Redefining Luxury in a Multipolar World

What brands must do, if they want to be considered luxury in the future

Introduction

In the last few years, the world has encountered some unfathomable events with consequences
of profound changes in the way our world has been structured.

For luxury, leading up to these years was an era marked with booming growth, especially in the
emerging markets of Asia, Middle East, and Latin America. With the new found riches of their
elite class backed by rapid economic growth, these markets created an enthusiasm for luxury
goods that had not been seen in the Western World in recent times. Globally, emerging
markets were estimated to represent at least 80 percent of growth by 2015 (Mc
Kinsey&Company Global Luxury Report 2010). Brands that were seeing a strong
decrease in their traditional markets of Europe and the US, were able to offset such
decrease with growing sales in the BRICS countries. With no real local competition,
thanks to decades of soft power influence of the Western media and entertainment, the
luxury brands expanded vigorously, breaking all the rules and guidelines that made a
luxury brand into what it is. Greed, to capture those markets before anyone else, it
seemed, overruled any restraint, and any potential damage to the long-term value of the
brand was ignored.

After twenty years of globalization, we are now at a time when there is an increased
awareness of social issues globally. Renewed effort is being put in to the long, ongoing
process of decolonization through promotion of equality, inclusivity, mutual respect and a
shared humanity, a process that had stalled and took form of neo -colonialism in the recent
decades. This debate on dismantling neo-colonialism as well as the changing geopolitical
structures require all industries to adapt rapidly to protect their brand value and safeguard
their long-term interests in this new global setting.

Key Markers of Luxury Brand

Before we can redefine luxury, we must first define luxury. For that we will use J. N. Kapferer,
arguably the leading voice on modern luxury strategy to provide us with the starting framework
for this paper. One of the most misused words within the fashion industry, to Kapferer, luxury is
equivalent to a culture and therefore the value of luxury is intangible – a luxury product is
not the most innovative, high tech or superior in quality. It is not the most fashionable or
desired by the masses, and it sells at a price point that is prohibitive to most wallets. It is
therefore appropriate to assume that to manage luxury one must first have a thorough
understanding of it
Kapferer’s criteria of ‘what makes a luxury brand’ includes the following (in particular order):

1. Luxury brand must produce in its country of origin with exceptional craftsmanship
2. Refrain from Celebrities: Keep Stars out of your advertisements
3. Selective Distribution: Luxury is rarity and exclusivity; access to it cannot be too easy
4. No lifecycle for a Luxury Brand; luxury is not a slave to time
5. Luxury is not comparative
6. Luxury must protect clients from non-clients; one on one relation with the client at retail
level
7. No product without service
8. Prohibit licensing
9. Don’t sacrifice the past to the future
10. Prices must be raised regularly to weed out low end (casual) customers
11. Exceptional level of quality
12. No super sales, no promotions
13. Strong involvement with the arts

If we pick any of the LVMH or Kerring owned luxury brands randomly and put them to this test -
Out of the 13 markers suggested by Kapferer that are integral to a luxury business model one
can see even the top luxury brands do not follow most of those rules anymore. Companies like
Gucci and Louis Vuitton which we can consider to be amongst the top tier of luxury barely
follow 4 to 5 of these rules, inconsistently at best.

Loss of craftmanship

Already going through a long and slow decline the fashion, textile and craft industry of France
and Italy suffered deeply and rapidly due to the Covid19 crisis. This has further accelerated the
production shift from the two countries to other countries in Eastern Europe, Turkiye, China
and India. While mass fashion has not been a stranger to this phenomenon, the luxury industry
had pride itself on inhouse production as one of the key pillars of defining luxury. This
uncompromising rule is now conveniently broken as required season to season.

A consumer survey cited by Kapferer, clearly shows that delocalization of production for luxury
brands is undesirable from the point of view of the consumer with 86% of them in an
established luxury market like Japan disagreeing with the trend of luxury production shifting
out of the country of origin. Yet the practice of increased production into lower waged
countries has continued to increase, with all luxury brands shifting production for one item or
another into another country.

