From embracing streetwear to investing in the metaverse, the luxury fashion industry is becoming more dynamic and multifaceted.
The market is forecasted to increase to US$382.6 bn in 2025 at a CAGR of 5.4%, making it essential for retailers to stay on top of this ever-changing space and leverage data to respond to macro shifts. Read on as we unpack the current state of play.
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• Streetwear remains embedded within luxury categories, despite rumblings that the trend would be on its way out in the 2020s. The categories continuing to see YoY growth include sweatpants by 59%, sweatshirts by 26% and T-shirts by 14%.
• A shift that has been bubbling up since the pandemic hit, investment in traditional workwear is back in full swing. This is evidenced by tailoring incorporated at Dior Homme and Valentino's runway displays, as well as YoY blazer arrivals being up 22%.
• Luxury brands have made an effort to accommodate larger sizes, with options ranging above an XL for women increasing 130% YoY. However, these sizes are only available in 7% of luxury apparel online, underscoring the need to serve this long-ignored consumer.
• Once synonymous with the luxury industry, animal hides are no longer viewed as a status symbol, bumping fur investment down 27% and exotic skins by 42% YoY. Though calf and lambskin remain core materials, animal-free luxury alternatives are becoming more commonplace as "vegan" leather options are explored - up 20% YoY.
• Positioning themselves as frontrunners, 42% of brands mentioning the metaverse and NFTs within the past year have been luxury players.
Showing no sign of slowing down, quintessential streetwear staples continued to land in luxury brands' collections, with hoodies, sneakers, sweatpants, sweatshirts, and T-shirts seeing a YoY rise. In accessories, bucket hats continued to trend - up 112% YoY - while luxury brands shifted away from bumbags(down 33%) to range crossbody bags or duffels. While new puffer jackets arriving since the start of the year dropped 44% vs. 2021, the style was prevalent on the Fall 2022 runways, where streetwear's essence continued to dictate major looks.
Brand expansion at luxury sites
Further proof of its continued influence in this space is the investment of street brands on third-party luxury sites. Across both regions combined, the number of styles by Fear of God and Stone Island stocked at MR PORTER swelled 680% and 81% YoY, respectively, while White Mountaineering grew 101% at FARFETCH. Leaving his mark on streetwear and luxury fashion, Virgil Abloh's legacy propelled demand for Off-White, where its sell out rate doubled at Mytheresa US and UK compared to 2021.
On the runway
Back To Workwear
Investment in traditional styles
Juxtaposing with streetwear's slouchy, comfort-led silhouettes, workwear essentials reminiscent of pre-pandemic times have noted a YoY growth in the luxury market. New shirt arrivals rose 16% and blazers by 22% YoY, while court heels outpaced 2021 levels by 13%. Wide-leg pants dropped 31% YoY. However, this slump is only expected to be temporary, and relaxed fits shouldn't be overlooked. Wide-leg bottoms are bookmarked as Fall 2022's most commercial trouser fit, as seen at Proenza Schouler, Roksanda and Max Mara.
The Dopamine Dressing treatment
As the runway points to more traditional work attire, we can expect luxury assortments to be brighter than ever before. Already, black makes up a smaller percentage of women's workwear at 37% vs. 43% in 2021. Excluding black, pink has jumped from 7% to 14%, green from 6% to 7%, yellow from 3% to 4% and purple from 2% to 4%. Pink will remain a key hue for work staples, as the Dopamine Dressing trend gives tailoring an optimistic upgrade combined with the viral success of Valentino's head-to-tonal show.
On the runway
More options in larger sizes
Across products and advertising, luxury brands have lagged behind their mass market counterparts with inclusive sizing. Styles generally cut off at a size XL for women (US 14) and a 2XL for men (40-42 inch waist). Beyond those, size accessibility in luxury diminishes. Retailers have extended their size offering to serve the demand from shoppers with more diverse body types to buy into high-end fashion, with styles going upwards of an XL for women rising 130%, and 2XL for men up 348% YoY. While this seems like an impressive uptake, when compared to the total range, products with this size availability only equate to 7% of womenswear and 4% of menswear.
For NYFW Fall 2022, 51 plus size models were cast, a slight increase from Spring 2022, when there were 48. This only accounts for 5.09% of total castings, with even less diversity in the menswear shows. Just seven Fall 2022 presentations featured size-inclusive male models and all of them were emerging brands rather than established luxury houses. Retailers also need to ensure the hottest trends are size inclusive, as demonstrated by Miu Miu, with Paloma Elsesser wearing its viral set on the cover of i-D. Currently, almost half of the extended size luxury products are T-shirts, showing that, despite recent efforts, the luxury market continues to lack product diversity and representation for larger bodies.
On the runway
Phasing out fur
Since 2016, luxury brands began to dissociate themselves from fur and skins to align with modern consumer values. This movement remains prevalent in 2022, with Dolce & Gabbana and Moncler among the latest brands making the switch, while the continued use of animals in the production of wool and leather is questioned by activists. Fur and exotic skins have clearly been affected, yet wool remains a stalwart material within luxury, though it has seen a drop by 9% YoY. Meanwhile, leather made from hides remains commonplace, up 1% YoY in luxury brands.
Brands like Chloé and Coach took to the Fall 2022 runway to showcase traceable and upcycled leather as a sustainable and ethical alternative to animal hides. Designers are also actively investing in vegan leathers, up 20% YoY with Stella McCartney's pioneering grape and mushroom options. As fur fall outs of favor, faux alternatives and teddy textures are on the rise, up 78% YoY. Though not yet as established in luxury as virgin wool - conscious wool that's been recycled or responsibly sourced and farmed - has seen a 67% increase.
On the runway
Entering The Metaverse
Luxury's new frontier
Merging fantasy with reality is integral to selling luxury fashion, making the metaverse optimal real estate for designer brands to push new boundaries. Though relatively new terminologies, 42% of brands mentioning the metaverse and NFTs within the past year on landing pages and within emails have been luxury players. With digital wearables and tokens emerging as the next status symbol, it's understandable that designers are getting involved. As retailers grapple with metaverse strategies, Gucci has emerged as a frontrunner, buying a plot of virtual land on The Sandbox and partnering with 10KTF among its many metaverse projects. As the space is still evolving, retailers need to collaborate with experts in this field for their strategies to resonate.
The runway as a jumping-off point
The metaverse was heavily referenced in Fall 2022 shows. Taking luxury's fantasy element to a new dimension, Dolce & Gabanna evoked video game silhouettes. Jonathan Simkhai staged a catwalk via Second Life, and Maisie Wilen cast virtual models in its presentation. From here, digital shows will only accelerate. Virtual realm Decentraland is hosting a four-day Metaverse Fashion Week starting March 24th, with Dolce & Gabanna, Hugo Boss, Etro, Gary McQueen and more participating. Some brands are even offering physical twins to the digital items showcased.
On the runway
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