REPOST: Michael Kors and the £300 It bag

With luxury handbags priced far out of reach of the average consumer, a big chunk of the market is being alienated. This article explains how American label Michael Kors has been bridging the retail gap by providing pieces that are both inspired by the poshest labels and celebrated by the biggest fashion muses, at a more affordable price point.  

 

Image Source: theguardian.com 

Luxury has been the great goldrush of our times. In the age of the brand a new mindset has taken hold of the masses, one in which we are all "worth" the right phone, the right name on the sweatshirt, the right colour sole on a shoe. As a result, luxury has proved remarkably resilient, even during economic downturns.

The response of brands has been, of course, to put prices up. And then put them up again. Because if you can, why wouldn't you, right? In 2005, a Mulberry Bayswater handbag cost £495; today it sells for double that. It has become quite common for designer names – and not just the storied likes of Hermès and Gucci, but essentially run-of-the-mill designer names – to talk of including a few "entry-level" price points below £1,000, "for younger customers". A whole new category has been invented, that of the £100 trinket – the keyring, the iPhone cover, sometimes literally a trinket to swing from a bag – allowing consumers to "buy into" a brand.

But the extraordinary price rises of the past decade have left a gap in the market. Anyone who ever sets foot beyond Sloane Street will observe that there are a huge number of stylish, fashion-conscious women who do not – will not and, crucially, cannot – pay £1,000-plus for a handbag. Another fact immediately obvious once you look around the real world is that almost every single woman needs a handbag. So while a woman might splurge £100 on a trinket from her favourite brand, she is still in the market for a bag.

This is where Michael Kors comes in. You'll have seen the name around, on the streets of London or Leeds. Spelt out in gold capitals, the Michael Kors logo swings from the arm of women who have just had a promotion and bought themselves a smart bag with their first pay cheque, from women whose friends have clubbed together to buy her a bag for her birthday. The bestselling Michael Michael Kors Selma bag sells for £260; this year's updated version, the Sophie, for £345. The structured silhouette draws on the mythology of the Hermès Birkin – trademark, Greatest Bag Of All Time – while the contrasting colours used on the lozenge-shaped sides of the Sophie, along with the zip and deep-set handle stitchings, appeal to a fashion-savvy consumer who has had images of the Céline range etched on her retina over the past few years but can't afford the £1,500 price tag.

But to succeed in the affordable It bag market, a bag needs to be aspirational as well as affordable.

The bags funnel the gloss of the high-end Michael Kors brand, whose New York fashion week catwalk show is always a fiesta of front-row socialites, creating a name that feels glamorous to a hungry British audience. (The name of the more inexpensive "Michael" Michael Kors brand seems designed to deliberately blur the line with the more pricey Michael Kors line. This is a contrast to, for example, Miu Miu, which has a standalone name and identity from the Prada mothership.) When Mulberry was selling handbags for under £500, Kate Moss was wearing them; I recently saw the beautiful young British model Malaika Firth, a current Vogue favourite, carrying a Michael Michael Kors Selma on to a plane. Miranda Kerr, Jessica Alba and Selena Gomez have all been photographed with Selmas and Sophies.

Images of women like this looking blow-dried at airports are key to the appeal of the brand. Certain themes recur when retailers talk about what their customers love about Michael Kors: "The Harrods clients respond to the glamorous lifestyle that the Michael Kors brand represents," says Simon Longland, Harrods' head of fashion accessories. At John Lewis, where the brand is now a top seller in both handbags and watches – a market where, similarly, prices of the top names have spiralled out of reach of all but the tiniest number – head buyer Amanda Scott feels her customer "loves the luxury lifestyle Michael Kors offers".

