Latest news with #AaronCheris
Yahoo
13 hours ago
- Business
- Yahoo
Report Findings Highlight Opportunities for Brands to Unlock the Next Phase of Value in Resale With DDPs
A eBay and Bain & Company joint report indicates the need for brands to act quickly as new European Union regulations unlock meaningful opportunity for the next phase of value in resale, transparency and customer relationships. As reported by WWD, luxury brands will need to meet a new European Commission regulation called the Ecodesign for Sustainable Product Regulation. The regulation aims to make transparency and traceability a regulatory requirement for luxury brands made or sold in Europe. Digital product passports will become mandatory for textiles in 2026. More from WWD Cellugy Raises 8.1 Million Euros to Eliminate Microplastics in Personal Care Products Paris Good Fashion Report Says 5% Volume Cut Needed by 2030 to Stay Within Climate Limit From Flooding to Heat Stress, Climate Challenges Are Threatening the Shoe Industry Like Never Before In the collaborative report from eBay and Bain, the companies aim to reveal how the upcoming regulation could reshape the economics of fashion resale. According to the findings, lifetime product value will double and deliver up to 65 percent of the gains to consumers. The authors of the report said the findings 'point to a transformative opportunity for brands to redefine the value chain around transparency, trust and circularity — far beyond the immediate goal of regulatory compliance.' While nearly 90 percent of brands surveyed by Bain said they currently view DPPs as a regulatory burden, the report finds that the DPPs are also a commercial opportunity with potential for additional resale and services when supported by a DPP due to improved trust, traceability and ease. Bain encouraged companies to reframe DPPs as a 'strategic investment capable of generating ongoing revenue, driving sustainability and strengthening consumer relationships.' 'DPPs are more than just checking a compliance box,' said Aaron Cheris, a partner at Bain & Company. 'They are a foundational shift in how value is created, captured and sustained over a product's lifetime. Brands that act early can build a more direct, data-rich relationship with consumers, tapping into resale trends and personalizing services in powerful new ways.' According to the report, DPPs will unlock hidden value, specifically in the way brands will capture value when an item is resold. Additionally, brands will be able to see a product's entire journey from resale to disposal, giving data on the lifetime value of a product and potentially its ongoing revenue opportunities. The authors of the report said that as brands plan for DPPs, additional opportunities to create value include buyback and repurchase programs, ownership tracking and authentication, customer insight and acquisition, customer experiences, post-purchase services and circularity. Importantly, the report highlights that consumers will be the biggest beneficiaries of DPPs. Consumers will potentially capture up to 65 percent of the new value in the secondhand market's expansion as they engage with new and secondhand products in new ways. Resale will also become a more seamless experience and by making the secondhand market more accessible, efficient and profitable for consumers, DPPs will drive substantial growth in the secondary market. 'Digital product passports are critical to powering the future of circularity in fashion,' said Alexis Hoopes, vice president of global fashion at eBay. 'As a global marketplace at the forefront of resale, we're exploring how better product data can enable smarter buying, responsible selling and a more trusted platform. Unlocking value for consumers is a critical part of the connected product evolution.' Beyond sustainability, brands that rethink DPPs can invent new ways to create value and monetize services. DPPs address four core needs for brands including upstream traceability, system integration, authentication and downstream traceability. While some benefits will take time to mature, the companies' research team believes that early adopters will unlock advantages such as 'enhanced customer engagement, the ability to reach new customer groups, streamlined resale processes and deeper insights.' As the 2026 deadline approaches, Bain and eBay warn that companies that do not start acting on DPP infrastructure investment will potentially fall behind. As the deadline draws nearer, brands were advised to begin engaging consumers and testing resale models to lead the way in sustainable, data-driven fashion. Best of WWD The Definitive Timeline for Sean 'Diddy' Combs' Sean John Fashion Brand: Lawsuits, Runway Shows and Who Owns It Now What the Highest-paid CEOs at U.S. Fashion and Retail Companies Make Confidence Holds Up, But How Much Can Consumers Take? 擷取數據時發生錯誤 登入存取你的投資組合 擷取數據時發生錯誤 擷取數據時發生錯誤 擷取數據時發生錯誤 擷取數據時發生錯誤
CNN
22-02-2025
- Business
- CNN
Aspirational buyers could save luxury brands from losing more ground
