When you allocate your capital for your future, perhaps where you are invested is not taking account of unexpected change.
Here are 2 stories. The first, “Can Amazon upend the luxury sector?“
“If they decide to have a real go, they may get somewhere given they have so much talent, capital, and logistics and delivery expertise,” said Mr Court. “But if you don’t have Gucci, Saint Laurent, Prada and Dior, then it’s hard to be a real destination for luxury shoppers. You need the brands you can find on Avenue Montaigne in Paris.” The key focus is on how relentless Amazon can be. Here’s the point. Why do people buy luxury items? People buy luxury goods for a variety of reasons; nearly all of these reasons are related to the strong emotions that we attach to the purchase of expensive material goods. In some cases, low self-esteem can be a factor that influences whether or not a consumer purchases luxury goods, especially if they can not easily afford the cost of luxury items. For some consumers, a luxury good can go a long way in increasing self-esteem or providing a sense of belonging. A sense of accomplishment is another reason why some people buy luxury goods. They want to reward themselves for their hard work by treating themselves to something they typically could not afford.
People may not really care about the point of sale as much. This is where Amazon may change the future in this market. If they do, how does this impact how you invest? And who would have expected this?
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Is it possible something so traditional could be upended? It shows no existing business is sacred. In fact, that’s the way it should be. Businesses should die to allow others to be born. It means investors do need to think more about how they allocate their capital for their futures in the face of fast change. What are you doing with your money?