Not long ago, about the same time Dolce & Gabbana made a hoo-ha by saying it was lowering prices by 10 to 20 per cent for next spring/summer, I got a distraught phone call from a young designer I know, a crafter of luxurious accessories and ready-to-wear. She said she had been contacted by a very powerful editor, who urged her in no uncertain terms to follow Dolce & Gabbana's lead by reducing her prices. The implication was that if she didn't, there would be trouble, both from the editor, who was looking to promote fashion's sensitivity in times of crisis, and consumers, who wouldn't spend.
“Do you think I have to?” asked the designer. “I don't know if I can.” She has no economies of scale.
At the time I wasn't sure what to say, there being a number of competing theories floating around regarding luxury and pricing. Some, for example, backed the powerful editor and Dolce & Gabbana, saying consumers weren't prepared to spend any more, so dropping prices was the only way to remain viable. Others argued that high-end buyers were still happy to pay if they felt they were getting something ultra-special. And yet others were saying (and this is what I am hearing a lot nowadays) that luxury consumers, who were not spending much at the beginning of the year for fear of looking crass, were now bored of being abstemious and were ready to spend again.