels, some of which, until not so long ago, only offered their garments in an EU size 38 [size 10 UK]. But also, and above all, it means “a huge slice of the market” is there for the taking, according to D’Arpizio.
In the survey, D’Arpizio found that this new type of "modest-accepted” fashion accounted for 40% of the sales of luxury women’s ready-to-wear in 2018, including garments specifically designed for Muslim consumers and other types of clothing regarded as “naturally” modest.
In the last few years, several fashion labels started to produce religiously acceptable garments, launching specific collections for Arab countries featuring hijabs and abayas. Is it a sign the mentality is changing? Veiled models now walk the runways without upsetting anyone, as do transgender, older or plus-size models.
The liberation of women and the democratisation of clothes sizes are also starting to drive sales, again according to the Bain & Company study: “inclusive” fashion accounted for 40% of total luxury womenswear sales in 2018, “thanks to the broader range of single-size items on offer, specific for curvy or plus-size consumers, and in general thanks to clothes with more generous, inclusive cuts.”
The study also noted that “cultures, sub-cultures and new consumption modes will appear, and turn into large-scale phenomena. Different categories will blend into one another: labels must be dynamic and proactive to adapt to this new trend.”
Another segment to keep track of is that of younger consumers. The market is currently divided in five generational segments, from young to old, and it is of paramount importance for luxury groups to focus on the younger generations, which will become more and more significant. Millennial consumers, the Z and Y generations, will account for nearly 55% of the luxury goods market in 2025, and will contribute to 130% of its growth between now and then.
“The new generations coming to the market are extremely different from Millennials. These very young consumers are digital natives and use technology freely, but don’t want to be dominated by it. They are keen to rediscover physical stores, but with another dimension, different from the past. There is a lot at stake there for labels,” said D’Arpizio.
Within this constantly evolving world, the key to success is being one step ahead, looking at consumers in a new way and stepping off the beaten track. “Luxury groups must be proactive in drawing up unique strategies targeting consumers, exactly as though they were their employers. Simply copying a strategy doesn’t work any more, the name of the game is individual excellence, keeping the next generations firmly in sight, in order to broaden the customer base and the cultural catchment area,” concluded D’Arpizio.
Copyright © 2023 FashionNetwork.com All rights reserved.
