The summer sale season is drawing to a quick end. As we’ve been racing to the back of stores and sorting through scattered sales racks, department stores and boutiques have been carefully laying out the new collection like fragile souffle. For many designers, this new collection will truly determine the state of the retail economy.
One trend we quickly noticed is the “re-adjustment” in pricing. In mid-June, an eager Gucci sales associate commented that pricing was going to start off much more aggressive. She pointed out a fine mohair coat, which she said would likely be priced at $6,000 during brighter economic days. This season, the coat is hitting store shelves at $4,000 or about 33% less than a similar coat in 2008.
Gucci isn’t the only brand trying to hold down prices. We recently got our hands the Prada winter price list. Classic styles that are almost never seen on sale have had their prices re-adjusted. A buttery, gathered, nappa leather tote was $2055 but is $1495. That’s 25% less! A similar bag made of nylon was reduced about 9% from $1155 to $1055.
Burberry has also reduced the price of some coats. The weather proof iconic trenches are $750, or $150 less expensive than the start of the prior season. We also hear the Chloe has made their prices a bit more agreeable to consumers wallets
Will these lower prices help lure customers? Huici Lin, an avid shopper who works in research at a major university says, lower prices will help lure shoppers but prior seasons have trained customers to wait for sales. “No matter how pretty those shoes look in the glass display cabinet, they will still go on markdown.”
If Huici is correct, this season may turn out to be great for shoppers like you and me but a bad sign for designers who have had to slash their margins to accommodate lower pricing.