Luxury Habitual Price Rises Can Hardly Conceal The Bruising Of Brand Design.

A notice of price increase of < p > Chanel raises a heated debate in the circle of friends.

Since mid April, the Classic Flap series medium and large have risen 450 euros; the 2.25 series has risen 450 euros per size; the Le Boy series has risen 300 euros, or around 15%.

Chanel every year, prices are rising all the time, and every time the price rises, we are not idle. We have begun to laugh and wait for the start.

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< p > the market scale of luxury clothing, leather products, watches, jewellery and cosmetics in 2013 was $390 billion, with an annual growth rate of only 7%, representing a marked slowdown compared with 11% from 2010 to 2012.

Statistics from Boston Consulting Group (BCG) show that

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< p > although the major luxury brands in 2013 experienced a "cold winter" period, they still failed to prevent their habitual price rise.

Since April 21st, the French jewellery brand Cartier has increased its price by 6% to 10%. In April 14th, Chanel announced the first rise in price and up to 15%. At the same time, Italy brand Ferragamo announced that the price of some commodities was 400 yuan on average.

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Less than P, brand names invariably attribute the price increase to rising costs, but this "trick" has long been seen through, and the fundamental reason is to maintain the high profit and high status of luxury goods.

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< p > for this reason, Pedraza, President of the luxury Research Institute of New York Research Institute, analyzes the intention of the old brand to increase prices, which is to distinguish between their own products and cheaper entry level luxuries, but instead of pushing customers to competitors, they may lose more than they gain.

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< p > indeed, with the strong rise of light luxury brands, the market share of traditional luxury brands is gradually being eaten up. At the same time, simple design is not innovative, and the loss of scarcity of product lines has become a "bruising" of traditional luxury brands, and high-end customers are losing no time.

But most luxury brands still rely on price increases to "save face", but ignore the quality is the root of attracting consumers.

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< p > < strong > "price increase game" is staged every year, < /strong > /p >

< p > having a top luxury brand package is the dream of all women.

The salaried class often pays for half a year's salary, so that they can buy a satisfactory luxury.

But in recent years, the price of luxury goods has soared like a rocket.

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< p > according to the data released by the US labor department, the price of luxury goods has risen by 60% over the past ten years.

In 1955, when Chanel released the first 2.55 pack, it sold for $220, and now it costs at least 4830 dollars to buy this classic bag.

This also means that in less than 60 years, the price of Chanel 2.55 has increased 20 times.

In addition, the Hermes classic Kylie bag has been raised from $4800 to $7600 over the past 10 years, and LV's Speedy pack also has a 32% increase.

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< p > Gu Minyu is a consultant of a multinational consulting company in Shanghai. She has been in the workplace for 6 years. From MCM, Coach to Chanel and Prada, clothing accessories have also been upgrading with the promotion of posts, and this installation fee has been rising with the frequent increase of luxury brands.

"In 2010, I spent 18 thousand yuan to buy a Chanel Classic Flap. After a month, the bag increased by nearly 2000 yuan.

Two years later, the price of this bag has exceeded 30 thousand yuan. "

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< p > data show that the price increase of luxury goods is far beyond the average inflation rate.

According to economic theory, the increase in prices of low and medium priced products may frighten customers away, but the increase in luxury goods will help to increase the attractiveness of commodities.

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< p > however, many critics have questioned this theory, saying that this is not a good strategy to boost the turnover. Once the economic environment is changing, it will become self defeating, for example, sales of Gucci2013 will decline by 2.1%. The sales of fashion and leather goods in LV in 2013 slowed down from 7% in 2012 to 5%.

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< p > in fact, luxury goods will be staged every year. Hermes, Cartier and Gucci will raise the price of the counters every year. The reasons given by the brand officials are generally attributed to the spiral inflation of global prices, including the rise of raw material prices, the guarantee of profits during the season break, the increase of the comprehensive cost of channel maintenance and new store expansion and so on.

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< p > the industry has raised doubts about the rising cost of luxury goods.

Gu Minyu once consulted a luxury brand for domestic market development. She told reporters that the cost of luxury goods is calculated: raw material + processing cost + luxury brand value + market public relations cost + channel cost + tariff and government tax rate = actual sales price.

From the point of view of accounting, the brand value of luxury goods is the most important one, and the so-called raw materials and processing costs are relatively low.

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P, the president of a well-known luxury brand, broke the news that the cost of material for LV canvas bags was 11 euros per meter, and it was only 100 yuan.

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< p > the relevant media pointed out that the reason why the high-end products can raise the selling price can be attributed to the market segmentation, because there are so many fashion brands, and the designer brands also have different advantages and disadvantages. For example, there is a gap between Chanel and LV and Michael Kors and Tory Burch. In order to reflect the value of the two sides and maintain competitiveness, the final way is to use the price difference to set the boundaries. This way can also maintain the superiority of high-end brands.

