CHAPTER ONE: LUXURY INFLATION

Walking out of The Row’s FW24 show that caused a bit of a stir in Paris by asking their guests to refrain from using their phones, The Washington Post’s fashion critic Rachel Tashjian, wrote something that has stuck with me for a while: “Chewing my madeleine and pondering my phoneless experience, I was transported back to the time, long before this era, when fashion was a subculture that demanded connoisseurship…looking back at the magazines, reviews and shows of the time, it seems that a lot of women — and not just big spenders — looked at fashion as something between a cult and a dating service. They were obsessive but also skeptical, in pursuit of an understanding of a designer’s vision.”

It’s hard to imagine the time when fashion was a niche artful hobby when every other person on your feed is a fashion influencer and you can barely walk a block in any major city without spotting the trending item of the season – a jelly shoe, a Le City Bag, and the oval Miu Miu glasses. “Fashion has never been more relevant in mainstream popular culture than now,” wrote Tony Wang and Michael Yeung in 1Granary. “From viral red-carpet fashion moments during the Challengers press tour to Super Bowl athletes striding into Allegiant Stadium decked out in runway outfits, fashion has become a key component of the public’s fascination in our biggest cultural moments across all spheres.”

Last week, the biggest fashion conglomerate, LVMH, reported €84.7B in 2024 revenue which means that their business grew more than eight times since 2001 when they reported just above €10B. Prada-owned brand Miu Miu has grown exponentially since its turnaround in 2020, reporting unbelievable numbers in 2024 – 89% YoY growth in Q1 and a whopping 105% YoY growth in Q3. Hermes grew from just over $1B in revenue in 2001 to €11.2 in revenue for the first nine months of 2024, and Mary-Kate and Ashley Olsens’ The Row reached a $1B evaluation.

A lot of this explosive growth came as a result of what Wang and Yeung called hyper-oprimitzation, Thom Bettridge called merchtainment, and Rachel Tashjian called the marvelization of fashion – prioritizing the broader idea and the theater of luxury fashion over its niche cultural essence and products. The most cited and clear examples of this are LVMH appointing Pharrell as the Creative Director of Louis Vuitton over an industry insider, François-Henri Pinault, the owner of Kering, buying the Creative Artists Agency (CAA), and YSL launching a film production company. But there are plenty of other examples of this throughout the industry – from brands, like Jacquemus, whose viral fashion shows, marketing campaigns, and spaces often overshadow its products, to brands like Telfar and Balenciaga, whose conceptual design and experimental marketing exist in an ongoing conversation with the broader cultural movements and popular discourse. Hyper-optimization goes beyond tapping star entertainers for seasonal campaigns or sponsoring artists, creative residencies, and foundations and sets culture creation across fine arts, music, film, sports, publishing, and other spheres outside of fashion as the top strategic priority of the brand. Broadening their direct cultural reach, fashion houses open up infinite new opportunities for monetization all while making their original products – clothing and accessories – desirable to a larger audience at a higher markup.

The only catch is that when luxury fashion houses open themselves up to a mass audience and lean heavily into the mainstream culture, they risk diluting their creative points of view and lowering the bar on craftsmanship so much that they start losing brand differentiation and alienating their core dedicated audience. Narratives and content take precedence over creativity and products that pull customers in with exceptional quality and attention to detail rather than buzz. “When fashion houses vie to become cultural protagonists at this scale, it signals a complete inversion of what luxury represents,” write Tony Wang and Michael Yeung. “Today, the output of luxury fashion houses is closer to a mass consumer good than it is to a true luxury good, as luxury brands constantly churn out new products, collaborations, content, and activations to become as relevant to as wide a demographic range as possible.”

