Global Luxury Brands

The small literature on the business of luxury fashion is located within specialist journalism and privileged ‘designer’ markets or investment banking reports. It is written primarily for clients, the global luxury brands. Neither analyse the fashion branding and management contexts within which global luxury brands and markets operate. This chapter was created to disseminate such analyses and document the principal strategic issues facing the industry. In order to address the omissions sited above, this chapter identifies and examines several overarching strategic questions. Initially it identifies and explores concepts of ‘real’ and ‘accessible’ luxury and the tensions between the two within the context of changing notions of fashion. It then analyses the strategic use of fashion by luxury brands to re-position themselves in broader markets by providing accessible luxury. The principal luxury brand groups are delineated and a number of strategic business trends are analysed such as the switch from licensing to directly operated flagship store distribution. The research methodology involved a case study about Burberry, which demonstrated a significant number of theses points. In particular the difficulty in balancing commercial objectives to grow sales through market extensions balanced with a simultaneous strategy to serve exclusive core customers. Francois Pinault, Chairman of PPR Group, highlighted this return to a ‘high luxury’ strategy in December 2006 some months after this publication