The Future of Leather Goods in Australia
Who the number one bag player in Australia was in 2017 in terms of its share value and sales? Take a guess, I’ll wait...
It was Samsonite Australia. Powered by the new economic progression of experiential spending, with international travel being one of the most popular experiences for Aussies to splurge on - it’s not surprising.
But what about the rest of the bag sector? According to a recent report from Euromonitor, growth in the luxury leather goods market is set to slow over the next four years. While the market saw six percent growth in 2017, it's predicted that luxury leather goods in Australia will slow to an annual growth rate of three percent to 2022.
And while the report predicts that mid-range priced handbags will continue to post stronger volume and value growth than both basic and luxury handbags, largely driven by fast fashion labels like Zara and H&M, there is a conundrum that the mid-priced leather bag sector faces. It’s what I call the “cookie cutter” syndrome, where the styles between one brand and another morph into pretty much the same bags, just with different brand labels slapped on.
Lately I’ve often found myself wondering what the designers of some of these bag companies are doing at their weekly/monthly meetings. Do they bring in clippings of other bag companies’ designs and change a seam here, add a new pocket there and call it their own? Is it possible that all the bag designs have already been invented? No, not at all. For all the cookie cutters out there, I come accross plenty of brands with a unique take on its designs and the way it operates.
Authenticity and creativity is what will future-proof leather bag brands.
Ultimately, what will future-proof bag brands is authenticity and creativity. We can talk about customer service and customer experience all we like, but if brands have winning products and hero designs and the right marketing, then the merchandise sells itself - it’s as simple as that. Consumers will seek you out.
Instagram fashion is starting to look all too similar.
Cashed-up Chinese tourists and strong growth in online sales are forecast to assist in propping up the struggling bag industry. Online influencers and fashion bloggers are another prop, however I predict there could be another “cookie cutter” conundrum here. A general observation of mine is that Instagram fashion is starting to look all too similar and one style influencer account is looking very much like the other.
While Instagram is a great way to get your product noticed and it's a great starting point for many fashion brands, it’s important to keep consumers engaged without them getting lost in all the other brands that are using the same platform and likely sharing in the same influencers as well.
Then there’s the unpredictable future of Instagram, which could well follow in the footsteps of Facebook - it's already in the early stages of looking that way. An increase in the number of Instagram ads could likely see an upturn of users put off by the app, resulting in a decline in engagement.
The key is to put your eggs in many baskets.
My thoughts are that editorial with integrity and quality content will play a more powerful role in the future of “influence” - content has continued to stay strong as a marketing channel. The key is to put your eggs in many baskets - customer experience, product quality, authenticity, the right marketing channels, being socially conscious, doing market research and listening to your customers are a great start.