Kurt Geiger increased sales by nearly 10 percent last year as the footwear and handbag retailer said it benefited from fashion fans switching to its more affordable luxuries during the cost of living crisis.

The company said its revenues had risen by 9.4 percent in the year to the end of January 2024. Sales of handbags boomed after it cut prices by 5 percent compared with three years ago, just as many luxury brands had upped price tags.

The British retailer’s revenues were also helped by its expansion in the US, where Kurt Geiger is now sported by the likes of Kylie Jenner, Jennifer Lopez and Paris Hilton.

Its sales have risen despite a tough time for the wider clothing and footwear market, particularly for luxury brands, as household income has been squeezed by the cost of living crisis.

Neil Clifford, the chief executive of Kurt Geiger, said underlying profits rose 34 percent to £40.4 million on sales of nearly £361 million – putting the group back on a par with its pre-Covid performance – and he expects further growth in this financial year.

He said: “The strategy of increasing prices when consumers were having a tough time to take the same sales from fewer people, I don’t think that has worked [for others]. We have put a lot of effort and creativity into our product but are at a price point that is lower than all our competitors and I think that is working.”

Clifford said fashion items had to be more affordable as they were now facing increased competition from other options – such as travel, events or luxury food. Kurt Geiger’s handbags range from £59 to £289.

“Everyone wants to look wonderful but not everyone earns £100,000 a year or more and maybe if they can afford it maybe they don’t want to, they would rather go on holiday,” he said.

He said the focus on affordable luxuries, with everyday prices dropped but fewer discount events, had helped Kurt Geiger sell 50 percent more sandals than last year – despite the gloomy summer in Europe – while handbag sales were up 45 percent.

That growth comes as many luxury brands, including Mulberry, Burberry, Gucci and Yves Saint Laurent, have seen shoppers cut back their spending. Their typical customer base – “aspirational” shoppers able to occasionally splash out on an expensive item – have been forced to prioritise essentials such as mortgage payments and heating bills which have risen.

However, Pippa Stephens, senior analyst at GlobalData, said Kurt Geiger was more likely to have benefited from shoppers trading up from high street brands rather than trading down from designer labels because of a trend towards investment dressing – wanting items that last longer and could be traded on resale sites – rather than more disposable fashion.

“Premium high street players have been faring quite well as people are trading up from the mass market and trying to find better value for money,” she said.

Stephens added that Kurt Geiger’s growth was also being fuelled by international expansion.

The company, which is owned by private equity firm Cinven, is investing more in marketing, including hiring model and actor Emily Ratajkowski to front its marketing campaign.

The group has just one company-owned store in the US – in Orlando – but plans to open four more there this year, including in New York and Los Angeles. It has a long-term target to open 50 stores in the US.

No new stores are expected to open in the UK, where Kurt Geiger has 58 outlets including a site on London’s Oxford Street which opened a year ago.

Clifford said sales of Americana-themed denim bags and footwear had also done well, thanks to the influence of Beyoncé and Taylor Swift.

By Sarah Butler

Learn more:

The Return of the Flip-Flop

The 2000s staple is back, this time with a luxury twist. Its resurgence is evidence that the old school playbook for starting trends can still work in 2024.

Both TikTok virality and dermatologists both helped boost Waldencast’s growth in the second quarter of 2024.

For its second-quarter earnings results for the three months ending on Jun. 30 reported today, the parent company of Milk Makeup announced 25.7 percent net revenue comparable growth, up from 21 percent in the first quarter. While Milk Makeup saw 20 percent year-over-year net revenue growth for the quarter thanks to its viral Cooling Water Jelly Tints, dermatological skincare brand Obagi Medical accelerated to 30.9 percent net revenue comparable growth. Total net revenue for the first half of the year reached $131.6 million with a 20.3 percent growth rate. Adjusted EBITDA for the first half of 2024 was $17.7 million, with a margin that increased to 13.4 percent, up from 12.7 percent in the same period last year.

Milk Makeup’s six-month-old Cooling Water Jelly Tint has sold out twice after going viral on TikTok. The brand’s growth was slightly lower than its first-quarter rate of 21.5 percent after the blush went out of stock.