A sharp hike in the price of luxury goods in recent years has cost some brands a key group of customers. About 50 million customers were sidelined from the luxury goods market by 2024 as prices climbed roughly 20% since 2021, according to Aaron Cheris, a partner and head of global e-commerce and marketplaces at Bain & Co. The deficit has some luxury brands rethinking ways to lure back 'aspirational' luxury consumers, who tend to buy at least one luxury item per year and spend between $3,000 and $10,000 annually on fashion, according to McKinsey & Co. The exclusion of so many consumers wasn't lost on British luxury group Burberry, which made adjustments ahead of the recent holiday shopping season. 'These past few years, we have been very focused at the top of the pyramid, especially in leather goods. Going forward, we will restore a 'good, better, best price' architecture in a luxury context across categories,' Burberry CEO Joshua Schulman said at a company strategy presentation in November 2024. Schulman added that the shift to more accessible products was 'restoring a price architecture' from previous revenue levels. And for the first time in two years, Burberry saw new customer growth globally during December. The company's third-quarter store sales also grew 4% in the Americas — the United States, Brazil, Canada, Mexico and Panama — which helped narrow global losses. Unlike wealthier fashion lovers, lower-income consumers lose spending confidence when faced with financial pressures like inflation and the risk of layoffs. Aspirational luxury customers typically spend almost $274 billion a year, making them an important part of the customer base, according to McKinsey. Cheris said luxury brands overshot in getting more premium and exclusive with higher prices. 'You can't do that at such an extreme that you cut out the base (of consumers),' he said. Luxury brands can see a boon off smaller products priced between $400 and $1,000 — price points where less affluent shoppers might be willing to splurge. Leather goods and accessories, such as belts, eyewear and fragrances, are typically lower-priced products that interest aspirational luxury consumers, said Joëlle Grunberg, who leads McKinsey's apparel, fashion and luxury sector in North America. That includes products like a $420 Gucci belt or a $98 perfume from Yves Saint Laurent, two brands owned by French luxury group Kering. While Gucci brought in about $8 billion in 2024 — a 21% decline from 2023, Kering Eyewear generated $1.67 billion, up 6% from 2023. Burberry's leather goods and entry-level categories were among the products slated for a return to price points similar to 2022, according to Schulman. It also focused on its outerwear and scarf categories, which were popular during the holiday season. By the end of the third quarter, the brand noted an increase in brand desirability, which measures purchase intent, Schulman said. Other luxury brands aren't making the same immediate changes for aspirational buyers, although they will maintain lower prices for leather goods and accessories. Moët Hennessy Louis Vuitton, the world's largest luxury group, is among the brands that continue to offer lines of lower-priced leather goods and accessories. But the company's former chief financial officer, Jean-Jacques Guiony, who currently heads the wines and spirits division, said in October that it would be a mistake to release a new line of affordable luxury products to address the decline in aspirational consumers. 'The current situation is more demand-driven than offer-driven,' he said, noting the issue is not with the company's product offerings or prices. High prices for luxury products and economic insecurities have aspirational luxury consumers choosing between fast fashion or high-end luxury, Cheris said. There's little in-between for consumers seeking value, especially as major chains shut down. There are two groups of aspirational luxury consumers luxury brands want to win over: young professionals who will stay loyal as their spending power increases, and customers who may never spend $5,000 on a handbag but regularly buy lower-priced products, Grunberg said. 'What the brands are really trying to do is attract consumers. It's also about moving them throughout the categories — into footwear, ready-to-wear and fine jewelry,' said Jeff Lindquist, a partner at Boston Consulting Group where he works with the fashion and luxury team. Top luxury brands aren't going to start selling only affordable items, but experts expect these brands to cater to aspirational luxury shoppers by improving the in-store experience. Some brands have invested in e-commerce in the last few years, but are also making in-store changes like cutting customers' wait time in lines, Grunberg said. They're investing in coaching sales associates to 'support experience in-store,' which includes welcoming customers and offering beverages. '(The in-store experience) is where the brand story comes together and core messages of the brand and one-to-one customer relationships can develop,' said Lindquist.
