"Why 'It' Bags are Out" Wall St. Journal 1.26.08 article

  1. Another article about "it"!! ;)

    Style
    Why 'It' Bags Are Out


    Luxury bags fall victim to their own success; exclusive over ostentatious
    By CHERYL LU-LIEN TAN and RACHEL DODES
    January 26, 2008; Page W1

    Irene Weisburd used to buy 20 handbags a year, dutifully getting on waiting lists for the season's designated "it" bag and filling her "bag wardrobe" with Fendi Baguettes, a Louis Vuitton Murakami bag and Prada nylon backpacks.

    Recently, however, she has bypassed popular styles such as last fall's Gucci Indy bag and the ubiquitous Fendi 'B' bag in favor of unadorned pieces from Bottega Veneta and lesser-known labels such as New York's MZ Wallace.

    [​IMG]Icons: Grace Kelly and the Kelly bag; Sarah Jessica Parker and Fendi; Kate Moss and Balenciaga.

    "I felt like, 'Gee, all these bags are so attainable by a lot of people that everyone's carrying around that bag,' " says Ms. Weisburd, a 59-year-old homemaker who lives in New York City. "I wanted something that was more exclusive."

    For the past 10 years or so, fashion houses have churned out expensive bags with distinctive shapes and logos in the hopes that they'd catch on as that season's sensation. Consumers, seeking the status a recognizable bag conferred, flocked to buy them, helping to fuel the recent luxury boom.

    But as big luxury brands have expanded world-wide, offering more entry-level products to reach more consumers, some high-end shoppers are getting turned off. The proliferation of knockoffs has helped erode the mystique of owning a high-end bag. Affluent customers have grown confident in their own sense of style and increasingly turning to unique accessories to set themselves apart from the crowd. On top of that, the recent stock market selloff and downturn in consumer spending has many consumers shunning spending that could be considered ostentatious. As retailers head into the new year, some are declaring that "it" is over.

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    Link to image if it doesn't enlarge:
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    "The 'it' bag isn't important any more," says Stephanie Solomon, women's fashion director at Bloomingdale's. "It's all about looking different from your neighbor."
    Instead of one hot, recognizable style, retailers this spring will be pushing a variety of styles and brands, many of them lesser-known. Intermix, a high-end New York-based retail chain, is making a big push for handbags from labels such as Zagliani and Lanvin. Scoop is stressing Jamin Puech, Whiting & Davis and other relatively unknown, expensive brands. For spring, Henri Bendel is picking up LVMH Moët Hennessy Louis Vuitton's brand Loewe, which is popular in Asia but hasn't been widely sold in the U.S.

    Retailers are targeting consumers like Elle Elder, a 36-year-old stay-at-home mother in Orchard Lake, Mich. Ms. Elder used to buy the latest looks from Prada and Jil Sander each season, but now she is seeking out brands that are more narrowly distributed and often more expensive. This season she bought a $1,700 handbag, from an independent Italian label called Marni, with no logo at all. "I don't like anything that has a designer's name on it," Ms. Elder says.

    These shifting tastes have sent ripples through the $230 billion-plus luxury-goods industry. Handbags have a longer shelf life and produce higher profit margins for their makers than apparel, which must be cleared from stores every few months. To offset sales declines of pricey handbags, some brands are moving further upmarket, launching ultra-luxury lines with extreme price tags to match. Others are developing limited-edition bags to reinforce their exclusivity.

    [​IMG]Alternatives for 2008: Left to right: Marni Sculpture bag ($1,347), Loewe Geranium bag ($3,025), Phillip Lim Omai bag ($625), Zagliani Star python clutch ($1,650), Jamin Puech Sami bag ($1,105)

    Many fashion experts date the original "it" bag to 1956, when Grace Kelly created a frenzy for the Hermès bag she famously used to shield her pregnant belly from paparazzi. The bag was known forever after as the "Kelly." In the 1980s, the Prada nylon backpack became a hit because its sleek, minimalist look was such a stark contrast with the cluttered excess in fashion at the time.

    The compact Fendi Baguette, which Sarah Jessica Parker wore under the arm like a loaf of French bread in "Sex and the City," became one of the most coveted bags of the late 1990s and pushed prices to new highs. Despite its price tag starting at about $400, women waited in line at Fendi stores for the distinctive-looking piece, with its prominent double-'F' logo.

    Following the success of the Baguette, luxury labels jumped on the handbag bandwagon, launching and pushing a major style each season. Shoppers put their names on waiting lists and tried scoring pieces on the resale market. Companies fanned desire by giving purses to actresses, in hopes of landing paparazzi shots of their bags in fashion magazines.

    In the summer of 1999, Christian Dior's Saddle Bag became a hit after stars such as Gwen Stefani started carrying it. In 2003, Louis Vuitton's Murakami bag, designed in collaboration with the Japanese artist Takashi Murakami, inspired long waiting lists at stores around the world.

