Most Recent Articles In Handbags
Latest Handbags Articles
- The 23 Best Tote Bags for Fall 2016
- Handbag Brand Rue de Verneuil Charts Success
- Price Target for Coach Shares Raised by Two Analysts
More Articles By
What do logos on handbags have in common with Celine Dion?
This story first appeared in the March 26, 2012 issue of WWD. Subscribe Today.
Neither is as ubiquitous as in the late Nineties, when Louis Vuitton’s famous monogram generated an estimated 80 to 85 percent of the brand’s sales and Dion’s “Let’s Talk About Love” and “Falling Into You” topped album charts. Logos have drifted from the fashion spotlight as some consumers in mature markets — perhaps influenced by economic turbulence — put more of a premium on craftsmanship, quality and discreet luxury. At the same time, certain brands, like Christian Dior and Fendi, have embarked on upscaling drives, deliberately reducing their reliance on obvious brand signifiers and entry-level products. For example, industry sources estimate logos now represent well under 40 percent of Vuitton’s overall business.
Yet logos, like Dion with her blockbuster Las Vegas show, continue to rake in the bucks.
Indeed, vendors, image consultants and retailers agree that brand identification is still a vital factor in the luxury handbag marketplace, whether telegraphed by an obvious logo, an iconic shape or a telltale design treatment like Chanel’s quilting or Bottega Veneta’s signature woven intrecciato leather. Indeed, some argue that logos are still aplenty and sought after, especially in emerging markets such as China, Russia and the Middle East, which have been driving growth in the luxury sector in recent years.
“It’s cyclical,” says Vuitton’s artistic director, Marc Jacobs.
“There’s always a moment where there’s almost an irony about status symbols, when even people who aren’t into logos will like the irony of it. And then there are people who always like them. I’m just happy finding a balance of continuing to celebrate it but finding ways to subvert it or to do completely without it.”
Philip Beil, a principal at Munich-based management consultancy Roland Berger and head of its fashion, sports and luxury goods practice, acknowledged a “trend” toward less-obvious luxury in markets such as Europe and the U.S. Still, he sees no significant change in the long-term appeal and use of logos.
He characterizes plainer bags with more subtle signifiers as a potential for “add-on business” for logo-reliant firms “to reach additional target groups who don’t like big and obvious logos.”
To be sure, logo-driven accessories offer a “comfortable” business model for luxury firms, with less volatility than designs dependent on the vagaries of fashion, notes Jean-Marc Bellaiche, senior partner and managing director at The Boston Consulting Group. A need for product pillars that are as solid as logos is what drives brands today to create iconic shapes that sell for several seasons, lending stability to their sales and allowing them to make forecasts and plan the supply chain.
According to Bellaiche, many consumers are becoming more sophisticated and using other measuring sticks for luxury besides obvious brand identity. These would include innovative design, quality materials and craftsmanship. That said, he stresses that “in emerging countries, status is still a positive value.”
Today, roughly 3 percent of the Chinese population buys luxury products. Should that consumer market de- velop along the model of Japan, where 35 percent of its population buys some luxury goods, there are likely to be millions of Chinese shoppers buying into luxury for the first time in the foreseeable future. “Buying a logo can be reassuring; you have status, the brand is visible,” Bellaiche says.
By contrast, more seasoned and sophisticated consumers may prefer to carry handbags with more discreet brand identity that only like-minded elites would recognize. “The stronger your design language, the easier it is for a brand to be recognized without obvious logos,” Beil notes.
Not that there’s an ideal ratio of logo to plain. Most experts agreed it depends on the DNA and heritage of the label. A long-established logo “still resonates with customers as it signifies the heritage of the house, craftsmanship, longevity and authenticity,” observes Jonathan Joselove, senior vice president and a general merchandise manager at Neiman Marcus.
That said, it is often difficult for a brand that has never had a logo to introduce one that resonates with consumers, with experts pointing to Hugo Boss and Chloé as examples.