Timeless Luxury or Out of Time Luxury

Can we say that this holds true for the luxury brands at this point? – For Example, Dior, making
the saddle bag season after season, based on each season’s trend makes it transient and puts
an expiry on its own products. The bag can be all the rage for one year and then not be touched
by the taste makers for the several years to follow.

We can also see that the luxury brands themselves, despite their continuous efforts to stay
fresh still fall prey to being out of fashion. Gucci and Dior are currently facing such downward
cycle after achieving tremendous successes. This is clear indication that the brand is run like a
fashion business (which is usually susceptible to such pressures) than a luxury house which is
considered immune to being out of fashion, because it is truly never meant to be in fashion!

Private sales

Although, sale events were a big red line within the luxury industry that separated it from
fashion, we see now such practices have seeped into the luxury sector. Even though they are
not advertised, it is an open secret that luxury brands hold private sales and silent sales events
for their clients on a regular basis.

Furthermore, by also starting to sell their products through wholesale accounts, (albeit
limitedly) rather than only through their direct point of sale, the luxury brands have opened
themselves up to the whims of departmental store promotions and sale events as well, not to
mention loss of control over part of their distribution chain.

Over reliance on logo

The overuse of logos and house prints in the last decade across all luxury houses has further
watered-down elevated image of the brands. The overuse of logo to sell garments has also led
to designs practices that rely less on innovation and creativity and more on trends and market
demands. This practice has not been curbed even at a time when fashion houses across all price
points now copy these codes to develop products for their market leading to product saturation
that makes it impossible to distinguish luxury from premium, masstige and at certain times
even fast fashion. This again goes against the DNA of luxury that must focus on craft and
exclusivity to distinguish its products.

Comparative Luxury Shopping

Stretching the brand universe and embracing the trend cycles of fashion has eventually led
luxury brands to a point where even their higher products (leather goods, couture) must cater
to their clients’ whims. The power dynamics between luxury and its consumers has flipped.
Whereas, once it was luxury that would dictate what the client desired, is now dictated through
trends that brands must create their own version of – and hence the over use of logo as the
sole distinguishable mark of identity. Similarity in products opens up the brands to comparative
shopping where various criteria including price start to play a role in the customer’s decisions.
Money Moving Eastwards

The consistent flow of money eastwards has been ongoing for a while. The recent explosion of
K-Pop on international stage, however, has led to a clear pivot by the luxury brands to utilize
the phenomenon to increase their brand cache. Black Pink, BTS, and other Asian celebrities
have been assigned brand ambassadorship to specific luxury bands. In a business that builds on
dreams and lack of accessibility on a certain level, using celebrities and personalities of East
Asia to cater to these markets is an indication of such changing times but more importantly is
also an indirect admission that these brands need celebrities to sell their products more (or at
least equally) than the celebrities need brands to further their image. It also takes the brand
away from its heritage as the new revolving door of celebrities do not have any connection to
the brands history and does not reflect the loyalty which luxury brands demand. Either way, it
goes against the cardinal rule of luxury strategy as was laid out earlier.

Overall, it is easy to see that the fall in craftsmanship, lack of control over the full retail
experience due to franchising and global expansion, and one to one relationship with clients,
have all experiencing varying levels of erosion. Furthermore, the use of celebrities, influencers,
is widespread and reaches beyond the definitions of a brand ambassador.

This is a clear indication that the brand does not have the high level of quality and creativity to
justify a price that would allow them to continue on a luxury business model or they have lost
confidence in their own history that they try to sell to the world.

Consolidation through collaboration

Faced with changing scenario and lacking confidence in their historical successes, luxury brands
doubled down on collaborations during this past decade. But if a luxury product is defined by
the fact that there is no ‘need’ to purchase it because it is a dream and will only happen on its
particular time for any given client, then how can a collaboration between Louis Vuitton and
Nike (or countless others within the last decade) with a limited scope and an immediate need
to buy now or miss out on it makes it a luxury characteristic? It does not. It is clear that these
products are sold solely by creating hype and directly appeal to not their core customer but to a
different market, one that is not motivated to desire ownership of a luxury good that brings an
intangible reward but with a singular objective of using luxury to elevate their status or taste
level. Kapferer refers to this group as ‘New riches’ from emerging economies although one can
argue that a sizable number of this segment also lives within the developed world (West).

