How Luxury Retail Businesses Have Adapted to the New Norm with COVID19

The Island Now

 

The luxury businesses have experienced a big hit in the past few months. The consignment of luxury accessories and apparel grew up to $24 billion before the pandemic took place, with estimations to reach even $51 billion by 2023.

However, with COVID 19, many people started to consider where they spend their money and whether that luxury necessary during these months. The same goes for how their closets look like. With so many clothes, especially ones that haven’t been worn in who knows how long, getting rid of them while eventually earning some money is not a bad idea. A big number of customers begin to view their wardrobe items not just like means for expressing their style, but also as valuable and tradable assets.

The industry is changing

Right now, many brands depend more on China than Europe and the U.S. The coronavirus forced many resale companies’ business models to be adjusted to some short-term or even longer-term new realities. Some of them include difficulties getting inventory stock – many fashionistas (and their closets) are out of the big cities, or ways on how to meet consignment partners that follow COVID guidelines.

The fact that many people lay low, do not overexpose themselves physically, and financially, and are focused on purchasing just essentials was a big hit. Plus, the lack of social events that often encourage high-end apparel or accessory purchases was the last blow that drastically changed the luxury market climate.

It’s different in the rich man’s world

Interestingly enough, rich people started buying more high-end products in the last months. The focus was on jewelry, gold necklaces, and of course, diamond rings. Fine jewelry purchases recovered from how it was at the beginning of the year and gained momentum during the summer months. Compared to last year, fine jewelry purchases were up almost 10% or up to $5.25b in August. This is because the top competition of this industry, travel, is not going anywhere. So, when people had a wedding, wedding anniversary, an important birthday or they wanted to do something romantic – they would usually go for the traveling option. Now, with that being out of the picture, diamond jewelry is taking some of that travel budget.

I spoke to Paul Gian of Beyond4cs.com and he was categorical in stating that the present condition requires sellers to adapt to this situation and those sellers who do not adapt will surely lose market share.

Using video calls and video presentations, many sales consultants can keep on driving sales for their businesses. Clients can call a specialist with whom they can discuss their requirements, as well as help them to order online. Once ordered, many stores offer contactless pickups and free shipping through secure and insured couriers. However, there are also smaller stores that do not have such services. Yet, their clients call and ask for certain pieces, and patiently wait until the stores are open, or have some type of curbside service. After all, although people have to keep a social distance, they still celebrate special occasions. And that is when these stores are happy to be of assistance.

 

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The Island Now

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