Louis Vuitton, Balenciaga, and Burberry are all good examples of this. Wang and Yeung cover in their research how Burberry’s numerous collaborations with everyone from Gosha Rubchinskiy to Minecraft led to Everything Everywhere All At Once-ification effect of the brand which stirred up short-term excitement but failed to modernize it. A brand consultancy and creative studio Nemesis broke down how with Demna taking over the reigns at Balenciaga, the brand became “a form of vore porn” that consumes stars, symbols, and subcultures and spits them out as ironic designs instead of cultivating original house codes. Interview’s fashion correspondent Lyas made a harsh but fair comment about Louis Vuitton. “We all know that the only thing that Pharrell is bringing to Louis Vuitton is his name. Because when people can’t remember your clothes, you make them remember your face,” he said pointing to the silhouettes of Pharrell’s and Nigo’s side profiles on one of the jackets featured on the AW25 runway. And while all of this doesn’t necessarily translate into an immediate decline in revenue - Demna’s Balenciaga, for example, performs consistently well, luxury fashion’s rapid expansion into every other bordering sphere of culture is starting to prompt questions among its core customers. When you buy a Louis Vuitton bag now, are you buying a piece of history the same way as when you buy a Loewe Puzzle bag or are you buying a piece of Pharrell’s merch that represents a bygone high fashion streetwear era?

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CHAPTER TWO: THE DISCERNING FASHION CONSUMER

The more value luxury fashion houses assign to the abstract aspects of their business, like storytelling and brand philosophy, the more foolish it feels to spend $2,780 on a designer book tote that costs $57 to assemble, and the more open fashion enthusiasts are to looking for more reasonably priced pieces elsewhere. Last august, BoF reported an ongoing slowdown in the luxury sector, specifically among aspirational shoppers in the US, citing a McKinsey report that showed that most consumers in this bracket delayed purchase, bought less and hunted for better prices. “Shoppers are being driven by value, but they’re “scrimping and splurging,” TD Cowen analyst Oliver Chen explained, meaning fashion customers trade up for the luxury pieces they deem worthy and trade down for cheaper alternatives for the pieces that feel overpriced.

On social media, and specifically TikTok, fashion influencers gave a new meaning to shopping and promoting replicas of luxury fashion pieces, conveniently changing the negative narrative associated with counterfeit shopping into a positive – finding and spreading the word about a decent quality dupe for a viral item with a high markup became a sign of intelligent consumption and an act of public service. Why spend $60 on a Skims bodysuit, when you can get a similar one at half the price and avoid being taken advantage of by one of the most obnoxious celebrity families in the US?

There are, of course, several big issues with this Robin Hood line of thinking, the most obvious one being that it turns fashion into consumption Olympics, further perpetuating mass participation in microtrends. All hell broke loose when a counterfeit $80 Birkin showed up at Walmart, prompting some people to celebrate it as a jab at the rich and their made-up status symbols. In a now deleted tweet, a fashion theorist Rian Phin pointed to the core flaw of the dupe culture: “Instead of defending and buying a knockoff walmart birkin, why not redefine what luxury means and shop intra-communally? Why not say “the hierarchy is bad and makes no sense” instead of saying “you too can play that game.”

But even outside of the dupe-sphere, finding decent-quality fairly priced fashion pieces has become a sign of intelligence and true interest in fashion that sets the discerning shoppers apart from the gullible crowd of fashion victims who buy into whatever “it” item is trending. In a piece about quiet luxury’s impact on dupe culture, Jose Criales-Unzueta approached three Vogue colleagues repping identical crewneck jumpers just to find out that not only did all of them come from Uniqlo (as opposed to the cool luxury brands, like The Row or Loewe) but also that his colleagues were genuinely excited about having discovered the same bargain – a cashmere sweater for under $100. “As average luxury prices continue their climb, we’re all now finding treasure troves in the hallowed halls of mid-market labels — Uniqlo, Gap, Banana Republic, J.Crew, Cos — that trend-forward, style-minded people had, for the most part, dismissed over the past decade or so,” he explains. “It’s not that everyone stopped shopping at these brands. It’s that the gap between luxury and everything else widened, leaving behind a customer base that aspires to invest in fashion but cannot afford ‘luxury’.” It’s hardly a coincidence that high street fashion brands, like Cos, have had a massive turnaround, winning back their place in the closets of fashion editors, creative directors, and other downtown influencers next to pieces from Loewe, The Row, Prada, and Miu Miu.