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Li Wei, department store business analyst P, also pointed out that the rise in prices of luxury goods is not much related to the rise in costs. It is more of a marketing tool that not only protects the luxury image of the brand itself, but also caters to the psychological needs of the buying group (if everyone can buy it is not a luxury).

In order to ensure brand image and value, luxury brands regularly raise their prices.

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< p > Li Wei pointed out to reporters that because luxury goods are different from ordinary goods, when people buy ordinary commodities, they pay more attention to the cost performance of this commodity, but for luxury goods, they are embodied by higher pricing and higher added value, so as to enhance the psychological satisfaction of buyers.

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< p > < strong > "light extravagant" diversion source < /strong > < /p >

< p > traditional luxury brands occupy a larger market share in the entire luxury goods industry, and are also strong in promoting publicity and new products.

From the big fashion to the annual Basel watch and Jewellery Fair, high-end luxury brands always occupy the best layout of the best venues and media.

And those small luxury brands, because of the relatively small audience, the size of the enterprise is limited, and rely on the "small circle" with similar tastes, word of mouth is their best advertising.

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< p > in the past two years, the strong rise of light luxury brands is obvious to all.

This has created pressure on traditional luxury brands and dispersed their customers. Therefore, traditional brands aim to enhance the attractiveness of products and offset the loss of sales volume by constantly increasing the price.

Even in the face of increasingly expensive traditional luxury goods, even many rich people find it hard to afford.

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The meaning of "P Affordable" is generally defined as "affordable luxury", specifically, the moderate price, the popular design, the good quality, and the brand of the store in the high-end shopping malls. "Luxury" is defined as the "affordable luxury".

Compared to Hermes, LV and so on, these brands are relatively young, and some even have the luxury lineage (a big brand of secondary line products). They are full of personality and do not lose time, but the most moving consumers are the price, below 10000 yuan or even less than 5000 yuan is usually their mainstream price range.

And when the brand names in the mall are priced at $35 million, the fashion quality, design sense and quality of these luxury goods stand out from the crowd and easily grasp the hearts of white-collar workers who can not catch up with fashion desires.

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< p > > --EndFragment-- > Gu Minyu's company has many fashion lovers. When we take a lunch break on weekdays, we will discuss what new brands have recently come out of the major luxury brands, and which new brands have broken out again. Tory Burch has been favored by many of her colleagues.

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< p > Tory Burch is an American brand. Many young girls know it from gossip girl. It is available only at several luxury electric business offices, and now there is a physical store all over the world. A dress in China sells for about three thousand or four thousand yuan, which is fashionable and affordable, and is very popular among young people.

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< p > today's light luxury brand is not Michael Kros. In the top five luxury companies listed in the 2013 stock market, Michael Kors is the only light luxury brand. In the total ranking of the 22 luxury listed companies, Michael Kors ranks eighth in an old luxury brand with 16 billion 500 million US dollars.

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< p > although the design of Michael Kros is often accused of plagiarism, it still can not extinguish the enthusiasm of the American people, and its proportion in the North American market is as high as 90%.

Ordinary consumers do not care where clothes come from. They value who can provide themselves with cheap products, which, to a certain extent, illustrates the reasons for the popularity of light luxury consumption.

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< p > besides, there are some distinctive niche designer brands in light luxury brands, which do not lead you to wear, but create the resonance of consumers with the personalization of their works.

These designers do not rely on the obvious LOGO to highlight their brand, but use their own personality to design "signature" on the product.

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< p > indeed, with the maturity of consumer psychology, the consumption concept is changing quietly.

More single products began to develop diversified, personalized luxury brands.

At the same time, the "limited and customized" rules followed by the niche designer brand also satisfy most buyers' mindset to avoid embarrassing and embarrassment.

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< p > French jewelry brand Tournaire is the favorite jewelry brand of Gu Wen Yu. Its wedding ring is the "Xiang Xie kiss" diamond ring launched by the brand. It is the design idea behind this diamond ring: the legendary love story of Paris Eiffel Tower, giving "the kiss of the pavilion" with immortal vitality.

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< p > Tournaire is a niche designer brand. In 1984, it was born in the town of Monmouth, France. Its "Architectural Series" has epitomized more than 60 world-famous cities in jewelry design. The distinctive design style and unique artistic treatment have made the brand logo of success.

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< p > < strong > big brand deep in old design < /strong > < /p >.

< p > in the face of the "provocation" of < a href= "//www.sjfzxm.com/news/index_c.asp" > light luxury brand < /a >, can traditional luxury brands only respond to price hike by raising the price? < /p >

Ashley Fred, who is in charge of a trading company in California, USA, is not very concerned about the annual price increase of luxury goods. "What I need is a luxury that can show my unique taste, and the price is not under consideration," P said.

