Lacoste

Luxury brands say “no” to online discounts

Isaac Mostovicz writes that luxury companies with new websites should be aware of how people experience their sites...

According to this article in the New York Times today, several large luxury brands (including Marc Jacobs, Jimmy Choo, Hugo Boss, Vince, Lancôme, St. John, Theory, Kiehl’s, Lilly Pulitzer, Donna Karan and La Perla) have recently started or are about to start selling their wares online directly to consumers. While online retailing is a tried and true channel for many retailers, these luxury companies hesitated because they felt that the web couldn’t provide a similar experience to their stores, but the recession has made them more willing to try new things. Operating a website can be significantly less expensive than operating a storefront, and it can also cut out the department store middlemen who collect the difference between a good’s invoice price and retail price.

The most interesting part of this article is the repeated emphasis of luxury goods companies like Lacoste saying that they will never, ever discount the goods they sell through their online stores. These companies certainly don’t want to devalue their brands, but at the same time, they should be aware that the recession has made many shoppers more price-conscious and only willing to buy when they find discounts. According to a recent article in USA Today:

For others, it’s about buying luxury goods only when they’re on sale — or at a steep discount. Nearly three in four wealthy women say they’ll only purchase luxuries if they can get a good deal, reports a recent survey by AgencySacks, a branding firm that consults for some of the nation’s top luxury brands.

If for many people part of consuming luxury becomes the hunt for the deal, companies that refuse to discount may have to change their strategy.

Photo by Bludgeoner86.

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