Tuesday, March 18, 2008

From the business plan: Competitors.

Menswear is a mature industry with many business models in play: 

(1) Online importers.  These are simple e-commerce operations that source mass-market quality garments cheaply from one-stop Asia-based manufacturers.  Their founding stories often parrot the open-source luxury concept, but their product likely could never make the shelves of a serious menswear label.  It is priced fairly for the (low) quality offered.

(2) Mass-stige.  These are well-liked mid-market consumer brands that offer a line of professional wear.  The product quality is poor in industry terms, but nonetheless attracts good prices due to overall brand appeal and popular styling.

(3) Traveling Tailors.  These are good-quality tailor shops who claim a value proposition similar to open-source luxury.  There is some legitimate overlap at the lower end of Moniker’s garment quality, however their prices are higher for equivalent construction.  These tailors have failed to establish attractive brands or web experiences and have little reputation for style or design innovation.  

(4) Big Luxury.  These are globally-recognized menswear brands.  The majority of their product is mass-manufactured, ready-to-wear and considered by custom tailors to be only average quality workmanship.  However they maintain strong margins through heavy investments in styling, branding and (especially in Zegna’s case) fabric development.

(5) Honest Luxury.  These brands are well-known but without the star power of Big Luxury.  What they lack in brand appeal they make up for with garment quality, and the final price is in-line with Big Luxury.  Honest Luxury product is usually full-canvas construction or equivalent, often with details worked by hand.   

(6) Bespoke.  At the top of menswear quality is Bespoke, or fully hand-sewn garments.  These are shops owned or trained by legitimate master tailors.  The emphasis is less on product innovation or brand, and more on experiencing exclusivity.  Pricing at the top-end is wide-ranging:  in the case of Brioni, a single suit may range from $3500 to $5000 or higher.  

(7) Open-Source Luxury.  By allowing consumers to bypass traditional retail channels for upper-end menswear, Open-Source Luxury occupies a dominant, best-price position vis à vis Honest Luxury and Bespoke.  Yet Open-Source Luxury product rivals these leaders in quality terms, and could legitimately sit on their shelves.  

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