July 17, 2018
For the longest time, luxury brands have always exuded a strong sense of exclusivity. The limited supply and detachment from the mass market created a facade of an almost “exclusive club” eligible for an extremely niche circle. However, strong competition has always prevalent in the fashion industry, and the luxury market is no exception.
What was once a market targeting baby boomers and generation X consumers is now gradually shifting towards a new demographic: millennials. Expected to redefine the luxury market, the millennial behavior seems to be under the spotlight of luxury brands who intend to reinvent their image in order to adapt to the shift.
In 2017, the luxury market saw a 5% increase, fueled by millennials and generation Z consumers. With that, more luxury brands are forced to break away from their mold and restructure their strategy to reel in the younger generation with disparate shopping behaviours. Failure to do so may result in the same fate as famed American luxury jewellery retailer, Tiffany and Co. As luxury analyst, Luca Solca, shared with Business of Fashion, “In this new world, luxury brands face a twofold problem: the poor man’s problem: how to move from uncool to cool; and the rich man’s problem: staying cool, once you have become cool.”
And in the fashion industry today, nothing is cooler than streetwear.
Source: Revolver Mag
The term streetwear is given to a particular style embodied by subcultures among urban youths. However, it is no longer as underground as it used to be. As hip-hop and rap culture becomes more popular among the youth, this also thrusts streetwear into the spotlight. Brands like Supreme and Off-White are synonymous with the term, driving a frenzy amongst its loyal consumers who are clamouring to get their hands on highly anticipated and limited collections at exorbitant price tags. Over the years, this crazed phenomena has evolved from being worn by hip-hop and skate culture to something accustomed to high fashion, with consumers willingly forking out over two thousand dollars on a sweatshirt that was intentionally made to look like it had seen better days.
This bred a new market of consumers: millennials with larger spending power towards streetwear. However, given its outlandish price point, would it not mean that consumers who are forking out thousands on streetwear are in fact, fueling the luxury industry? Is there even a difference at this point? Luxury giants seemed to have discovered a goldmine in this market and are swiftly tapping into it, blurring out the fine line between streetwear and luxury.
Immersing Streetwear In Luxury
More luxury brands are realising the streetwear mania among millennials and cleaning up their brand image by injecting a touch of youth culture in their collection. To further entice the younger crowd, collaborations with notable names in the streetwear industry are introduced.
Source: Kulture Hub
In March, globally-renowned luxury brand, Louis Vuitton, shocked the world with the acquisition of Virgil Abloh as their new men’s artistic director. Abloh is a Ghanaian-American fashion designer and also the founder and CEO of haute-streetwear brand, Off-White. With a clientele of Kanye West, Jay-Z and Beyonce, the name Off-White embodies the culture of hip-hop and streetwear, thanks to its cult following. Upon building an iconic brand in the streetwear industry, perhaps some off Abloh’s urban magic will rub off on Louis Vuitton in order to spark a whole new empire of modern day luxury.
Another brand that has taken a few pages off the streetwear book would be Balenciaga. Fashion search platform, Lyst, in conjunction with Business of Fashion, have revealed Balenciaga to be the hottest fashion label of 2017. This could be attributed to the appointment of Demna Gvasalia, who is also the head designer of the underground streetwear brand, Vetements. Important elements from streetwear, such as oversized t-shirts, caps and sneakers have been all the rage for Balenciaga, especially the latter. From 2017 onwards, the sneakers range from Balenciaga was highly coveted, despite their peculiar exterior and style. And it’s no surprise, since sneakers is one of the most distinct fashion category for streetwear.
From left to right (All from Balenciaga): Speed logo-embroidered metallic stretch-knit high-top sneakers, Triple S logo-embroidered leather, nubuck and mesh sneakers, Printed cotton-jersey T-shirt
The items above were some of the best-selling items from Balenciaga, which evidently comprised of more casual pieces, borrowing influence from streetwear culture.
Jumping On The Social Media Train
The instantaneous nature of social media has rendered consumers easy access to information and trends pertaining to streetwear. Fashion blogs and Instagram accounts have planted the presence of streetwear culture onto the screens of millions globally, leading to a saturation of oversized sweatshirts and outlandish sneakers. However, the pervasion of the once underground subculture resulted in a huge market. “But what the internet taketh away in exclusivity, it giveth back in hype,” shared online trade magazine and media platform, Digiday.
Gucci, for example, has used Instagram to win over millennials with their advertisements and campaigns. The chart above depicts the age range of Gucci’s Instagram followers and it is not surprising to see that millennials surpassed the other age ranges. Gucci churned these numbers and fully embraced their millennial audiences by incorporating their peculiar internet humour, launching a meme-inspired campaign for their luxury watches. And it was a very successful outreach as the campaign shed the supercilious facade of luxury brands and invoked the humour of millennials, making them more approachable and inclusive. How exactly did Gucci’s attempt reflect on their performance?
The performance comparison table above was taken from luxury retailer, Farfetch. Gucci’s superior performance could be attributed to their successful social media marketing.
Source: The Playbook Asia
Brand Crossovers To Entice Millennials
Another conspicuous attempt to fortify the patronage from the mass market and gain “cool” points from millennials was the collaboration between streetwear and luxury brands. Such attempts at broadening their prestigious legacy towards a whole new market was witnessed when Louis Vuitton released their collection with Supreme. The highly sought-after collection sold out within hours and doubled in value, thanks to internet resellers.
Luxury brands that have remained comfortably stagnant will have to dust themselves up and restructure their assortments in order to ride the waves of the current market. This rising obsession with streetwear is paving new opportunities for the luxury market, and outright ignorance could result in the irrelevance of a brand or worse, loss of customer loyalty. While this trend may not resonate with every brand vision, the popularity of it is plenty. Although there is no telling of streetwear longevity, that is where data can help decipher if it’s a trend worth investing in.
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