Much of the buzz this week alluded to the fact that although 2012 was generally a good year for brands and consumers, 2013 is off to a shaky start. There is, however, room for improvement.
Dolce & Gabbana founders Domenico Dolce and Stefano Gabbana had their day in court earlier this week, answering alleged tax evasion charges. The fashion designers, in addition to colleague Cristiana Ruella, pleaded not guilty. The main source the charges was the selling of Dolce & Gabbana to a Luxembourg holding company, which the Italian government took as a way to avoid higher corporate taxes in Italy.
Meanwhile, consumer confidence went up 24.3 percent the last quarter of 2012, according to the Luxury Consumption Index by Unity Marketing. However, it has already dropped 19.4 percent, the biggest drop since 2008. There are some experts that say President Obama’s reelection could be what triggered the confidence drop, so whether or not consumers will start spending again in the near future is still to be seen.
However, some things are looking up for luxury marketers. For instance, luxury-focused magazines sales are skyrocketing due in part to high-end brand ad buys.
Hearst’s Harper’s Bazaar and Elle magazines both saw their biggest March issues of all time, seeing 21 percent and 33 percent gains, respectively. Also, Conde Nast saw an overall 5 percent growth, its first big increase in five years.
Furthermore, Wall Street Journal’s WSJ. magazine expanded its issue count from four to 11 per year, implying that both readers and advertisers want more out of the magazine.
But magazines aren’t the only ones looking to expand. In fact, Michael Kors plans to open up a men’s wear-focused store in SoHo later this year, while Barneys New York is opening a discounted website for its goods called Barneyswarehouse.com.
As long as luxury brands keep their quality and goods up to par and give consumers reason to buy high-quality goods, there is no reason they cannot get out of this rough patch.