“With logos, you always have ups and downs,” said Ralph Toledano, who was recently named president of the fashion division at Puig. “But for brands that are legitimate in logos, the business continues to be very steady.”
Logo products are attractive to brands because they tend to offer higher margins than other products due to production scale and the fact that “people are prepared to pay a premium,” Toledano says, while noting that, particularly in emerging markets, newly flush consumers are “looking for status symbols.”
All around the world, an increasingly savvy and demanding consumer is forcing brands to examine their offerings. According to Patrizio di Marco, president and chief executive officer of Gucci, the 2009 financial crisis and “general uncertainty in the world” have impacted consumer purchasing habits. “There is a much greater emphasis on core values such as quality of materials, craftsmanship and authenticity, combined with a reluctance to show off,” he explains. “This is especially true for the so-called mature markets, but even for the newer markets where the logo can still play an important role in consumer behavior, those luxury consumers are quickly becoming more discerning as they become more knowledgeable about the heritage and values of the brand. [Percentagewise] we have definitely decreased the incidence of logoed products. This, however, is only a part of a more general and focused strategy on rebalancing the overall product mix toward the more sophisticated end of the market.” This endeavor involves defining the “appropriate mix of fabric, leather and precious materials and, of course, achieving the relevant weight of carry over and newness.”
Still, logos remain a powerful tool for brands with large awareness. Roland Berger’s Beil argues that they “help create a certain brand image and increase your brand visibility on the street.” To wit: Some companies do little to combat counterfeits, which broadcast the brand name. “On the other hand,” he warns, “you have to be careful that you don’t overdo it.”
What lessons about logos can a new heritage luxury player offer?
Take Moynat, for instance. The 19th-century French trunk maker was just relaunched by Bernard Arnault with a Paris flagship and complete range of leather goods, including a tote worked in an archival monogram canvas. Since the boutique opened in December, most customers have gravitated toward timeless nonlogo pieces, such as the leather Pauline bag. But, according to Moynat head Guillaume Davin, some see the powdery, slightly metallic grid of Ms of the house canvas as a chance to be “part of an exclusive group in possession of a little-known monogram tote.
“We hope that the curves of the bags, the handles and the quality of the leather will be as powerful recognition codes of the house as the monogram canvas,” Davin continues. He characterizes the logo as an immediate communication tool. “You just have to use it in the right doses,” he says. In other words, don’t exploit it.
As for Jacobs, he said he’s energized by the design challenge of working with more or fewer logos — Vuitton’s main ones being the Damier check and the monogram. “We just continue to play with both,” he says.
Ditto for Silvia Fendi, who is strongly attached to the FF logo that evokes the Roman firm’s family roots. “I also find it particularly beautiful from a graphic point of view,” she offers. “We treat every element of the collection in a unique way and apply the same creativity regardless if it involves the logo, our Selleria [leather goods] or made-to-order.” In her estimation, the Fendi logo is not only a brand signifier but an assurance of quality.
Retailers, meanwhile, cite lusty demand for designer handbags, with small sizes and subtle brand identification among key directions.
“It’s more about the shape and style being iconic and recognized as opposed to being bought because it has a logo,” says Sarah Rutson, fashion director at Hong Kong-based Lane Crawford. “Trends do come and go, and clever ways of branding an item can also be refreshing — you just have to see with Marc Jacobs at Louis Vuitton how he took the classic logo and worked with Stephen Sprouse, then on to Takashi Murakami.” As reported, Vuitton plans to unveil a major collaboration, à la Sprouse in July, this time with dot-crazy Japanese artist Yayoi Kusama.
Marigay McKee, chief merchant at Harrods in London, said she detects “a greater move toward classic styles which are exquisitely crafted and will last a lifetime rather than customers purchasing a handbag for the sake of a logo. “Chanel,” she continues, “will always be one of the most coveted brands for their chic and iconic logo, whilst Celine’s sleek and simple designs are extremely popular for those seeking a more pared-down style. Today, when consumers are buying a handbag, they are looking for quality and craftsmanship rather than being lead solely by an obvious logo.”