Luxury e-commerce platforms like Matchesfashion and Farfetch face financial struggles in 2024 due to ongoing debts and a market shift towards brick-and-mortar stores. Matchesfashion collapsed in March, owing $263 million.
The pandemic accelerated the transition to online shopping, but also highlighted weaknesses. Rising competition from resellers and traditional retailers, along with a lack of unique selling points, has further strained these platforms.
Matchesfashion’s acquisition by Frasers Group and Farfetch’s financial troubles exemplify the industry’s challenges. Luxury brands are now investing in experiential shopping to attract consumers back to physical stores, marking a significant shift in the luxury retail landscape.
Luxury fashion shopping down
Just a few months back, there have been reports regarding these luxury brands having an overflow of their goods. Sales are apparently down, and these brands are not allowed to allegedly destroy their items in Europe in order to appease the “scarcity” tactic.
Prior to this, e-commerce platforms for luxury brands were popular due to their coupon codes. However, with the recent development of some high end brands, they are less inclined to sell their products with a discount code.
Others gave an example on how discount sales may not even work for these brands. A handbag would’ve cost significantly less in 2021, while with the new prices they’re being sold for, a discount may not make a significant dent in the already high price.
A Redditor states that, if an item is 40% off, it would still relatively be the same price as it was in 2021. Mind you, 2021 was barely a few years ago. Regardless, it seems that the brands are in stagnation now, and e-commerce sites that specialize in them are receiving the brunt of it.
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