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The aptly named Canadian-based luxury coat brand is best known for its puffer jackets labeled with the ubiquitous bright red, white and blue patch on its sleeve with parkas priced upward of $1,000.
The exorbitant price tag apparently isn't freezing out sales as Canada Goose reported Wednesday a 22.2 percent jump in sales to 219.8 million Canadian dollars (about $165.7 million), with revenue from retail stores and online soaring 47 percent to CA$74.2 million (about $55.9 million).
|GOOS||CANADA GOOSE HLDGS||38.84||-0.13||-0.33%|
Designer winter coats with price tags fit for the 1 percent seem to be attracting more of a mass audience looking for a jacket that not only provides warmth but an aspirational status symbol. And buy now, pay later options make them seem accessible to those who can’t afford them.
“Outerwear is another category in addition to sneakers that have become a status item.”
Canada Goose is one of the leading luxury coat retailers in the U.S. In the designer apparel category, which includes outerwear, Ralph Lauren had the most retail sales in 2018, followed by Calvin Klein at No. 2, and Michael Kors at No. 3. Canada Goose ranked No. 14 of the 37 brands tracked in the category, up from No. 29 in 2013, according to data from market research firm Euromonitor.
Canada Goose, which has been around for more than 60 years, bills itself as “luxury artic outwear,” capitalizing on the fact that scientists in Antarctica wore the brand’s down-filled parkas in the 1980s, and by the first Canadian to ascend up Mt. Everest, giving it perceived street credit to keep wearers warm in elements, Vox reported. Celebrities, like Rihanna, Drake, Daniel Craig and Ben Affleck have been spotted bundled up in the brand.
Nordstrom offers shoppers the option to pay for a $1,050 Canada Goose jacket in payment installments via a partnership with point-of-sale loan company Affirm when Fox Business checked its website on Wednesday. Other brands, like Moncler and Mackage, sell puffer jackets for thousands of dollars and also offer shoppers the option to get on a monthly payment plan via the financial lender service. A women’s Moncler puffer jacket that costs $2,025 on Moda Operandi can be purchased for $179 a month and paid over the course of a full year, which would accrue $112.01 in interest, totaling $2,128.01 by the time someone finishes paying it off.
“I’m skeptical of these services if it’s for luxury goods,” Ted Rossman, an analyst at Creditcards.com told FOX Business.
“This ‘get it now and pay for it later’ is a dangerous proposition. What if you can’t afford to pay for it later? What if it drives you into significant debt? If you want a luxury item, you really need to be able to pay cash for it and not finance it on a credit card.”
Indeed, Americans are already saddled with debt. The overall debt in U.S. households is higher today than it was ahead of the 2008 financial crisis with $26 billion in credit card debt in the last quarter of 2018, according to a report from the Federal Reserve Bank of New York from earlier this year. And nearly a quarter of Americans don’t have money saved for an emergency.
It’s unclear how many consumers are taking advantage of pay-as-you-go options for luxury items. Nordstrom, Mackage, Moncler, Moda Operandi and Canada Goose did not respond to a request for comment. Affirm said its customers typically make purchases four times a year with an average order value of around $700, though it would not say how many users were buying designer winter coats with their service.
Some fashion experts are cool to the overall aesthetic. New York Magazine’s “The Cut” referred to it as a “wearable sleeping bag” in 2015, and dozens of other think pieces have spawned with writers and vloggers questioning if the jacket was worth its price tag.
Founder and CEO of luxury men's outerwear brand Norwegian Wool Michael Berkowitz referred to the jacket as “an over-sized space suit.”
“You don’t want to be looking like you’re going on an arctic mission.”
“If someone is buying it for the little circle label on the sleeve, you’re better off spending money on some therapy because you’re dealing with bigger issues,” he added.
Some say the splurge is worth the investment. New Jersey native Carli Franco, 28, was hesitant about spending money on a Canada Goose jacket but decided to buy one four years ago for $850, she said, after reading positive reviews.
“I debated buying one for a long time because of the price point,” Franco said. “But I heard about how warm they are so I eventually went for it and I’m really glad I did. It’s so warm and I’m on my fourth winter with the coat.”