Even when it comes to purchasing luxury pieces, consumers are still looking for the best deal. “Make accounts with all e-tailers. Download the app, notifications on, put the things you want on your wishlist and get notified when the prices drop,” a fashion influencer Brenda Weischer instructed listeners of her podcast last year. “Even though I have money to shop, I still always google Mytheresa codes, SSENSE codes, Net-a-Porter codes…My rule #1 is don’t pay retail price because things are so crazy expensive.” Luckily, it seems like the luxury e-tailer sales are now everlasting which, as Brenda notes in the same podcast episode, creates a vicious cycle of luxury brands increasing their prices even further in an attempt to make higher profits from discounted items. And then there are horrifying cases of Rick Owens and Celine pieces showing up on Walmart’s third-party resale platform after a troubled e-tailer Matches Fashion sold off its inventory, and Khaite and The Row pieces popping up at discount retailers, like T.J.Maxx. “Luxury inventory on Walmart signals two things,” Globaldata analyst Neil Saunders explained to The Cut. “First, the market for luxury is slowing down and there is excess stock that needs to be sold. (“This is bound to find its way into all kinds of channels,” adds Saunders). And second, luxury brands are not in full control of where their product is sold.”

There is also a demographic of shoppers who aren’t familiar with luxury fashion and are simply looking for chic and fun quality pieces for their wardrobes. This is where brands, like Tory Burch, The Frankie Shop, and Coach with their well-made stylish pieces shine the most. “Why is it that we call a brand a luxury brand  – just because the price tag is, like $800 for socks?” the founder of The Frankie Shop Gaëlle Drevet told Vogue. “I mean, it’s so silly. It’s not about being cheap, or affordable—it’s about being fair.” Stuart Vevers, the creative director of Coach, expressed a similar sentiment by sharing that the brand is no longer interested in engaging with the long-held meaning of luxury: “It feels a little outdated, at least in the way that we used to define it as something very polished, very perfect, and very unobtainable.” Instead, Coach focused on well-made wardrobe staples and expressive pieces that target young shoppers and grew their business by 10% YoY based on the latest reporting for Q2 last year.

The mass fashion opportunity

A healthy appetite for fairly priced, decent-quality fashion pieces has been growing once again in the intersection of the masses who shop peer-to-peer recommendations on social media, fashion insiders embracing high-low wardrobes as luxury prices continue to climb up, and stylish people looking to build or update their wardrobes without fully immersing themselves into the trends or the fashion scene. Capturing just one of these demographics and really owning that niche would already be highly impressive and profitable. Capturing all three with a more or less the same selection of pieces would be hitting a jackpot. And yet, while the opportunity is clear, the strategy for getting there is tricky which means that it’s easy for mass brands to slip into making the same hyper-optimization mistakes that luxury fashion made when they accidentally opened up this market opportunity to them in the first place.

CHAPTER THREE: MASS BRANDS’ BIG LUXURY AMBITION

A few weeks ago, Zara announced a partnership with Samuel Ross – an award-winning designer who is most known for his work alongside Virgil Abloh as well as founding his own brand A-COLD-WALL*. But unlike every other collaboration between a mass fashion brand and a luxury fashion designer, this one is supposed to be an ongoing multi-year line housed under Ross’s studio SR_A, which could mean that Zara’s long-term plan is not only to create luxury association but perhaps, even become luxury. “Zara is clearly building a platform where they can empower emerging designers, and even creators, influencers and celebrities,” Tony Wang told Financial Times. “The next major fashion group might come from a high-street brand – the next LVMH or Richemont or OTB Group. It feels like it’s hard to enter that through the luxury fashion route now. So I wonder if a Zara or an H&M would eventually try to take equity positions in emerging designers as part of a long-term strategy, to become the next LVMH or Kering.”

This would explain why in the past couple of years, mass fashion brands started actively tapping luxury fashion talent, investing in “studio” lines, and participating in New York, London, and Paris Fashion Weeks. Former Head Designer at YSL Stefano Pilati made a capsule collection for Zara which was shot by Steve Maisel and modeled by Gisele Bündchen and Pilati himself. Gap hired Zac Posen to lead GapSudio as well as the creative, design, and marketing across their portfolio and went to The Met Gala with Da’Vine Joy Randolph and Cannes with Anne Hathaway. H&M snapped up Glenn Martens for a capsule collection right before his move from Diesel to Margiela. Uniqlo has been teaming up on bi-annual releases with JW Anderson since 2017 and most recently brought in ex-Artistic Director at Chloé and Givenchy Clare Waight Keller as their in-house CD. And J.Crew released sheer dresses and tiny bottoms in collaboration with New York’s chief cool girl Maryam Nassir Zadeh.

