That happens and it does not matter how bright you are. At times you get the message and it makes no sense (at that moment). I had that yesterday with an article by Fortune (at https://fortune.com/2024/11/17/luxury-goods-lvmh-kering-bain-broken-promises/) we get ‘50 million people have stopped buying luxury brands like Dior and Burberry after ‘broken promises’ to customers’. The first question that pops into my head was ‘How do they get to these numbers?’, lets be clear I am not accusing anyone of anything. Yet that gives us the 100% of Tokyo and Sao Paulo together. To collect that amount of data requires a mind boggling amount of data. I lost track to the article as Fortune hides behind a paywall and I am not that stupid to fall for the ‘disaster’ sales technique. The article gives us brands like Burberry and Dior. As such Simple questions become apparent.
What form of verification was used?
Data in itself is the biggest liar of all. A simple mistake of cleaning and verifying the data is essential. Example is the question ‘Are you pregnant?’ Is a nice one, when the men are not cleaned out of this setting we get an astounding 50% offset (if we are lucky). The man (always trying to be funny) will answer no, because it is the truth.
Then we get the broken promises.
What evidence is there?
I get that Fortune gives us “On some level, brands have broken their promises to consumers” the voice (read: writing) of Marie Driscoll an equity partner. So what evidence are we given. The to some degree aggregated setting gives us LVMH, Burberry and Kering. There is a mention that they missed revenue targets. And suddenly we see that they are surpassed by Ozempic (a Pharma solution). We see not mention of any broken promises. We see all kinds of excuses and no actual mention of broken promises. At best we get the term brand fatigue. Actually I made mention of this in an article in January 2024 called ‘That one sided conversation’ (at https://lawlordtobe.com/2024/01/27/that-one-sided-conversation/) my issue is that malls (and brands) need to set their focus to engagement. I even created the setting to do just that And I had the Toronto Eaton Centre as an example as well as the Dubai Mall (and a few other places in Dubai). I never considered broken promises, and as I see it Fortune has no real setting for that either. If you have 50,000,000 consumers. You have data. Whether the consumer told a porky pie (read: lie) or there is another reason like they ran out of cash. The simple setting is data and the article does not give us any. The article is (as I personally see it) a sham. We are given “an equity Analyst told Fortune” the name appears later. Yet, if I had this to say you mention that name EVERYWHERE. And the article goes one step further “Now 50 million luxury consumers have either ditched buying designer bag, scarves, watches and more — or have been priced out, Bain & company’s new annual luxury report warns”
I personally believe that LVMH, Burberry, Gucci (et all) need to demand that data from Fortune. I wonder how long I need to shift through that data to see an astounding amount of gaps that could get Fortune into hot waters?
I got to see the article in my mobile, but not my laptop (another fine mess I got myself into).
In these troubled times I have no issue with missed revenue targets and I feel certain that their investors do not have that issue either. The very rich know how they are doing and for the most they also know that of their peers. So if only 2 get their numbers that quarter, they are certain that about 80% will not go shopping everywhere. Optionally they will push back their Burberry suit or dress. There is no shame as I personally see it (and for the record I have never had enough money for a Burberry suit).
As such my puzzlement. Fortune was always seen by me as a straight error in ‘reporting’ and this article basically threw their credibility in the trashcan.
The Second sight
That comes from the reference to Bain and Company and the stage that was referred to. The headline there was ‘Global luxury spending to land near €1.5 trillion in 2024, remaining relatively flat as consumers prioritise experiences over products amid uncertainty’ an article by Claudia D’Arpizio and Federica Levato. There we see “And yet, 50 million luxury consumers have either opted out of the luxury goods market or been forced out of it in the last two years. This is a signal for brands that it’s time to readjust their value propositions. To win back customers, particularly the younger ones, brands will need to lead with creativity and expand conversation topics. Simultaneously, they must keep their top customers front and center, surprising and delighting them while rediscovering one-to-one human interactions. For all customers, it will be critical to double down on personalisation, leveraging technology to achieve it at scale.” That is a view I can get behind and there is no mention at all of ‘Broken Promises’ (anywhere in the article). These two youthful young sprouts basically confirms my believes that it is about engagement. It does not matter how (I personally chose a generic setting) to engage the consumers in a much larger setting of a place and not a specific brand. I do not disagree with “rediscovering one-to-one human interactions” but as a technologist I prefer my Chicken Shawarma in a one to many configuration. And I do get that to address the very wealthy (aka filthy rich), a one on one setting is likely preferable. But that was never the reason for the IP I created in that setting.
And I for one personally believe that you can ditch the Fortune story and go straight for Bain & Company (at https://www.bain.com/about/media-center/press-releases/2024/global-luxury-spending-to-land-near-1.5-trillion-in-2024-remaining-relatively-flat-as-consumers-prioritize-experiences-over-products-amid-uncertainty/) the article is quite remarkable. And it was a pleasure to read too. I get that the numbers game can be nerdy and dry, but this story is uplifting and a good thought to address, for anyone in retail that is.
In the end what did Fortune do? Very little, all praise to Bain & Company here.
Have a great day all.
Lawrence van Rijn - Law Lord to be 