Furthermore, the fact that the collaboration involves a mass-produced brand from the US or
Germany and has no connection to French luxury heritage is completely ignored. This also
speaks to the larger ongoing geo political power play between US and its allies that we will
touch upon later in the paper.

Deviating further from the luxury strategies

The rise of the streetwear and sportswear into high-end fashion was not co-incidental or
aesthetical in nature completely. Two factors contributed immensely to this rise in popularity.
The 2008 crash of financial markets consolidated the global elite of the world while creating
even more inequality amongst the rich and poor, wiping out large chunks of the middle class,
which still formed a good chunk of the occasional luxury purchaser.

At the same time, globalization and social media continued to bring new swath of customers,
led by the Chinese, into the luxury segment, whose idea of Western fashion and luxury was very
different as well as their use for those luxury products. As the brands pivoted to these new
markets, they slowly and slowly started breaking down the rules that had guided them over the
years. The greed for growth and profits was too much to handle. Over time, as these luxury
brands delved more and more into the hype-based collaborations, they themselves become
victim to the very phenomenon that they unleashed onto their customers – Fear of Missing
Out. If Gucci has a collaboration with Adidas, then Dior must have one with Nike. The irony in
this cannot be understated.

The young, new execs, armed with their prestigious IVY league degrees from hollowed out
institutes that were now incapable of imparting true learning, could not understand and
respect the traditions that separated these luxury brands from others high end fashion brands.
In an era of uncharted waters that required deft handling through an understanding of the core
of what luxury is, these execs took the easy way out for short term profits.

In that sense, the current events of the last three years (the pandemic and the Ukraine War) are
a continuation of that same phenomenon that started in 2008. It is now starting take its final
shape.

Unintended Consequences of Rapid Expansion

In his book, “Kapferer on Luxury” the author acknowledges the rapid and multi directional
growth that is unusual of the luxury brands. Horizontal, across the globe, Vertical, into second
and third lines, as well as diversification into all product lines led to an abandonment of all
notions of specialty.

It must be said here that from an outsider perspective, the premise for the author is falsely
build on a conviction that Western lifestyle is the most desirable and hence sought after by the
masses around the globe. This has been evidently not true anymore. As the power of unilateral
influence weakens, so does the soft power it can exert.

The consolidation of brands, products and narrative speak to that. The absorption of Japanese
aesthetics into the wider western aesthetics and the consumption of French Luxury into Nike
and Adidas through collaborations etc. are prime example of such phenomenon. This is no
different than the narrative for geopolitics in Western News media where increasingly the
narrative of all US allied countries is same and yet at complete odds with the narrative in rest of
the world.
As the prominent French intellectual Emanuel Todd puts it “The US “imperial system” is
weakening in much of the world but this is leading Washington to “strengthen its hold
on its initial protectorates”: Europe and Japan.”

The vast majority of the world is no longer invested in such black & white thinking. Criticizing
Shein while giving Bershka and H&M a pass, demonizing TikTok while allowing Instagram to do
the same, weaponizing Climate change to hinder the development of certain countries are neo-
colonial tactics that are currently being questioned by the global south. The emphasis is on self-
development and stability while navigating a more complicated set of global issues that can’t be
addressed in yes or no.

In this context, over the past few years, the renewed debate on Neo-colonialism, and the rise of
social activism (especially online) has forced all global brands to take clear positions on various
social and political issues. The luxury brands have been no exception. Although this might be
somewhat easier within a domestic setting, being global brands, we have seen them get in to
trouble frequently with such decisions. A similar story is being played out in sports and movies
as well. This has in turn again brought to light the colonial and neocolonial association of these
brands and a change in perception about their image amongst the global south. Time and again
questions have also been raised about the performative nature of such position taking and if it
is in fact the responsibility of a brand to take positions on social issues, being for profit global
corporations that they are.

The performative nature of such decisions is further highlighted by hiring of a woman (Maria
Grazia Churi) and Black man (Pharrell Williams) to head Dior and Louis Vuitton respectively in
an effort to pivot one brand to be the champion of feminism and one for Black inclusivity. The
lack of trickle-down effect of such moves and virtually no real change at the bottom of the
industry shows the superficial nature of such moves and reveals the image rebranding exercise
as its real objective.

