Sonia Rykiel RTW Fall 2016, Gucci RTW Fall 2016, Mary Katrantzou RTW Spring 2017

LONDON — Call it the luxury kiss.

In a tricky climate for high-end goods, with too many brands and stores, too few high-spending Chinese tourists, and the ever-present threat of terrorist attacks in key shopping cities, luxury prices have begun to drift downward, while premium and contemporary price tags are floating up.

The aim is to reach the kissing point, that still underpenetrated space, where the clothes look fresh, original and expensive, but don’t cost thousands of dollars, pounds or euros.

Retailers, under constant pressure to drive footfall and digital sales, are embracing the trend, arguing that the premium middle ground has become a hotbed of creativity and commerce, piquing interest and driving sales alongside the high-end runway pieces.

“It’s a really nice segment for the luxury brands to move into, because they’re not eroding their names or their credibility by stretching their prices downward. And it allows them to attract a brand new shopping base in a competitive climate,” said Honor Strachan, lead analyst at the London-based consultancy Verdict Retail.

Gucci is a classic case: While the velvet dress with the long white sleeves and the pink pussy bow may set customers back 1,850 pounds, or $2,270, there are also blouses with pearl buttons and price tags in the 400 pound to 500 pound range, or $490 to $615.

Burberry is another. In its aim to outperform luxury market growth in the coming years, the brand is re-strategizing, slashing its product assortment and broadening its opening price offer with the aim of transforming its 40 million-plus social media followers into spenders.

With a new chief executive officer on board, Mary Katrantzou has also expanded her offer: The designer, who built her name on lavish, digital print dresses with price tags upward of 2,000 pounds, or $2,455, has added skirts, knits and embellished button-front cotton shirts to her famous occasion wear for resort, allowing retailers to buy deeper and wider.

Some brands have decided to live permanently in the contemporary sweet spot. Last fall, Sonia Rykiel announced it was shutting its diffusion collection as it moves to reposition its main line to lower price points to meet the demands of an increasingly competitive market.

Already for fall 2016, the house began lowering prices on certain key categories such as knitwear, a strategy that has proved successful.

Hugo Boss is another example, with the brand recently revealing plans to return to the premium category, with a renewed focus on entry price points.

Luca Solca, managing director at Exane BNP Paribas, said he believes there is a “significant opportunity in midprice, not in luxury. I welcome the announcement by Hugo Boss that they are going back to their roots and abandoning lofty ambitions to trade up.”

Stretching for the new middle ground isn’t only for the luxury players. Because of all the competition on the high street, big chains are looking to differentiate themselves, too, and grab a larger share of the high-end market with the launch of premium lines.

Reiss has launched a premium range, with coats costing between 800 pounds and 1,000 pounds, or $980 and $1,227, while Zara Studio, a collection of timeless pieces, launched a few years ago.

Mario Eimuth, founder and managing director of the Munich-based, which carries brands ranging from Alexander McQueen and Marc Jacobs to Polo Ralph Lauren and Paul & Joe, believes it’s consumers who are fueling the changes, mixing up luxury with contemporary as they try to create an individual look.

“There is no denying that the continued growth of street style and social media are key points of influence here, creating the desire for a more individual look and prompting customers to seek out products from a more diverse range of brands,” said Eimuth. 

“They’re teaming a McQueen jacket with Frame Denim jeans, an Être Cécile T-shirt and APC boots, looking to create something that reflects their personal sense of style.”

Sarah Rutson, vice president of global buying at Net-a-porter, has a similar take on customers’ increasing fashion mash-ups. She said that while Net-a-porter’s luxury designer business is “certainly not waning,” her customers remain thirsty for newness — and don’t mind about price.

“Women want to mix it up with high and low-price brands,” said Rutson, adding that the contemporary designers Net-a-porter carries all have a defined aesthetic and signature. “In an industry saturated with so many options, having this clarity of vision is essential.”

She said this season, Net-a-porter grew its contemporary buy by nearly a quarter, with brands such as Self-Portrait, Acne Studios and Tibi driving the category. “Other brands such as, Ganni, Jacquemus, Off-White and Joseph are performing very strongly.”

Natalie Kingham, buying director at, said the contemporary brands that perform the best are the ones that offer luxury details, “in the fabric, the enamel button, or the colored stitching on the shirt cuff. They have something artisanal about them, or come in limited batches.”

Kingham added that the successful contemporary brands also tend to be more flexible with their production cycles, and are able to arrive on the shop floor during critical times — well after the runway collections have landed, or when other stores are promoting their mid-season sales or pre-holiday markdowns.

“The luxury customer wants newness — and a store cannot rely on runway pieces,” said Kingham. “Those smaller, contemporary brands keep things interesting.”