Ged Carroll

Month: December 2020

  • Luxe streetwear

    I started thinking about the latest developments in luxe streetwear after leafing through the FT to see the following advert marking the proposed purchase of Stone Island by Moncler. (Stone Island had already sold its parent brand CP Company and intellectual property back in 2015 to Hong Kong manufacturer Tristate Holdings Limited).

    Moncler buys Stone Island
    R+R SpA – published in the Financial Times – a luxe streetwear merger

    It follows hot on the heels of Supreme being purchased by VF Corporation.

    Luxury disruption

    From the luxury market point of view their customer base over the past 30 years has done three things:

    • The customers have become younger. Luxury shopping is no longer dominated by dowager heiresses in Europe and the New World. Now the man purchasers of luxury are much younger and are second generation money. They’ve had money in their families for somewhere between 20 and 50 years. They are the scions of political leaders or business leaders. Money has allowed them access to the world’s best education institutions. They might have had etiquette classes, but they’re no more than two generations away from having known deprivation.
    • The customers are in a different place. Globalisation massively changed their customer base. First it was the Japanese middle classes who picked up a taste for luxury brands whilst travelling abroad. As the Asian tigers took off, you started to see luxury purchases being made in Singapore, Hong Kong, Korea and China. When the Soviet Union fell luxury consumption also sprang up in the East as some people had money to burn. Much of the luxury retail in traditional shopping areas like London and Paris are derived from tourists rather than local purchasers. A change in the luxury tax regime in China has seen more domestic luxury consumption. China is now looking to build Hainan into a domestic luxury shopping and holiday resort.
    • Luxury serves a different purpose. Luxury has traditionally reflected status. Goods of a superior nature that the ‘wrong sort’ of people would never be able to afford. Luxury then became a symbol that you’d made it. In Asian markets, particularly China, luxury became a tool. People gifted luxury products to make relationships work better. It also signified that you are the kind of successful business person that partners could trust. You started to see factory managers with Gucci man bags and premium golfwear to signal their success. Then when the scions of these business people and figures in authority were adults, luxury has become about premium self expression. It has been mixed up with streetwear in a manner reminiscent of the Buffalo Collective.

    So from the perspective of the luxury industry, they are feeling a massive amount of disruption going on. And that’s even before you get into digital transformation.

    It is this transformation of customer segments, geographies and use cases which is forcing the luxury industry to ‘go casual’ fit in a luxe streetwear space.

    Streetwear evolution

    The perspective from the streetwear side of the table is more exemplified by my favourite Thai English phrase: same-same, but different. Their market hasn’t been disrupted in the same way as luxury. It has got a lot bigger.

    Rise of Streetwear
    Growth in streetwear

    The internet has meant that streetwear culture has become global and trends catch on much faster. It has become more popular around the world and there are thriving secondary markets like StockX and GOAT.

    Streetwear has pushed into luxury pricing models led by Japanese brands; who brought a higher attention to detail to the market. It has continued the trend of innovation that companies like Stone Island started. This is best exemplified now by the likes of German label ACRONYM.

    From a design perspective right back to the origins of what we know as streetwear by the likes Shawn Stüssy or Harlem’s Dapper Dan co-opted luxury product language. In Dapper Dan’s case using fake fabrics and labels to make clothing. His customer base of African Americans from poor neighbourhoods whether early hip hop stars or criminals didn’t see the items that they wanted in boutiques. And even if they did, many of them didn’t feel welcome in the uptown boutiques.

    From Stüssy’s point of view it was the pop art ethos and DIY fanzine culture that infused his work. The reversed double S in a circle is an obvious reference to Chanel’s design language.

    Over the space of a decade Supreme went from being sued for aping Louis Vuitton’s design language to collaborating with them. Dapper Dan has recently been collaborating with Gucci.

    Does luxe streetwear lack ambition?

    Highsnobriety asked the question five years ago and concluded that no streetwear company had shown the serious ambition to become an umbrella brand the size of LVMH or Kering. Skiwear, skate wear and snow sports equipment are sectors that are a tenth of the size of streetwear. Yet they have seen consolidation into larger holding groups. These groups provided the financial cushion for these companies through the 2008 financial crisis.

    The closest that luxe streetwear has got to the holding group is likely to be New Guards Group. New Guards Group describes itself as a contemporary luxury fashion holding group. It owns Off-White, Opening Ceremony and Palm Angels. This in turn was bought out by luxury e-tailer Farfetch. Farfetch in turn has Richemont and Alibaba as minority shareholders.

