Brand loyalty in the fashion industry holding up despite tough economic times
September 3, 2012 by admin
Despite tough economic times, the luxury fashion sector is showing unprecedented growth and profits due to customer retention efforts and brand loyalty.
Recent studies have shown that a number of luxury fashion brands have flourished because of the unparalleled product quality and craftsmanship, something that people are clearly willing to pay for.
Mid-range fashion retailers on the other hand have been suffering, and these recent reports do much to elucidate why: they are not offering high quality goods that represent real value, or offering sufficient savings.
The strength of luxury
Studies made by analysing the top 500 global brands have shown that those offering high quality luxury products have gone on to make more profits than well-established middle market brands. Many have interpreted this to show that the rich are unfazed by difficult times.
Even in tough economic times, people aim to keep up their appearances, and sporting luxury brands is definitely a way of doing this.
Well established luxury fashion companies such as Dior, Louis Vuitton and Burberry have been showing billion-dollar valuations. This is because a number of their products have become easily available, moving away from niche sales locations. By selling their products in department stores such as Harrods, Burberry have made massive steps in commercialising their products.
With Harrods’ recent introduction of customer loyalty schemes implemented by the likes ofICLPLoyalty.com, sales have continued to grow for luxury brands, showing that brand loyalty is essential to long term success, and that luxury brands are successfully engaging in marketing practices that started on the high street in the interests of commercial gain.
French fashion house Dior has shown unpredicted success, launching itself into the top 500 global brands table for the first time. UK fashion has also been making steady progress, with Burberry proving to be one of the most successful UK fashion brands in the past 5 years. This has primarily been down to its success in eastern markets such as China, where exclusive clothing has been flying off the shelves.
Luxury jewellery has also bounced back, with the likes of Cartier and Tiffany & Co. making significant headway in the top 500 list. With Gold and rare stones being one of the few recession proof investments, it’s of little surprise that well established jewellery brands are selling well.
If there is anything struggling brands can learn from this, it’s that it pays to provide consistent high-quality products that are perceived to be more exclusive than other products on the high-street.
While austerity has been the buzzword of the last few years, the fashion and retail has shown that the high-end market is still there to be tapped for brands able to catch their eye.