The idea behind these collaborations is for the mass brands to provide the infrastructure and resources necessary for the “scene cool” talent to become mainstream, and for the talent to drive media and industry buzz as well as earn street credit among fashion insiders – all of which ultimately trickles down to the mass brands’ bottom line. When Salomon releases a limited edition sneaker with Sandy Liang, they also end up selling a bunch of baseline shoes to the people who did not manage to shop the collab. When On designed a shoe in collaboration with Loewe, it was a major push in their transition from a technical to a lifestyle fashion brand and a reason for people outside of the running community to take a second look at their website. People who walked into Uniqlo to get a pair of jeans from the JW Anderson drop, likely picked up a few t-shirts and socks from the basics collection on their way out of the store.

But while so many successful rebrand and growth stories of the past decade have been largely driven by this type of collaborations, it doesn’t mean that doing something like this automatically makes a difference – the key to creating long-lasting impact is in precision, timing, and detail. For example, Charli XCX and Troye Sivan might have owned the music charts this past summer but when brands vying for a comeback – Converse, Gap, and H&M – dropped a huge amount of money to bring them into their campaigns and activations, they failed to create long-lasting marketing moments and ended up as tiny blips in the zeitgeist. Gap x Madhappy collaboration that starred Devon Lee Carlson and so clearly targeted Gen Alpha and Gen Z with its campaign visuals and product lineup, was likely much more impactful for the business. Peter Do’s collaboration with Banana Republic went array because of the fabrics, pricing, and other not so sexy business details even though conceptually, it made perfect sense. Kaia Gerber and Cindy Crawford modeling for Zara Streaming is a buzzy but confusing headline, making it the type of partnership that more people want to analyze and write about than shop as opposed to something like Clare Keller’s or JW Anderson’s capsule collections for Uniqlo where the pieces and styling speak for themselves.

“If Louis Vuitton can have ball gowns that they don’t produce on a red carpet in order to sell luggage, why can’t Gap have a T-shirt gown on the red carpet? But we’ll actually produce it,” Zac Posen told Vogue earlier this year. But even though something like this makes sense on a conceptual level, it starts to fall apart when it comes to strategy. When Louis Vuitton makes a custom dress for a red carpet event, not only do they get mass brand exposure, they also show off their creativity and craftsmanship and advertise their couture services which make up a nice share of their business, to the VIPs. When Gap puts Anne Hathaway in a button-up dress, it doesn’t say much more than what we already know about the brand – their PR is working overtime and Zac Posen is a great couturier. When New Balance releases a crazy limited edition pair of 550s, it’s clear how the buzz around that collection converts into baseline model sales. When JW Anderson designs a capsule for Uniqlo, it can be easily styled together with the brand’s core collection pieces. When Gap releases something that’s so widely disconnected from their core offering both in the product sense and the spirit, it’s tough to see the same connection, especially given the importance of consistent strategy and messaging as the brand is trying to reinvent itself.

There are a couple of major fallacies in flipping luxury fashion’s tiered offering model and copy pasting it as a strategy for mass brands. It feels equally dishonest for luxury brands to hike up their prices and double down on the craftsmanship and creativity messaging as the production value of their products continues to decline, as it is for mass brands to capitalize on this trend by increasing their marketing spend and hiring luxury talent to appeal to the tastemaker crowd without investing into a solid core product offering with a cohesive vision first. Plus, the idea that fashion fanatics and higher status shoppers need a separate collection that speaks directly to them to get excited about a mass brand is awfully misguided. Basic garments, like nice roomy pants, cozy puffer coats and sturdy menswear shirts, offer an endless room for experimentation and an opportunity to coin iconic styles in the world where fashion is as genderless and high-low as ever. Obviously, it’s a challenge to create products that appeal to a wide range of demographics at once while also making sure that the materials, production costs, pricing and other business details make sense at the same time. And yet, it’s unclear how breaking the audience up into small segments and marketing to all of them separately is that much cheaper or easier, especially as you try to make all of these efforts align at the top strategy level.