Transition to heritage brands,

In an era of the declining western influence, is it the brands final cashing in on their
decades (sometimes a century) of their foundational ethos, knowing these structures
and influence will not last for too long now or whether the leadership was just not
competent enough to understand the true nature of luxury and what sort of cultivation it
requires (akin to the politicians who also show a lack of understanding of the history
when making decisions) is up for debate and not in the scope of this paper.

But one thing is very clear – 23 years into this new Century, the once haloed luxury
brands of the Western world have been relegated to mere ‘Heritage Brands’ living not
on the craft and skilled workmanship that made them, but merely on packaging and
selling that heritage through, logos, trend driven products, and meaningless ‘cut and
paste’ collaborations.

So, to fully understand and define this changing structure of luxury fashion, it is equally
important to restructure the way these brands are segmented aesthetically. Traditionally, the
structure loosely consisted of the following segmentations: Haute Couture, Ready to Wear,
Bridge, mass production etc. As the boundaries between Haute Couture and Ready to Wear
started to blur through the 70,s and 80’s, the high-end fashion brands were divided into the
following categories to best understand their aesthetical placement: Luxury, Contemporary &
Avant Garde.

Luxury: Chanel, Hermes, Louis Vuitton – brands with no secondary lines and only direct
company owned point of sales.
Contemporary: Calvin Klein, Ralph Lauren, Giorgio Armani – brands that delved into vertical and
horizontal expansion but always focused on modernity, wearability and functionality at the
their core.
Avant Garde: Alexander McQueen, Martin Margiela – brands that embraced design innovation
and experimentation at their core (usually coming from cult personality of the designer). These
brands could go as high as Haute Couture or as low as streetwear in their price point as long as
pushing the design envelope was at the heart of it.

As we have seen that most of the Luxury brands do not follow the rules that make them a
luxury brand anymore. At the same time, the influence of sportswear and streetwear within
fashion has become a permanent fixture, blurring the lines between other segments as well.
Hence it is important to restructure these categories to better place them in the fashion
universe which is important to our understanding of where fashion is headed. This author
suggests the following:

Current New

Luxury Brands Heritage Brands

Avant Garde Design-Centric Brands
Contemporary Niche Values Brands
Streetwear Brands Hype Brands
Fast Fashion Trend Driven Brands
Heritage Brands: A true luxury brand does not and cannot stray from the luxury business
model. A luxury brand cannot be in the business of being more popular or preferring growth
over value. Most established Luxury brands have moved well within fashion – A phenomenon
that started in the late 90’s with Tom Ford at Gucci, and Marc Jacobs at Louis Vuitton. These
brands now follow the fashion business model (albeit the high-end fashion) more so than the
traditional luxury model. And along that has come the negative baggage that fashion businesses
carry – sales, discounts, over-saturation of products, lack of scarcity etc. To please their ever-
growing new customer, these brands have relied more and more on their heritage, logos, house
prints, in essence their cache build over decades to sell a product that is no longer unique, is
not identifiable with the brands design codes or brings the value added that luxury products
need to bring. The need to constantly update (as is the demand of the fashion business model)
has taken away the soul of what gives the luxury product its coveted desire.

Design-Centric Brands: As more and more non-trained celebrities take over the reins of these
big former luxury brands as ‘Creative Directors’, the specific segment of the fashion brands,
that formed the avant-garde can now be placed in an expanded category of ‘design-centricity’,
These brands can be identified from the point of still being led by a trained designer who puts
his/her design philosophy at the core. Their design values may range from experimental and
forward looking (Comme Des Garcon, Rick Owens) to more contemporary and modern
(MISBHV, Marine Serre, Doublet), they are however consistently identified through a specific
design point of view first and foremost. The size of the brand and the price point is no longer
relevant criteria for their placement.

Niche Value Brands: These are somewhat of a new and growing area of fashion brands that are
based on specific ethos like sustainability, social issues, LGBTQ ethos, or can be very specific in
the product they offer/specialize in. Reformation and Ludvic de Saint Sernin are just a couple of
examples.

