Posted on : 2023-11-26 19:05:58
Article : 27th Nov 2023- Good morning Monday management solution for the TASK 268- The luxury fashion industry is a complex landscape, where brands rise and fall due to a variety of factors.
Very few beloved brands stay on top for long. We live in the moment, so it is hard to imagine that Starbucks, Amazon, Google, Uber, Tesla, Apple or Nike would ever collapse. While there are no signs any of those brands will, history tells you that a few of them will falter. Staying at the top is just as hard as getting there.
Brands usually have a turning point based on a decision they have made or a decision they avoided making. They lose touch with the reality of their marketplace. They ignore competitors, stop listening to consumers or fail to attack themselves. If you fail to attack yourself, you can add your brand to a future list of brands that fell from grace.
Benetton -It’s a great beloved brand who forgot who they were and what made them famous. In 1990, “Benetton could do no wrong”. Business schools wrote case studies of their success and Ad Agencies held them up as the brand of envy for all clients to learn from. They had shock-value advertising campaigns that people talked about at the lunch table and there was a Benetton store in every mall. Their colourful and stylish fashion was the desire of the core teenage crowd.
Benetton’s brand promise was providing European fashions at an affordable price. But the arrogance of the “can do no wrong” brand quickly faded. While they were so busy creating shock-value advertising and arrogantly talking of their brand as it were art itself they forgot about the fashion part of the business. Benetton started to look like a hollow promise of cool ads with not-so-cool clothing. Benetton expanded so broadly and so fast, they opted for franchises instead of maintaining ownership over the distribution.
The Rise and Fall of Christian Lacroix: A Tale of Artistry and Business -The saga of Christian Lacroix’s fashion house is a story of immense creativity juxtaposed against the harsh realities of business. This narrative serves as a valuable lesson in the balance between the artistic and the economic in the world of luxury fashion.
The Christian Lacroix brand was launched in 1987 by the Agache-Willot Group, with Lacroix himself, an esteemed designer from the house of Patou, at the helm. Lacroix quickly established his reputation as a master of the grand and extravagant. His designs, known for their elaborate embellishments, vibrant colors, and rich fabrics, were widely acclaimed. He reinvigorated haute couture and brought back the glamour and opulence that had faded in the minimalist 1980s.
From the late 1980s through the 1990s, Lacroix’s creations were the epitome of luxury and the brand became synonymous with French high fashion. His designs graced runways and red carpets alike and were celebrated for their flamboyant artistic expression.
However, underneath this glamorous facade, the house of Christian Lacroix was enduring financial strain. Despite its artistic success, the brand had never turned a profit. Its focus on haute couture, though artistically acclaimed, was not a lucrative venture. Haute couture involves significant expenditure on materials and handcrafted workmanship, with limited scope for sales given the high price tags and small clientele.
Additionally, the brand struggled to expand its ready-to-wear and accessories lines, which typically provide more substantial revenue for luxury fashion houses. Lacroix, the artist, found it challenging to balance his creative aspirations with the practical necessities of running a profitable business. By 2005 the LVMH Group, which had brought the brand in 1987 sold it to the Falic Group due to the brand’s persistent financial problems. The global economic downturn in 2008 further exacerbated the brand’s troubles, and in 2009, the house of Christian Lacroix filed for bankruptcy. Its haute couture and ready-to-wear lines were shuttered, marking a tragic end to a remarkable story of creative brilliance.
Post-bankruptcy, the brand continued in a significantly reduced capacity, focusing on accessories, fragrances, and home furnishings. The name “Christian Lacroix” lives on through these product lines, even though the designer himself is no longer associated with the brand. These products lines have helped maintain the brand’s presence and provide a stream of revenue, albeit a far cry from the brand’s heydays of haute couture glory.
End point- Some luxury brand failures come as a surprise to consumers because of the high expectations these brands tend to set. They are often seen as symbols of opulence and perfection, yet they can still succumb to mismanagement or unforeseen circumstances.
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