And it doesn’t end there – looking up to their luxury counterparts, mass brands are fully leaning into the ‘hyper-optimization’ and ‘marvelization’ of their brands. Gap’s CEO Richard Dickson who came to the brand from Mattel is already thinking about pants in sweaters in the Barbie universe terms. Could Gap, originally a records and jeans shop, have a record label? Could Banana Republic operate a line of hotels? It’s always worrisome when these types of visionary ideas pop up in meeting rooms of companies that have plenty of low-hanging fruit design, product, and marketing adjustments to make. But it’s even scarier when a brand starts actively moving in this direction before making any progress in bringing their core business back. For example, when Zara opens a cafe in their men’s store in Madrid, essentially replicating a staple brand tactic created by luxury brands, like Prada and Alaïa, as well as elevated lifestyle brands, like Aime Leon Dore and Supreme, it’s unclear exactly what it’s supposed to accomplish. When a luxury brand enters hospitality, it’s either building out a lifestyle universe for their high spenders through hotel and resort collaborations or expanding their product offering into the masses via coffee shops and cafes. And a lot of times, this is the type of brand marketing that ends up diluting the value of their brands. It makes no sense for a mass brand to replicate this strategy, hoping to score luxury association points to revive their dead brands. The main reason why H&M and Zara declined is because the quality of their product fell. Opening a cafe feels like an unnecessary marketing spend when there is work to be done in the core business of the brand.

Another problem is that all these grand ideas about the way both mass and luxury fashion can shape culture often boil down to just working with buzzy industry and celebrity talent and miss major opportunities to actually touch people’s lives. On the business side, it’s critical to understand the shifting dynamics of how and where people want to shop and what they spend money on outside of fashion. On the creative side, it’s wild how little value most fashion brands assign to the way people’s lives have changed in the past few years – from work sliding into a weird space between home and the office to the lifestyle implications of the radical political and technological shifts happening in some of the industry’s top markets. For example, when women’s bodies become a political topic, the decisions around how women dress go beyond the artists they enjoy and the trends they see on TikTok, and factor in how they want to show up in a society that’s so eager to censor and regulate them. And even on the lighter note, fashion should at least try to understand how women’s priorities and lifestyles have changed over the past decade – how they are recontextualizing their sexuality, how they think about their careers, and which private little moments they enjoy. It takes much more to touch and shape culture than hiring pop stars and downtown influencers to wear your brand’s clothes and repeat the message your audience has already heard time and time again – cool hot people are wearing this and so should you.

A mass brand that’s tapping into culture more or less successfully is Abercrombie. It may not be as sexy as hiring an “it literally girl” to write a collection of short stories to accompany a seasonal campaign, like Prada, but it is impactful to their business and brand. Abercrombie’s core target demo is young millennials which is representative of a huge swath of America. “They are living their best lives. There’s nothing better than being a young millennial. They live for the long weekend. Monday would come along and the most important thing for them was what was happening the next weekend,” Abercrombie's CEO Fran Horowitz told WWD a little over a year ago. So, the team created a 96-hour calendar of what these consumers could be up to during the weekend – bachelorette parties, weddings, trips, and activities with their friends – and made sure Abercrombie's product mix can dress them for all of these events. And sure, it’s jeans, sweaters, and dresses that look like they came straight from Pinterest but it’s also honest, cohesive, and representative of where and how a certain type of young millennial in America chooses to shop. So, it’s hardly surprising that the business started seeing a positive shift by the end of 2019, and brands like Reformation, Artizia, and Sezane, that have followed a similar strategy, take up a huge share of young millennials’ closets and wallets.

And that’s not to say that if a brand has mass commercial aspirations, it has to settle for boring basic pieces and campaigns. A walking masterclass in understanding culture through the everyday lives of regular people rather than the creative output of the coastal elites is Phoebe Philo who dressed cool party girls at Chloe and then confident, tasteful young women at Celine – ultimately shaping the quiet luxury style that trickled down into the masses through brands like Cos and H&M. Her namesake brand Phoebe Philo is now a major part of the greater cultural conversations about the way Gen X women are rearranging priorities in their lives and recontextualizing their sexuality, alongside Miranda July’s book All Fours and Halina Reijn’s Babygirl. Zara had such an incredible opportunity to weigh in on these conversations when they released a capsule with Kate Moss and cast Cindy Crawford in their live shopping campaign but unfortunately, the stories around those collaborations were reduced to having big luxury fashion names involved with a high-street brand.

