Di$count Universe

Luxury Brand in a Postmodern World

Michael Beverland

Business Case
Source: Bloomsbury Fashion Business Cases
DOI: 10.5040/9781350996007.0012
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Abstract

This case examines New York-based Australian fashion brand Di$count Universe, a small luxury fashion label founded in Australia by Cami James and Nadia Napreychikov on three key beliefs: that anything goes in postmodernity, that authenticity is suspect, and that online communities can help nurture a brand. The brand attempts to up-end luxury conventions with outrageously loud clothes, a refusal to sell at retail, accessible pricing structures, and the use of aggressive messaging. With a focus on social media, the company have developed a large and engaged fan base. Starting in 2014, celebrities including Miley Cyrus, Rihanna, Katy Perry, and Kylie Jenner have been photographed wearing Di$count Universe items. These unpaid endorsements and a fanatical online community spurred the company to move to New York City. The move provides the context to explore brand challenges, possibilities for further growth and development, social media endorsement, and the evolution of an avowedly punk brand. However, the city has also posed challenges for the small company: How can the brand grow and move to a more mature phase without undermining its roots? Students are asked to analyze brand identity, brand positioning, and strategies for future growth for Di$count Universe.


Learning Objectives

Upon completion of this case, students should be able to:

  • Define Di$count Universe’s brand identity and brand position in relation to its competitors.

  • Describe the users of Di$count Universe merchandise and reasons for their connection with the brand.

  • Examine the advantages and disadvantages of the brand’s position and identity.

  • Evaluate how positioning drives all aspects of a firm’s business approach.

  • Analyze the challenges for new social media driven brands looking to build longevity.

  • Recommend strategies for future growth of Di$count Universe.

Introduction

Di$count Universe is a small luxury fashion label founded in Melbourne Australia by Cami James and Nadia Napreychikov. The pair met in 2009 while studying at Melbourne’s RMIT University on the fashion honors degree and quickly realized they shared similar interests. As part of their studies, they were required to explore a particular context, usually a runway show or museum collection depending on whether they wanted to take a more commercial or artistic focus. Instead the pair chose to explore the role of the internet on fashion, with a particular emphasis on blogging (which both were engaged in at the time). Apart from sites such as Etsy, at this time the web was not seen as a viable channel for new fashion brands or student designers. Web 2.0, and the ability to interact with fans through this medium, had yet to take off and Instagram had not yet launched (Singer 2016).

Cami James first came up with the concept of Di$count Universe in her dissertation, in which she promulgated the belief that anything goes in postmodernity, that authenticity is suspect, and that online communities could help nurture a brand and shake up what she saw as an elitist industry. Even the name of their luxury fashion label, “Di$count Universe,” provides a direct contrast to the names of other luxury fashion labels and thus demonstrates a desire to be authentic. The brand’s manifesto emerged from their studies and continues to define the brand:

DI$COUNT operates on the assumption that in the post-modern world, nothing is new, and re-appropriation is vital to an honest and transparent approach to design. Through this subversion of, and fucking with the fashion system, the DI$COUNT designer’s output is steeped in humor and irony, cliché and imitation. (Di$count Universe 2018)

The reappropriation mentioned in the manifesto above involves subverting the tradition fashion system by being overtly anti-seasonal (Singer 2016) and refusing to remove older items from the website, through to outright copying of mainstream brands, such as their rip-off of the Moschino choker. However, it is the loud designs that reflect the manifesto the most, with examples shown in Figures 1 and 2. As Nadia and Cami state about the brand and their anti-seasonality:

It’s obviously excessive in style … it’s anti-industry, that’s part of the DNA of the brand. There’s a lot of messages and certain innuendo and humour in the brand.

Clothes aren’t just made seasonally to go out of fashion the next season, If something has resonance with people over and over again we will keep releasing it. (Singer 2016)

Figure 1. A Di$count Universe model wears a bodysuit. Slogans include “Hysteria,” “Not for Sale,” and “Goddess of War.”

A Di$count Universe model wears a bodysuit. Slogans include “Hysteria,” “Not for Sale,” and “Goddess of War.”

Photograph: Frazer Harrison/Getty Images Entertainment/Getty Images.