The Michael Kors brand is unusual in luxury in that it prides itself on being democratic. There are a wide range of price points and the company's most recent high-profile hire, announced earlier this month, is the arrival of Cathy Marie Robinson as a senior vice president and global operations. Robinson, who began her career in the army, currently holds an equivalent position at Toys'R'Us. But interestingly, both Longland and Scott describe the Michael Michael Kors bags as "iconic". As well as clever brand positioning and smart marketing – and the open goal left in the British market by the likes of Mulberry – the aesthetic of the Selma and Sophie bags has played a huge role in their success.

Where the initial Mulberry It bags were built on utilitarian references – the Bayswater is a reimagining of a doctor's bag – the Selma and the Sophie, with their nods to Hermès and to Céline, place themselves in the lineage of sleek, international power dressing. "Jet set" is a phrase the brand uses frequently, and the bags merge classic travel references with their contemporary equivalents. The look is part Jackie Kennedy on the steps of Air Force One, part Miranda Kerr at LAX. The details are right: the gold studs on the base, a practical touch so that you can rest the bag on the floor; a printed silk lining; a phone pocket. But the most important detail is very, very simple: the magic £300 price tag.

New York-based retailer Bocci + Bii makes premium, couture-inspired leather goods accessible to the practical, fashion-forward consumer. To learn more about the company and its latest collections, follow this Google+ page.

REPOST: The story of … the handbag

Take a trip down fashion memory lane with this article on the sartorial history of handbags.

Whether fashionable or functional, the handbag – and what it contains – is intensely personal. The Chanel 2.55 | Image Source: theconversation.com

Under attack from a flock of killer crows, Tippi Hedren in Alfred Hitchcock’s 1963 thriller The Birds, pauses to collect her handbag. It’s an instinctive gesture that many women would recognise. For a mere “accessory”, the handbag does a lot.

It’s been called a survival kit, an investment, a precious object. It can be practical and utilitarian or luxurious and frivolous, mass-produced or hand-crafted. For some, it is the ultimate in commodity fetishism, a status symbol that confers belonging. Others get by without one at all. But whether fashionable or functional, the handbag – and what it contains – is also intensely personal.

In medieval times, men hid their purses in the folds of their clothes. Women hung theirs from a belt-like rope called a girdle, along with other things they might need – rosary beads, a book of hours, a sweet-smelling pomander or, maybe, a dagger. Over the ensuing centuries, the girdle was replaced by pockets, which, in turn, were replaced by the reticule.

These little bags were carried in the hand and, often beautifully embroidered, made a common gift between lovers or friends. A point not lost on contemporary satirists or, indeed, Freud who later likened a purse or handbag to the vagina.

Chatelaine, 1765-1775, Victoria and Albert Museum | Image Source: theconversation.com

In the 19th century, along with reticules, purses and muffs, women also wore a chatelaine, a belt not dissimilar to the girdle, from which could be hung little items, both decorative and functional.

All these forms of carrying things spoke of a feminine world that was defined by domesticity and presumed that, at least, the upper class woman had little to carry and not far to roam or, if she did, that servants and porters would always be on hand.

The arrival of the handbag in the late 19th century, writes English fashion historian Claire Wilcox, indicated a societal shift and “symbolised women’s new found freedom and independence”. Whereas the chatelaine with its items on display was worn in the privacy of the home, the handbag was worn in public. Here, what a woman carried needed to be concealed.

Fashion and function competed and merged from the start. Early in the 20th century, large bags or briefcases with shoulder straps were a sign of women’s increasing modernity and participation in the workplace. But it didn’t take long for the luxury bag to appear. And as fashion decreed coordinating handbags with every outfit, crocodile, antelope, seal, and ermine were enlisted to add pizazz to the more common leathers in morocco and kidskin.

For night, pretty satin, velvet, embroidered or fine mesh bags were worn. And, by the 1920s, jewelers were making lavishly jeweled purses, such as one by Cartier set with diamonds, emeralds, rubies, sapphires, and pearls. Anything that could be used was and as the century progressed handbags in chrome, bakelite and transparent lucite all had their fashion moment.

