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Luxury Goods Cement Their Online Presence: Q&A with Stroock’s Trevor Adler
The purchase of luxury goods is generally accomplished on-site and in person. The idea here is not just to buy something expensive but to be seen while doing so.
But in the past few years, high-end products are making their way online, where buyers can shop and purchase at their leisure. Connect CRE asked Stroock & Stroock & Lavan LLP’s New York partner, Trevor T. Adler, about this trend and why it’s occurring now.
Connect CRE: What drives the luxury retail sector, especially in this inflation era?
Trevor Adler: I think that for many people who enjoy the “see and be seen” element of society, the experience of being couped up in their homes during the pandemic without the need for luxury goods (because they were not ‘being seen’) created a pent-up surge of demand for those luxury goods once people began “going out” again. While there has always been a steady demand for luxury goods from this segment of the consumer market, re-emergence from pandemic seclusion reinvigorated sales in this area. From what I have seen in my practice, fashion and accessories seem to me to be the most in-demand of these luxury goods.
Connect CRE: Why did luxury goods make the move to e-commerce?
Trevor Adler: During the pandemic, when online sales soared, many online retailers saw the opportunity to enter—or expand their offerings in—the luxury goods market. This focus brought with it marketing and competitive pricing that led to higher luxury sales for online retailers.
But unlike everyday home goods, the expensive nature of luxury goods made many people reluctant to engage in online sales of certain items because they could not preview them in person before purchasing them. But, online retailers have been innovating to better compete in the luxury goods market by offering easy return policies and through programs like Amazon’s Prime Try Before You Buy, which creates a trial period during which the items are sent to you before final purchase.
Connect CRE: Do you see this trend continuing?
Trevor Adler: Yes, I think so. There is room for brick-and-mortar and online retail in the luxury goods market. Different people have different preferences about how they shop for luxury goods. The irony is that some of how online retailers facilitate merchandise trial-and-return procedures brings them closer to opening brick-and-mortar stores. Many brick-and-mortar stores are also beefing up their online offerings to compete with online retailers.
- ◦People
- ◦Economy
