Prada and New Luxury

Chavie Lieber wrote in Racked on January 5^th about Prada, “In 2013, the company reported a net income of 3.59 billion euro, or roughly $4.2 billion. But Prada’s relevancy appears to be slipping, and it’s not just the Saks shoppers that think announced a in net profit. Numbers dropped 27.6 percent to 319.3 million euros (around $427.8 million), compared with the 440.9 million euros, or $582 million, that was reported in 2013. Speaking about this slumping profit, Prada’s chief financial officer». 

In David Millán and Frédéric Godart’s article about «Creativity in luxury, Chain or value system?» They carry out comparative analysi about the system that have pointe out France and Spain inopposite sites in fashion market, the fast fashion and luxury. Each country leads in one of them.

«The current models, such as the value chain, not possible to understand the complexity of a luxury company. New models are required, appropriate to the reality of the sector. So the concept of creative value system (CVS), which provides insight into the functioning of both luxury companies recognized as the building recently, putting creativity at the center of a system that allows the creation of value appears. To do this, the main contribution of CVS is not only to understand creativity as an essential part, but understand it proactively. That is, it is a very creative proposal of the company, and not an identification of market needs or customer.

The way that creates value creativity is also significant. It should not be understood as an isolated (…) attribute, but as circumscribed in a system that allows the company to create through collaboration with other areas of knowledge, with partners and in a given geographical area. This helps to amplify the ability to create and communicate«.

Chavie Lieber also includes a few words of Lorna Hall of WGSN, which says «Of course, big brands aren’t going to go away, but they will have to address the way consumers now relate to luxury. We’re looking at a different generation. There will always be consumers that want to buy into classic luxury, but the market is fragmenting as customers want to alternatively express their wealth and status through what they wear.»

My reflexion about the Prada case goes together these two analyzes, we have a generation that sees the luxury very differently. And therefore it also looks differently. Brands cannot ignore these indicators. Otherwise, they will pay dearly.

I think that the future of luxury pass through a change of mind. In the XXI century it is impossible to have the same concept of luxury than in the XVII century, because people have a different way of sense. The luxury will always be something intangible. But the ways for expressing it will be different.

In otherwise, we are facing a change of paradigm. In front of a change in the way to life the excellence. Therefore, is necessary that brands realise about this change in the people. I think that it is very difficult, this change of mind to understand the reality of the luxury, but it is very important for its future. Opposing to this change is crazy.