Figure 2. A model walks the runway for Di$count Universe during New York Fashion Week 2018.

A model walks the runway for Di$count Universe during New York Fashion Week 2018.

Photograph: Frazer Harrison/Getty Images Entertainment/Getty Images.


The pair set up a blog in 2010 in order to research whether the online world could be used as a legitimate place to display their garments—before this time fashion shows and galleries had been considered the only legitimate spaces in which academic fashion could be displayed. The blog, and Nadia and Cami’s clothes, quickly generated a large fan base so Nadia and Cami consequently launched the brand. Di$count Universe’s fan base were known for being incredibly engaged, with many writing posts or comments of considerable length about each product and release.

The brand gained a steady following until 2014 when Miley Cyrus was photographed in one of their tops, at which point the popularity of Di$count Universe took off. The photograph of Cyrus wearing Di$count Universe was printed on her Bangerz tour t-shirts; the awareness and licensing fee gained from this launched the brand onto the global stage. The brand and Cyrus would eventually fall out over claims that the music star had ripped off their look (Grounsell 2015).

Further adoptions by stars such as Rihanna, Katy Perry on her Prismatic world tour (Clark 2016), and most recently Kylie Jenner (photographed in the brand’s sequined bikini during the 2016 Coachella festival, see Andrews 2016) have not only driven sales but have also built such a large awareness of the brand that Nadia and Cami were able to relocate their offices to New York in 2017. The pair hoped that this new office would enable them to take advantage of a larger market and a natural target user base, and would also provide them with closer links to entertainment icons; Lady Gaga, for example, had previously asked for a dress just two days before the Oscars, which Nadia and Cami were not able to fulfil due to their geographical distance (Syfret 2016).

Business Problem

The popularity of Di$count Universe has been built around unpaid endorsements from high profile female musicians and a fanatical online community (Syfret 2016). The brand’s Instagram page (their main social media outlet and gateway to their webstore) has over 200,000 followers from over eighty countries and is Nadia and Cami’s main form of communication; Di$count Universe fans are encouraged to post images of themselves in the brand’s clothes on this page (Singer 2016). The pair do not police the site at all and allow anyone to post, although they do step in if comments become negative about body image. This community-based approach juxtaposes the elitism so often seen within the luxury fashion industry, where only a few individuals are lucky enough to be selected to attend shows and launches. The brand is defined as grassroots and being pushed on by the people (Singer 2016), so much so that fans are given priority access to Di$count Universe fashion shows, which often resemble rock concerts in their set up and emotional intensity (Mercer 2018). In contrast with traditional fashion shows, Di$count Universe shows are like lavish parties: decadence is encouraged, as is cheering, and content is available to any fan who wishes to blog, post, or tweet about the collection.

In only six years of operation, Nadia and Cami managed to create over 1,000 garments; they presented these as a retrospective in Australia in 2016, a seemingly strange decision considering the age of the brand. The two stated that this was to mark them being able to have everything in Australia for one last time before leaving for New York (Syfret 2016). Despite suffering some financial difficulties in the early years of the brand, Nadia and Cami had previously refused investor money in order to remain independent within the ownership of Di$count Universe. Nadia and Cami had saved nearly everything that they were capable of earning from 2010 in order to fund further expansion of the brand’s operations in New York. These goals for expansion included workspaces, show rooms, and specialized marketing and public relations staff within the newly established New York office (Singer 2016).

Both Nadia and Cami still design the collections, though they do now have to rely on the help of interns, and sales remain primarily online with only a few small retail partners, such as Liberty of London, stocking them. This strategy is a deliberate way of protecting margins, controlling sales, and ensuring control. For the luxury category, Di$count Universe’s prices are low and range from less than US$50 through to US$400 for larger pieces, although the pair also offer a made to measure service for select clientele that is priced much higher (Di$count Universe 2018).

