The lines between streetwear and luxury fashion have never been more blurred than they are today.
Streetwear as a style is ever-evolving and has gained significant mainstream appeal in recent years. Put simply, streetwear is fashionable
casual clothes: T-shirts, hoodies and sneakers. More broadly, it is a cultural movement and business model that is quickly subverting the traditional fashion ecosystem by reframing its main component: exclusivity.
Both streetwear and luxury fashion drive demand from their positions as cultural status symbols, however, they come about doing it from different angles. While luxury's exclusivity traditionally came from a higher price point, streetwear's exclusivity came from scarcity and lack of access to distribution channels or designers. In time, the two worlds intertwined and streetwear became a prominent force in luxury brands' arsenal to drive sales, especially amongst younger consumers.
Signs of streetwear being essential to luxury business models is everywhere, from Virgil Albloh's last collection for Louis Vuitton to Tiffany and Co's collaboration with Beyonce and Jay Z.
This article aims to explore why luxury brands are investing heavily in incorporating more streetwear into their collections.
The Changing Landscape
It's no secret that streetwear has become a critical part of luxury brands' business model, helping to drive blockbuster results in recent years for major brands like Balenciaga, Gucci, and Dior.
At the centre of this culture shift are consumers who grew up on hip-hop, gaming, tech, basketball, skateboarding, and have long been mixed with Supreme and Hypebeast culture.
Millennials and Gen Z are predicted to be the main growth channel for the luxury market. According to studies, by 2025, these groups are expected to account for 45% of total luxury spending. However, this figure vastly underestimates their influence on the industry and changing consumer preferences across the board.
Why Luxury Brands Leverage Streetwear
It has become abundantly clear that streetwear has become a significant driving factor in luxury brand sales growth. This is especially true for men, as streetwear helped store luxury's appeal amid quickly declining sales for tailored suits, watches and dress shoes.
Streetwear introduced compelling new sales and marketing strategies to the luxury space, from buzz-generating "drops" that are more in line with customers' expectations for newness in the age of social media, to new community-building tactics that take luxury brands away from being about good-looking clothing to spaces where people feel like they can belong. Combining the engaged communities built by streetwear designers with the status of a luxury logo has proven to be a profitable venture for luxury brands.
The most crucial element that streetwear collaborations bring to the mix is that they manage the revamp the very meaning of a luxury brand's logo, widely considered the most valuable asset that the luxury brands own. They transform luxury logos from being a sign of affluence and wealth to an expression of tribal belonging and inclusivity. In this instance, streetwear provides one thing that high-end fashion couldn't, accessible exclusivity.
By its very nature, streetwear creates a cult-like, tight-knit community with its consumers and masters the direct-to-consumer model that the wider fashion industry has long struggled to crack. This makes interacting with the brand feel less transactional, and more like a social experience.
Streetwear may soon become as significant an element to luxury brands' business models as the beauty industry is, appealing to millions of new prospective buyers, new marketing and distribution strategies, and a reliable new revenue stream.
Why This Matters
Today, many brands ranging from traditional luxury brands to retail high street brands all routinely include streetwear or streetwear components into their offerings, primarily to try and appeal to a wider demographic. While the individual styles may differ, the streetwear DNA persists, and are the driving force behind a good portion of the brands' sales.
The streetwear DNA is dependent on community building, authenticity and the rejection of traditional cultural authorities (or challenger brand behaviour). Streetwear in not just a trend within fashion, but a fashion manifestation of a larger shift in pop culture spanning fashion, art, music, and tech.
Consumers want to engage with their favourite brands and be part of their brand co-creation story. The question is: are brands ready to respond?
Join again next time on the components of streetwear that make it a compelling movement for this age of consumers.
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