Casual fashion driving growth in luxury goods industry
MILAN (AP) — Casual luxury is driving global sales of high-end apparel, footwear and handbags as big-spending consumers look for low-brow statements in T-shirts, sneakers and rubber sliders, according to a study by consultancy Bain released Thursday.
The casual trend is driven by Millennials, with help also from their comfort-seeking parents and the next generation of consumers, teens, said Bain partner Claudia D’Arpizio, who led the study for the Altagamma association of Italian high-end producers. It is helping boost sales of personal luxury items including apparel, footwear and handbags, to upwards of 280 billion euros (329 billion), up 8 percent from 260 billion euros in 2017.
China is forecast to post stunning growth of 20-22 percent this year, as traditionally higher prices there come more into line with prices overseas, D’Arpizio said. At the same time, the Chinese customer base is growing.
While a strong euro is penalizing sales to tourists in Europe, local consumers are filling the void to keep the market steady with a projected growth of 2-4 percent. The United States, conversely, is benefiting from a weaker dollar and tourist spending for a forecast of 3-5-percent growth.
Younger consumers who had long been “detached” from luxury are now buying individual elements that appeal to them — say, sneakers or T-shirts — and not whole collections at a time.
“The really-growing brands now beating the market are the ones already hooking these teenagers. This is the first time this is happening in the history of luxury, that some brands are becoming so appealing to young consumers,” D’Arpizio said.
Some of that is due to the power of social media like Instagram, which act as a newsfeed for brands and give a sense of urgency to fashion trends, she said.
The demand for casual and street wear has helped luxury producers by giving them a new creative outlet — such as luxury Birkenstock-style footwear. And it is also giving household names like Fila, Nike, Adidas and Birkenstock more access to big-spending consumers of luxury goods, D’Arpizio said.
The result also means that apparel is growing less than accessories, because evening and formal wear — still a significant part of many fashion house collections — are less in demand than casual elements, D’Arpizio said.