The Risks and Rewards of Diffusion Lines

Aries, Commes des Garçons and virtually every major new luxury brand manage diffusion lines. What are they and why do they matter?

Diffusion lines have emerged as a core element of New Luxury as brands establish more accessible and (often) more popular collections than mainline. Examples include CDG PLAY, VERSUS Versace, Dior Homme, Mui Mui, and ARIES’ No Problemo. 

As brands navigate fast shifts in consumer preferences, seasonal market demands and cut-through in a competitive marketplace, diffusion lines offer substantial benefits—particularly where operational strategy, consumer perception, and market reach are concerned.

Diffusion lines offer brands significant benefits, particularly within operational strategy, consumer perception, and market reach.

In this post, we explore how and why diffusion lines have become a core element of the fashion industry. Covering:

• What are diffusion lines?

• How can a brand benefit from launching diffusion lines?

• Examples of success

What are diffusion lines?

The concept of diffusion lines was popularised as early as the 1960s, with some of the earliest market successes attributed to Yves Saint Laurent and Ralph Lauren—the latter through the extremely successful Polo Jeans Co. that grew synonymous with the iconic fashion of the 90s and continues to be a huge performance driver on the vintage market.

During the 90s, diffusion lines reached the point where they were considered a phenomenon as momentum across the industry accelerated rapidly with the arrival of Calvin Klein’s CK Calvin Klein and Giorgio Armani’s Emporio Armani.

Notable contemporary offerings within the New Luxury atmosphere include Maison Martin Margiela with MM6, Comme Des Garcons’ CDG PLAY, and most recently Aries’ NO PROBLEMO.

For diffusion lines to be successful, they must aim to maintain the desirable elements of the mainline, most notably, the brand’s aesthetic qualities and quality. By referencing the mainline through finishes, details, or colours, coupled with fresh motifs or graphics, diffusion lines effectively diversify the brand’s profile and democratise it for a wider audience.  

In New Luxury, the appeal of diffusion lines hasn’t been lost, with leaders in the space readily adapting their product offerings and market strategies to offer them. 

How can a brand benefit from diffusion?

The most significant benefit of diffusion is an expanded market reach. By offering products at reduced price points–see £490 Georgio Armani jeans vs. £190 Emporio Armani jeans–brands expand their consumer accessibility, allowing a reduced buy-in for customers unable to afford the cost of mainline luxury.

Through a diversified retail presence and market reach, the implementation of diffusion broadens their retail scope beyond in-house e-commerce platforms and luxury boutiques into mid-to-high range New Luxury retailers like END. and FLANNELS. This expansion creates operational complexities–particularly for brands who have (up to that point) been 100% DTC–yet provides the additional benefit of broadening and increasing revenue streams. 

By offering new, more accessible entry points, luxury brands benefit from broader brand awareness, developing loyalty and increased aspiration for mainline products. Add to this that the lower price point of diffusion lines often makes a brand accessible to a younger consumer base (often for the first time), meaning they’re establishing relationships with customers who could be with them for life.

Building out a diffusion line that runs parallel to the aesthetics and identity established within the mainline, serving as an extension of the brand. Allowing for the diversification of their category offerings, styles, palettes, and design elements (such as graphics), bolstering the product range while maintaining synergy across the brand. 

Furthermore, this provides ample opportunity for a brand to innovate and experiment with ideas that don’t fulfil the tenets of luxury; Alexander McQueen’s now suspended McQ being a key example. 

The diversification of revenue streams achieved by launching a diffusion line and seeing it stocked at variable market levels has additional operational benefits, specifically back-in-stock subscribers.  

Back-in-stock (BIS) subscribers describe consumers who have signed up or subscribed to back-in-stock alerts for specific products. These indicators, offered by e-commerce platforms within diffusion lines, allow brands to gauge consumer interest levels. Brands can buy stock with a high degree of certainty that it’ll sell through, effectively driving profitability performance and averting the risk of over or understocking.

See Represent Owners Club as the perfect example of this—the popularity and demand around the product mean customers subscribe to BIS notifications to ensure they’re the first in line to get the product once it restocks or launches in new and exclusive colourways.

Examples of success.

Many early interpretations of diffusion from luxury brands have found enduring success for decades following their inception, offering insight into sustained consumer loyalty through expanded market reach. 

Emporio Armani

Introduced in 1981, Georgio Armani’s Emporio Armani offered a more casual interpretation of the mainline, encompassing apparel, accessories, and eyewear for both men and women–to date, the diffusion remains a success, with stock held at Selfridges, House of Fraser, FLANNELS, and more. 

