The nineties
The 1990s was a decade of explosive global consumption of modern luxury
fashion goods, spearheaded by the vast expenditure of Japanese and Middle
Eastern consumers on luxury goods. As a result, the majority of the existing
luxury brands launched international market operations, notably in Japan.
Luxury brands also expanded their product portfolios and placed increased
emphasis on accessories like leather goods and jewellery, in response to
consumer demand.
The decade also witnessed rapid developments in the competitive structure
of the luxury goods industry, which led to the adoption of advanced fashion
management practices. The most noteworthy of these developments is the
reinforcement of the luxury brand’s equity as an intangible asset generator for
luxury companies. This recognition of the important role of the ‘branding’
factor in the performance of luxury companies led to the revival of staid
brands like British brands Burberry and Mulberry and the rise of other brands
like the Italian brand Roberto Cavalli.
Also, for the first time in centuries, Britain, which is considered the global
centre of business services rather than fashion, began to take fashion seri-
ously with the recognition of the huge corporate potential of the luxury
goods sector. Efforts in this regard include the establishment of The British
Fashion Council in 1991, to protect and support the interests of the British
fashion sector and to discourage talented British designers from leaving the
country. British fashion schools like Central St Martin’s College of Art and
Design, London, were also highly promoted as a centre of learning and fash-
ion excellence.
An additional change in the luxury competitive environment was the grad-
ual lowering of the high entry barrier of the luxury goods sector. This was
made possible partly as a result of the interest of external non-luxury compa-
nies in funding new brands and acquiring old ones. Consequently, brands like
Ozwald Boateng, Alexander McQueen and Jimmy Choo were launched in
1990, 1992 and 1996, respectively. They also paved the way for the 2001
launch of the Stella McCartney brand.
The management methods of luxury fashion brands was also highly
affected by the rapid growth and influence of LVMH, the first luxury goods
conglomerate with a portfolio of more than 50 brands including Louis Vuitton
and Christian Dior, among several others. LVMH’s success led to the emer-
gence of a new luxury goods sub-sector and other conglomerates and corpo-
rate brands like the Gucci Group, Richemont and the Prada Group.
In response to growing competition, luxury brands also focused on prod-
uct retailing by adopting the strategy of colossal ‘cathedral-type’ retail
stores, with great emphasis on architectural design. Several innovations were
also made in selling strategies in addition to store design and atmosphere as
tools for representing the brand image. These include the use of advanced34
luxury fashion branding