Inflation has reached the highest peak in the last 40 yearsalso involving the fashion industry: if the mass consumption market was the first to be hit, now the luxury sector is also suffering the consequences, starting to slow down. However, 2022 was still a positive year for the sector.
The Retviews experts have observed the price trend in the face of the decrease in the purchasing power of consumers, analyzing how the fashion brands of the entry-to-luxury range are managing the phenomenon at a global level. The Retviews, the Competitive Intelligence Platform for Fashion Brands and Retailers study found that while high-end brands are not at risk of an impending recession, accessible luxury brands they are putting instead different strategies in place.
The research has, in fact, shown that, compared to 2021, the prices of accessible luxury have increased particularly aggressively both in United States (+36%), both in United Kingdom (+26%) and inContinental Europe (+20%).
The major price increases can be attributed to a different management of the supply chain, which has been affected by higher costs both for import taxes and, above all, for transport costs.
The price of new lifestyles
In the post-pandemic, the return to social life has favored the resumption of shopping: after almost two years of smart workingIndeed, consumers have started traveling again and going to the office, shifting their preferences from mainly casual clothing to more formal outfits.
It is therefore not surprising that the largest price increases have occurred at clothes (+46%) e shirts (+35%), or those product categories for which, on the basis of new lifestyles, consumers are inclined to spend more.
However, we are seeing a change in shopping habits which sees consumers more attentive to spending, with a progressive decrease in demand in the luxury sector, so much so that recent research has shown a growing preference for cheaper products.
Competitiveness and brand image: the right discounts
In this context, luxury brands are faced with a more competitive commercial approach and more aggressive discounts than in the past, aimed on the one hand at conquer the so-called “aspirational” consumers”, on the other a reduce stocks to respond to the new needs of a more sustainable supply chain.
Retviews data revealed that brands have applied higher discounts in 2022 than in 2021offering offers on a wider range of products and with higher discount percentages.
Furthermore, research has shown that i brands have adopted different strategies in terms of discount percentages and of number of products on offer, based on the positioning of each brand and the different geographical areas. In Europe, for example, a brand like Stella McCartney has chosen to discount less products, but with a greater reduction in prices than a brand like Tory Burch.
Phenomena such as supply chain transformation and rising inflation are deeply affecting the fashion sector. In this constantly evolving context, it is essential for companies to know how to anticipate trends and stay competitive in an increasingly rapid market”, explains Fabio Canali, President Southern Europe & North Africa of Lectra. “Technology is a differentiating key in this: the data made available by the artificial intelligence of tools such as Retviews allow brands to monitor the competition and analyze the market in real time, developing the most effective strategy to address their target audience”.
