“This is a monumental step signifying change in a department store model. I would not underestimate what a major step this is,” says Robert Burke, chairman and CEO of New York-based consulting firm Robert Burke Associates. “I’m sure other retailers will follow suit, because they have struggled with how to come up with a formula to address their immediate issues.”
Burke says trusting brands to handle customer information and fulfilment “may be the cost of this type of partnership”.
While many larger luxury houses with a broad variety of merchandise at different price ranges have managed their way through the economic turbulence, small, emerging brands like Christopher John Rogers that focused on expensive, glamorous frocks are especially vulnerable, says luxury-goods consultant Robert Burke. “Women’s apparel has been hit the hardest.”
“Men have felt the need to change up their wardrobes,” Burke said. “It’s about casual, not athleisure.”
“Recovery is going to happen where businesses and retailers are not heavily tourist-dependent,” said Robert Burke, a New York-based retail consultant who works with clients across the globe, from China to South America to Europe. “That’s where we are seeing some of the best recoveries: where it’s a local shopper.”
“Men have felt the need to change up their wardrobes,” Burke said. “It’s about casual, not athleisure.”
In addition to offering more comfortable styles, fashion brands have also leveraged the unusual holiday season to test new collection ideas and marketing strategies, said retail consultant Robert Burke. For example, Jacquemus offered an all-pink Christmas capsule collection (a standout in a season drowning in gold lamé, crystal embellishment and satins) that did little to evoke the holiday season but excited shoppers nevertheless. Some items from the collection — made up of affordable gifting-ready keychains, socks and knitwear — sold out quickly.
While Farfetch offers more than 3,500 brands, Mytheresa has a tight 250. This focused number gives it a clear, strong point of view and an agile setup, according to luxury brand consultant Robert Burke. “It’s not the biggest, but it’s certainly one of the most influential.”
Despite this investment in customer experience by LVMH, customer service as a key differentiator may play to the advantage of smaller businesses such as Mytheresa, which already has a strong reputation. “This is part of the challenge of being a larger player: you lose your laser focus on who you are appealing to,” Burke says. “We’ve realised that bigger is not always better with companies and retailers. Going forward, we may end up finding that with online as well. The secret sauce is to be a big player and act like a small player.”
The amped-up pace of change is a post-Covid-19 constant. “We have gone through a period with online shopping in which the pandemic has expedited anything we thought about it — it’s moving at warp speed,” Burke says. “Where it will end up with the consumer will be the real question: what really resonates in the end? I don’t know that it’s a black and white answer at this point.”
But consumers may be thirsty for the opposite. “For the consumer, bigger isn’t better,” said retail consultant Robert Burke. “People want more edited, focused product selections.”
“There’s been less of an opportunity for buyers to be creative,” said luxury consultant and former buyer Robert Burke. “Their function has become more administrative.”
“It only makes sense to represent more than just hard cases and Rimowa will be able to make that transition,” said Robert Burke, a retail advisor. “They could certainly enter product categories like sweaters, accessories and jackets with a great deal of credibility. I’m not sure if we’ll see a full-blown runway show, but a focused [lineup] that relates back to travel and lifestyle makes a lot of sense.”
“In many ways, it’s good for both parties, and I think that’s kind of a hard pill sometimes to swallow,” said Robert Burke, the CEO of an eponymous retail consulting firm.
“This is probably one of the biggest partnerships or collaborations that has happened in many years. A lot of big players are leveraging expertise and knowledge for the online market,” adds luxury industry consultant Robert Burke.
This partnership is a testament to the importance of China, Burke says: it’s an incredibly complex market but also one of the most lucrative.
The fashion industry is likely to push for relief that's seen as long overdue since the first relief package in the spring. “Look, 400,000 small businesses have gone bankrupt since the pandemic and many are part of the fashion industry,” says luxury industry consultant Robert Burke. “The fact that the stimulus package has been stuck and the Republican senate could get through a Supreme Court nominee in 30 days — certainly many people in the fashion industry won’t ever forget it.”
It’s unlikely that a Biden administration would immediately warm relations with China given the snarl of issues with production, competition and counterfeit goods. (The American Apparel & Footwear Association plans this week to launch a publicity effort encouraging consumers to “shop safe online” — meaning to avoid buying counterfeits.) But it is expected that Biden would warm relations with other countries, encouraging tourism once the pandemic is over. Restoring tourism from China and the Middle East could be a potent booster for luxury sales in the US, says Burke.
“People who were in shock during March, April and May have just started to realize that life will go on, though in a different way,” said Robert Burke, a luxury consultant in New York. By August, with their spending diverted from restaurant dinners and lavish vacations, “they were looking for ways to treat themselves.”
After months of near isolation, plenty of people are buying relatively inexpensive items priced at $300 or less, Mr. Burke said. “Especially during times of crisis there will always be those making feel-good purchases,” he said.
