Raden. Away. Horizn Studios. Arlo Skye. The luggage market is a $44B opportunity — and each of these new players is hoping to grab a good portion of it.
Let’s assess these brands’ chances:
Travel (lifestyle or job-related) is huge. For the US market alone, the US Travel Association estimates that “Direct spending by residential and international travelers in the US average $42.6 billion a day, $108.1 million an hour, $1.8 million a minute and $30,033 a second”. No surprise here: Travel continues to be a significant part of contemporary life — both leisure and job-related — so Away, Raden, Horizn Studios, and Arlo Skye are clearly tapping into that.
The luggage market itself. Let’s just say it’s big. Just typing the word “luggage” in Amazon gets you 441,000 results. That said, it’s headlined by some serious incumbents, including: Samsonite, TUMI, and Rimowa (in which LVMH recently acquired an 88% stake). Quick note: Given the frequency of their travels, business travellers are likely to be the strongest customers for premium luggage.
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Some things to note about Raden, Away, Horizn, and Arlo:
- They speak directly to the under-40 crowd. Today’s young professionals are on the rise, and more continue to pour into the workforce. Be it branding, messaging, ‘connected’ design, their DTC model, or clever pop-ups, these four upstarts speak a much different language from old brands like Samsonite or even the more luxury-minded Rimowa. This customer base prefers brands that cater to them and their lifestyles. For Away et al. this is a key differentiator.
- That said, some features aren’t exactly necessary. You could make the case that some connected features are a little gimmicky. Being able to charge your phone directly from your suitcase is one thing. But, in the case of Raden, for example, do you really need to have the ability to check the location of your luggage at the airport? Perhaps, but those cases are rare.
- They’re more efficient. Incumbent competitors have dedicated retail locations and supply chains that both weigh on the bottom line and create far-reaching inefficiencies. There’s an obvious advantage then for Raden, Away, Horizn, and Arlo’s in their DTC model, making their businesses more efficient, more agile, and more fairly-priced. True to DTC form, all of these advantages are passed down to the consumer.
- What should be of some concern: Repeat purchases. The suitcase industry by the nature of its product, is one that lacks a high rate of multiple or repeat purchases. You can likely apply this to yourself: Once customers purchase a suitcase or substantial piece of luggage, they tend to stick with it for years. In fact, some figures estimate that people purchase new luggage every 3-5 years. Not the best rate.
- One way to combat the repeat purchase issue: emphasize “travel” over “luggage”. This strategy comes from Away whose co-founders Jen Rubio and Steph Korey are fond of emphasizing that Away is actually a “travel” business, not merely a suitcase brand. As such, they continue to roll out extended pop-ups that feature their products, alongside other brands’ products that tie into this idea of what a traveler needs. It’s a savvy branding turn, one that shouldn’t be surprising since both founders are former Warby Parker and Casper employees — two companies with some of the best branding and marketing moves out there today.
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