Hype Brands: As the codes of streetwear and sportswear started merging, high fashion brands
like Supreme, A Bathing Ape etc. started taking center stage within fashion at large. The era of
these brands was filled with exclusive collaborations, limited drops and better quality for price
that the high street fashion would generally offer. Naturally, the codes were grounded in
hoodies, sneakers, graphic prints and youth. Whereas once these brands were very influential
(2008 – 2018 approximately) as with everything in fashion, the influence has waned. The drops
no longer sell out, the collabs no longer generate the long lines of enthusiasts and the resale
market (which formed along the successes of these brands) has started to dive downwards.
Today these brands still exist and work within a certain segment of the population. However,
they have nothing new to offer the high fashion segment at this time and over rely on hype to
sell these products. Consolidation through acquisitions is also currently key in this segment with
Nike and VF Corporation as prime examples.

Trend Driven Brands: The term fast fashion was developed around the same time as the
emergence of Zara and its then revolutionary new business model of quick turn arounds and
regional sourcing. Since than the ‘Fast Fashion’ segment has seen major changes, extensive
growth and a lot of new players entering the market. As the world becomes multi-polar so is
the fast fashion segment – with major new players competing with these established
international brands. Brands from Turkiye, Poland, Japan, China, South Korea etc. offering the
same products within their regions (and often times globally) that follow the same principal of
fast fashion but are better equipped to understand their specific markets, through taste, sizing,
timing and fabric choices. The common denominator amongst all these brands is the following
of the global trends that are started at the high-end level and interpret them for their market.
Bershka, Reserved, Shein, GU are some examples of such brands.

So, is there any Luxury Brand Left?

As the lustre of the luxury brands erode slowly, there must be mention of brands that are still
holding true to the ideals of luxury business model. Chanel, Patek Phillipe and Hermes are few
examples of such brands that have been uncompromising in efforts to stay ‘true luxury’. These
brands have shown that there is ample growth and profits in the luxury model if one truly
understands the luxury culture and how to manage it with appropriate pace, flair and
spontaneity.

A tale of two Shops (Saint Tropez)

The glaring difference in what a luxury brand must maintain and insist on versus what luxury (or
as I said ‘heritage brands’) have let go for increased growth is clearly visible if one were to visit
the Chanel store and Dior store in Saint Tropez during the summer season (as I did recently).

Regardless of the summer tourist season, the Chanel store insists on a 1 to 1 sales associate to
customer ratio even if it leads to a line outside the store and potentially result in losing out on
some customers. The importance is given to the instore experience where customers are given
the space and time to browse as per their liking, all the while a very well-informed sales rep is
never too far to answer any of your queries. A visible policy of not allowing for any selfies and
other photography in the historical mansion that holds the boutique further elevates the
experience, discouraging influencer culture and encouraging the potential customers to rather
savor those precious moments mentally.

On the other hand, the Dior store, a few streets away, with its three floors looked like a Macy’s
on a black Friday sale. The overwhelmed sales team was hard to get hold off and product range
was so wide, that being a specialty which is at the heart of a luxury brand, was replaced with a
simple strategy: what else can we sell by putting our logo on it. For good measure, as if that was
not enough, there was also a Dior café in the lawn, for you to enjoy some ‘Oblique Pattern’
engraved desserts and coffee.

In a recent article the founder of BOF, Imran Ahmed argued that queueing up outside a store is
not a luxury experience. It is not surprising (as I have alluded to this before) as the fashion
media, in order to not jeopardize their lucrative advertisement income from these
conglomerates, acts more like their PR agency and is interested in only pushing the narrative
that suits them rather than a critical, unbiased reporting of facts. But we can see, again through
a case study of Chanel, that rather than go big and create a ‘Chanel mall’ as the Gucci and Louis
Vuitton boutiques have become, they have opted to create separate new boutiques within the
same high growth cities that are exclusive to their loyal clientele and not open to the rest of the
public.

Fashion establishment

Faced with competing ‘soft power’ initiatives from dozens of countries the job of conglomerate
controlled mainstream fashion media, is thus to control the narrative.

