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The notion of luxury is evolving, but into what? This answer becomes a little clearer when examining two fashion houses: Ralph Lauren and Versace.
Ralph Lauren records a significant amount of its sales from the middle and mass markets (through different brands), while still maintaining prestige among its more affluent purchasers. Fashion, in general, is becoming more accessible, and Ralph Lauren has ridden this wave for years. Take Target, for example. Their tagline, “Design for All” implies that high fashion is accessible.
Versace, on the other hand, does not obtain significant sales from middle and mass markets. Rather, it focuses on reaching high-end consumers via one brand, unlike Ralph Lauren. However, the company has been struggling internally with its desire, on one hand, to create “flamboyant clothing designs” and the market’s desire for lifestyle goods.
I find it fascinating that the referenced articles cited Louis Vuitton and Gucci as competitors of Ralph Lauren and Versace, respectively. If you apply a classic syllogism of “if A = B and B = C, then A = C,” then Ralph Lauren and Versace should be competitors. But, they’re not. Why? Because of their inherently different models.
Not only does Ralph Lauren have the versatility to reach a broad spectrum of income levels, but it is also on par with these high-end houses. I find this fact to be an impressive feat on Mr. Lauren’s part. He has extended the notion of luxury to the masses without cannibalizing his high-end lines.
Luxury is becoming more accessible, but the idea of luxury is drifting from goods in hand to lifestyle…where do the wealthy dine and travel, how do they live…as evidenced by Versace’s shift in focus. I look forward to seeing how these and other high-end fashion companies continue to evolve.
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