Wednesday, November 11, 2009

Louis, and Burberry, online, oh my!

Is Fifth Avenue drowning in Canal Street?

The e-world of retailing has changed the consumer world faster and more drastically than we could have ever imagined. Consumer goods, which were once only for a small, privileged group of clientele, are now available to anybody who has a computer. Is this a good thing? Who is it good for? And what are luxury brands to do in a world where they can’t control the social image of their brands?
The consumer world has been profoundly changed by e-tailing, and one of the most changed is the world of luxury business. It is important to define e-tailing. On his website, High Latitude, William Koty defines e-tailing as “the process of developing and managing online storefronts whereby individual consumers can shop for goods and services. The intent of e-tailing is to provide a customer value proposition that is different from realspace stores. That value proposition often includes cheaper prices, increased flexibility, convenience and consumer empowerment of the shopping process.”
With the online boom of luxury e-tail stores such as Gilt Group, Bluefly, Outnet, Yoox, and Vente-Privee, just to name a few, discounted luxury brands have become available to anybody who wants them. I spend many lazy afternoons perusing these sites, which my boyfriend and many others consider time wasting and to which I pipe back, “It’s research! I am a member of the world of fashion.” On the one hand, this is wonderful for people like me who love and appreciate high-end fashion, but can’t afford to pay the luxury prices of those frame-worthy designer pieces of art that are meticulously…but I digress. And on the other hand, this over-saturation of very identifiable luxury brands takes away from the very reason we wanted them in the first place. Now those who can afford these luxury items at their original prices, and then some, don’t want the same branded merchandise that their nanny and housekeeper sport.
Many luxury retailers are re-vamping their image and finding ways of appealing to their original target customer again. Their customers need reassuring that the luxury Image they are buying into has not been devalued by over exposure. Historian Daniel Boorstin, in his essay “Welcome to the Consumption Community,” states that we buy luxury goods because they provide “a feeling of shared well-being, shared risks, common interests, and common concerns that come from consuming the same kinds of objects … A designer label is a community of consumers on whom some of the celebrity of the name rubs off.” The community is getting diluted!
Undeniably there are two major brands that have been the most affected by e-tailing and the over-saturation of their branded image to the mass public. That’s right, you guessed it, Burberry and Louis Vuitton. These historic, time-honoured and groundbreaking fashion houses have faced the scourge of the rapid rise of e-tailers selling discounted and, even worse, counterfeit or knock-offs version of their merchandise, thus causing the extreme popularity of their brands’ iconic images with the mass market, including hip-hop stars and soccer hooligans.
In the last couple of decades these brands have had to re-vamp their images, their marketing approaches and even the products they produce to maintain their rightful place and reputation in the luxury brand market. But how these brands chose to reclaim the power of their image may seem a bit unconventional and only time will tell what will happen.
What is beige, black, white, red, and plaid all over? Well, for a while almost everything that could be covered in plaid. These products that saturated the marketplace prompted Burberry to change their merchandising and marketing strategy. The Burberry plaid, which had once being associated with upper class “Britishness” and royalty, was being seen everywhere and on everyone. When famous football players in Britain began wearing the infamous plaid cap, it became a mainstay for rowdy football fans as well. Realizing that the cap had lost its cache, Burberry stopped production of the cap altogether. Alan Bannerman, owner of a bar in Dundee Scotland, who was interviewed for The Guardian (September 12, 2003) said, “I believe I speak for at least 90% of pub owners in Dundee. Burberry has become the badge of thuggery.” Changing their current merchandise from plaid, plaid and more plaid to a more discrete but still iconic look is something Christopher Bailey is doing to a tea.
Louis Vuitton is another brand whose historic logo has been pervasive throughout the mass market. Hip Hop artists have always been fans, some even covering themselves in the LV logo from head to toe. Discount e-tailers love Louis Vuitton and it has become one of their most popular brands. Its iconic LV logo is paired with wealth and luxury like none other in the mass market. But Louis Vuitton has taken another approach to reclaiming the image of its brand. They are embracing these unconventional fans and giving the fans what they want. Most notable is the partnership Louis Vuitton made with Stephen Sprouse, a significant fashion designer in his own right and known for bringing street cred to high fashion. Sprouse’s “graffiti bags” were a huge hit for Vuitton who seem to be swinging with the punches and targeting a new audience. How this gamble will affect their traditional and time-honoured luxury image remains to be seen. What does their more gentrified clientele think of the new direction that Marc Jacobs is taking with the brand? Will this contradictory market strategy be the winning combination in a world where e-tailing is providing luxury to more consumers at cheaper prices?
So whether going back to your roots and reclaiming the iconic history of your brand like Bailey, or broadening your target market to bring merchandise to two very separate customers like Jacobs, it is undeniable that e-tailing is changing the way retailers run all aspects of their business. And though this is great for consumers like me, who covet designer pieces and can buy into a world of luxury that used to be out of reach, what does it mean for the future of luxury business? Are we fashion lovers ruining the world to which we aspire and admire by buying into a luxury world that was not meant for us?

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