It is the perfect time to take a deeper look at the fashion world, not with the dreamy eyes of my inner fashionista – who just indulged herself with her first Alexander McQueen dress – but with the commanding, sceptical, hard-core eye of the investor: Is it worth investing in fashion?
One only has to read the highly lucrative results of the big fashion houses – Dior, Armani, or Hermes – to understand the mass appeal for what is tagged as fashion. Consumers’ thirst for anything branded seems truly unquenchable.
When the gross domestic product growth of China is expected to rise by 8.5% in the coming year, I cannot help but think it is a numbers game. With so many new people consuming, it truly constitutes a ripe market.
You could argue that I am actually mixing fashionable and fashion? Maybe I am, but the question is: why? Why do people constantly and consistently buy fashion?
Trivially … because they want something to wear and if we correlate this to demographics and purchasing power – and it can only go up – the trend is almost a secular one.
If you overlay a more sophisticated approach with an investing twist, people buy because they have a particular interest in a collection or a designer.
Trend settings, advertising and celebrity endorsements are then becoming part of the equation. We live in a world which is increasingly community driven, where everyone can become an influencer or a trend-setter, and celebs even more so, so the demand and the appetite for fashion can only go up.
But if the market is definitely there to stay, how do you translate this into an investment opportunity? How do you truly define fashion? What makes fashion valuable?
I spoke with Kerry Taylor, a fashion reference in the UK. She was the youngest auctioneer at Sotheby’s and
established its costume and textile department, working on landmark auctions of the Duke and Duchess of Windsor’s wardrobes, as well as the stunning haute couture wardrobe of Princess Lilian of Belgium. She now runs her own auction house. Fashion is her passion and she defines it beautifully.
Taylor said: “Fashion can be defined as something truly fabulous – an haute couture piece made for a special occasion, a piece made with a special technique, or by an innovative spirit. Dior New Look, or Courreges Mondrian dress are pure fashion items.
“If I had to boil it down to one word, it would be craftsmanship – the essence of fashion. Think of 18th century French lace or silk, made with secular techniques that have now been lost. The production was also very limited.”
Rarity, uniqueness, innovation and technical attributes seem to be the definition of fashion worth investing in. These attributes carry the promise of long-term value and they seem to resonate highly with other alternative investments. The return has the same potential as other alternative investments. With a relatively low entry point – a 1920 beaded dress can be bought for £200,000 to £300,000, while a Madeleine Vionnet early dress can be acquired for £20,000 to £60,000 – a fast disappearing knowledge and technique, with only 100,000 experts remaining in France, an increasing demand from highly competitive players – museums are starting to take a premium position on fashion buying, driving prices up – fashion investing is attractive.
Proof is also in the number of exhibitions at New York’s Metropolitan Museum Costume Institute and London’s Victoria and Albert Museum. Museums and cultural institutions are increasingly turning to fashion to attract a wider audience. Because fashion is a symbol of the time in which we live – it is telling a story of change, upheaval, joy and drama in ways we can relate to and marvel at.