    Surfwear is also described as having a generational strain. Dads keep wearing the gear. Kids no longer want to wear it. Given the commonality with the streetwear lifestyle. You could see similar things happening at even the largest of streetwear brands eventually. Some of the people wearing Supreme in the mid 1990s are still wearing it. The original international Stüssy Tribe are still going strong, repping streetwear in their 50s and 60s.

    Luxe streetwear brand A Bathing Ape has definitely seen better days, by the time Nigo sold the business to Hong Kong I.T. Group. The transitory nature of streetwear brands is littered with names that were formerly prominent like XLarge (that came back) or 90s icon Massimo.

    Stone Island and luxe streetwear

    Moncler get a technically proficient firm in Stone Island. It was built on a foundation of experimenting with materials. It is the only company able to garment dye polyester fabric for lightweight applications like summer jackets.

    The brand is widely respected and has collaborated with other innovators like Nike. It has been worn by Drake regularly that opened the brand up to hip hop fans. This has helped the brand widen its association beyond football hooligans and scally culture.

    More luxury related content here.

    More information

    Moncler to buy Stone Island in deal that values rival at €1.15bn | Financial Times

    VF snaps up streetwear line Supreme in $2bn deal | Financial Times

    Luxury brands set sights on Chinese tourists in Hainan as extended duty-free quotas and pandemic-free shopping attract travellers | South China Morning Post

    Dapper Dan’s collaboration with Gucci – focused on ‘hip hop style ready to wear and accessories featuring the GG logo

    Everything we know about the Supreme x Louis Vuitton collection | High Snobriety

    The umbrella brand: is streetwear ready for corporate takeover? | Highsnobriety

    Billabong’s demise is emblematic of a wider crisis in the surfwear industry | Guardian

    Silk or Synthetic | Financial Times

  • New Balance factory closure + more

    New Balance Boston factory closure

    New Balance to Layoff Dozens of Workers as It Closes Boston Factory – Footwear News – this is huge for New Balance. It is a major knock to the perceived wisdom around the New Balance brand and its differentation versus other footwear vendors like Nike or Adidas. New Balance his made US manufacturing a big part of its corporate story. Being private owned, it can take a longer view than competitors. But that doesn’t seem to have helped New Balance during the pandemic. It will be interesting to see how New Balance handles this moving forwards.

    Business

    The inadequate trials of Philip Green | Financial Times – There is something else at work too — distaste for the wheeler-dealer made good. His parties and celebrity schmoozing were considered vulgar. He was accused by MPs of being a “spiv”. Three commenters under one FT article this week described him as a “barrow boy”. A campaign was launched to strip him of his knighthood, as if that is what mattered. – interesting op-ed that makes a valuable point about the discussion around Philip Green

    Consumer behaviour

    Streetwear in China: hip-hop influence and form of expression for the Chinese youth – Daxue Consulting – Market Research China 

    Economics

    Hong Kong chief has ‘piles of cash’ at home after US sanctions – A government survey taken between June and September registered for the first time in 11 years a reduction in the number of foreign businesses operating in Hong Kong. The survey found 9,025 companies had offices in Hong Kong compared with 9,040 the previous year. Only 15 per cent of the companies said they had plans to expand in the city in 2020, whereas last year 23 per cent expected an expansion. – I thought that this quote was interesting in the FT article. What becomes apparent is that the Chinese government thinks that internal circulation is more important than Hong Kong as a gateway to foreign direct investment (Paywall)

    Media

    NSFW TikTok Porn: Bree Louise OnlyFans Is the Future of Adult Content – According to Alex Hawkins, Vice President of xHamster, Gen Z and young millennials are “disproportionately” willing to pay for adult content compared to previous generations, especially if the star of the video is also the one creating it. “We see the shift from studios to performer-producers dramatically changing the industry,” he says. Aesthetically, this translates to “a surge in realistic situations and more natural bodies.” In other words, more of what you might find on TikTok, albeit with fewer clothes. “We believe that consumers are much more likely to pay for performer-created content than they are traditional porn,” says Hawkins. “It feels more intimate.” – Mirrors the record labels have been historically looked at from at least the 1980s.

