As we start our journey in the world of fashion and luxury, it may be helpful to clarify what we actually mean with the terms “Fashion” and “Luxury”. Of course, these are widely used words, but at the same time, each of us might think about something different every time mention them. We could try and explain what we mean by them by breaking down some of the characteristics that define both a fashion and luxury product, as much as these industries themselves.
These are the topics we are going to cover:
Have you ever heard of Maslow’s Hierarchy of Needs? It’s a useful representation of the urgency that individuals face when addressing their needs as human beings. Maslow’s hierarchy of needs is represented through a 5-storey pyramid which includes:
According to this model, clothing would fit into the ground level of the pyramid, as clothing is essentially a tool to protect ourselves from the weather, but because of the social significance that fashion represents, fashion products can be unboundedly ranked among higher-status needs, as fashion garments are social currency and a tool to reinforce social strata.
We could provocatively say that nothing new is ever created only re-discovered. This, in my humble opinion, is not always true, but the fact of the matter is that in the fashion industry we can see how the most prestigious firms are those who are able to leverage their history and cultural heritage. Through their products, we seem to able to access the history of their brands and countries of origin. Storytelling and heritage are designed to tell us, as customers, that we are not only buying a product, we are accessing a wonderful narrative through the purchase of an item.
This is a very important element, as purchasing fashion products is ultimately an experience, where a garment is simply a gateway to the brand, a means to start a relationship, rather than the end of a transaction. The sense of satisfaction that we get by acquiring ownership of certain items is irrational and contrary to the traditional principles of economics, to the degree that a new category of goods had to be invented in order to justify how the demand of certain items could increase proportionally to the increase of the retail asking price. Veblen goods are a category of products, such as diamonds, jewellery and champagne capable of defying the very principle of demand and supply. Now, it’s understandable that not every person would decide to buy a luxury good based on its higher price, but this is another important element of our conversation: luxury is not for everyone, as it is not to understand. Luxury is mostly focused on a niche of individuals, as opposed to being designed for the masses.
Moreover, the experiential nature of fashion has allowed firms to exploit the values associated with a brand, by creating line extensions through licensing. This phenomenon is particularly significant in the areas of cosmetics and fragrances, where a new line of luxury products has been introduced by selling commodities at a premium by leveraging the power of more luxurious brands. These categories of products are called mass prestige, or masstige in short. At the same time, however, we should avoid falling into the misconception that luxurious is a synonym of expensive, the value of a luxury good is not to be found in its economic value, as much as in the desire to own it.
An interesting element of comparison between fashion and luxury has to do with the perception of time. Time in fashion is fast, ever-changing, whereas time in luxury is slow, almost still. In manufacturing, we use the term “product life cycle” to indicate how long a product will maintain its appeal towards customers. The product life cycle is divided into four stages: introduction, growth, maturity and decline.
What makes fashion special is that the pace of these four stages has been growing faster and faster, to the point in which a new category of fashion firms was created: fast fashion companies. Traditionally fashion products revolved around two main production cycles, Spring\Summer and Fall\Winter.
The reason for this organization of the manufacturing and supply chains was rooted in the fact that essentially fashion items are creative items and such designers and stylists need time to conduct research and interpret through clothing the spirit of the time. This however created a lag for consumers, who would be somewhat limited in their purchase options if store shelves were to be replenished only twice a year. Fast fashion companies, realised the potential to deliver value by bringing to market the looks of luxury brands in a more inexpensive and streamlined manner.
As a result of this new business model, customers quickly got used to the idea of finding new items on sale every week, regardless of the hard work which undoubtedly goes into bringing an insightful and innovative look to a storefront. Timing is indeed essential, and as a result, the span of time available for the sale for a product is indeed very limited. This phenomenon ends up creating a competitive pressure that narrows the time that designers need to develop a meaningful collection. This contraposition between the timing of fashion and the timing of luxury is a heated debate at this time, as it is strictly related to human and environmental sustainability. Luxury, on the other hand, escapes the “planned” obsolescence that many fashion products may experience, and is, therefore, more prone to benefit from the sale of a few, timeless and iconic pieces for entire decades, as if trends and culture did not apply to these goods at all.
Fashion follows trends. But where do trends come from? Most of the trends are a reflection of society and the influences of culture and arts on the designer, but some may actually derive from the fashion pipeline itself. The availability of certain threads, the development of new technological materials, or the simple need to use what is most abundant on a particular season, are just a few of the many impactful elements on collection’s design. The crossroads between cultural and industrial trends can create a very interesting landscape for designers, and create new and exciting opportunities both from a manufacturing and creative perspective.
After having analysed some of the specific characteristics that define fashion and luxury products from a business perspective, we can understand how unique the fashion and luxury industries are, as they delve into both the rational and impulsive side of human behaviour. As we discuss a variety of topics in fashion and luxury, clarifying some of these fundamental concepts is very useful to make sure we can develop a common language to articulate our ideas and throughs as we conceive new and exciting fashion and luxury ventures.
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