Online Luxury Shopping Just Isn’t Cool Anymore

Online Luxury Shopping Just Isn’t Cool Anymore

Shopping for Fabergé eggs online?

If not, we present you the gift of schadenfreude: The e-commerce luxury market has taken a big dip, The Wall Street Journal reported Thursday. While this isn’t necessarily the end of the world for luxury brands themselves, the platforms that sell them are in hot water — especially as discount e-commerce apps sweep the US.

Where Did You Get That Bag?

Growth in luxury goods has hit a rough patch this year. French luxury conglomerate LVMH, which owns Louis Vuitton and Moët & Chandon, reported slowing growth in October. It wrote it off as demand returning to something resembling normal after a few bumper years fueled by pent-up pandemic demand — although it did hat-tip inflation in regard to its premium drinks businesses.

According to the WSJ, a disproportionate amount of the sales slowdown has been online. Two luxury online retailers, Farfetch and MyTheresa, have each suffered roughly 90% drops in their market value since they went public, the WSJ said. This comes as two upstart low-budget e-retailers duke it out for consumers:

• China’s newest e-commerce exports, Temu and Shein (Shein is now headquartered in Singapore but was originally founded in China) have been in fierce global competition. Temu filed a US lawsuit against Shein in July, accusing it of unlawfully trying to elbow Temu out of the US market.
• Now, Temu seems to have the upper hand, thanks to the frankly unnerving discounts it can offer shoppers. Its US November sales were triple those of Shein, Bloomberg reported.

Avocad-no Toast: With a year of extremely belligerent macroeconomics almost behind us, it’s no wonder shoppers have more of a head for bargains. In the UK, where inflation has been more stubborn than in the US, even high-end shoppers are trading down, as boutique supermarket Waitrose said customers are opting for less adventurous meals. The prime example? Putting smushed peas on toast instead of that all-time millennial favorite (and the reason none of them have a mortgage) avocado.

– Isobel Asher Hamilton