March News Roundup

1.

Multi-vendor online luxury retail is in a tailspin. In the last year, we’ve seen the implosion of Farfetch and now the administration of Matches. According to this article, it’s cash-strapped aspirational shoppers and brands preferring DTC over wholesale that’s at the heart of the problem. The later issue I have been talking about for years, as brands have greater control over image and pricing. But it’s also a consumer preference - why shop at Matches or Farfetch when you can see a brand’s full array of products on their own site? With fashion decisions at multi-vendor retailers dictated by anonymous buyers and corporate planners, directional fashion edits are no longer on offer. And without giving clients exceptional customer service – and not the kind of immersive experience offered in-store - then what exactly is the appeal of shopping with them?

Farfetch at the New York Stock Exchange, photo by Christopher Penler / Shutterstock

2.

Sephora gave all beauty retailers a refresher course on why you need to know both your audience and your offer as a brand before entering any market. On March 19th, Sephora announced that it would be closing all five stores in Seoul and exiting the South Korean market entirely. After five years of losses, the beauty behemoth could not make inroads into the country’s extremely competitive beauty landscape. Read up on Sephora’s decision here.

3.

Global fashion and lifestyle digital site Highsnobiety has teamed up with AI-powered brand performance cloud Launchmetrics to round up the most impactful fashion collaborations of the last year. Highlights from this report underscore the importance for brands to recognize the equal significance of both product quality and compelling storytelling. Moreover, it's crucial for brands to understand that storytelling must evolve naturally and authentically. Brands also need to acknowledge that audiences are consuming fashion content like entertainment. Jörg Haas, the founder of creative agency Beinghunted, points out that the Louis Vuitton x Yayoi Kusama collaboration – the top-ranked collab - offered the kind of global visibility that traditional galleries and museums could never provide an artist because they lack the financial resources. That is the new power of global brands.

4.

Strategy and consulting firm McKinsey & Company released a podcast at the very end of February discussing how luxury retail is built on providing clients with an emotional experience (there is a transcript of at least part of the interview if you prefer to read rather than listen). Since my days at Chanel, the discussion at every luxury company I’ve worked with is the customer’s emotional experience. And that’s what makes this interview interesting, as it’s with Scott Malkin, the founder and chairman of Value Retail, which operates open-air luxury shopping destinations in Europe and China. Malkin claims to have some of the “highest sales per square foot of shopping centers in the world.” Listen to the podcast here.

Renzo Rosso, photo by Delbo Andrea / Shutterstock

5.

Most luxury and fashion brands base their businesses on handbag and accessory sales. Ready-to-wear, while garnering most of the social media and editorial interest, tends not to be a money-maker. Issues with basing a business on clothing to drive sales range from sizing consistency to maintaining a steady creative point of view that is unique enough to gain interest, but commercial enough to sell at full price. Which is what makes Renzo Rosso, president of Only The Brave, such an outlier in the fashion industry. His stable of brands, which includes Diesel, Maison Margiela, Marni, Viktor & Rolf, and Jil Sander, are all predominately ready-to-wear driven. Click here to learn about Rosso’s view of the industry and why he is investing in Italian manufacturing know-how.

Sephora photo courtesy of Manuel Esteban / Shutterstock