Luxury Ready-to-Wear Fashion Industry in Taiwan

Introduction

Today, the ready-to-wear segment of luxury brands is growing globally in general, and in many Asian nations such as Taiwan in particular. To determine the current state of affairs and the potential for the future in this sector, this paper provides a definition of the context of designer ready-to-wear, including a discussion of how it functions within the fashion industry and which brands operate in this space. An examination of how stores are designed to attract target customers follows, focusing on three major luxury ready-to-wear designer brands in Taiwan. This is followed by an analysis of representative advertising and branding initiatives for these brands and Taiwanese consumer attitudes toward them. Finally, an assessment of the target market for the ready-to-wear luxury fashion industry in Taiwan — including relevant demographics and current consumer preferences — is presented, followed by a summary of important findings in the conclusion.

Context of Designer Ready-to-Wear Market

The ready-to-wear luxury fashion industry is unique because it depends on marketing and promotion to sell products to a specific target market (Nguyen, 2004). Because of the highly guarded proprietary nature of the ready-to-wear luxury goods industry today, it is likewise difficult to locate relevant and timely information (Nguyen, 2004). Despite these constraints, what is known for certain is that the ready-to-wear luxury goods industry is "very fascinating and the products themselves signify prestige and status. The apparel industry exists in a very competitive environment where companies need to adopt new technologies in order to improve profitability and lower costs" (Nguyen, 2004, para. 3). In some cases, companies competing in this industry are able to operate as both manufacturers at the wholesale level and retailers. In this regard, Nguyen adds that "an example of this is the Gap Corporation, who manufactures their own products to sell in their stores. Apparel manufacturers have the option of selling their products under their own label or under private labels" (2004, para. 4).

At the global level, the context of the ready-to-wear luxury fashion industry involves an intricate international network of companies that transcends national boundaries — not only based on design appeal but also for production and dissemination (Hayes, 2009). When ready-to-wear luxury fashions are produced and disseminated at the global level, the process involves actual sellers as well as symbolic actors including the media (Hayes, 2009). According to Hayes, "As society changed over time, and fashion gradually infiltrated all classes, designers became arbiters of personal style" (2009, p. 62). This assertion might seem hyperbolic until recent trends in this industry are taken into account, since global ready-to-wear luxury fashion represents a multi-billion dollar industry (Hayes, 2009).

The history of the ready-to-wear luxury fashion industry dates to the 1960s, when Italian and French haute couture companies developed their local boutique industries into a global industry (D'Aveni, 2010). According to D'Aveni, "Seeking a broader market, these houses created ready-to-wear fashions at high prices, positioned slightly lower than their haute couture lines" (2010, p. 37). Over the next two decades, ready-to-wear luxury fashion became the focus of modern production methods and the industry was transformed (D'Aveni, 2010). By the early 1990s, haute couture designers had expanded into upper-middle price range so-called "diffusion brands" that broadened their markets and image (D'Aveni, 2010). In this regard, D'Aveni reports that "Dolce & Gabbana launched D&G, Calvin Klein launched CK, and Giorgio Armani launched Emporio Armani and Armani Exchange to capture different upper mid-market segments. Likewise, Versace created Versus, while Prada spawned Miu Miu" (2010, p. 37).

Fashion designers also began the practice of licensing their brand names to clothing producers, who would contract with their own designers to produce designer labels such as Gloria Vanderbilt and Oleg Cassini (Rosen, 2002). According to Rosen, "This new approach lent itself to the production of clothing for the high end of the clothing market to the low end. As the number of women in professional and managerial occupations increased, they needed wardrobes that would permit them to 'dress for success'" (2002, p. 182). In addition, American designers such as Liz Claiborne joined the fashion industry's expansion, and this company and others began producing high-quality ready-to-wear luxury fashions for Asian countries including Taiwan (Rosen, 2002).

The sales of luxury goods in Taiwan are projected to remain strong in the near future as the global economy continues to improve, thereby strengthening consumer confidence (Luxury goods in Taiwan, 2014). Moreover, restrictions on luxury good purchases in mainland China have diminished demand there while contributing to even stronger demand in Taiwan (Luxury goods in Taiwan, 2014). Taiwan also enjoys a relatively high GDP per capita of $39,600 (2013 est.) (Taiwan economy, 2014). Today, competition between ready-to-wear fashion retailers is fierce, due in large part to sluggish global economic conditions (Luxury goods in Taiwan, 2014).

Conclusion

Today, the Taiwanese ready-to-wear luxury fashion industry is booming, and retailers are dedicating more floor space to this market segment to satisfy the growing demand from fashion-conscious — and increasingly affluent — consumers. The research suggests, however, that many American design houses are overlooking this burgeoning market. Nevertheless, current signs indicate that the ready-to-wear luxury fashion industry in Taiwan will continue to flourish in the coming years, threatened only by a downturn in the global or Taiwanese economies or a deterioration of the tenuous relations with mainland China.

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