Tapestry, the New York-based fashion conglomerate that owns Coach and Kate Spade, among other brands, announced Thursday that it has agreed to take over Capri Holdings—the parent company of Versace, Jimmy Choo, and Michael Kors—for nearly $8.5 billion.
While the deal is just the latest merger of major brands to affect the continued consolidation of the luxury fashion industry, it marks perhaps the largest effort ever made by an American company to gain dominance. of mega-powerful European fashion conglomerates such as LVMH (which owns. 75 brands, including Louis Vuitton, Dior, and Tiffany) and Kering (over 18 brands, including Gucci, Balenciaga, and Yves St .Laurent).
Whether Thursday’s news signals the creation of an American luxury entity capable of taking on the European titans remains to be seen. But the development will almost certainly have implications for the continent’s growing divide between how major luxury brands choose to interact with—and rely on—emerging technologies like blockchain.
After NFTs became fashionable in 2021, luxury brands across the board dipped their toes into the sector, beating an NFT slump and metaverse pop-ups. But when the crypto market looks at the next year and the public perception of the industry sourluxury brands appear to be divided into two main camps.
Some brands are doubling down on blockchain efforts and starting to meaningfully integrate them into product lines, convinced of the technology’s staying power. Others have moved from silo tech projects to increasingly sporadic activations that have taken away from their brands’ core identity.
The former, passionate camp happens to be heavily represented by European-owned brands; the cautious, of American companies.
This year, for example, Gucci launched a lot limited edition jewelry lines in partnership with Otherside, the metaverse gaming ecosystem from the creators of Bored Ape Yacht Club, following the lead of the unofficial Tiffany unity last summer with the dominant NFT collection CryptoPunks.
Louis Vuitton has launched a unique line of custom trunks tied at $41,000 NFTsand Dior pioneered a line of Designer sneakers with NFC chips which comes with on-chain digital twins. On the other side of the pond, American brands such as Coach, Kate Spade, and Michael Kors choose only to occasionally make pop-up appearances on a relatively low impact events like Metaverse Fashion Weekwhich keep their product lines insulated from Web3 experiments.
The reasons for such a difference are likely to be many. For one, the political and regulatory climate for crypto-related products in Europe is equally distant more clearlyand far away more welcomingthan is now in the United States.
Moreover, in the age of hyper-conglomerated luxury companies, it only takes the conversion of a few key leaders to change the paths of many leading brands. Bernard Arnault, CEO of LVMH, appears to be taken aboard the block-train by both of them passionate pro-crypto sons, Frédéric and Alexandre.
Kering CEO François-Henri Pinault, meanwhile, has repeatedly praised emerging technologies such as blockchain and the metaverse as game changers that change history.
As the American luxury space further consolidates—and the winner of Thursday’s merger, Tapestry, moves to take on its European rivals in a more zero-sum game—the confidence of those who advanced technologies are ready to be a major point of difference between the reduced number of players that determine the path of the luxury industry.
Tapestry may choose to follow the example of LVMH and Kering, and more meaningfully bring technology front and center to its brand identities. It may also choose not to, however, further exacerbating the growing ethical gulf between American and European luxury brands.
Either way, the conglomerate now faces a fork in the road; the path it chooses will likely affect the path of American luxury for decades to come.