The key aspects of this narrative include:

 Use Sustainability as a means to slow development of foreign brands and show
themselves to be superior. While Climate change is a real emergency and there are
genuine new brands who are whole heartedly committed to that issue, it can hardly be
said for the bigger corporations across the board from luxury to fast fashion. The
consistent accusations of ‘green-washing’ against them are not co-incidental but are
easily distorted or misdirected through media and influencer campaigns.
 Exploitation of Young talent: The hiring of rising designers to head luxury brands to
avoid decay started about two decades ago with John Galliano at Dior and Alexander
McQueen at Givenchy as two famous examples. This practice still continuous today with
a constant ‘musical chair’ of creative directors and head designers going on at each
luxury brand. Examples too many to mention here.
Now it has taken a step further through programs like the ‘LVMH Prize’ that in essence
is tool for controlling talent at even earlier stage. Talented designers are scouted and
seduced with the conglomerate resources, some supported financially for a year or two
while their ideas are appropriated and absorbed into the language and codes of the
mothership leaving them struggling on misguided path eventually, while also eliminating
them as possible future competition.
 Skewed coverage of the global fashion week events: While Paris, Milan and New York
continue to hold top place in the fashion week pyramid (and well-deservedly), countless
other fashion weeks are organized in major cities around the world. The balance of
coverage for these events is skewed drastically in favor of the big three. It is true that a
lot of these fashion weeks are terribly organized, and do not showcase the true talent
from those countries, but there are nonetheless several which are on par with top or for
the very least highly influential in global trend making.
Tokyo Fashion Week is one such example. The influence of Japanese designers on
fashion is unmistakable and has been such for decades now. Now, more than ever, with
globalization and hyper-connectivity Tokyo should find its place amongst the top. But
year after year, it has to see its talent leave for Paris and Milan to be taken seriously
leaving Tokyo Fashion reeling with brain drain. Similarly, Seoul and Shanghai Fashion
Weeks are stuck in the same boat, unable to get the coverage from the fashion media
that they deserve. This gets glaringly obvious when you compare them to the lopsided
 coverage that London and Copenhagen Fashion Weeks get while barely showing any
truly established fashion house on their calendar.
 Media Franchise Model: The spread of Vogue and other big fashion magazines through
franchising has created another neo-colonial system that continues to erase the local
culture by instilling a Western-centric lens on all issues and designers it chooses to
highlight. Young designers dreaming of success, consistently fall victim to this scheme by
having to compromise their work to the validation of western lens.

To the rest of the world, much of this can be seen as yet another neo-colonial practice of
appropriating foreign ideas through a systematic way that not only legalizes the appropriation
but also makes the conglomerate look like a responsible community supporter to western
public that genuinely care for such issues globally.

Quiet luxury and its discontent

One recent example of such narrative push has been the fashion establishments insistence on
promoting Quiet Luxury as the biggest upcoming shift in fashion. Using pop culture, like the
critically acclaimed TV show “Succession” everyone from Vogue to BOF insisted that we buy
into this trend. With no real depth to the argument beyond the show’s wardrobe, it was clear
that this was an attempt by Western Fashion Establishment to take control of a fashion
narrative that was increasingly being set from outside their sphere, mostly East Asia, in this
case. While all cultures have their own ethos of quiet luxury, their interest in western fashion is
not aligned with such aesthetics. Middle East clearly still prefers the opulence and maximalism
of French and Italy, China still prefers the logo emblazoned, sharp color aesthetic of American
sportswear and K-pop continues to embrace over the top styling and branding to dress their
stars. It gets even more absurd, as even within the grassroot Western fashion scene, there is a
vibrant movement of craft-oriented fashion (specially within knitwear) that is extremely
expressive, unique and not quiet at all (not to mention more sustainable and eco-friendlier than
the conglomerate model).

So was quiet luxury an intentional push to take that narrative back or to snub the vibrant craft
movement and absorb that talent as it goes against the conglomerate model or to bring back
sort of austere conformity to their population during harsh economic times can be up for
debate, however it very easily plays into the hands of critics who see it as another neo-colonial
example of control.