“[Over the past four years], meetings in Europe would start out with, ‘What is going on with the President?’” said retail advisor Robert Burke. “That reflects on the erratic nature of this office.”
“Election years usually slow retail down for a few weeks prior to an election,” says luxury retail consultant Robert Burke. “It’s because humans don’t like uncertainty. And that’s magnified right now.
Burke says he planned to close his Manhattan Robert Burke Associates office on Tuesday and Wednesday so that employees wouldn’t be forced to travel across a possibly insecure city. “And maybe Thursday,” he added.
The optics alone could drive more customers to spend the holiday season shopping online, even if the pandemic hadn’t prevented them from visiting stores. “A boarded-up store is not exactly welcoming,” says Burke.
Robert Burke, chairman, and CEO of Robert Burke and Associates, a consulting firm specializing in retail and fashion, thinks the collection displays a more reflective side, perhaps due to the pandemic's slowdown, and spells retail gold. "Hedi has this sixth sense that he understands the importance of having key or recognizable items on offer," Burke said of the collection he called wildly eclectic.
Noting that the collection spoke to the younger generation's styling leanings, he didn't feel it stopped there. "The good thing is you can see the young consumer clamoring to buy it but also the moms seeing pieces for themselves too," he said. He referred to essential items such as tailored jackets, biker motos, drop-waist dresses, other comfortable pieces and of course, those bags.
If the goal was to attract Gen Z, either Slimane's intuition or big data was spot-on. "In the last six months since the pandemic, we are seeing a young consumer extremely focused on the luxury house," said Burke. "They would rather have one luxury piece versus fifteen average pieces, and they have been lining up at luxury stores globally to get their hands on that one coveted item."
“In the aughts, the philosophy was you followed certain steps to build a really big brand,” said Robert Burke, the founder of a luxury consulting company and former fashion director of Bergdorf Goodman. That era may be definitively over, Mr. Burke suggested, gone the way of the power tie.
“We’re entering a period where bigger is not necessarily better,” he said.
“The pandemic edited away all the nonessential fluff,” said Robert Burke, chairman and ceo of Robert Burke Associates. “And so many times, these retailers or brands were doing experience for the sake of experience and had no direct effect or connection to their true brand. This has brought us back to the experience of customer service and valuing the customer.”
“There will be a balance between online and physical retail,” Burke said. “But the idea of more human-scale retail as far as physical goes is really important. The bigger-is-better flagship store on Fifth Avenue is seemingly not attractive right this moment and probably won’t be ever as attractive as it was.”
Dries Van Noten’s traditionally extremely selective distribution choices have been beneficial for the brand, says Robert Burke, founder of consulting firm Robert Burke Associates. Both Shanghai and Los Angeles openings, opened under Puig ownership, are “very smart moves”, targeting locations where the brand already has a strong following. “Once the brand has a store we always see sales go up in that market and online,” he says, adding that the chosen location will draw customers from all over the Los Angeles area.
Fashion business consultant Robert Burke says the shift in attitude is being driven by social media and the direct communications it drives between brands and consumers. “It was not long ago when brands and designers would absolutely not comment on anything about [politics] because they were so afraid of alienating customers,” Burke says. By contrast, brands now fear they may be accused of complacency if they do not speak out. “They run the risk of Diet Prada or someone calling them out if they don’t say something,” Burke adds.
“It seemed to be a perfect marriage,” said Robert Burke, chairman and chief executive of consulting firm of luxury consultancy Robert Burke Associates. “They were going to be stronger together than separately and there were benefits on both sides. Everyone was excited about this acquisition because it would have been the biggest ever global luxury investment. At $16.2 billion, it was something that got everyone’s attention.”
It’s a view shared by Burke. “At the end of the day, Tiffany will be OK. It’s one of the few globally recognised luxury jewellery brands which I believe can even go even more luxury and has potential. And in other ways, this puts a flag out there to say that Tiffany has been open to be acquired, so let’s see if this means that a company like Kering starts to look at the opportunity. I’m not sure that Richemont has the appetite but certainly, it is clearly known now that Tiffany is open to the right acquisition,” said Burke.
“It certainly could go either way,” said Burke. “Luxury has certainly been hit, the economy has been hit and fashion goods have been hit, but luxury is proving to be the first to come back, within the consumer goods category.”
“I do think that there will be more consolidations because it will be very, for the right partnerships or acquisitions, there are a lot of upsides and strengths. And it seems as if the big brands and big groups are only getting bigger and stronger. So, I don’t see a slowdown.”
“I do think it’s going to be really hard for smaller brands,” said Burke. “There will be niches for them to fill, but when you look at Kering and LVMH, they have built these powerhouses that are just so dominant in the market.”
“There are a lot of advantages in being part of a very big group with big budgets that can produce major shows globally, be able to market a brand globally, which is very hard for independent brands and there are becoming fewer and fewer big independent brands. The competition has been fierce for the customer’s attention,” he added.