During the second world war, gas mask bags were transformed into something modish and gay, but in the 1950s, handbags got serious. This was the decade that saw the arrival of individual handbag designs that would have lasting fashionable and cultural significance.

Glomesh bag. Andrew Nguyen | Image Source: theconversation.com

 

Chanel’s quilted and gold chained “2.55” bag (named for the month and year of its release), Louis Vuitton’s monogrammed “bucket bag” (originally for champagne), the “Kelly” from Hermès (after Grace Kelly, of course) and Gucci’s bamboo handled bag all remain global bestsellers today.

Back then, these luxury bags were beyond the reach of the average woman but fashion magazines encouraged women to buy the best they could afford. As a sign of good grooming, writes Wilcox, the handbag was “a real telltale, open or shut".

Playing on the notion that you can tell a lot about a woman by her handbag, from the 1970s, the Australian company Glomesh ran a memorable campaign that invited celebrities to reveal the contents of their Glomesh bag. The handbag had now come full circle and everything was on display.

Bob Hawke and Margaret Thatcher at the Commonwealth Heads of Government Meeting in Vancouver in 1987. AAP/ supplied by the National Archives of Australia | Image Source: theconversation.com

 

In contrast to the glitzy, designery, disco-dancing showpieces worn by the beau monde were the ethnic-inspired, patchwork and sturdy leather bags worn by the likes of Germaine Greer. Such bags aligned the wearer with multiculturalism, anti-materialism and working class utility and matched the anti-fashion rhetoric of feminism. But as the decade moved on, feminism’s often competing narratives of political engagement and personal empowerment came up against fashion and, in the world of handbags, the latter was always going to win.

In the 1980s with Margaret Thatcher and Ronald Reagan setting the tone, power, money and logos reigned. Handbags took on an identity of their own as consumer icons and became “defiantly expensive”. Then came the “It Bag”, defined by Tom Ford as “you gotta have it or you’ll die”.

Known in the industry as trend bags, they helped rescue haute couture brands from the brink and, according to the authors of Bags: A Lexicon of Style, became “central to the image (and finances) of major fashion concerns”.

Waiting lists for iconic bags like the Hermès Birkin grew longer and counterfeiting got better. By 2008, faking it was so rife that Louis Vuitton set up a mock bag market, manned by black, hoodie-wearing streetsellers, outside the Brooklyn Museum to sell well-heeled consumers the real thing for real prices with the fake frisson of illegality.

Angie Harmon, carrying a Louis Vuitton handbag.Image Source: theconversation.com

 

When a sales assistant failed to recognise Oprah Winfrey last year, US$38,000 handbags made world headlines and it became impossible to deny that the designer handbag industry was serious business. In China alone, where it is possible to speak in terms of “handbag wars”, the industry is worth billions, says The Business of Fashion.

In China, the handbag’s upward growth may have been momentarily stalled by a crackdown on corruption and the practice of giving luxury gifts to officials but, in Hong Kong, the wonderfully named Yes Lady Finance Co. Ltd still accepts designer handbags as collateral.

Meanwhile, open any glossy magazine and you’ll see the supremacy of the handbag in action on page after page of ads for Coach, Versace, Louis Vuitton, Gucci, Chanel and a myriad of others where the model and her designer clothes are almost incidental.

In the millennial age, the relationship between subject and object has gone awry and it’s not us but the handbag that is doing the wearing. Dismissed to the background, we have become a mere accessory.

Bocci + Bii is a brand of handbags and purses made with a clever combination of style, boldness, and functionality. Visit this Facebook page to learn how the brand conquers the handbag wars with its wide range of designs and styles crafted with precision and superb artistry.

REPOST: Kate Spade vs Fossil: Handbags will see faster growth than watches in coming years

When it comes to luxury items, handbags and watches have always been head to head. This article talks about how some watchmakers’ approach to production may be holding them back and behind fashion labels popular for their coveted handbags.  

