High end fashion is huge business. Fashion in general is one of the biggest economic drivers on the planet. No matter how silly people make it out to be, the business of deciding what to wear is part of what makes the world go round. It accounts for about 5% of all household spending in the US, which, in aggregate terms adds up "lots of money". Just like every other industry on the planet, the fashion industry is subject to take overs, mergers and deals. The most recent huge one was Richemont SA bought a controlling stake in Net-A-Porter!
Why is this a big deal? Net-A-Porter is easily the most major player in the high-end fashion internet market, and it was independent from any of the conglomerates so it was able to carry designers from all of the different conglomerates. Most of the fashion retail websites aren't able to carry the kind of range of products or can only carry them after their season has passed. NAP has been able to get a huge range of products in their current season and get designer exclusives--they've done a magnificent job carving a niche for themselves. People make a big deal about their online magazine that they put out every week, but honestly as a regular consumer of theirs, I don't care two straws about their magazine. All I care about is whether they were able to get in stock any of the particular hard to find item that I MUST HAVE. So far, they've always been able to.
Richemont, a Swiss Conglomerate that owns Cartier and other high-end brands has promised that they are leaving NAP's founder Natalie Massenet in charge and will not be integrating it with their other companies. It is hoped that this will allow for NAP to broker retail deals with competing conglomerates and continue with their success. I'm not sure that it will pan out like that. One of the things that made NAP so successful was that it was a third party to the fashion houses and now it will lose that advantageous aspect. I'm really curious if the other conglomerates will buy into the idea that Richemont isn't meddling in NAP and allow for it to continue to be a retail outlet. I think that Richemont will maintain this kind of hands-off approach for the next while but I think that over the long term they will probably seek to slowly integrate it with their other brands and use it as a huge internet portal to sell their goods--this would give them a massive advantage over the other conglomerates because none of the others have been able to either acquire such a portal or build one on their own. LVMH tried with eluxury but failed. With internet commerce becoming such an important aspect of luxury retail I think over time the concept of further brand integration will prove to be simply too irresistible to Richemont. I'm not sure if that will be a great thing or not, but it will be different. That kinda makes me sad.
Pictures of Stella McCartney items from
Net-A-Porter. Thanks to a faithful reader to suggesting the topic!
