Hugo Boss isn't cool anymore
Newly appointed CEO of Hugo Boss Mark Langer says the 92-year-old German brand will be abandoning its attempt to become a true luxury brand.
"The effort to make in-roads in the luxury market didn't prove to be particularly helpful for our business," Langer said in an interview with German language newspaper Handelsblatt, according to Reuters.
Langer assured Handelsblatt that the company would remain a premium brand, however, just not quite what it was aspiring to be.
This comes after a concentrated effort by former CEO Claus-Dietrich Lahrs in recent years to diversify the previously menswear-focused retailer and take it further upmarket as the worldwide luxury market expanded in the early-to-mid 2010s.
That move didn't sit well with customers, according to a new UBS report. In survey, 59% of customers reported they abandoned the brand because either the styles were no longer appealing or they began to like other brand's styles more - compared to 43% last year.
"The relatively high levels of these answers were an early confirmation to us that the brand elevation was not working and we agree with management's decision to focus back on premium," UBS says.
Perception of the brand has also fallen sharply in the last year, with only 20% of those surveyed responding that Hugo Boss was a cool and fashionable brand, compared to nearly 40% a year ago.
This comes amid a harsh worldwide slump in the luxury market, especially affecting the US and Chinese markets and prompting Hugo Boss's shift. Apparel - especially luxury - just seems like less of a priority for purchase than technology or a nice vacation in the eyes of many consumers.
This is primarily blamed on changing buying habits, with more shoppers - even affluent ones - preferring logo-free clothing and fast fashion to luxury apparel. Fast fashion has seemed to replace department store shopping - even if it's not always cheaper.
Other factors affecting the worldwide luxury slowdown, like economic and political uncertainty in the US and changing tastes in China, have contributed to the tough times.