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From Conspicuous to Conscious, the Definition of Luxury Evolves

Bleecker Street in New York City’s West Village neighborhood was once an epicenter of luxury retail with a disproportionate number of Marc Jacobs storefronts, a destination for tourists and local shoppers alike. That is, until roughly 2017, when most of the clothing retailers located in the area shuttered thanks to high-rent blight.

Today, the area is seeing a new kind of luxury retail staking its claim on the famed street. Naadam, a three-year-old mid-priced luxury cashmere brand, just open a new, permanent retail location there, representing a reinvention of both Bleecker Street and, more generally, the definition of luxury.

Naadam is but one of a handful of newer brands leading the charge toward a new luxury: Denham focuses on premium denim materials; Edun supports African trade with its mission-based philosophy; Cuyana ethically sources Chinese silks and prioritizes philanthropy for abuse victims.

The emergence of brands like these coincides with news exposing long-held and widespread practices in the luxury market that neglect environmental and ethical concerns. In July, news reports revealed that Burberry, England’s premier luxury brand, had burned millions of dollars worth of its unsold product rather than donate, recycle, or—perhaps the most dreaded—discount them.

By September, thanks to mounting pressure from industry watchdogs and consumers, Burberry pledged to stop the practice altogether.

Further to the unfavorable news about the luxury market, a recent New York Times investigation found that luxury manufacturing in Italy exploits workers, resulting in shockingly low wages, unsafe working conditions and few worker protections.

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Compare that to Naadam’s approach to the supply chain. The company, which Matthew Scanlan co-founded in 2015, monitors each step of the supply chain from sourcing to sales, cutting out manufacturers in the middle that drive up production costs while reducing the wages Mongolian herders earn. The result is a soft-as-a-cloud cashmere sweater starting at $75 that a shopper can feel good about buying.

“Supply chain is something that sounds complicated, but it’s really not,” Scanlan said. “Brands in this space never bother to get access to this information, so we did, and we use it to make a better quality product and remove the inefficiencies that get the wrong people rich.”

KOTN (like “cotton”) is another clothing brand focusing on giving back to the communities from which it sources without sacrificing profit. Co-founder Rami Helali started the business in 2015 after recognizing the consumer-facing market void: It was difficult to find a reasonably priced, well-made T-shirt that lasted beyond a few wears.

Fast forward to 2018 and Helali and his partners have learned all about the process of sourcing cotton—an expensive material to harvest that is frequently subsidized by governments—leading them to work directly with Egyptian farmers and, in the process, enabling the local communities to improve their own well-being by funding education programs with a sort of philanthrocapitalism.

“We create luxury products at a mid-market price by cutting out the middleman retailers and working directly with the farms, fabric mills and dye houses. There’s no markups in between,” Helali said. “This is ingrained in the company’s DNA.”

There are, of course, some hiccups preventing so-called ethical brands from exploding to the level on which other luxury players operate, including skepticism over so-called ethical processes as well and relatively subdued design aesthetics.

Everlane, the minimalist-bent basics label, has perhaps the greatest commercial brand recognition in this space, and has set a new standard for how brands should publicly outline their manufacturing process. That said, the brand, which declined to comment for this story, has been questioned by some outlets as to just how transparent it really is, despite all of its marketing efforts.

And while some ethically-focused fashion brands push design boundaries (Mara Hoffman and Stella McCartney come to mind) many of the newer players in the space are primarily concerned with creating products that outlive trend cycles, which one could argue results in a general drabness. Contrast that to the logomania that has dominated the luxury space over the last two-plus years (Gucci, Fendi and Supreme among the most notable) and it seems as though new luxury means existing above street-level noise.

“The products end up being timeless, and I think that’s the key on the brand side,” said Ken Morris, principal at Boston Retail Partners consultancy. “If you can create a timeless product, it doesn’t matter when it’s purchased, and instead it becomes an investment in clothing.”

To call these nascent brands disrupters is perhaps a bit premature, though they’re certainly influencing consumer perceptions of what it means to shop responsibly, as well as industry standards for sustainability. In a $1.4 trillion luxury goods market, European conglomerates may not yet feel the pain or pressure brands like Naadam and KOTN do, but Morris says they’d better take note because young and mature shoppers alike have become more aware of what’s going on.

“As more people enter that luxury market, they are more socially conscious, focused on more of a social mission and they want to know their product isn’t being made by underage children in Pakistan, or they want to know the wood they buy for furniture isn’t stripped from a forest in the northwest United States,” Morris said.

“Plus, [the big European houses] would be crazy not to invest in this space,” he said. “As those older brands age, so to speak, this new blood is invigorating the older houses to change things up a bit.”