Thanks to Retviews data, it’s easy to spot a pattern in pricing strategies within the accessible luxury sector. Stella McCartney and Tory Burch both have smaller price hikes in their country of origin. For Stella McCartney, the UK had the smallest price increase, standing at 10% YoY, whereas its collections’ prices increased the most within the US market. US brand Tory Burch similarly had the smallest price hike in its base US market, of 15% YoY, whereas its collections’ price increased most in the EU market, at 26% YoY. Higher price increases abroad could be attributed to recent supply chain disruptions, and the import duty and freight cost increases.
Although recession is a distant fear for high-end luxury, accessible luxury brands are feeling the pinch, which could be a contributing factor to why accessible luxury brand Tory Burch, on average has increased its prices more than Stella McCartney. Tory Burch could be trying to go higher upmarket and improve brand value perception, thus targeting high income shoppers who are likely to continue spending on luxury in times of inflation and recession.
Consumer demand is weakening in the accessible luxury sector. The Real Real has indicated that consumers are beginning to trade down to cheaper options, and Capri is expecting a decline in revenue, a decline which is driven by Michael Kors, the group’s cheapest brand.
Where are fashion leaders increasing their prices?
Consumers are heading back to the office and back to events, after over 18 months of working from home. This means that their priorities are going to shift, and they are gravitating more towards formal and office apparel, inching away from casualwear.