AFFORDABLE LUXURY: SUPPLIERS


Pricing accessibility and novelty defines affordable luxury’s success


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The booming trend towards affordable luxury presents an opportunity for DF&TR to leverage footfall and conversion with the right consumer retailing and pricing strategies. Jessica Mason asks the industry to define affordable luxury and describe how it can answer the consumer need for high quality, aspirational products and good value impulse buys.


T


he parameters for defining affordable luxury are changing. The challenges


that DF&TR stores face include striking the correct balance between aspirational and accessible luxury. Affordable luxury is the answer and should not be overlooked. Indeed, it should be part of nearly every credible brand owner’s retail proposition. “The growth of global and


regional air passenger traffic, due to democratisation of travelling and the budget airline boom, can be considered one the main reasons why affordable luxury brands are now more and more in demand,” comments Emanuele Mazziotta, Head of Travel Retail at Coccinelle. Mathias Landin, Regional Sales


Manager Europe & IMEA - Travel Retail, Daniel Wellington says: “Affordable luxury is a category to use to increase footfall, conversion and basket size within each store. “For many years, global travel


retail has focused on luxury brands and generally this has been a good strategy, but now the market is changing. Jonathan Smith, Executive Director at Travel Blue notes,


“Millennials are demanding luxury at an affordable price. “As merchandise becomes more


affordable, it opens up opportunities for approximately 50% of passengers who do not purchase anything.” According to Deloitte’s fourth


Global Powers of Luxury Goods Report, Patrizia Arienti, EMEA Fashion & Luxury Leader, reminds that ‘luxury is a genuinely global market’, but “this poses a challenge for both the luxury brands and luxury shoppers, particularly those who travel extensively”. “Prices, stock levels and ranges


differ from market-to-market and between cities, making it difficult to optimise pricing strategies,” she notes. Arienti highlights that “there is a


relatively even spread across the six product sectors considered (cosmetics and fragrances, watches, jewellery, bags and accessories, shoes and clothes) with one in five consumers making a purchase of luxury jewellery or cosmetics and fragrances. However, she identifies big


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differences between consumers in emerging luxury markets and those in the more mature markets, with watches and jewellery for example favoured much more by consumers in Russia and the UAE. In order to understand affordable


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luxury, it is necessary to define it. As Dassi Levin, Director, Travel Blue states: “Affordable luxury is anything branded under $300-$400. This category must grow because a larger segment of travellers have less money in their pockets.” Claire O’Donnell, Travel Retail


Accessible pricing is key, says Kurate. FEBRUARY 2018


Manager at Kurate International points out that “due to huge competition in the market and the unsteady economic climate, consumers have started to expect


many retailers wish to fill up their doors with the high-end ‘signpost brands’ that made up the luxury and travel world in the past, most other consumers are “looking for more unique and affordable items”.


“The growth of global and regional air passenger traffic, due to democratisation of travelling and the budget airline boom, can be considered one of the main reasons why affordable luxury brands are now more and more in demand.”


Emanuele Mazziotta, Head of Travel Retail, Coccinelle


TRBUSINESS 37 A Coccinelle store at Haikou Meilan International Airport.


higher quality products at accessible price points”. As such, “affordable luxury is the


trend that duty free retailers need to follow to be more successful with the pax of today,” explains Katherine Sleipnes, President at International Brand Builders. She highlights that although


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