By George Anderson
Norma Kamali designs a $500 jumper for upscale department stores and specialty shops. She also has her name on a tank top selling for $10 at Wal-Mart.
This approach, according to Ms. Kamali and others, is the way for luxury designers to remain in business today when consumers are unwilling to spend with the same reckless abandon as in the past.
"It's a new economy," she told MarketWatch. "You can buy something that's got a great value at $1,000 and something that's got a great value at $10. And you can wear them together. People are going to shop this way from now on."
The high end of the fashion market has been particularly hard hit in the past couple of years. Luxury retailers have pared merchandise to keep costs down and introduced less expensive items to try and appeal to shoppers who may be more cost conscious.
Calvin Klein has not gone the discount store route yet but it too is looking to offer a range of fashions at more moderate price points.
"We are putting out more lower-priced products," Francisco Costa, creative director of Calvin Klein Collection, told MarketWatch. "We have a great line with very diverse prices so it meets a lot of needs. Everybody is being cautious. You have to be price conscious."
Pam Danziger, president of Unity Marketing, recently wrote in a piece on Jimmy Choo's plans to expand into new luxury product categories, "Fashion luxury marketers in this luxury drought are challenged by both fewer luxury consumers willing to make upscale purchases and a decline in the average amount they are willing to spend... The boom times are over when business came easy; luxury marketers today have to be willing to change direction and find new avenues to growth in the luxury drought that has taken over."
Discussion Questions: Has the luxury fashion market been changed in fundamental ways over the last several years? Have the less wealthy, aspirational shoppers left the luxury fashion market for good? Will luxury consumers revert to old habits once the economy has recovered?