Shopping. An Un-Risky Business. High End Fashion Junkies Are Web Shopping’s Latest Addicts. Second City Style Fashion Blog

November 6, 2007 • Shopping


Everyone knows that internet shopping is at an all-time high. Consumers can purchase goods from all over the world from independent retailers, indie designers and often without the burden of sales tax. But as the NYT reports, more and more online sellers are aiming for higher end markets– not just the ladies and gents looking to find a bargain basement. And the research supports the claim, as Bob Tedeschi reports, "Over all, luxury apparel sales will approach $1 billion this year, according to Forrester Research,
a technology consulting firm. E-commerce is expected to grow by 21
percent compared with last year, and growth in luxury apparel sales is
expected to exceed that, Forrester said." For the full story see below.– Joanne Molina, Senior Editor

AANGELENOS have Rodeo Drive. New Yorkers have Fifth Avenue.
Chicagoans have the Magnificent Mile. For many other high-fashion
shoppers, the nearest destination is the Web.


and brands are increasingly relying on the Internet to market $3,000
skirts and $5,000 suits to consumers who think nothing of spending that
much on clothing. The trend represents another byproduct of high-speed
Internet connections, but it also speaks to the growing belief among
luxury retailers and designers that a two-dimensional Web store will
not diminish their marquee status.

“We’ve begun to see that the
e-commerce shopper is indeed someone who has really quite a level of
sophistication, and is older than was once imagined,” said Robert
Triefus, an executive vice president with Armani Group. “For fashion,
that type of consumer is very fundamental.”

Armani had been selling a small fraction of its collections through online retailers until September, when it introduced, which sells the entire Emporio collection, one of Armani’s six major brands.

Among other things, Mr. Triefus said, the site opens the brand to
consumers who are not near the company’s stores. “In a market like
America where we’ve historically only had 10 freestanding stores, this
suddenly makes accessible one of our most important collections in a
very broad way,” he said. “One imagines the virtual store will
progressively rise up the charts.”

The Web site may not become
the top-selling store, but given the experiences of other fashion
brands, it could get close. The online stores of Saks and Armani
Exchange, the company’s casual clothing line, sell more goods than all
but the top store in their chains.

According to Brendan Hoffman,
president of Neiman Marcus Direct, the company’s catalog and online
division, luxury apparel “has been exploding over the past 18 months,
really at the upper end of the price points.”

Basic garments sell comparatively slowly, Mr. Hoffman said, but items like $7,900 Valentino gowns, $5,500 Carolina Herrera jackets and other items “with more camera appeal” sell quickly.

“We’ve yet to see any limits to what they’re willing to pay,” he said.
Two factors are behind the recent growth, Mr. Hoffman said.

many more customers have high-speed Internet connections, allowing them
to click more freely through multiple pictures of an item and zoom in
on shots of fabrics and colors. Mr. Hoffman noted that until 18 months
ago, most of his business came during working hours on weekdays. Now
much of it comes “on weekends and after 8 p.m., once the kids are in
bed,” he said.

Designers, meanwhile, have given shoppers
more reason to move online, Mr. Hoffman said. After watching Neiman
Marcus and other luxury online retailers — like,,
— for years sell expensive shoes, bags and other accessories, designers
like Armani, Zagliani and Marni have pushed more of their collections
onto the Web.

The recent surge in luxury apparel sales brings
sweet vindication to online-only retailers who endured the fallow
years, like Net-a-Porter and Yoox. The two sites made their debut in
2000, around the same time as the humiliating demise of, an
online retailer based in London. in late 1999 built a site
heavy on animation and slick photography, but that proved useless for
those with dial-up Internet connections.

By contrast,
Net-a-Porter aimed at more basic customer needs, like fast delivery and
fast-loading photos, said Natalie Massenet, the company’s founder.

wanted to put the clothing and images on show, but we didn’t have
money, so we had to do things simplistically,” she said. “We continue
to do things in a very streamlined way. Customers like that.”

Massenet found other ways to improve the shopping experience.
Net-a-Porter’s early management team, which included fashion magazine
veterans, developed weekly editorial spreads featuring the site’s

The site’s packaging, meanwhile, carries more than a
whiff of cachet; shoes come inside noncollapsible boxes tied with
brocade ribbon, which are then wrapped in tissue and placed inside
cloth bags and placed inside another box tied with ribbons. The company
is considering ways to cut the cost of the packaging, she said.

we always say it’s what makes it so exciting to shop on Net-a-Porter,”
Ms. Massenet said. Sales at the privately held company will jump by
more than 85 percent this year, Ms. Massenet said, with profits rising
as well.

Over all, luxury apparel sales will approach $1 billion this year, according to Forrester Research,
a technology consulting firm. E-commerce is expected to grow by 21
percent compared with last year, and growth in luxury apparel sales is
expected to exceed that, Forrester said.

Sales for
Net-a-Porter’s chief competitor,, which is based in Italy, are
also increasing rapidly, but the site has recently added a new
dimension: creating e-commerce sites for designers who want to sell
directly to consumers. Yoox this year developed online stores for
Marni, a women’s designer, as well as Armani’s Emporio site, with 10
designers still to follow over the next 18 months.

Marchetti, Yoox’s chief executive, said the decision to build online
stores for designers was easy. “We already put together so many things
— logistics systems, technology, customer care, warehouses, 20 studios
to make pictures with 25 photographers; why not give this platform to
the brands to do their own mono-brand flagship store?”

Marchetti said the business had about $70 million in revenue in 2005,
and sales have increased annually by at least 40 percent since then. It
has been profitable since 2005, he said.

Given the sales growth,
it is perhaps no surprise that Web sites are investing more heavily in
technologies that could give them a competitive edge. Take Saks Fifth
Avenue, for example. In September, the company unveiled a revamped Web
site, simplifying its layouts and adding features meant to showcase
popular designers with video fashion shows and interviews, among other

Denise Incandela, president of Saks Direct, said visitors
to the new site buy at a slightly increased rate, compared with the
older version. “This medium is a fabulous way to communicate even more
information than we can in the stores,” Ms. Incandela said.

“This is almost what you heard people talking about in 2000, but only now is the technology catching up with our ideas.”


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