Price Factor: Product pricing is crucial in generating sales as well as creating demand. However, does low price entail higher sales on bags? From the different segments analysed, this condition seemed to hold true – especially for fast fashion brands. Consumers have grown accustomed to the rigorous discounting strategy launched, especially over the holiday sale during Fall/Winter season.
Designer houses, on the other hand, naturally target consumers with higher income, the price serving more as a measure of a brand’s value and image. This is evident with most luxury brands recorded high full price sell-out rates.
Premium brands tend to struggle with balancing luxury quotient over price. Most try to position themselves on the upper end of the ‘affordable luxury’ spectrum but fail due to multiple product promotions and distribution issues.
Style Interpretation: This season’s ‘it’ bags such as mini, belt and bucket bags were prevalent across all three segments while crossbody or sling bags remained more of a staple style.
The dissimilarity, however, could be seen on certain styles translated from luxury to fast fashion – the chunky chain trend was more extravagant and elaborate in luxury brands while premium and fast fashion interpreted it in a much-understated manner to cater to the masses.
The luxury segment also saw a resurgence of visible labels and logos (logomania), all over the bags’ exterior and even on straps. This trend, however, was less prevalent in the premium and fast fashion segments.
Next Step for Brands
Evaluate Positioning: It is key for brands to understand their current position, especially against competition, to enable strategic decision-making.
With sell-out not catching up with frequent newness, the fast fashion brands faced overstocking issues, which resulted in heavy discounting to clear out stocks. To avoid landing in a similar situation, brands should be more proactive in examining and re-assessing their positioning periodically to remain relevant and competitive.
Understanding Consumer Demand: As brands keep tabs on runway trends and the growing significance of social media buzz, it is more important to understand own consumer demand or when targeting a new group of consumers.
Simply adopting the latest styles without the target consumer in mind or without research, will lead to costly lessons learnt. Consider again, why chunky chain and logomania were less prevalent in the fast fashion segment while trending successfully in the luxury segment.