Frugal is the new black
Spurred by new competition, Canadian retailers are looking for ways to bring us less costly options.
Did you hear that Holt Renfrew is joining the rush to win the hearts and wallets of the more frugal? Yup. It has announced plans to open up hr2, an “off-price” arm that will deliver less expensive options for cost-conscious consumers. “Tarjey”…err Target hasn’t even arrived yet and our Canadian retail market is already looking for ways to bring us less costly options.
There was a time when the names behind the brands were synonymous with both quality and the rarified. Handmade is history. Instead, family-owned brands like Fendi, Gucci and Yves Saint Laurent have been gobbled up by conglomerates that have created more visibility and brand-awareness all in the name of profit.
When brands became mass-market products they made a killing selling the hoi polloi the idea that they could mimic the lives of the truly wealthy by acquiring their brands. Sucker wannabes everywhere swallowed the bait hook, line and sinker.
Hand-crafted products are practically extinct. Most brand-name manufacturing takes place in large factories in places like China, right beside the mass-market label that sells for way less.
Did you know the average mark-up on a handbag is ten- to twelve-times the production cost. So if you’re planning to drop $900 on that oh-so-chic brand, grab your calculator, divide that $900 by 12 and you’ll see what you’re paying for $75 worth of materials and workmanship.
For a long time men and women alike believed that they could emulate the rich and famous by throwing serious money at retailers to buy the products that would elevate them to new heights. It seems consumers are finally smartening up. Hallelujah!
Joe Fresh is probably the best example of a brand that has made value shopping chic. Old Navy does a great job of combining sassy marketing with down-to-earth pricing. And that kind of pressure is making the old, staid brand-name sellers sit up and pay attention.
As brand-name houses like Holts brace for quality and price-conscious retailers like Target to enter the Canadian landscape, the penny has dropped. Only the most shallow and uneducated still think that the Prada that was is what they’re buying when they drop $1,800 for the brand name today. Smart consumers have wised up and know they have to judge quality for themselves, not by brand. And smart consumers also know that there’s real caché in getting a good product for a great price.