In general, it feels like mass fashion brands are so caught up in their desperate desire to regain their relevance that they forget the most important page in the luxury fashion’s playbook. They can hire luxury designers and pay high-profile influencers and celebrities to star in their campaigns and attend their events. They can open cafes, hotels, and restaurants and host expensive activations. They can zoom out to the brand universe level and fantasize their ideas can spill out into the bordering industries. But at the end of the day, if they don’t have a unique point of view and something interesting to say at the core of their business, all of these efforts add up to is a boring business theater rather than any type of cultural influence that can revive and support the brand long-term.

CHAPTER FOUR: PARTY IN THE FRONT, CRISIS IN THE BACK

Although consumer backlash, specifically among the younger generation, is often credited with “taking down” mass fashion brands, like H&M and Zara, and pushing them to change their business approach, this narrative is largely misleading. The generation that’s become so tightly associated with intelligent consumption, is also responsible for the rise of ultra-fast fashion which, funny enough, is actually one of the reasons mass fashion giants are cleaning up their act. When H&M put out 4414 new styles on their website in a year, an ultra-fast fashion giant Shein put a whopping 315,000 new styles up – and these numbers are from 2022. When ultra-fast fashion beat fast fashion at their own game, and luxury fashion giants quadrupled their earnings in the business that’s supposed to be “exclusive”, brands like H&M and Zara ended up in a weird spot – all of a sudden, competing alongside luxury brands sounded like a more viable business opportunity than racing to the bottom against Shein and Boohoo.

Plus, on the legislative level, US administration is toying around with the idea of tariffs on goods imported from China, Canada, and Mexico, and according to BoF, fast fashion is currently the number one villain in the EU – France’s proposal to tax cheap clothes like cigarettes is only the latest indication that European lawmakers are starting to take the ecological cost of fast fashion seriously. A legislation proposal called The Fashion Act is being actively pushed in the state of New York, and if implemented, will require all major brands that want to sell clothes in the state to guarantee sustainability, transparency, and fair work conditions. And since New York is one of the most populated and fashion-centric states in the US, the hope is that The Fashion Act would eventually spread through the rest of the states.

It’s not surprising though that none of these very real business concerns have been showing up in mass brands’ messaging. Although brands, like Zara and H&M are taking steps towards bettering their production processes, their communications about them aren’t central in their rebrand. “Sustainability, once a hot buzzword, has become a liability for many brands, with consumers wary of greenwashing,” Sarah Kent and Malique Morris write in BoF. “Values-driven messaging is increasingly viewed as preachy, rather than aspirational; limited drops of innovations that never scale have become routine, rather than exciting. At the same time, brands are grappling with a broader cultural vibe shift, especially in the US, where a backlash against “woke capitalism” has prompted many businesses to pull back from public commitments to diversity and sustainability.”

That’s not to say that sustainable mass fashion brands can’t be successful. Companies like Ganni and Reformation have built amazing businesses while keeping sustainability at the core of their brands. But even then, at least from the consumer point of view, sustainability has been more of a pleasant add-on that turns expensive purchases from these brands into guilt-free investments rather than a key reason to shop from them. Plus, sliding my credit card at a register at Ganni, I still sometimes wonder how an operation so massive with so many shops in New York alone could be sustainable.

But like most people, I don’t ask these things out loud. To a certain extent, we all benefit from playing along with fashion’s pretend game. The people who are desperate for status symbols are keeping the value of branding over quality high. Creatives want to believe in the effectiveness of corporate sustainability efforts to feel more content about their jobs.  An average consumer is rooting for a comeback of high street brands because everything else is either boring or impossibly expensive. And someone who splurged on a nice designer sweater sure doesn’t want to know how little it cost to make it. And so we go on, confused as ever about what’s worth our hard-earned money and shortening attention spans, complicit in blurring lines between art and commerce, hype and quality, luxury and mass.