W Magazine hosted a conference on luxury this morning – what’s going on with it, who’s hurting, who’s winning, when will it come back?
They conducted a series of polls with their readers, dubbed “Fashion Passionates,” and compared them to the more generally affluent, as in still-rich people who don’t devote their extra money to Givenchy and McQueen.
What’d they learn? This is the first time in recorded history that the luxury market has been hit harder than retail in general. Aspirational customers (those who save up for that one big purchase or consistently live beyond their means) are totally gone and not likely to return anytime soon. Even the best luxury customers are spending on average 50% less.
The literal dollar amount actually being spent has also been greatly reduced due to overwhelming markdowns. In the last six months, over 80% of designer merchandise has gone on sale and now, even those who once pre-ordered their bags/shoes/dresses are now buying things on sale and only 55% of customers are buying product on first sight. They re-visit whatever they want to buy 30% more often than they used in hopes that it have gone on sale. And 73% said they’ll never buy full price again. That can’t make luxury retailers feel very good at all.
We’re the girl who buys a piece of Phillip Lim or Alex Wang here and there while consistently shopping vintage/random/J.Crew – not the woman who buys $1800 bags per season and a few Louboutins to match. So we have to say, we haven’t really changed our shopping habits all that much.