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Only 24 hours left to get an invitation to Paris fashion week, it starts tomorrow in the French capital. After two years in virtual format, the big brands are returning to public fashion shows.
And their companies are reconnecting with wonderful incomes. In 2020, the waves of confinement and the paralysis of air transport literally deprived the fashionistas of their favorite pastime. The luxury industry, which was unaware of the crisis, took a nosedive. But this bad patch has already been overcome, sales returned to 2019 levels last year.
And the year 2022, despite the Omicron threat, looks very promising. This is why in the fashion capital of the world, the big houses are making it a point of honor this year to reintroduce parades in public. This is the case for the overwhelming majority of haute couture brands which organize their shows next week, because fashion week actually lasts 15 days.
Fashion houses also offer virtual events
The internet has become an essential new channel for this industry. We buy less when traveling, but much more from our screen. With the covid-19, online sales doubled last year. They now represent 22% of global luxury turnover and there is still a lot of room for improvement. In this context, offering a virtual fashion show is essential.
Luxury players are also eagerly exploring the new fields opened up by internet tools. Balmain created a stir with an auction of NFT, non-fungible tokens, for 3 models specially created for the Barbie doll. The outfits will also be available in an adult version, regardless of gender, because the pink clothes can be worn by both Ken and Barbie fans.
According to the bank Morgan Stanley, the opportunities of gaming, the association of luxury with video games or the virtual worlds of the metaverse might generate 50 billion euros in additional turnover. The turnover today is 283 billion euros.
Luxury is also overtaken by inflation: prices are skyrocketing
In this sector where we don’t do things by halves, we might even speak of hyper inflation, because the rise in prices is in double digits. The small Chanel bag in quilted leather and with a gold link chain has increased by 30%, going from 5500 to 7300 euros in a few months. We are of course talking regarding the increase in wages, the supply problems which are pushing the houses to buy back their suppliers to secure their production chain.
But the reality is more prosaic: when a bag sells too well, its creator increases it to create scarcity, the scarcity that drives demand. It is an economic principle specific to the luxury sector which uses and abuses it. the it bag, the bag you must have, has become a financial investment, the value of which is growing exponentially.
Does this soaring price explain the success of vintage luxury sales?
In the world of luxury consumption, price is secondary. If the demand for second-hand clothes and objects is exploding, it is above all to meet the expectations of the ultra-rich anxious not to worsen the carbon footprint of this industry, which is already in the red.
More and more brands are organizing their own recycling sector themselves, a source of sales that amounts to tens of billions of euros. This relieves the bad conscience of their customers, but not really the planet. Because the luxury industry is producing more and more to meet demand, its carbon footprint will therefore worsen further in 2022.
► IN BRIEF
Chinese growth rebounded to over 8% in 2021.
A performance beyond analysts’ expectations, with Chinese growth being more like 6% at its cruising speed. But this improvement might very quickly fade, with the difficulties ofEvergrande, the bankrupt developer, and the resurgence of Covid-19, activity began to slow in the fourth quarter. The Central Bank just cut rates today to support the economy, the first since April 2020.
Lebanon is said to have made a secret agreement with Israel for deliveries of gas from Jordan.
Beirut denies the information released yesterday by The Times of Israel. This agreement, which has been talked regarding for several weeks, would allow Lebanon to diversify its supply which is very dependent today on Iran, the godfather of Hezbollah.
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