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Retailers have taken a beating since the breakout of COVID-19. But luxury fashion finds itself in a strange spot. Some of the world’s top fashion houses and designers were among the first to suspend their own production, repurposing supply lines to churn out personal protective equipment like masks and medical gowns.
But that positive glow can only last so long. Upcoming Fashion Weeks have been either moved to streaming or canceled outright. Not only are fashion magazines scrambling to determine how to conduct photo shoots in a world that works from home, but many advertisers are pulling marketing campaigns, gutting the bottom line. Then there are the celebrities and influencers still shilling their luxury goods, only to be labeled as tone-deaf, at best.
High-fashion retailer Moda Operandi‘s Runway Report normally offers a preview of next season’s looks based on the preceding quarter’s retail data trends. But these aren’t normal times, so the e-commerce platform is taking a pulse on the luxury fashion industry amid the coronavirus pandemic and how quarantine mandates and the economic fallout have influenced fundamental shifts in home life, leisure, and work.
Researched in partnership with the Harris Poll, Moda Operandi’s findings are based on the responses of 1,500 women in the U.S. between the ages of 18 and 60, who were surveyed in January 2020 on their perception and attitudes toward wardrobe purchases. The report also covers spending data through April.
While all geographical regions saw declines in daily average spending in April, rates didn’t fall everywhere at once. New York, Illinois, and the U.K., for instance, began seeing luxury spend decline in March, while California, Florida, and Texas saw growth in spend through March, before declining in April. Meanwhile, European countries saw flat spending in March, and the steepest decline of all regions in April.
“We’ll, of course, see spending decline during this economic crisis—that’s just the reality of any downturn,” says Lisa Aiken, director of buying and fashion at Moda Operandi. “But we feel strongly that consumers’ sentiment and propensity to buy higher-quality, longer-lasting items will remain steadfast through this period as people will seek out apparel and products that will last them for years or decades, rather than ‘wear-once’ or ‘use-once’ pieces.”
Thus, the biggest takeaway from the report is that consumers don’t mind shopping full-price if there is a clear perception of long-term value. This points toward a shift favoring investment pieces over fast fashion, a movement that had already been generating interest before the pandemic started. Fine jewelry, in particular, saw an uptick by the end of the first quarter, up 35% in sales versus the same period last year.
Approximately 73% of the women surveyed said they are willing to pay more for higher-quality items in their wardrobe. And of the women shopping for investment pieces, half of them said they’re looking for a quality piece that will endure. Nearly 40% believe the investment pays off long-term because of the cost-per-wear ratio, while some women (13%) make fashion investments because they know they can eventually resell it, and others (12%) plan to pass these items—from luxury handbags to accessories to apparel—to their own children some day.
While promotions allow for more casual purchases, those flash 50%-to-75%-off sales at high street stores like J. Crew and the Gap aren’t going to make much of a dent with online shoppers right now like they would in a normal year on Black Friday, or even a holiday weekend like Presidents’ Day or Labor Day.
“For many, staying at home has necessitated a simpler lifestyle,” Aiken explains. “People are eating out less and cooking more. They’re at home with their families and living less extravagantly. This lifestyle shift will undoubtedly cause people to examine the quality and quantity of the products they choose to buy. We think consumers will begin moving away from a ‘more is more’ fast-fashion mentality and instead emerge from this crisis with a ‘fewer better’ mindset.”
Aiken notes that during the pandemic, some of Moda Operandi’s bestselling items have fallen under what she describes as “quiet luxury,” describing those purchases as understated, high-quality products. “With the fashion industry at large, there’s a sense that, in seasons to come, designers and big fashion houses will embrace a scaled-back approach to creating collections,” Aiken continues. “Designers will release fewer collections throughout the year and rethink the grand-scale fashion shows they once produced. While the fashion itself will continue to evolve and have elements of playfulness and fun, there’s no question that the industry’s scaled-back approach will trickle down to American consumers and the fashion they choose to wear.”
Meanwhile, pollsters found that, despite the economy’s slump, charitable components can still draw in new customers, suggesting full-price buyers also have a propensity to spend their dollars on luxury goods when there is an opportunity to give back.
Still, while shoppers might be dreaming of when they’ll actually be able to wear any of these luxury goods in public again, they seem to want to dress more comfortably in the meantime. Moda Operandi casually notes searches for “sweats” and “sweatpants” on its site have spiked by 50% and 85%, respectively, in recent weeks as people have been cooped up in their homes.
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—Behind the B Corp movement and its fight against corporate “greenwashing”
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—The comfort economy gains momentum during the coronavirus pandemic
—Listen to Leadership Next, a Fortune podcast examining the evolving role of CEO
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—WATCH: How the battered food-service industry is weathering the coronavirus
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