Brands that operate their own retail outlets often have a deeper understanding of consumer behavior than those that don't and that leads to a competitive advantage, according to Claudia D'Arpizio, a partner with Bain & Co., who spoke at the Reuters Global Luxury Summit in New York.
Ms. D'Arpizio told attendees, "You have in your hands all the levers to really understand how the consumers are changing."
Retail ownership is not a requirement for a deep understanding of consumer behavior and success, said Ms. D'Arpizio, who tracks the global luxury product business. Many brands who have close relationships with retailers are able to create a relationship that gives them access to shoppers without having to set up shop in a more permanent and costly manner.
"I think in particular category leaders can work with department stores and retailers, trying to understand how really to improve the relationship," Ms. D'Arpizio told Reuters' audience.
She also believes that brands that are part of larger organizations have an advantage over smaller independents.
"For sure if you are a medium-sized brand inside a big group you are better-equipped to overcome this moment of crisis because in that group there is at least one big cash cow that is still fueling growth for all the others," Ms. D'Arpizio said.
Discussion Questions: Do you believe brands that set up their own stores have a deeper understanding of consumer behavior and therefore have a competitive advantage over those that do not? How can suppliers that do not operate their own stores work with trading partners to deepen their understanding of consumer behavior across a wide range of retail channels?