Twice a year, in January and July, fashion aficionados gather in Paris to watch as the latest couture collections are unveiled. Most attendees are looking for cues to coming trends, styles and colours.
Others are there to shop
Buying couture doesn't come cheap, as each custom gown may require hundreds of hours of concentrated effort. Despite their high initial cost, designer fashions can increase in value over time. Buyers with cash to spare pursue couture collections for their investment value as well as their personal appeal.
Can buying high fashion really pay off over the long term? If the idea sounds intriguing, here's what you need to know.
What is haute couture?
By law, the term "haute couture" has a strict definition. Fashion houses designated as "grand couturiers" must appoint a permanent head designer to create a minimum number of original designs, employ a specified number of people and present a set number of outfits, usually in Paris, at the twice-yearly couture fashion shows.
The requirements for haute couture have eased slightly since their creation in 1945, but the list remains an exclusive group with instant brand cachet: think Chanel, Christian Dior and Givenchy.
The garments themselves are made by skilled craftspeople such as lace makers, seamstresses, tailors and leather workers, all of whom may work their entire careers at a single fashion house.
Who buys it?
The price of a couture garment is negotiated and never advertised, but the materials, components and sophistication can push prices into the millions of dollars. As a result, each couture piece is a serious investment, akin to a work of art.
Who are the buyers? Unlike previous decades, when most purchasers were from France's society elite, today buyers also come from China, the Middle East and Russia, places that have demonstrated growing interest in couture and are influencing style globally.
The worldwide market for haute couture is small, estimated at about 4,000 customers. Many of the designers who issue haute couture collections also offer ready-to-wear (or prêt-à-porter) collections that are priced more accessibly than couture pieces, although still at the elevated prices befitting luxury goods.
The market for luxury fashion in Canada is small but occupied by some big names. Perhaps the country's best-known fashion enthusiast is Suzanne Rogers, who since 2010 has brought together her dual passions of philanthropy and fashion via Suzanne Rogers Presents, fundraising events that bring international designers and their collections to Toronto.
Couture as an investment
For the fashion houses who produce it, haute couture is widely understood to be a "loss leader," a product often sold at a loss but used to draw attention to other products. Most houses report no profit on it and in fact may record losses. Nevertheless, couture is often viewed as a long-term investment that will raise brand visibility that spills over, in turn, to the designer's profitable lines, such as ready-to-wear collections and accessories such as handbags, jewellery and fragrances.
For the purchaser, however, a couture piece may in fact be an investment, an asset that, along with real estate, precious metals and antiques, will be uncorrelated to the ups and downs of the stock market. Ready-to-wear pieces, too, can be viewed as investments.
Because luxury brands can hold value and may even grow at a rate that outpaces inflation, allocating a portion of your savings to high-end fashion can make financial sense.
Selling your investment
Those who invest in luxury fashion will likely some day sell it, and this is where auction houses come in. In recent years, Sotheby's and Christie's have entered the world of luxury fashion.
Just last week, an auction of designer handbags at Christie's in Paris set a record, with sales totaling $3.5-million.
The resale value of luxury fashion goods has spawned a strong secondary market, where owners can sell pieces on consignment. One such marketplace is the San Francisco-based website TheRealReal, which is on track to handle an estimated $500 million (U.S.) in sales this year.
In 2014, the RealReal reviewed its database to determine which brands have the highest resale value and which hold their value the longest. At the top of the list were Chanel, Louis Vuitton, Hermès and Cartier; among the weaker performers were Versace and Etro.
Prices are related to how exclusive brands are perceived to be, the site found. Chanel and Hermès, for example, do not hold sales in their stores and have a limited number of outlets, which contributes to a sense that their goods will have lasting value.
Collecting luxury goods comes with risk, of course. Although collectibles can add diversification to a portfolio and provide a hedge against inflation, they are less liquid, meaning investors can't easily buy or sell them in the same way as traditional investment asset classes.
Prices can be volatile as well, as their value is highly subjective and is influenced by personal taste, trends and even by politics, such as if a designer falls out of favour. Finally, transaction costs can be high – an auction house might charge a commission of 25 to 30 per cent.
Protecting your investment
Collectors often store their investments as if they were works of art.
French aristocrat Jacqueline de Ribes, a noted collector of haute couture who has appeared on international "best dressed" lists since the 1950s, once told Forbes magazine how she cares for her extensive collection: "Every garment is enclosed in a blue or black custom-made zippered bag, equipped with a plastic-windowed pocket into which a snapshot of the outfit has been inserted. Affixed to each garment bag are coloured stickers, inscribed with numbers, that give the long sacks the enigmatic appearance of a Baldisseri painting."
Philanthropist Becca Cason Thrash of Houston, for her part, once told the BBC that she preserves her collection in a specially ventilated walk-in closet, "packed with tissue to hold the dress shape or carefully stored fitted on a life-size mould."
Another way to invest in fashion
Fashion fans can also invest in luxury fashion by owning shares of the companies that produce it.
One company to consider is LVMH Moët Hennessy Louis Vuitton SA, the luxury goods conglomerate whose holdings include haute couture house Christian Dior. It reported growth in net profit of 24 per cent for the first half of this year.
The haute couture house Valentino SpA is said to be considering an initial public offering in 2018, based on revenue in excess of $1.5-billion in 2016, with expectations for further growth.