    Francis Fukuyama: How to Save Democracy From Technology | Foreign Affairs – everyone hates big tech. Fukuyama is famous for his Warsaw Pact break-up era book The End of History and The Last Man. Here’s his opinion on social paltforms: But few recognize that the political harms posed by the platforms are more serious than the economic ones. Fewer still have considered a practical way forward: taking away the platforms’ role as gatekeepers of content. This approach would entail inviting a new group of competitive “middleware” companies to enable users to choose how information is presented to them

    How Biden’s Rebels Blew Up Trump’s Death Star | AdExchanger – on combating disinformation: “Instead of chasing down and knocking down every ANTIFA rumor, we knew that the best defense was convincing people that the Joe Biden they did like, whose values they shared, would be the author of his own presidency,” said BPI partner Danny Franklin. “And when we reminded them of those values … and validated that through trusted endorsers, we could win the argument and defeat the attack.”

    Technology

    Warning lights are flashing for Big Tech as they did for banks | Financial Times – The pandemic has emphasised our reliance on technology. It’s not just the interminable video calls or the technology that underpins deliveries to our locked-down doors. It is the mountains of data that dictate the ads we see as we scroll through coverage of the latest coronavirus briefing. Digital transformation is sweeping through my industry, too. Consumers have squeezed years-worth of adoption of apps and online banking into just a few months. Yet the risks go much deeper than the risk of hastily managed change. The algorithms that determine how much work delivery drivers get and what we see when we go online are no better understood than the structured credit products that brought the banking system to its knees in the financial crisis. – Interesting and provocative analogy to the financial system

    Teaching in the Pandemic: ‘This Is Not Sustainable’ – The New York Times – vehement debates have raged over whether to reopen schools for in-person instruction, teachers have been at the center — often vilified for challenging it, sometimes warmly praised for trying to make it work. But the debate has often missed just how thoroughly the coronavirus has upended learning in the country’s 130,000 schools, and glossed over how emotionally and physically draining pandemic teaching has become for the educators themselves. In more than a dozen interviews, educators described the immense challenges, and exhaustion, they have faced trying to provide normal schooling for students in pandemic conditions that are anything but normal. Some recounted whiplash experiences of having their schools abruptly open and close, sometimes more than once, because of virus risks or quarantine-driven staff shortages, requiring them to repeatedly switch back and forth between in-person and online teaching. Others described the stress of having to lead back-to-back group video lessons for remote learners, even as they continued to teach students in person in their classrooms – I imagine that it is probably pretty similar levels of burnout in knowledge workers as well. (Paywall)

    Do serious games help you learn? – Hello Future Orange – Serious games are more effective than traditional teaching but they do not produce better results than more active forms of knowledge transmission and are often more costly to implement.

    Thailand

    Pornhub, along with several other adult entertainment sites have been banned in Thailand. This has been part of a wider political debate within the country on government performance and what role the royal family should play. Asian Boss asked Bangkok residents on their opinions. What pleasantly surprised me about this video was thoughtful opinions on both sides of the argument

    More Thai-related posts here.

  • String art and other things that caught my eye this week

    For me string art is something that was a hangover from the 1960s and 70s. I remember visiting a number of schools as a child as I was going to move infant schools. One of the ones that my parents and I visited had a giant felt covered board with tacks nailed into it and coloured threads forming a geometric patten of string art.

    Strings

    Artist Petros Vrellis took string art to a new level. Using a giant circular frame with 200 pegs and a computer programme built in Openframework to work out where to arrange the 2 kilometre long strings.

    More on Petros’ string art work here. More design related content here.

    I’ve been listening to a lot of Dimitri from Paris this week. Here’s a sample of this work

    Kerri Chandler does a rare set using reel-to-reel tape recorders. The models he is using are mid-range consumer models by Pioneer (I think they’re the Pioneer RT-707) with direct drive motors that the Japanese manufacturers pioneered in hi-fi. I suspect Chandler is using these more for their compact size than them being the best machines. The RT-707 couldn’t take 10 1/2 inch reels

    He is putting it all into a vintage Bozak mixer. Back in the 1970s and 80s, DJs used reel-to-reel tapes much more in the DJ booth. It allowed new recordings to be tried. Or edits and mixes that had been made at home played to a live crowd.

    The reel-to-reel machine didn’t allow you the same control of tempo that a Technics SL-1200 or CDJ machines would allow. Reel to reel tape allowed for a richer saturated sound than digital recording does.

    Ogilvy did a presentation on what previously have been called youth marketing trends. Despite them using the generation Z label there is some good consumer trend content in it.

    If you were around ten years ago, much of this is is familiar and would have been said about millennials. Authenticity was also said about generation X. Though it was often tied to the idea of not ‘selling out’.