If consumers knew a $1200 bag costs just $100 to make, would they change their consumption patterns? Scott Gabrielson, founder of Oliver Cabell, is betting they would. The leather goods retailer’s website compares the price and production costs of its goods to the average luxury bag. Oliver Cabell bags are sold for 2.2x their production cost and cost $250 while traditional retailers mark up a similar bag by 12x production costs to $1,320. With traditional retail markups, Oliver Cabell bags would cost as much as $970.
Gabrielson seeks to keep costs down in his company, but not through shoddy manufacturing practices or low-wage factory workers rampant in the fashion industry. His goods are fully manufactured – not just assembled – in Italy. He has no storefronts, which lowers costs. As for fulfillment, he anticipates it being cheaper than reaching his mostly urban consumer base living in high-rent areas. As for returns, his company deliberately chose accessories to minimize them.
Fashion has been experiencing a movement that calls on consumers to consider the ethics and origins of what they buy. For example: Cuyana urges consumers to buy less and save for high-quality, ethical products. Everlane promises better quality at low prices by cutting out the middle man. Reformation produces clothing from recycled fabric and tells consumers how they are helping the planet by avoiding further contribution to trash.
Digital has provided many avenues for brands to communicate their identity, which makes it possible to sell the consumer on a set of ethos outside of how a product or storefront looks. For a new generation of shoppers, this could be the new brand.