Retail Diary: Week of January 1, 2024

This Week's Topics:  

  • Shopping in 2024 - Cooler, Smaller and Weirder

  • Luxury Retail Updates

  • Initial Holiday Sales #s

  • New Launches, Collabs, Corporate Moves & News

  • What else I ❤️️ 

Shopping in 2024 - Cooler, Smaller and Weirder

I kicked off Substack Chats with a link from this article from Rachel Tashjian in the Washington Post (gift link) titled “How we’ll shop in 2024: Cooler, smaller and weirder”

  • Highlights from the article:

    • Luxury Business Shift: how the consumers are shifting behaviors due to increased pricing from inflation and changing consumer behavior to more affordable categories - especially beauty.

    • Bifurcation of shoppers: True luxe shoppers not balking at the price points vs consumers shopping for entertainment and joy and affording the entry price points of brands (beauty and small leather goods, for example.)

    • Rise of Independent Boutiques: Independent retailers, offering unique and reasonably priced items, saw success as consumers sought alternatives to big luxury brands.

    • Shopping inspiration: Love love love that Tashjian called out some fabulous writers Leandra Medine Cohen, Becky Malinsky and laura reilly for where we are getting inspiration as the “new guard of shopping newsletters” vs traditional fashion market pages (although I’m still reading magazines too.)

  • I’m excited about these shifts as it opens lots of new opportunities for retail disruption. Retail entertainment is bringing immersive and engaging experiences into shopping - this can drive loyalty and create memorable moments for a shopper that they want to talk about with others.

  • This WWD article further discusses the luxury shopping experience and how when stores deliver the customers will visit - shown by an uptick in foot traffic in London’s West End shopping district at its highest since 2019.

  • Join the chat - I’d love to hear what boutiques, brands and retailers you think are providing exceptional service to all customers and who is nailing the experience and entertainment to shopping? Tiffanie Darke shared Agora, her boutique in Ibizia “We treat it like a live magazine, telling the stories of fashion and sustainability and it's as much an event space and a hangout as it is a shop.” and Liz McKay (author of a newsletter I love Bad Influence) mentioned A Current Affair vintage show that pops up a few times a year in LA and NYC.

Luxury Retail Updates

  • Farfetch and Matchesfashion luxury retail was in the news so much during December 2023 it was hard to keep my head from spinning. Here are a few updates on where they currently stand:

    • Frasers Group, a British retailer, has purchased Matchesfashion/Matches for $63 million, which was a significant loss for Private Equity group Apax Partners.

    • In 2017 the PE group bought Matchesfashion but it is disappointing to see the retailer struggle. Prior to 2017 it was a destination to discover trends, new labels and showcase the owners curation (Tom and Ruth Chapman.)

    • In late December, Coupang acquired Farfetch, infusing the luxury retailer with a crucial $500 million capital boost. Farfetch has significantly evolved from a tech-centric service for boutiques providing back-end support into a luxury e-tailer that has been struggling. With competitors like Net-a-Porter, Mytheresa, Matches, SSENSE, and LuisaViaRoma, differentiation and a unique perspective are vital for navigating the bustling luxury market landscape for today’s consumers.

    • The fate of Farfetch owned Browns Fashion is still up in the air. Browns Fashion is another legacy and iconic boutique known for discovering new brand and curation (see a trend here…) that was purchased by Farfetch in 2015. This Glossy article also points out a lot of challenges - brands that sell to multiple luxury retailers could see their Purchase Orders go down with consolidation. Additionally, it makes me wonder about the state of consumer businesses with volume around $10-$50 million. How do they stay independent, successful and profitable?

    • Still waiting to see what happens with Saks interested in buying Neiman Marcus.

  • This WWD article has great insights on luxury online retail with executives from some of the major players. And I liked reading about Toshi which could be an answer to many online retailers creating luxury omnichannel customer centered solutions.

  • In case you missed it, this late December post from Business of Fashion dives into the state of luxury ecommerce.

Initial Holiday Sales #s

  • From Retail Dive and Adobe Analytics, “online consumer spending between Nov. 1 and Dec. 31 rose 4.9% year over year to $222.1 billion” which was a new record for e-commerce.

  • BNPL (buy now pay later) saw a 14% jump from LY and hit an all-time high.

  • According to Mastercard there was 3.1% growth Year over Year but I suspect we are still waiting for a fuller picture of retail performance including discounting impact which seems to have been heavy for Holiday 2023.

  • Also too early to speculate on January returns (Return-u-ary) but I’m keeping my eyes peeled for that data to get a better picture of how Holiday 2023 performed.

New Launches, Collabs, Corporate Moves & News

All images from the sites linked in Retail Diary newsletter.

What else I ❤️️ 

What's Next?

I’d love to keep the conversation going - so come join the chat. Here is a link and I’ll see you there. Substack chats are such a happy place on the internet.

I’m ready for 2024 to be a disruptive, innovative, exciting and successful year in Retail - follow along and let’s uncover the news together. I’ll curate the best content for you.

After Amy Odell‘s interview with Dana Thomas I purchased Deluxe: How Luxury Lost Its Luster and plan to read for a Retail Diary Book Club newsletter. (I saw @ideservecouture on Instagram also posted and since it is sold out on Bookshop.orgwe are likely part of a large group that decided to read this book. Tip: I ordered mineused via eBay.)

Thanks for reading Edition 147

Sarah Shapiro