The era of "silent luxury" is over; big brands change strategies.

The trend of “ostentatious luxury” is making a comeback as fashion houses struggle to innovate designs to attract consumers.

The arrival of a series of new creative directors at fashion houses such as Gucci, Chanel and Versace, along with the new CEO of luxury group Kering, Mr. Luca de Meo, signals the decline of the trend of "quiet luxury" to make way for impressive styles.

Analysts say this could be a turning point for the entire industry.

Speaking to CNBC last month, Carole Madjo, head of European luxury research at investment bank Barclays, said the industry is seeing a shift towards a more recognisable luxury style.

She explained that luxury fashion is cyclical. After a few years of “quiet luxury,” she said, consumers start looking for something new. So, uniqueness and novelty are now the industry’s main focus.

This major shift in style comes as the luxury sector struggles to overcome a range of challenges, from trade tariffs to sluggish consumer sentiment, following the COVID-19 boom.

Top luxury brands such as Brunello Cucinelli, Hermes and LVMH's Loro Piana have weathered the downturn relatively unscathed, as ultra-wealthy customers continue to spend heavily on cashmere products and exquisitely designed high-end handbags.

But for many brands, the discreet elegance of the “quiet luxury” trend, which took off in 2022 with the popularity of series like HBO’s “Succession,” is no longer appealing enough.

This could herald a new era where large logos, bold branding and signature designs dominate from the catwalk to the shopping streets.

Analyst Yanmei Tang of consultancy Third Bridge said the market's appetite for many products has declined, forcing all major brands to change their creative direction to regain appeal.

Gucci, Burberry and Moncler

Burberry fashion house is one of the brands at the forefront of change.

Under the leadership of CEO Josh Schulman, Burberry is re-embracing its British heritage after years of leadership changes, falling sales and knock-offs that have eroded the value of its signature products.

Chief financial officer Kate Ferry said on a second-quarter earnings call that the company's statement-making heritage collection is “reigniting aspiration for the brand” and positioning Burberry among a broad consumer base as “a luxury brand with global appeal.”

Gucci is also said to be aiming for a similar overhaul under new artistic director Demna Gvasalia, whose unconventional designs have caused controversy at Balenciaga, a subsidiary of parent company Kering.

Gucci's outfits are introduced at Milan Fashion Week, Italy. (Photo: THX/TTXVN)

Kering Group executive vice president and head of brand development Francesca Bellettini recently said that “the first signs of Mr. Demna’s vision for Gucci” will appear in September, with the full collection launching in early 2026.

Fashion enthusiasts and investors have long been waiting for a catalyst to revive Gucci's business, as sales have continued to decline, especially due to weaker demand from the Chinese market.

The arrival of former Renault boss Luca de Meo as CEO of Kering next month is also expected to bring an outside perspective and branding expertise.

Madjo believes that the key is to regain the brand’s appeal. Bringing something new, something fresh and unprecedented, is what can make Gucci great again, she says.

New creative and artistic directors are also expected to usher in major changes at fashion houses Chanel, Bottega Veneta and Versace, which are known for their unique styles.

Meanwhile, Moncler has chosen to experiment with rotating designers through its Genius collection, and Prada has recently highlighted visual adaptability as one of the brand's strengths.

Prada Group CEO Andrea Guerra, in an earnings call last month, spoke of the beauty of Prada as being able to be both sporty and glamorous, claiming it is one of the few brands that allows them the flexibility to approach the market in three or four directions at the same time.

Great differentiation

Fashion houses hope that image overhauls can help reignite waning interest from consumers disillusioned with brands, after dramatic price increases during the pandemic were not accompanied by product innovation.

Luxury prices are set to rise an average of 8% in 2022, a record, compared with 1% before the COVID-19 pandemic and 3% from the start of this year through May, according to data from UBS's Evidence Lab.

Only top luxury brands such as Hermes, Rolex and Cartier, owned by the Richemont group, will be able to sustain significant price increases in 2025, although many others have warned that tariff policies may force them to do so.

Meanwhile, Gucci, Burberry and Prada have also increased prices, but to a lesser extent, which is likely to further deepen the divide between the ultra-luxury brands pursuing a more discreet style and the relatively more affordable labels.

Last week, Marcus Morris, portfolio manager at asset management firm Alliance Bernstein, told CNBC that price increases can only be tolerated now if there is “the right brand, the right management and the right marketing strategy.”

However, more modest pricing strategies may be necessary for struggling brands looking to regain market share and attract a larger audience.

Luca Solca, head of global luxury at research firm Bernstein, said that high-end luxury brands with a more discreet style have increased their prices significantly. According to him, brands with a more moderate pricing approach are doing well and are likely to benefit from this mid-range segment./.

(TTXVN/Vietnam+)

Source: https://www.vietnamplus.vn/het-thoi-xa-xi-tham-lang-cac-thuong-hieu-lon-doi-chien-luoc-post1054941.vnp