But she also complained to reporters that nowadays more and more people are starting to consume luxury goods. "Bump" and "bump bags" are becoming more and more frequent. Some big brands are not as good as they used to be.

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< p > when it comes to "light extravagance" eroding the market share of traditional luxury goods, Bernard Arnault, the chief executive of luxury goods giant LVMH, even calls "Affordable luxury" the two word. It can not be confused, suggesting that light extravagance is not a luxury category.

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< p > however, the rise of light luxury brands is an indisputable fact. Personalized fashion design and moderate price are becoming the biggest selling point of light luxury brands, while some traditional luxury brands are still stuck in the classic design.

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< p > in fact, simple design and single sales channel can no longer keep pace with the changing market.

From the old Prada earnings report of Italy, we can see that a "simple" brand is beginning to be squeezed out. If there is no change, there may be no future.

Prada's earnings report showed that net profit rose by only 0.3% in the 2013 fiscal year ended January 31, 2014, the worst result since its launch.

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< p > industry insiders say that the weakening of the global macro economy has made the European market of brand consumption to a certain extent, but the initiator of the decline of Prada's performance is the internal injury of its brand.

From the point of view of product structure, most of the Prada sales are lack of freshness for their classic and basic funds, while consumers' ideas are changing, while brand and design remain the same, so it is difficult to attract consumers' attention.

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< p > at the same time, with the advent of the LOGO era, many brands are beginning to break the classics, and continue to innovate in order to meet the needs of consumers.

Fendi and Gucci have launched products and series that weaken LOGO.

It is obvious for the brand to play a low profile and conform to the consumer psychology of shopping.

However, Prada has been stalled in design, and has been labeled by many high-end consumers with a lack of novelty.

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< p > in Ashley's view, luxury brands need innovative factors as well as enterprises. However, some traditional luxury brands are hard to come up with new brand names after designing some classic models and basic funds. "Two or three classic brands of each brand are enough, and the first choice for wasting luxury goods is classic, but if you want to be different and have your own taste, it is obviously not only classic."

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< p > over the past decade, Gucci, Chanel and LV are the best selling brands in the mainstream market.

These brands used to be affordable for only a few people, but now they are becoming more and more popular. Consumers are no longer as keen on them as they used to be. They are increasingly fond of brands with the flu and freshness, and the aura of some traditional luxury brands is disappearing.

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< p > "in the past, the golden rule of success in the luxury industry is noble, elegant, consistent and effective: do not ask customers what they want, but tell them what they should have.

Today, the self centred approach is no longer effective.

You must understand your customers and grasp their high-end value proposition.

It's not just letting your customers know you, but trying to understand them. "

Bain consulting released the report.

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< p > < strong > emerging market + diversification is the way out < /strong > < /p >

< p >, where is the way out for luxury giants? Some have turned their attention to the emerging market countries, which are becoming the next golden hunting grounds for luxury brands.

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< p > Europe > a href= "//www.sjfzxm.com/news/index_c.asp" > luxury goods < /a > the market has been successful in emerging markets, European brands account for 2/3 of global luxury exports. Since the European debt crisis, many industrial entities have been weak and even unable to keep market share, while luxury goods enterprises have achieved great success because of their exports.

In this regard, a study by the Paris Institute of economics shows that first, the strength of brands, such as LV, Hermes, Chanel and so on, are world famous brands. Second, emerging markets are the main consumers, such as India and Mexico.

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The upstarts of < p > a href= "//www.sjfzxm.com/news/index_c.asp" > India < /a > are consuming extravagant luxury, and luxury luxury manufacturers from Hermes to Chanel are keen to meet their needs.

Natasha Dhaudhri, an entrepreneur in Delhi, India, said: "India has become an important luxury market.

Indians with high consumption level are very fashionable. We love famous brands.

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In Latin America, the sales of luxury brand products in Mexico also strengthened, and sales in the world ranked fourth. Mexicans with an annual income of more than 60 thousand US dollars will reach 6 million 400 thousand in 2030.

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At the same time, diversified development has become the fashionable word of today's brand. How to kill a blue ocean in the face of fierce competition? Many luxury brands are based on the diversification strategy of products, markets and promotion. P

LV Group vigorously develops the watch business, Bottega Veneta began to plan the development of jewelry, fragrance and other categories, and the process of brand seeking diversified development is becoming more and more intense.

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< p > on the road of diversified development, Burberry is a successful example which has to be mentioned. Children's clothing, home and bags involve multiple product lines in various fields, so that the brand can meet various needs of consumers.

At the same time, luxury brand's electricity supplier channels have also been thrived. In late April, Burberry successfully entered Tmall online mall, bringing fresh shopping experience to those who love Burberry.

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