Georgio Armani, heralded as one of the most influential and respected designers of his era, conceived an eponymous line synonymous with sophistication and timelessness steeped in luxurious quality; as such, its name is instantly recognisable and owning it begets prestige. Its high pricing, however, would alienate a large consumer base wishing to buy into the brand. 

The success of Emporio Armani is attested to its highly targeted marketing and positioning, which tapped into trend-driven design for a younger audience, a strategy that’s ensured its longevity and cultural relevance. Through an adaptable approach, it struck gold with those looking for a cheaper buy-in that retained the quality, prestige in ownership, and an extremely versatile offering that caters to a larger market segment. 

No Problemo

More recently, ARIES tapped into diffusion with the launch of No Problemo. 

A brand lauded for its ostentatious streetwear-inspired designs, ARIES has built a reputation for its high-quality, carefree, vibrant aesthetics. These two components form the brand’s essence, speaking to its continued success. 

Within its product offering, pieces featuring the now iconic “No Problemo” spellout graphic have continually been a high revenue driver and performance indicator within seasonal collections and third-party retail platforms, with a recurring presence on market-leading platforms like END. and Selfridges.

In comparison to its more outlandish designs, No Problemo pieces lean on simplicity: bold colours, heavy contrasts, high-quality bases, and an aversion to heavy patterns or prints. As such, their commercial performance and accessible designs made them a natural centre point for establishing a diffusion line. 

ARIES’ beloved elements are maintained while No Problemo’s product options have extended beyond a small selection of season items, matched with a reduced point-of-entry for consumers with t-shirts priced at £48, contrasting ARIES’ £70-125. 

By creating a more wearable, affordable, and high-quality buy-in, ARIES finds success in a broader consumer demographic and bolsters the loyalties of No Problemo’s fans.

Represent 247.

A great example of diversifying market reach, consumer demographics, and expanding product categories, Represent’s 247 sits at the core of the brand’s community-led strategy. 

While the mainline has been established (over 10+ years) for delivering on-trend, New Luxury styles for modern menswear enthusiasts, 247 appeals to the growing trend of fitness and fashion crossover, with versatile fitness apparel that maintains the quality of the mainline at a slightly lower price point and marketed through the lens of collective self-betterment.

By appealing to fitness enthusiasts alongside fashion devotees and casual consumers, 247 has achieved enormous cross-market success while cementing itself as a peaking name in the sportswear market, complete with signature branding, collaborations, and visual identity.

Risk vs. reward.

While launching a diffusion line bears potential for success: profitability, revenue stream diversification, extended market reach, brand awareness, stronger retail presence, and consumer accessibility,  it isn’t without risks. 

A common issue brands face making the diffusion plunge is consumer confusion—posing questions such as: is the diffusion line a new brand altogether? Is it replacing the mainline? Will it alienate loyal consumers?

Introducing a diffusion line poses the risk of distorting a brand’s market positioning and established identity. Similarly, this may lead to an assumption that the diffusion line bears lower quality due to the reduced price point, ultimately “cheapening” the brand.

Should the execution of a diffusion line fail, there’s a significant risk of brand dilution in the eyes of the consumer. Typically, diffusion lines produce higher quantities of products and have a more saturated market presence, levelling the potential to damage the mainline’s image or allure, particularly if forecasting isn’t correctly utilised in the line’s initial launch and continued operations.

As the number of brands launching diffusion lines continues to rise, market saturation becomes a palpable concern. Without the use of performance indicators and proper forecasting within the supply chain, brands run the risk of launching a new product into a highly competitive market and failing to capture the attention of a wider demographic, thus requiring a significant effort and financial investment in marketing. 

Finally, offering a cheaper alternative to buying into a popular brand builds the potential of the cannibalisation of sales, as existing consumers may buy into the diffusion instead of the mainline as a more affordable option. To combat this, brands must establish a degree of separation between the mainline and diffusion through finishes, graphics, colourways, et cetera.

In the case of Alexander McQueen’s McQ in 2022, Valentino’s Red Valentino from 2024, and Marc by Marc Jacobs, diffusion was suspended or terminated altogether, thanks in part to brands’ increased supply chain control, but also the dilution and confusion these secondary lines afforded their market identity.

Is diffusion a must?

While establishing a diffusion line may not be essential to successfully operating a New Luxury brand, the potential benefits greatly outweigh the risks. Key players in the current streetwear era, such as CLINTS and Corteiz, have utilised operational elements of diffusion to build efficient supply chains that avoid overstock, fulfil consumer demand, and drive profitability without diversifying or diluting their product offerings.

Given the affordability of these brands’ buy-ins, however, diffusion in the traditional sense may prove detrimental to their financials and consumer relationships. As such, diffusion remains a market strategy that offers its greatest potential benefits to brands operating within the high-end market segment.