A High-End Challenge
December 14, 2009,
A news story in apparel business paper WWD last week brought into focus an underlying challenge facing producers of high-end products in home textiles as well as across all product areas.
What this brings into focus is the dilemma facing the high end of the home textiles market — how to generate significant volume without destroying the base that brought you to the party.
Using the Fekkai-Sephora scenario as an example, Sephora is continuing to roll out its brand into more JCPenney stores after successful tests in a number of Penney units over the last couple of years. And most folks will agree that JCPenney doesn't exactly fit the profile of a high-end or luxury retailer.
Taking this to the home textiles world, the luxury designer brands especially are being confronted more and more with the need to build volume amid the challenge of a declining roster of major players.
Similarly, the smaller, boutique luxury suppliers are facing increasing challenges from off-shore suppliers in terms of production minimums as well as quality issues.
What seems to be happening in the designer\luxury world is similar to the Fekkai situation — selling to the next tier down with either the same brand as an exclusive — or rebranding some product at a lower price/quality to sell to those retailers — a move that is confusing an already confused customer grappling with the pricing/quality situation in home textiles.
Quietly, almost stealthily, there is another movement afoot. A few high-end suppliers — designer or otherwise — are discovering the power of going direct via the internet. Some are identifying themselves as the producers, others are offering product under a nom de plume. Either way, the early results appear to be showing some favorable results, albeit not without challenges.
Watching the process unfold will be fascinating.