Other Problems

Part of the problem also lies with the regulators or the continuous dismantling of regulations –
if a conglomerate is allowed to grow as big as LVMH, and all power is consolidated within a
handful of groups then we are bound to face the decline of luxury as an industry that puts craft
at its heart. The scale of such product development is unable to match the rapid growth that
the massive corporation requires. The design innovation and quality craftsmanship is hence
substituted with stock options and market dividends. The stories about craftsmanship become
just that – Instagram stories – to sell a hollowed out, logo dream without any substance. This
critique is in line with the consistent criticism that comes from the emerging countries
regarding the cherry-picking treatment of the Western in calling out countries for human rights,
climate and countless other social issues.

Regulations are an especially big problem when it comes sustainability and eco-friendly aspects
of luxury fashion. Rather than put in place strict rules of business for such issues, businesses are
told to responsibility for themselves and individuals are continuously told to play their part. This
did not work in the aviation industry or the pharmaceutical industry (where it is a matter of life
and death) and it clearly does not work for the luxury industry.

As Chris Hedges puts it so eloquently that the oligarchs have bought off intellectuals
and artists to serve their commercial interests. He further goes on to say “The
machinery of corporate dominance is carried out by the college-educated, those who
rise to the top of academia” who disperse across government, Wall Street, corporate super
structures as well as within those who provide the jingles, advertising, brands and
political propaganda in public relations firms, and in the press all with the objective of
filling our heads with distractions.

Larger Trend

Fashion does not take place in a vacuum. It is highly connected to the mood of the societies and
is always reflection of what societies stand for in their current states. Hence, what is happening
in fashion now cannot be understood without the context of the larger geopolitical trends and
power dynamics at work around the world.

The issues facing luxury are no different across multiple industries/institutions across the West.
The News media, Hollywood etc., after building their reputation for decades on quality content
and innovative story-telling, these entities are now cashing in on their well-earned reputation
through empty sequels, copy/paste productions, and pedaling narratives that do not show the
full picture or all sides to the story.

Similar is becoming true for higher Education, where cashing in on the reputable name has
become standard practice. A recent decision by students in UK to take universities to court
speaks of that. Similarly opening up of satellite campuses across the globe has become a
business model to rake in more money – especially since the student enrollment is decreasing
with falling demographics and the continued antagonization of prized foreign students at a
governmental level, beginning with the Chinese students.

Within fashion, the recent hiring and then subsequent firing of the two young designers,
Ludovic De Saint Sernin and Rhuigi Villaseñor at two esteemed European design houses, Ann
Demuelmeester and Salvatore Ferragamo respectively, further suggest the pivot to hype as a
strategy at the very high end of fashion and luxury. A little analysis into the design work of
these two designers would be easy to show that they do not possess the skills or the design
ethos to handle the workload or provide a vision needed for those specific brands as they
attempt to refresh themselves. If it is not incompetence in hiring, it is an acceptance that the
brand does not want to invest in craftsmanship as integral to the brand vision but prefers viral
fashion show moments and hype to build their new brand image.

It is the same vision at play for the people at the helm of other luxury conglomerates – for
example, in LVMH’s decision to hire Pharrell Williams to head LV menswear, in this case a
healthy network of fellow celebrities to bring into the clientele also plays a added part.

Future of fashion

Luxury must have long term value. That is what separates it from fashion or masstige. Its value
lies beyond the quality and rarity into an intangible character that speaks to the buyer on a
personal level.

As luxury expanded globally at breakneck speeds, it was a matter of time before the
consumers in these countries started demanding products that were tailored to their
taste. The Chinese consumers demanded that increasingly with each passing year. Not
to lose this customer, the brands caved in, breaking the first rule of luxury management
and becoming a follower rather than the leader. Dior created an advertising campaign
dedicated to the Chinese market in 2010, and Marc Jacobs’s 2011 collection for Louis
Vuitton is inspired by Shanghai.

A case can be made for financial growth to justify such decisions but there are
numerous examples of brands that opt to find a different route to reach that success.
Hermes and their Chinese origin brand Shang Xia is a perfect example of expansion
through careful strategizing of long term investment in the new country - a strategy that
will certainly not give immediate results and requires patience, but if successful can
provide the double reward for Shang Xia and Hermes itself.

