The retail sector may have come under pressure in recent years – but one area that continues to flourish is the luxury market.
While the major brand houses have been in Australia for some time now, over the past three years, they’ve added another dimension to the market with the introduction of their sister brands. For example, Kering Group has successfully introduced Saint Laurent and Balenciaga is soon to launch Alexander McQueen – adding to the growing line up of ‘hot’ luxury brands in Australia. This has paved the way for increased interest in the sector, from both landlords and especially consumers who can now shop an alternative to the traditional major brand houses.
From a retailer perspective, these brands have enjoyed relative success on Australian shores in a short space of time. This is largely due to Australia being a comparatively immature market, which is helping these brands experience rapid growth off a low base. It’s this lack of market saturation and untapped growth that continues to drive brands to Australia – and our market is well placed to capitalise and reap the benefits of a more diverse retail offering.
Changing consumer habits are also supporting the growth of luxury retail in Australia. People are expressing themselves differently – seeking fashion as an outlet for this. People want to show off their wealth and see designer labels as a status symbol of it. While older generations were more low key, the younger generations tend to be more expressive and showy.
Further adding to the strength of luxury retail in Australia is an increasing tendency to shop across sectors and brands. For example, it’s common to see designer bags being worn as statement pieces – often with non-luxury outfits. Designer trainers or sneakers are another prime example, where consumers are happy to pay north of $500 for the latest offering – this has helped create a catalyst for change in the wider footwear market with retailers providing alternate offerings at more affordable prices, essentially growing the whole category.
This is also sparking multiple brands to explore the ‘in-between’ market - filling the gap between more budget conscious choices and luxury brands that aren’t always as accessible to everyone.