Starting a luxury fashion brand isn’t easy. The market is very saturated, and it’s tough to compete with established fashion houses owned by companies like LVMH and Kering. In the wake of rising inflation and global health scares, like COVID-19 and monkeypox, the idea of starting a fashion brand makes a lot of people nervous. China, one of the biggest engines of the luxury fashion industry, is experiencing an economic slowdown, and inflation in America peaked at 9.1 percent. That being said, this recession is also unlike any other, with people spending money and jobs still being added.
What designers need to consider when launching a luxury brand during a recession
Despite the worries of a recession, the CFDA/Vogue Fashion Fund has proven that it Is possible for luxury brands to still thrive during a recession. Emerging knitwear brand, Black Boy Knits, is slowly making a name for itself by selling knitwear pieces in the 300 to the 400-dollar range. Omar Salam of Sukeina is considered one to watch with his opulent dresses and separates clocking in with four-figure price tags. Jackson Wiederhoeft, who successfully made the transition from bridal to demi-couture, is becoming a favorite of fashion editors and stylists.
While the temperamental state of the economy has consumers on edge, many see luxury as a recession-proof industry. High spenders will be able to weather the economic storm and continue using their disposable income for luxury fashion purchases.
For designers seeking to build a luxury brand right now, one of their best friends is social media. As a platform, Instagram transformed the entire fashion industry from the inside out. It transitioned the era of bloggers into influencers, changed how fashion brands advertise, and it created a whole new marketing sector of influencer marketing. For independent brands, one of the best ways to build a following and customer base is through social media. TikTok is also becoming a powerful player in the fashion industry, with TikTok fashion influencers the next big target for brands looking to court younger consumers. Gone are the days when fashion brands have to wait for the approval of top department store buyers for their big break. Social media can open the doors for them to potential consumers. Getting one outfit on a major influence can also be a sales boom.
For designers looking to launch luxury brands right now, they need to think about their approach to their design aesthetic. Historically, when it comes to luxury brands during times of economic downturn, minimalism is the name of the game. During the 2008 recession, New York Fashion Week’s runways were notorious for dripping in black. As the economy improved and designers were looking to rebel against conservatism, runways became more colorful and maximalist again. In creating a line while people are pinching their pennies, it is best to opt for neutrals and approachable designs, and things customers see as “safe” to buy.
Last, and certainly not least, new luxury brands need to figure out what hole they are filling in the market. If you’re doing something similar to an established luxury brand, come up with something original. Luxury brand Lisa Marie Fernandez attributes her success to launching a luxury swimsuit line in 2008 during the Great Recession to offering customers neoprene bikinis.
Building a brand during an economic downturn isn’t possible, but brands have to take a strategic approach to launch and growth. Fashion Weeks are still poised to see a new crop of emerging designers going into 2023.