Retailers, consumers and prices
Check Out Line: Luxury chains facing dilemmas
Check out the challenges before the luxury sector:
Many fancy European companies like Valentino have widened their entry-level offerings to lure more shoppers, given how edgy the global economy remains. This could be shortsighted, experts said this week at the Reuters Global Luxury Summit in Paris, New York, Dubai and London.
For instance, Valentino’s 300 euro T-shirts are dubbed “Couture T-shirts” a term some in the industry view as an oxymoron and could harm the cachet so essential to luxury’s appeal.
But to be fair, how much choice do these purveyors of expensive watches, suits, cocktail dresses really have?
There will always be mega-millionaires to boost the luxury industry and buy $50,000 diamond necklaces at Tiffany. But luxury got a big lift a few years ago from aspirational shoppers, or consumers pretending to be part of the jetset, if only for an hour or so while they buy a new suit at Barneys. And those shoppers could take years to come back, Reuters’ guests said.
That shrunken shopper base has forced a number of top European brands to look elsewhere including the United States, where they are hoping shoppers’ tastes are growing more refined. But China, and its emerging professional class are also top of mind, despite that country’s difficult bureaucracy.
Still the tentative recovery hasn’t stopped the luxury industry’s CEOs from splurging. One CEO bought himself a 4.5 million euro house in Ibiza.
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