A Closer Look at the 'Kate Middleton Effect': Why It Can Be a Double-Edged Sword for Retailers

Throughout Kate Middleton’s first year of married life, the Duchess has donned a slew of tasteful and decidedly quiet outfits that inevitably landed tenfold in the press—-each one leaking online with increased excitement. There’s no doubt that the brands the Duchess supports have experienced unforeseen growth, selling out of Middleton’s favorite pieces in a matter of days, sometimes even hours. Though despite the profit-drawing qualities of what retailers now call ‘The Kate Middleton Effect,’ The Sunday Times recently published an article drawing attention to the phenomenon’s reverse implications. The (paywalled) piece, which was picked up by international outlets, including The Daily Beast, noted that after Middleton wore Links of London’s Hope drop-style earrings in her official engagement photos, the brand quickly sold out of the style at such an accelerated rate that they were unable to produce additional stock at the necessary speed, leading to an onslaught of counterfeits that cost the brand $12.6 million in potential profits. Titled, “Kate’s Favourite Jeweller Loses £8m to Net Pirates,” the article quoted the head of the brand’s online sales team as saying, “The counterfeiters were a lot cleverer than we were at the time of the wedding. We didn't have that much stock so we started to sell out quite quickly ... The counterfeiters took advantage of that by saying they had stock and people were duped into buying them."
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Throughout Kate Middleton’s first year of married life, the Duchess has donned a slew of tasteful and decidedly quiet outfits that inevitably landed tenfold in the press—-each one leaking online with increased excitement. There’s no doubt that the brands the Duchess supports have experienced unforeseen growth, selling out of Middleton’s favorite pieces in a matter of days, sometimes even hours. Though despite the profit-drawing qualities of what retailers now call ‘The Kate Middleton Effect,’ The Sunday Times recently published an article drawing attention to the phenomenon’s reverse implications. The (paywalled) piece, which was picked up by international outlets, including The Daily Beast, noted that after Middleton wore Links of London’s Hope drop-style earrings in her official engagement photos, the brand quickly sold out of the style at such an accelerated rate that they were unable to produce additional stock at the necessary speed, leading to an onslaught of counterfeits that cost the brand $12.6 million in potential profits. Titled, “Kate’s Favourite Jeweller Loses £8m to Net Pirates,” the article quoted the head of the brand’s online sales team as saying, “The counterfeiters were a lot cleverer than we were at the time of the wedding. We didn't have that much stock so we started to sell out quite quickly ... The counterfeiters took advantage of that by saying they had stock and people were duped into buying them."
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Throughout Kate Middleton’s first year of married life, the Duchess has donned a slew of tasteful and decidedly quiet outfits that inevitably landed tenfold in the press—-each one leaking online with increased excitement.

There’s no doubt that the brands the Duchess supports have experienced unforeseen growth, selling out of Middleton’s favorite pieces in a matter of days, sometimes even hours.

Though despite the profit-drawing qualities of what retailers now call ‘The Kate Middleton Effect,’ The Sunday Times recently published an article drawing attention to the phenomenon’s reverse implications. The (paywalled) piece, which was picked up by international outlets, including The Daily Beast, noted that after Middleton wore Links of London’s Hope drop-style earrings in her official engagement photos, the brand quickly sold out of the style at such an accelerated rate that they were unable to produce additional stock at the necessary speed, leading to an onslaught of counterfeits that cost the brand $12.6 million in potential profits. Titled, “Kate’s Favourite Jeweller Loses £8m to Net Pirates,” the article quoted the head of the brand’s online sales team as saying, “The counterfeiters were a lot cleverer than we were at the time of the wedding. We didn't have that much stock so we started to sell out quite quickly ... The counterfeiters took advantage of that by saying they had stock and people were duped into buying them."

We reached out to Links of London multiple times for comment, and though the brand refused to shed more light on the issue, they implicitly refuted the article’s claims for reasons that still remain unknown. Though, quite literally, the bottom line is that ‘The Kate Middleton Effect’ seems to be a double-edged sword: sell out of a style, increase financial gains, and then lose a good deal of potential profit to counterfeiters who capitalize on a brand’s inability to quickly produce additional stock.

Photo: Getty

Photo: Getty

But it seems that some brands are starting to take matters into their own hands, so to speak. Orla Kiely, one of the Duchess’s chosen labels, told us that their customers often want to purchase the same color and style worn by Kate—a difficult situation considering the brands limited runs in manufacturing. “Often customers try to buy all the stock—we assume they want to sell it on ebay. Now we have a policy in our New York story that limits one unit per customer…as we don’t want anyone profiteering as a result of Kate wearing our clothes,” explained Paula Flynn, Orla Kiely’s US brand manager.

And while Kate-approved label, Issa, declined comment on this piece, a quick Ebay search reveals multiple knockoffs of their designs, specifically the blue wrap style that Middleton wore to announce her engagement—some sold at up to 95% off retail.

UK-based label, Reiss, has also encountered blitzkrieg sales of Middleton-popularized styles. After wearing the brand’s Shola dress to an official visit with the Obama's last May, Kate-crazed shoppers crashed Reiss’s site, with the dress selling out via phone before the brand’s US stores even had a chance to open the following morning. According to a Reiss spokesperson, traffic to the retailer's site was up 500% the day Kate wore the camel bandage dress, and a dress sold every minute. And despite re-ordering the dress (only to sell out again), copies sprung worldwide. As The Huffington Post pointed out, even Banana Republic was in on the deal, issuing a ‘Kate sheath.’

Overall though, brands are greatful for Kate’s support. “L.K.Bennett is honored that the Duchess has chosen to wear our shoes, clothing and accessories, it has certainly helped to raise awareness of the brand in the United States where we have opened five freestanding stores in the past 12 months,” Anthony Dimass, LK Bennett’s US President told us. Reiss issued a similar statement, “There is no question that Kate choosing to wear Reiss has impacted our brand. We have noticed a significant increase in brand interest and global awareness, strengthening existing markets and attracting attention in markets we are yet to enter.”