    One reason designer bags generated so much heat is that designer apparel had taken such a minimalist turn in the 1990s, says Valerie Steele, director of the Museum at the Fashion Institute of Technology in New York. "You could look all minimalist but then you could have an amazing handbag," she says.

    It's only recently that fashion companies have begun to sense the shift in consumer tastes. Stores couldn't keep the $1,380 Paddington leather handbag from Chloé, a unit of Compagnie Financière Richemont, in stock after its release in 2005. But over the next year, elite shoppers began to lose interest, in part because it was showing up in so many magazines and stores.

    To compensate for the Paddington's flattening sales, Chloé has shifted strategy over the past 18 months. It has expanded its handbag styles to 80, compared with only 20 a few years ago, and it is introducing limited-edition styles at Chloé boutiques, such as the new Heloise bag in python for $4,295. And to reduce its reliance on bags, the company has branched out into new product categories. Watches and jewelry are "the new 'it' bags," says Ralph Toledano, chief executive of the Chloé brand.

    Other fashion companies are moving upmarket to bolster their images. Chanel says when it introduced a limited-edition alligator handbag with a diamond clasp for $230,000 earlier this month, nine people were on the waiting list. "The discerning customer is evolving and we are continuing to make sure we are evolving with her," says John Galantic, president and chief operating officer of Chanel Inc.

    Two years ago, at the height of craze for iconic handbags, Neiman Marcus executives realized they would have to "move up" in terms of what it was offering at the "high luxury" level, says Karen Katz, president and CEO of Neiman Marcus Stores. To stand apart from rivals carrying the same designer labels and products, Neiman Marcus over the past 18 months has requested exclusive, limited-edition handbags made from exotic skins from design houses including Prada, Gucci and Yves Saint Laurent. Most of the bags cost $2,500 and up, Ms. Katz says. For spring, the retailer will emphasize new bags from labels including Phillip Lim and Roger Vivier.

    It used to take years to establish a fashion brand. But lately, many small labels are benefiting from the same sort of viral buzz that has boosted the fortunes of under-the-radar rock bands and made overnight celebrities out of people on YouTube.

    Julie Gilhart, the women's fashion director for Barneys New York, says sales of Lanvin and other small luxury labels are growing at a "faster velocity" than Prada did when it was a niche brand in the early 1990s. She attributes the growth to coverage on fashion blogs and Web sites like Style.com and in celebrity magazines.

    Marni, an Italian label that doesn't advertise, is one of the hot new brands benefiting from consumers' taste for the obscure, growing markedly over the past two years. "We target a niche market, but that niche market is becoming bigger and bigger," says Gianni Castiglioni, president of Marni and husband of designer Consuelo Castiglioni.
     
  2. Fascinating.
     
  3. this :

    "I felt like, 'Gee, all these bags are so attainable by a lot of people that everyone's carrying around that bag,' " says Ms. Weisburd, a 59-year-old homemaker who lives in New York City. "I wanted something that was more exclusive."

    what makes the prices of bags rise and rise and rise....
     
  4. Great article, thanks for posting!

    Yesterday I was at a ZARA store, and everyone around me was carrying an LV or a Gucci... And I thought, "the Zara crowd is carrying these bags" and I was immediately turned off... Mind you, I AM part of the Zara crowd, I don't buy expensive clothes, as I feel they are not an investment.
    I like the "hidden" advertisement of Marni... I 'm a Marni fan since 1999, where only 1 store in Athens imported very few items. Now I'm seeing the article talking about Marni, I know I have to look for the next new thing in town...
     
  5. Thank you so much for sharing and posting this article. I just don't see the WSJ on a regular basis (that's putting it mildly) but I love reading what is going on. Thank you!
     
  6. Hmmmmm...thanks for sharing this. Very interesting!
     
  7. Out of all the "luxury handbag" stories that have been written lately, I actually enjoyed this one. Thanks for posting!
     
  8. Great article! Thanks for sharing!!
     
  9. Yes, fascinating read! What I think is great is the tone of the article clearly puts us (the consumers) in the power role...
     
  10. Thanks for posting!!!!!! - you saved me the work.

    GREAT article!!!!
     
  11. I hate to be the bearer of bad news for "Elle" who is too good for Prada and Jill Sander, but you can buy Marni at TJ Maxx!!!!
     
  12. ^^Wow! We don't have a TJ Maxx here - would love to check that out!

    Glad you are finding the article interesting - makes the Journal's pricey annual online subscription fee of $99 a bit more worthwhile!! :sweatdrop:
     
  13. you can buy a lot of high end designers there like marc jacobs or michael kors or etc. ^
     
  14. what is this?
     
  15. Thanks for the article. BTW, I have seen Marni at TJ Maxx (Brea) as well.