Christian Louboutin lands in NZ as luxury retailing ramps up
Tuesday, 13 February 2024
Luxury shoe retailer Christian Louboutin has expanded into New Zealand, opening a glitzy on-brand scarlet red shop on Auckland’s Queen St.
The French multinational has put down roots in the luxury retail precinct, in Queens Arcade, situated in and around a growing number of high-end global fashion names on the waterfront end of the city centre shopping strip.
The retailer, known for its flamboyant designs and shoes with red soles, has remained quiet since its arrival in December, but retail experts say the fashion brand sees Auckland as an important and lucrative market.
Retail expert Chris Wilkinson said expanding into New Zealand would have been a natural progression for Christian Louboutin, which has eight stores in Australia.
Wilkinson said luxury brands tended to “play the long game” and would not be too concerned with the cost of living crisis and current economic conditions. These types of stores operated with huge margins, meaning they typically needed fewer sales.
“These big brands have seen impactful events before including the global financial crisis, Sars, Covid-19. They know economies will recover and want to be ready for when they do,” said Wilkinson.
According to Devon Funds, demand for designer handbags and accessories has been “storming back”, and stocks of luxury goods appear to be back in fashion.
In January, LVMH (LVMH Moët Hennessy Louis Vuitton), one of the world’s largest luxury goods giants with brands such as Christian Dior, Bulgari, Celine and Givenchy, posted a 13% leap in full-year sales and has raised its annual dividend.
Last year, LVMH was marked as the most valuable company in Europe.
Ibis World has projected that the luxury goods market across the Tasman will grow row 3.7% between 2023 and 2028.
Demand has been growing worldwide for luxury goods, particularly among younger people, who were opting to spend more for better quality, said Wilkinson. This could be seen by the demographics of shoppers typically queued outside high-end fashion stores on Auckland’s Queen St, he said.
Juanita Neville-Te Rito, managing director of RX Group, said luxury fashion tended to be recession proof as the wealthy continued to spend despite inflationary pressures.
She said there was continued demand for bags, accessories, shoes and ready to wear luxury goods.
“True luxury remains upscale rather than trying to appeal to the masses. Louboutin isn’t for everyone. It is a brand people aspire for and see it as an investment piece that can be worn for years,” Neville-Te Rito said.
“There are good quality pockets of wealth in New Zealand that have been buying overseas. Now they can access product right in their own backyard. Luxury is a touch and feel experience, so having a store and feeling the experience is critically important.”
With China’s economy slowing, she said, ageing luxury brands like Christian Louboutin needed to find new pockets of growth, making New Zealand an appealing destination to set up shop in. “NZ has suffered from a lack of real luxury for a long time, and those dollars were being spent overseas. We have a vibrant luxury fashion market here in NZ, just as we do for super luxury cars,” she said.
“Having a home for the brand in our own backyard is incredibly important as the brand can deliver an experience straight to their customers. These are places where people know your name – they contact you when new product is arriving and reserve product for you.
“Outside that there are a bunch of wannabes or the aspirational set who appreciate the kudos and status that comes from owning a piece of the brand, or truly appreciate the design and product. That’s why even in tough times the likes of Gucci still sells fashion jewellery versus fine jewellery.”
Luxury retail expanding across NZ
Auckland’s base of luxury retailers, spread across Auckland’s lower Queen Street, innercity shopping mall Commercial Bay and Westfield Newmarket, has been growing over the past few years, with brands such as Van Cleef & Arpels and Bvlgari setting up shop to appeal to the uber-rich.
According to Heart of the City, foot traffic in lower Queen St had grown 29% year on year, and real estate agents report demand continued to outstrip supply for premium retail space in this part of Queen St, driven by growing numbers of people in the area.
In the South Island, Queenstown has become another luxury destination for some of the biggest names in fashion. Louis Vuitton is located on the waterfront, along with Partridge Jewellers, and other high end brands found inside the DFS store there.
Wilkinson said he knew of luxury brands that wanted to be located in Queenstown but the limited availability of retail sites with the scale and presence they required meant many had not yet set up a base in the South Island.
There were some well-developed plans to bring international luxury brands to Christchurch prior to the pandemic, but those developments did not go ahead. However, Christchurch was poised to be the next city to see luxury retailers establish themselves here, he said.