Similarly, Chanel, as rule never jumps into a new venture of any sort without fully
understanding the repercussion that might come negatively for the brand. Recently they
used the same logic when they refused to enter the Metaverse and NFT markets while
other luxury brands like Gucci jumped into it.

Similarly, it is extremely important to control the resale market as Chanel does to protect
not just their brand image but also their loyal customer base. With an explosion of luxury
resale market in the last few years and continued expected growth, it is vital for luxury
brands to treat that as part of their own distribution channels and exercise control over
it.

Ten years ago, the debate was if premium products can trade up to luxury. While it was
advocated by some experts (e.g. Doyle and Stern 2006) it was also criticized by others as
reduction of the Luxury products to mere positioning (Kapferer and Bastien 2009). At this
time, the situation has reversed. It is the luxury brands of Western world that have traded
down to ‘heritage brands’ - a discussion we do not hear enough of in the West, as it
consolidates its tools for a meaningful push of soft power to counter the multipolar system that
is emerging. Time and again, the media channels of the Western fashion establishment mimic
the greatness of these brands, at a time when none of these brands have added anything
significant to the luxury conversation in years now. This becomes even more important if we
bring in the debate on climate change, sustainable consumption and social responsibility. While
fast fashion is an easy scapegoat of the accesses and mounting garbage in the world, luxury
easily escapes accountability through the carefully crafted narrative of skilled craftsmanship, in
house production, and limited production runs. If we look at the expanded luxury brand model
with global boutiques, five full collections a year, (including a cruise collection usually shown in
far off places that have nothing to do with the brand ethos), and the international shipping that
it engages in on a daily basis, for both distribution and retail, it is a fallacy that is easy smashed.

Conclusion

Kapferer in his book – acknowledge that these brands are no longer the luxury brands that they
once were but are global brands with much more elaborate structures. However, he stops short
of calling them heritage brands and still insists on their luxury status. Perhaps because we
would be hard pressed to find the new luxury brands at this point save Chanel or Hermes.
However, that is exactly the position that we are in at this point in time, with changing
structures, power bases, and renewed voices from the global south demanding more
sovereignty over their cultures and needs for development. So it is understandable that there is
no replacement to name at this point, as a lot of those potential luxury businesses are not
global names yet and need to be discovered, but just like there is no true replacement of the
dollar in international trade at this point (though many are trying) and no Institutions to replace
the global institutes like the IMF, etc.(again there are options in the works) the move is well
underway and Luxury brands that want to stay as such in the new world order need to think
much more long-term strategic shifts then short term annual profits and growths that hollow
out their heritage with each mediocre product put out to increase sales.

So where can the next luxury brands come from? Predictions are always hard. All we can do the
analyze various up and coming countries on the basis of what creates an environment for a
luxury brand to develop and flourish:

 A certain amount of tension within society and class culture

 A rich history of indigenous craftsmanship and product development
 A history of aristocracy and royal riches
 A culture that is able to appreciate the finer things detached from their functionality
 A culture that allows self-expression
 Appreciation of soft power and how to project it to the rest of the world
While this is not within the scope of the paper, it is appropriate to touch up on it as part of the
conclusion.

Although nothing is certain in geopolitics, it can be assumed that at this time East Asia is
emerging as the center of center of economic power, and growth of the new riches.

China: while it does check all boxes, it’s recent history of communist-centric society and the
value of …makes it not a sure thing. Moreover, its huge size, and a similar spirit to the US in its
commerce and enterprise, makes it also a weakness when put in context of the luxury industry.
Japan:
South Korea:

Other regions
India: Similar to China but also behind on the overall developmental curve. Although, ahead in
certain areas of soft power projection that brings them
Middle East: Years of dependance on oil and long decades of instability have erased a lot of the
heritage and craft skills of the region. There is concerted effort to rebuild such heritage closed
off immigration and lack of key skills makes it a long-term project at best. Like China, a …of self-
expression also hinders such progress.
Africa:
Brazil:

Any of these places have the potential to be the next France or Italy in sharing their vision of
what true luxury could be in the decades ahead.