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HomeNEWSEmerging global trends in luxury retail

Emerging global trends in luxury retail

WGSN head of market intelligence Lorna Hall says luxury brands are increasingly seeking to position their bricks and mortar stores as more of a lifestyle club, offering unique experiences that money can’t buy.

The “lifestyle club” trend also hints at a broader industry movement away from the idea of accessibility. Luxury brands’ retreat from accessibility is because they’ve realised they have been neglecting the ‘one percent’ in favour of going after volume, says Hall. The movement of markets towards third-party sites has exacerbated this.

Hall says luxury brands became more democratised during the early and mid 2000s, as demonstrated by the ubiquity of Ralph Lauren polo shirts among middle-class men: “The polo shirt is an aspirational buy that’s within their means.”

Now, the label has a ‘palazzo’-style store in Milan with a club feel to it, offering a much higher level of exclusivity. Hall feels this is a sign Ralph Lauren is distancing itself from mainstream shoppers.

“I think the days of us walking into a Ralph Lauren store and feeling comfortable… may well be over.”

Handbag label Coach is also addressing a ubiquity problem. In his blog, retail commentator Robin Lewis described Coach as being “in the middle of its own unraveling”, with roughly 70 percent of its revenues coming from outlet stores.

“Once a brand is declared as too accessible and overexposed by its loyal customers, no amount of fashion trickery will bring it back.”

Hall says Coach is now totally restructuring its presence in department stores as it seeks to gain control of discounting.

A variation on the exclusive “lifestyle club” approach is the rise of “appointment-only” stores. Members-only store ‘Revolve Social Club’ in Los Angeles offers just 200 high-value customers an invite to come inside and shop only once a month. It focuses on a Millennial crowd of bloggers and social influencers.

Another Millennial magnet is World of Niche, a sneaker store which concentrates on experiential retail rather than simple exclusivity. Hall explained it well:

“The entire collection is contained in a giant brass ball suspended from the ceiling. Once the selection is made, the shoes are served on a platter.”

“This store has huge queues outside it. People love this stuff.”

Quoting an executive from colour matching company Pantone, Hall says retail experiences are all about “bragging rights”.

“[These stores] are not trying to be a retailer, they’re trying to create a brand.”

She asked Kiwi retailers to consider what they’re doing exclusively for their highest-spending customers: “Are you giving them access to weird and wonderful experiences?”

Her tips are:

  • Create unique and super-exclusive experiences for customer in the top one percent.
  • Appointment-only is a simple mechanism for doing this.
  • Leverage your data for unique experiences.
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