Does cut-price designer chic really work?

New Look is the latest high street store to launch a cut-price, designer fashion range to combat cheaper and “cooler” competition (MW last week). Introducing such lines on store rails is not a new idea, but has gained momentum since H&M teamed up with Stella McCartney last year.

The lure of cut-price clothes bearing the designer’s name resulted in chaotic scenes, with flagship stores engulfed by bargain-hungry shoppers. Some garments ended up changing hands for many times their original price on online auction houses such as eBay.

Fashion experts say the move was indicative of a chain trying to differentiate itself in a competitive market and predict that New Look and others will try to recreate the buzz that surrounded H&M. It worked, says Interbrand design director Lisa McLaren, by fusing high fashion and celebrity with high street prices and an air of exclusivity.

The trend can only continue, she adds, as such ranges are great brand-building tools. McLaren says: “They attract customers that would not normally go there and send a positive signal about a brand. For the designer, high street stores reach an enormous, generally younger, market that can’t [normally] afford their clothes. It’s a win-win situation for both parties.”

She says catwalk fashion is reaching the high street faster than ever, and designers are anxious to become a part of the process rather than be “copied” for nothing. Yet Sanjay Nazerali, managing director of brand consultancy The Depot, is concerned that such collaborations are short-lived and do little to change perceptions of a store in the long term.

“What are you really buying? It is not H&M, it’s Stella,” he says. “When she disappears you’re left with H&M. Brands do this because they think it will rub off, but I’m not convinced. It just doesn’t have long-term impact. There’s an assumption that it is going to be a greater, longer association between the funky designer and the boring brand. There’s the sense that it will make the brand cooler – and it does for a short period of time. “Why not, for example, bring Stella in to set a design brief for the entire range, then you would get continuous ‘Stellaness’ inside-out? That doesn’t happen nearly enough.”

Debenhams maintains a year-round designer presence through its Designers at Debenhams umbrella brand, which pioneered the idea of cut-price diffusion lines in the 1990s. This strategy, says an insider, works well and has grown organically since launch. It now features more than 20 designers and has extended into home, mens- and childrenswear. “The strand is a core part of Debenhams’ marketing strategy,” says Nazerali. “It also represents an increasing proportion of its sales.”

He admits, however, that Debenhams’ core market is different from New Look’s and thinks the latter must do more. Nazerali believes it should be fighting its rivals in different ways – instanced in the recent introduction of TV presenter and actress Kelly Brook’s lingerie and swimwear range – as it has lost ground on both price and attitude. Chains such as Primark and Matalan beat New Look on price and range, whereas Topshop, Zara and sister store Bershka are more aspirational. “New Look pioneered pride in cheapness,” he adds. “But it had the rug pulled from under it by the likes of Topshop, which says it is not just enough to be cheap, but also sees necessity in being chic.”

Catherine Turner

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