“Out of stocks were a factor on our results in Q2,” said Michel Brousset, the founder and CEO of Waldencast. “We created quite a bit of product being ready to go for the launch. But it stripped all of our expectations.”

Obagi Medical’s comparable net revenue growth, meanwhile, was up from 20.6 percent last quarter thanks to increased focus on brand awareness among both dermatologists and customers, said Brousset. The brand’s Daily Hydro-Drops Rejuvenating Eye Gel Cream was cited as a growth driver, and also faced an out-of-stock period after it sold out in less than 72 hours.

Milk Makeup surpassed the $100 million threshold in net revenue for 2023, and reached $63.2 million in net revenue for the first half of 2024. Obagi Medical had $68.4 million during the same time period.

“The consumer, especially in beauty, is super strong and thriving in the US and most of the places where we operate,” said Brousset.

Learn more:

Pretty Enough to Eat: Behind Beauty’s Food Obsession

In recent years, TikTok has birthed a number of beauty trends with very little staying power. Despite this reality, labels are increasingly using sweet treats like glazed doughnuts, jelly and gummy bears to sell their products to Gen-Z and Gen Alpha shoppers.

PVH Corp. reported a 6 percent dip in revenue, year-over-year, in its quarter ending Aug. 4, to $2.1 billion — in line with Wall Street estimates.

Its two marquee brands, Tommy Hilfiger and Calvin Klein, reported sales declines, “primarily due to the challenging consumer environment in Asia Pacific, particularly in China and Australia,” the company said Tuesday afternoon.

In North America, however, both brands saw a 1 percent uplift. PVH reaffirmed its previous guidance of a 6 percent to 7 percent drop in 2024 revenue. Inventory decreased 12 percent compared to the year prior.”

For both Calvin Klein and Tommy Hilfiger, we drove strong consumer engagement and continued to increase product strength and improve newness in our assortment, leading to more full-priced selling and less end-of-season clearance sales, which fuelled significant gross margin expansion,” PVH chief executive Stefan Larsson said in a statement.

Learn more:

PVH Corp: The Power of Trust in Transforming Supply Chains

From zeroing in on traceability to sharpening inventory management, PVH’s chief supply chain officer, David Savman, unpacks in this interview for The State of Fashion 2024 what it takes for retailers, brands and their suppliers to thrive together.

After dominating the sun-kissed beaches of Los Angeles, Tower 28 has officially made its way Down Under.

As of Tuesday, the clean beauty brand known for gentle ingredients will be available to shop in 35 Mecca locations across Australia and New Zealand, as well as online.

A wholesale partnership with Mecca, Australia’s largest prestige beauty retailer, will allow LA-based Tower 28 to penetrate the new market and reach 4 million-plus customers. The move comes at a time when the brand looks to scale. Last year, it more than doubled its internal team from 12 employees to 32.

“Mecca’s reputation precedes itself in terms of being a great partner, a great brand advocate and they really know how to build up brands on the local market,” said Tower 28 founder Amy Liu. “There’s a lot of trust from the beauty community in general when it comes to Mecca.”

Glossier also launched in-store and online with Mecca earlier this summer.

Tower 28, founded in 2019, is known for skincare and makeup products for sensitive skin, such as its best-selling silicone-free cream blush, daily gel cleanser and tinted SPF. It inked a partnership with Sephora when it launched and has become one of the most sought after brands of the year at Mecca for its hybrid products that blur the line between beauty and skincare, according to Mecca chief marketing officer Kate Blythe.

“Customers are looking for makeup-skincare hybrids that address their skin concerns while also doubling as a staple in their makeup kit,” Blythe said in a statement.

As part of Tower 28′s rollout in Australia, Liu and her team are hosting a number of media appearances, pop-ups and other activations in Sydney and Melbourne. Liu will be personally hosting some training sessions for Mecca staff.

Learn more:

How Mecca Dominates the Australian Beauty Market

The Melbourne-based multi-brand retailer has kept both local and international competitors at bay with a regional store footprint four times larger than Sephora’s.