Despite this success, moving to New York presents big challengers for the new brand. Many of the musicians the brand relies on for support also wear a wide variety of competitor brands; stylists for high-profile internet celebrities are constantly trying to find new looks due to the need to post at least two images a day on Instagram sites, and thus search through fashion design schools and the websites of a range of similar, new-wave street-based luxury brands such as Vetements, KTZ, Hood by Air. The pair attempted to gain representation in New York following their adoption by Lady Gaga, however, they struggled to find the right publicist and retailer to take them on. Now that they have relocated to New York, Nadia and Cami plan to continue to sell direct to consumers via their web-shop, rather than searching for a retailer, and have ten-years’ worth of experience to build upon. Nonetheless, the niche occupied by Di$count Universe is a crowded one, and the costs of running high-profile shows in New York are immense. The pair believe there is no limits to the growth of the brand but also wonder how to move the brand on to a more mature phase without sacrificing their fanbase.

Business Questions

  1. Identify three words or phrases that define the brand. What position does this brand occupy in comparison to its competitors?

  2. How is the brand’s identity reflected in the firm’s marketing, including their communications strategy, product designs, endorsements, and distribution?

  3. Who is the brand’s user? Develop a short profile of the customer and identify why these might connect to the brand at an emotional level.

  4. Identify competitors for the brand. What sets Di$count Universe apart from these players? To help, think about what is necessary to compete in a luxury fashion category and draw up a list of points of parity (those things one must have to be legitimately considered luxury) and points of difference (unique aspects of Di$count Universe).

  5. The brand is built on an anti-establishment position and is often defined as “punk in spirit.” What are the advantages and disadvantages of such a position?

  6. What is the future direction for the brand? In particular identify other aspects of “anti-establishment” the brand could leverage and how it can move the brand on without undermining its roots? What should the brand avoid doing?

Extended Teaching Notes

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References and Further Reading

Find in Library Ahmed Osman and Jan-Nico Meyer. 2017. ““The Aesthetic Blender” .” The Business of Fashion, Special Report 10: 70–72 .

Andrews Jessica. 2016. “You Won't Believe Who Stepped in to Defend Kylie’s Coachella Outfit.” Teen Vogue, April 21, 2016. Accessed November 29, 2018. https://www.teenvogue.com/story/kylie-jenner-coachella-outfit-copy-discount-universe .

Clark Jenna. 2016. “Discount Universe Move on from Miley Cyrus, Focus on their Fashion and Fans.” The Sydney Morning Herald, May 14, 2016. Accessed November 29, 2018. https://www.smh.com.au/lifestyle/fashion/discount-universe-move-on-from-miley-cyrus-focus-on-their-fashion-and-fans-20160512-gotydo.html .

Di$count Universe. 2018. “About us.” Accessed November 29, 2018. https://www.discountuniverse.com/pages/about-us .

Grounsell Lauren. 2015. “‘We’re Obviously Distraught’: Australian Brand Slams their Former Number One Customer Miley Cyrus for Ripping Off their Signature Designs for VMAs Costumes.” Daily Mail, September 1, 2015. Accessed November 29, 2018. https://www.dailymail.co.uk/femail/article-3217808/Miley-Cyrus-VMAs-costume-angers-Discount-Universe-brand.html .

Mercer Emily. 2018. “Discount Universe RTW Spring 2019.” WWD, September 8, 2018. Accessed November 29, 2018. https://wwd.com/runway/spring-2019/new-york/discount-universe/review/ .

Singer Melissa. 2016. “Discount Universe Farewell Australia with an Exhibition of Star-Spangled Glamour.” The Sydney Morning Herald, November 25, 2016. Accessed November 29, 2018. https://www.smh.com.au/lifestyle/fashion/discount-universe-farewell-australia-with-an-exhibition-of-starspangled-glamour-20161125-gsxdgj.html .

Syfret Wendy. 2016. “Di$count Universe on Their Very Early Career Retrospective.” i-D, November 24, 2016. Accessed November 29, 2018. https://i-d.vice.com/en_au/article/3kbwx8/dicount-universe-on-their-very-early-career-retrospective .

The author(s) wrote this case solely to provide material for class discussion and independent learning. The authors do not intend to illustrate either effective or ineffective handling of a situation. The comments and interpretation presented are not necessarily those of the company or its employees.

This case has been written on the basis of published sources only. The interpretation and perspectives presented in this case are not necessarily those of the company in question or any of its employees.

Definitions

Web 2.0:

A term that first came into popular use in 2004 to define the transition of the internet from a search-based tool to a collaborative system. YouTube, MySpace, and Facebook are example of the transition to Web 2.0.