To outsiders, luxury fashion is a curious industry where consumers seem to irrationally shell out hundreds and thousands of dollars for sneakers, handbags, wallets, or T-shirts.
But take a step inside, and you’ll find the world of high fashion is more like Game of Thrones with Italian, English, and French houses like Gucci, Louis Vuitton, YSL, and Balenciaga fighting to be the king. For the houses that get to sit on the throne, they don’t last for long.
Brands like Versace, Tony Burch, and Coach once dominated in the 2000’s. Fast to the 2020’s and today’s top players are Gucci, Louis Vutton, YSL. Now what if I told you that there’s a high fashion brand that’s more lucrative and successful than Gucci, YSL, Moncler, and Louis Vutton?
A brand who only sells its products to a carefully curated list of only its highest spending customers, takes no preorders, refuses to expand inventory, or scale production. A brand whose products are so elusive that they appreciate thousands of dollars and are often resold for profit. A brand that does not allow returns, refunds, or exchanges. A brand who has remained independent, manufactures by hand, spends the least on marketing, and yet grosses close to what Gucci makes every year.
That brand is Hermès and they are the current king in high fashion. Hermès operates their business with a playbook and style that no other brand can even come close to emulating.
If you prefer reading over watching, the written transcript of this episode is available here: https://medium.com/@modernmba/h%C3%A8rmes-the-modest-king-of-luxury-fashion-d128b87be499
Chapters:
0:00 Intro
2:00 Standard Playbook of High Fashion Leaders
2:43 Gucci’s Rocketship Growth
4:28 YSL’s Traditionalist Approach
5:30 Moncler’s Small Player Resurgence
6:10 The Magic of Hermès
7:35 Tradition & Craftsmanship Above All
9:18 Expensive, Elusive, and Exclusive
10:15 A True Test of Loyalty