CNN
22-02-2025
- Business
- CNN
Aspirational buyers could save luxury brands from losing more ground
A sharp hike in the price of luxury goods in recent years has cost some brands a key group of customers. About 50 million customers were sidelined from the luxury goods market by 2024 as prices climbed roughly 20% since 2021, according to Aaron Cheris, a partner and head of global e-commerce and marketplaces at Bain & Co. The deficit has some luxury brands rethinking ways to lure back 'aspirational' luxury consumers, who tend to buy at least one luxury item per year and spend between $3,000 and $10,000 annually on fashion, according to McKinsey & Co. The exclusion of so many consumers wasn't lost on British luxury group Burberry, which made adjustments ahead of the recent holiday shopping season. 'These past few years, we have been very focused at the top of the pyramid, especially in leather goods. Going forward, we will restore a 'good, better, best price' architecture in a luxury context across categories,' Burberry CEO Joshua Schulman said at a company strategy presentation in November 2024. Schulman added that the shift to more accessible products was 'restoring a price architecture' from previous revenue levels. And for the first time in two years, Burberry saw new customer growth globally during December. The company's third-quarter store sales also grew 4% in the Americas — the United States, Brazil, Canada, Mexico and Panama — which helped narrow global losses. Unlike wealthier fashion lovers, lower-income consumers lose spending confidence when faced with financial pressures like inflation and the risk of layoffs. Aspirational luxury customers typically spend almost $274 billion a year, making them an important part of the customer base, according to McKinsey. Cheris said luxury brands overshot in getting more premium and exclusive with higher prices. 'You can't do that at such an extreme that you cut out the base (of consumers),' he said. Luxury brands can see a boon off smaller products priced between $400 and $1,000 — price points where less affluent shoppers might be willing to splurge. Leather goods and accessories, such as belts, eyewear and fragrances, are typically lower-priced products that interest aspirational luxury consumers, said Joëlle Grunberg, who leads McKinsey's apparel, fashion and luxury sector in North America. That includes products like a $420 Gucci belt or a $98 perfume from Yves Saint Laurent, two brands owned by French luxury group Kering. While Gucci brought in about $8 billion in 2024 — a 21% decline from 2023, Kering Eyewear generated $1.67 billion, up 6% from 2023. Burberry's leather goods and entry-level categories were among the products slated for a return to price points similar to 2022, according to Schulman. It also focused on its outerwear and scarf categories, which were popular during the holiday season. By the end of the third quarter, the brand noted an increase in brand desirability, which measures purchase intent, Schulman said. Other luxury brands aren't making the same immediate changes for aspirational buyers, although they will maintain lower prices for leather goods and accessories. Moët Hennessy Louis Vuitton, the world's largest luxury group, is among the brands that continue to offer lines of lower-priced leather goods and accessories. But the company's former chief financial officer, Jean-Jacques Guiony, who currently heads the wines and spirits division, said in October that it would be a mistake to release a new line of affordable luxury products to address the decline in aspirational consumers. 'The current situation is more demand-driven than offer-driven,' he said, noting the issue is not with the company's product offerings or prices. High prices for luxury products and economic insecurities have aspirational luxury consumers choosing between fast fashion or high-end luxury, Cheris said. There's little in-between for consumers seeking value, especially as major chains shut down. There are two groups of aspirational luxury consumers luxury brands want to win over: young professionals who will stay loyal as their spending power increases, and customers who may never spend $5,000 on a handbag but regularly buy lower-priced products, Grunberg said. 'What the brands are really trying to do is attract consumers. It's also about moving them throughout the categories — into footwear, ready-to-wear and fine jewelry,' said Jeff Lindquist, a partner at Boston Consulting Group where he works with the fashion and luxury team. Top luxury brands aren't going to start selling only affordable items, but experts expect these brands to cater to aspirational luxury shoppers by improving the in-store experience. Some brands have invested in e-commerce in the last few years, but are also making in-store changes like cutting customers' wait time in lines, Grunberg said. They're investing in coaching sales associates to 'support experience in-store,' which includes welcoming customers and offering beverages. '(The in-store experience) is where the brand story comes together and core messages of the brand and one-to-one customer relationships can develop,' said Lindquist.
