Friday, February 18, 2005
Fashion Economics: The Value of a Brand
not a topic discussed on ZS - fashion; but then to quote Mr. Wilde "Fashion is a form of ugliness so intolerable that we have to alter it every six months"! The shows that alter fashion however have been affected by global competition and changing consumer tastes. In the fashion industry, where brand consciousness reigns (or reigned?) supreme, here are some trends that shed light on the value of brands.
Handcrafted luxury gowns are no longer en vogue: Only eight Paris fashion houses are participating in the current haute couture shows as demand for the unique creations has dropped over the past few years (During its heydays in the 1950s, 23 Paris fashion houses presented haute couture collections -- soon only seven will be left: Chanel, Christian Dior, Christian Lacroix, Jean-Paul Gaultier, Louis Scherrer, Dominique Sirop and Torrente). Fashion icon Yves Saint Laurent once described haute couture as "whispered secrets passed on from generation to generation." He's since pulled out of the business of selling deluxe dresses -- just like many of his colleagues. Long gone are the days, when fabulously rich ladies ordered haute couture outfits by the dozen. The value of brands is all that's left of the "high art of tailoring."
As in fashion, there remains a motivation to produce high-end expensive products that are endorsed by celebrities - advertising. The brand name can then be used to produce `cheaper' and different products ranging from perfumes and liqeur to chocolates and cigars.
"Producing such a collection costs less money than a global advertising campaign," said Didier Grumbach, president of the French fashion association, the Federation Francaise de la Couture. Fashion houses still invest between €500,000 ($617,000) and €2 million to put on a 20-minute haute couture show.
So whats happening today - cheaper retail outlets use designers with a brand name (Karl Lagerfeld with H&M, Isaac Mizrahi with Target etc.), buy from cheap international suppliers and market it (at a fraction what these things cost historically) in the US. Thats that for fashion and using the brand advantage, no longer to charge higher but to leverage it for the masses!
Handcrafted luxury gowns are no longer en vogue: Only eight Paris fashion houses are participating in the current haute couture shows as demand for the unique creations has dropped over the past few years (During its heydays in the 1950s, 23 Paris fashion houses presented haute couture collections -- soon only seven will be left: Chanel, Christian Dior, Christian Lacroix, Jean-Paul Gaultier, Louis Scherrer, Dominique Sirop and Torrente). Fashion icon Yves Saint Laurent once described haute couture as "whispered secrets passed on from generation to generation." He's since pulled out of the business of selling deluxe dresses -- just like many of his colleagues. Long gone are the days, when fabulously rich ladies ordered haute couture outfits by the dozen. The value of brands is all that's left of the "high art of tailoring."
As in fashion, there remains a motivation to produce high-end expensive products that are endorsed by celebrities - advertising. The brand name can then be used to produce `cheaper' and different products ranging from perfumes and liqeur to chocolates and cigars.
"Producing such a collection costs less money than a global advertising campaign," said Didier Grumbach, president of the French fashion association, the Federation Francaise de la Couture. Fashion houses still invest between €500,000 ($617,000) and €2 million to put on a 20-minute haute couture show.
So whats happening today - cheaper retail outlets use designers with a brand name (Karl Lagerfeld with H&M, Isaac Mizrahi with Target etc.), buy from cheap international suppliers and market it (at a fraction what these things cost historically) in the US. Thats that for fashion and using the brand advantage, no longer to charge higher but to leverage it for the masses!
