From today’s Wall Street Journal comes this totally depressing story about the state of the economy and how it’s effecting the aspirational retail shopper.
When Ann Taylor and Banana Republic launched higher-priced clothing lines last fall, the luxury market was booming and specialty apparel chains of all stripes jumped on the new "accessible luxury" bandwagon. The strategy seemed like a sure-fire hit. Stores began rolling out $350 jackets and $200 pants which should have seemed like a drop in the bucket to higher-income customers.
Yet, their timing couldn’t be worse. As the economy has tanked retailers across the board are struggling with a slowdown in consumer spending. The market for entry-level luxury goods (aspirational buyers) has been hit particularly hard. Some chains are delaying or scaling back their high-end plans, or canceling them altogether.
Cache closed two of its 15 Caché Luxe stores this year and plans to close more. Coldwater Creek is dropping its higher-priced Spirit line, after testing it in about 50 stores. AnnTaylor, which launched its more-expensive Collection line in 24 of its 929 stores in September, the response so far has been lukewarm. Gap won’t disclose sales for Banana Republic’s BR Monogram line, now in 30 of its 555 stores in North America.
"The aspirational buyer (middle class) is pulling back and not buying, or shopping at the outlet malls to a greater extent," says Craig Johnson, president of Customer Growth Partners LLC. Shoppers with annual incomes of up to $250,000 have trimmed luxury purchases in the past year, he adds.
By moving upmarket, the chains hope to boost their profits. But right now, they are having to slash prices to move merchandise.
Read more "Retailers Downscale Their Luxury Lines" here.See the Top Ten Summer 2016 Trends for Women Over 40
Tags: accessible luxury