I am a daily reader of Business of Fashion and rely on their coverage of latest news on the fashion brands. I could not recommend this resource more for those of you who are interested in, well, the business of fashion.
There have been numerous articles lately written about the trouble that American fashion brands are having, including Coach’s decision to acquire Kate Spade in order to put their eggs in more than one brand basket. There are stories about the decline of Michael Kors and their recent acquisition of British brand Jimmy Choo. There has been speculation about whether either of these companies can become an American LVMH, stories about Marc Jacobs leaving Marc Jacobs and the future of American designer brands.
Meanwhile, across the pond, all are hailing European fashion brands Gucci and Louis Vuitton for growing during these troubled retail times. Somehow they figured out the magic formula to appeal to the elusive millennial and Gen Z customers, who, by the way, are not the actual consumers of luxury products (older people like me are). European fashion brands are long time masters at creating pent up demand and they use collaboration to stay relevant. Gucci and Louis Vuitton are doing just that by collaborating with street wear brands like Supreme and emerging artists like Coco Capitan. This strategy is not so new, as you may recall that Louis Vuitton collaborated with Stephen Sprouse and Murakami during the days when American designer Marc Jacobs was the creative director. What does seem new is how social media can make it seem like an original idea to young consumers, and how much influence young consumers have on making images of these collaborations go viral. I am not going to lie though – Gucci and Louis having me falling hook, line and sinker, but are we all buying it?
There was a total outrage on BoF’s Instagram recently when Lanvin announced the appointment of Olivier Lapidus as their new artistic director who shared his vision for Lanvin: to become the “French Michael Kors”. It is hard to imagine one of the only remaining privately owned French luxury fashion houses, known for couture like embellishment and opulence, being used in the same sentence as all American brand Michael Kors. As a consumer of both fashion brands at some time in my life, there literally is no comparison. Having said that, Lanvin sales are in decline and it is time for them to make a move. They would be loath to copy Gucci and Louis Vuitton, so Olivier Lapidus may be on to something by looking to learn from what American brands have done well. Whether it’s taking a more simplistic design approach, lowering price points to make Lanvin more accessible like Michael Kors, or building out a whole world of Lanvin in the American way (at Macy’s), we will have to wait and see. In the meantime, I could not agree more with this quote from Olivier Lapidus:
“You don’t create a product, you create a universe. Lifestyle is the last link in the chain of fashion design.”
As I said before, when consumers connect with a fashion brand, designer or personality they literally want to live in their world. What American brands have done well, most of the time to their benefit, is expand into lifestyle categories like home, gifts and kids through longer term collaborations (i.e.licensing). American brands are motivated by selling a lot of products and at numerous points of sale with the consumer. This means that their “hero products” are items that connote status, but are priced somewhat accessibly (i.e. polo shirts) and there are typically numerous touch points for the consumer to buy into the brand within a store (i.e. home, kids, fragrance, socks). In contrast, European brands are motivated by creating hero products that are high priced, limited edition and seemingly limited distribution, thus creating the kind of demand – “What do I need to do to get off the wait list for a Birkin bag?” – that makes headlines. The higher price points of these items like bags and shoes add up to big dollars when a European brand is hot. Depending on the day, the season, what cycle we are in, we really can’t say what strategy is right or wrong. The wheel of fortune goes round and round, so what goes up will eventually come down (hint: it’s almost time to sell the Gucci Princetown mules).
Gucci just announced a recent expansion into home, which is not common for European brands to do in a commercial way and via widespread announcement on blogs like Refinery 29. Now, I am at the edge of my seat and cannot wait to get my hands on the product, but I have to say that consumers may believe a whole bedding set by Calvin Klein is a better long term investment than a needlepoint Gucci screaming cat pillow. I will probably buy both, but again, the wheel of fortune goes round and round, and so does trend. I know better than to design my whole bedroom around a fleeting fashion trend.
Right now, we are in a wild and original moment, where European brands are using collaborations brilliantly to remain create a lot of hype. Now that American brands like Tommy Hilfiger are taking a page from the European play book by launching street wear collaborations (with Vestments!), and Calvin Klein has brought in Belgian street wear designer Raf Simons as chief creative officer, there will come a day when this strategy will cease to be as original. The cycle of immense creativity may not be sustainable – and then what? Perhaps the day will take a deep breath and come back to the basics, to the Calvin Klein days, when everything was minimalist, and just so simple and serene. We all look to each other to see what worked in the past in order to move forward, as is always the case.