5 minute read
The Value of British Luxury
The challenge is how to preserve that, especially given how quickly moods shift and consumers grow ever more picky and prone to boredom. At its best, associating ourselves with contemporary culture anchors us in things that are engaging to our customers. In other words, matter to them. But picking the newest or shiniest toy in the arts and culture box isn’t an approach that is likely to work. Indeed, too often it’s a shortcut to ersatzdom. Rather, my advice is to start at the other end. With the realisation that our brands are often culture-generators in their own right – and may have been for a long time. Plus, as an industry that is essentially selling things that allow people to say something about themselves, we have a more complex two-way relationship with not only our own culture and place of origin but also how that plays across other geographies, resonating (or not). My advice, therefore, is never to stray too far from our centre of gravity, especially in terms of where our expertise, personality and so ultimate authority lies. This includes, where relevant, not forgetting a word missing from the four I started this piece with: craft. Traditionally considered less exalted but in cultural terms often more powerful, as not only is how something made, literally material to its promise of quality, but it’s likely to be rooted in local disciplines, stories and people, including our own. More accessible and human for many consumers – talking with, rather than talking down. Knowing and sticking to our base doesn’t mean we shouldn’t strive for the most imaginative and freshest way to tell (or retell) our stories. And sometimes this means reaching half way across the world to collaborate with artists, campaigners or others who share our point of view. And reach new audiences or get existing ones to look again. Ideally avoiding worthiness at all costs, keeping a lightness of touch and preferably a sense of humour stops us coming across as bores, or worse – outsiders looking in. Finally, along with the responsibility to our own brand to get this right we should remain mindful of its influence, both as a representative of a set of wider cultural values and a vehicle for our customers. For actually this is quite a high stakes game, especially when tempers run high and instant sharing, or even more instant judgements, are the norm and when anything less than perceived total transparency raises suspicion. Done well we can enhance our brand’s standing, reinforce our competitive advantage and do some good at the same time. Worst case, we can destroy brand value. Sometimes imperceptibly, sometimes almost overnight. Although overused, maybe it comes back to that lodestar of our industry at its best: authenticity. Being and staying real. And looking for ways old and new to reinforce and emphasise it.
THE NUMBERS
The Value of British Luxury
Walpole has commissioned a new study from Frontier Economics to look at the economic impact of the UK’s luxury sector. We present some of our findings here...
British Luxury is one of the UK’s
greatest success stories ►
9.6%
The luxury sector is growing at 9.6% per year on average, outpacing the UK’s average annual economic growth of 4%.
How are Walpole members celebrating this success? ►
£2,100,000,000
Harrods
Last year Harrods, the luxury department store, revealed a total revenue rise of 6.8% to just over £2.1 billion, the second year the brand has topped £2 billion sales.
Johnstons of Elgin
Five years ago Johnstons of Elgin, the Scottish cashmere and fine knitware brand, were losing money. Today, profits, sales and staffing have all increased significantly, with a 58% growth in total sales, and 88% growth in export sales since 2012.
House of Hackney
Former Walpole and purveyors of ‘maximalist’ homewares, House of Hackney’s total business revenue has grown by 90% over the past two years.
88%
90%
The value of British luxury
£48,000,000,000
2018
£32,200,000,000
2015
49%
This is an increase of 49% in just four years.
British luxury is exported
around the world ►
80%
Around 80% of what the British luxury sector now produces is destined for export.
Where are Walpole members
exporting their goods? ►
30%
Molton Brown
Luxury fragrance and beauty brand Molton Brown has seen great success in exporting their distinct take on British luxury internationally – particularly in India, the Middle East and Scandinavia – growing their UK export business by 30% over the last three years.
Dunhill
In 2018, luxury menswear and accessories brand Dunhill opened six new stores: three in China; a new Middle Eastern flagship; a new flagship in Tokyo; and a new HQ in London.
DAKS
China is a key export growth market for DAKS, with the British luxury fashion house increasing their total number of stores in the country to 22 in 2018.
6
22
The key export markets for British luxury goods ►
42%
European Union
23%
North America
11%
China
The extraordinary growth in export of British luxury goods ►
£38,400,000,000
2018
£25,000,000,000
2013
54%
This is an increase of 54% over five years.
How are Walpole members
benefiting from tourist spend? ►
312
Fortnum & Mason
Christmas 2018 saw the best international sales renowned department store Fortnum & Mason have had in the company’s 312-year history, with Fortnum’s international customers spending more on gifting than ever before.
Gleneagles
“Scotland is one of the most beautiful countries in the world – its fascinating history, rich culture, spectacular scenery, and warm hospitality making it an appealing destination for overseas guests. We’ve always enjoyed welcoming guests from around the world, and guests from Europe and North America in particular represent a key growing market for us.”
“In the last 12 months we’ve nearly doubled our US business and seen significant growth in guests coming from continental Europe, which reflects our ambitions to strengthen our presence in those markets. With international guests having to travel from further afield to enjoy the Gleneagles experience, inevitably they come for longer trips than our domestic guests, benefiting not only Gleneagles, but other local businesses and Scotland and the UK as a whole.”
Conor O’Leary
Gleneagles General Manager
British luxury’s reputation for innovation, creativity, heritage, culture & quality
resonates with global markets and audiences ►
£24,500,000,000
In 2017, 39.2 million overseas visitors came to the UK, and spent £24.5 billion.
A fifth of visitors’ total spend – £4.5 billion – was on luxury, with fashion, watches and jewellery, accessories, cosmetics and fragrance the most popular items.
£4,500,000,000
Overseas tourists, by percentage,
that buy luxury in the UK ►
22% 13% 12% 10%
Richard Carter Director of Corporate Communications, Rolls-Royce Motor Cars