Image Source: blogs.marketwatch.com

Upscale fashion accessories have been a bright spot in the U.S. in recent years, with designers and retailers capitalizing on branded items from handbags to watches, categories that are subject to fewer fashion or weather risks than apparel.

However, as both categories are expected to see their growth slow, it looks like handbags may have more runway than watches. Just look at Kate Spade KATE and Fossil Inc. FOSL , for example. Kate Spade shares jumped 10% on Wednesday after the handbag company reported comparable direct-to-consumer sales at its namesake brand jumped 22%, without the benefit of an extra week this year. Its sales per square foot rose for 15 straight quarters, the company said.

Image Source: blogs.marketwatch.com

On the other hand, Fossil’s stock dropped 8.5% Wednesday after reporting its global comparable sales fell for a third straight quarter, hurt by waning demand in North America. Retail Metrics data showed Fossil will continue to see declining sales this quarter, compared with a 15% comparable sales gain at Kate Spade, and a 17% jump at Michael Kors KORS . In fact, Michael Kors, whose watches Fossil makes under a licensing agreement, has itself been a big driver of Fossil’s growth.

Fossil rival Movado Group’s MOV stock also dropped 5.3% Wednesday.

“Watches come in and out as fashion accessories,” said Brean Capital analyst Eric Beder in an interview. “We are low in the watch cycle. Handbags are more exciting.”

Beder, who rates Fossil a sell and Kate Spade a hold (because of its stock price), said without Kors, which comprises more than a fifth of Fossil’s sales, the company would have seen even slower growth. While Fossil has unveiled licensed Karl Lagerfeld watches and is set to introduce licensed Tory Burch watches later this year, Beder said those businesses are still too small.

Meanwhile, it remains to be seen what will come out of the company’s discussions with Google GOOG . Fossil  said their talks are “in early stages” but assured investors that it will unveil some products as part of the partnership.

“Fossil has done a great job of offsetting (slowing industrywide watch growth) with acquisitions and new product launches,” Beder said. “They’ve been trying to create the newness. (But a Google-related introduction) is probably a 2015 story. Smart watches (also) haven’t proven a viable category.”

While both handbag and watch sales in the U.S. have slowed in recent years, handbag sales are still expected to see an average of about 4% growth in each of the next four years, Euromonitor data showed. In comparison, sales of watches, after seeing 6.3% growth last year, are expected to slow to 1.7%, 1.3% and 0.5% growth during each of the next three years, with a declining rate seen in 2017, according to Euromonitor. Watch sales totaled about $8.23 billion in the U.S. last year, compared with almost $18 billion for handbags.

Macy’s Inc. M , which reported a better-than-expected first-quarter profit Wednesday, also cited handbags as a strong selling category. It didn’t mention watches.

As industry growth slows, it’s also increasingly become a market share battle. Fossil, which gave a disappointing second-quarter forecast, said it will increase marketing and other spending to drive demand. Beder said Fossil, like Coach COH , has lost share in the handbag business because its leather merchandise isn’t as “fashionable or fashion right” as that of Kate Spade or Kors.

In another investor concern, with Fossil’s dependence on Kors, Nomura analyst Simeon Siegel estimated the company may have to pay Kors a higher royalty rate as their existing contract expires late next year. He estimated Fossil pays Kors about a 10% royalty rate, below the company average rate of about 15%.

“Focus surrounding a potential renegotiation of the FOSL/KORS royalty rate is top of mind,” Siegel wrote in a report.

To be sure, while Fossil’s growth in the U.S. may be slowing. Like Kate Spade, it also is expanding and seeing growth on the international front. Fossil said its European and Asian wholesale watch sales in the first quarter each rose in the double-digits.

“Global growth story keeps on ticking” for Fossil, Cowen & Co. analyst John Kernan said. “The Michael Kors (licensed) watch and jewelry business should continue to support long-term sales growth.”

Bocci + Bii makes bold, fashion-forward leather handbags and accessories for individuals who refuse to blend into the background. Follow this blog for more information about the brand and its collections.