By  on June 13, 2006

PARIS — Hankering for a monogrammed handbag in the north of England? Or in need of a fashionable designer coat in Siberia?

Help is on the way as high-riding fashion giants steer their global retail expansions into new, and less obvious, locations. Louis Vuitton is plotting an outlet in Leeds, England, this fall, for example, while Max Mara is to set up shop in Barnaul, Russia.

While designer firms still spy plenty of room to grow in established markets and major cities, many are venturing further afield into secondary and tertiary population centers. They're capitalizing on a buoyant luxury market and banking on the reach of their brands and their ability to cultivate a local clientele for high-end fashions and accessories.

Tertiary cities already represent about 45 percent of the total number of doors for the Max Mara brand, and the percentage is growing for its Max & Co. and Marella labels, according to Luca Donnini, president of the Italian firm's worldwide export division.

"Access to brands and products will be a very important ground for future competition in any market," Donnini said. "We definitely prefer to be active in developing a rational tertiary retail formula to supply an original product with a good service, rather than to be passive and allow a growing parallel business."

He acknowledged that revenues per square foot in tertiary locations are lower than in flagships in major capitals, but stores in smaller cities benefit from lower operating costs. Max Mara Group operates 1,930 stores in some 90 countries.

"As a general trend, we do feel that the so-called luxury market is expanding beyond the exclusivity concept and selective distribution boundary. This is an attitude that must be carefully considered in order not to spoil the positioning of the brand in the consumer's mind," he explained.

"But it's also an opportunity to improve the access of our product to any residential area of wealthy communities."

Neiman Marcus, which operates 37 full-price stores in the U.S., recently indicated it's mulling openings in smaller markets where the affluent are clustered, such as Charlotte, N.C., Princeton, N.J., or in southern Florida. In addition, the retailer — along with competitors such as Saks Fifth Avenue and Barneys New York — is aggressively expanding its Web site to broaden its reach into states and towns where it doesn't have a store. The goal, executives from all three retailers say, is to satisfy the growing demand throughout America for designer apparel.

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