Bright side: A new generation of brands is spanning the space between high-end and high street

They're chic, playful, affordable – just don't call it 'diffusion', says Rhiannon Harries

Just as presenting a special-offer voucher at a restaurant in which you couldn't otherwise afford to dine can take the shine off the whole experience, there was once a time when procuring a piece of your favourite designer's handiwork involved a depressing level of compromise. Months of saving might culminate in meekly selecting the cheapest item on offer. A useless miniature clutch bag, perhaps. A key fob even, if we're talking Prada. Wilfully ignoring your folly, you'd proudly premiere your slender spoils, only for the woman next to you at the bar to plonk her behemoth of a bag, obviously from the top of the same range, casually at her feet.

For a couple of decades, there has been a third way in the shape of the designer diffusion label. It's just that that third way was previously paved with flashy logos, checks and monograms and rendered in cheapo synthetic fabrics. Polo shirts, T-shirts, sports bags and other accessories put out under the auspices of big labels seemed to have little to do with the clothes that formed the high-fashion core of the brand.

All that is changing at a brisk pace. Anita Barr, head of womenswear at Selfridges, agrees that there has been a marked shift in what designers are putting out there in the name of diffusion and how we in turn are responding to it. "The past two seasons you've really seen the impact of this new generation of diffusion brands," says Barr. "New lines such as Alice by Temperley and McQ from Alexander ' McQueen have done phenomenally well for us. Alexander Wang's T-shirt collections have also been a massive success."

"I think it's because these labels are no longer watered-down versions of the main collections," she continues. "Of course, you still need some of the key elements from the main collection that the customer will recognise – the embellishment of Temperley, say, the drapery from Wang, or the cut of Alexander McQueen – but what they have now is their own design identity, which is why they have come back so much stronger since the old diffusion labels of the 1990s."

Certainly the excitement surrounding recent launches, among them Boutique by British brand Jaeger and Heritage by the revived 1970s New York label Halston, suggests that these mid-range collections are hitting a particularly relevant spot at the moment. The buzz began to build months before Net-A-Porter became the first e-commerce outlet to stock cult French designer Isabel Marant's Etoile line, a lower-priced collection of basic items, earlier this year. The collection has been available for some years in France, but that is perhaps no surprise since the French have always led the way in chic, mid-range labels – diffusion or otherwise.

Sarah Curran, CEO and founder of My-Wardrobe.com, cannily spotted the potential of the new genre of diffusion label when the site was conceived back in 2006. Its success has been built on a judicious selection of ranges such as Paul & Joe Sister, D&G and Anglomania by Vivienne Westwood. "At that time, there wasn't really a retailer occupying that middle space, but it was something I believed in because not everybody – very few people, in fact – have the disposable income to buy pieces from a main collection, so our focus has always been about 'bridge' brands," Curran explains.

"Obviously, in a recession that becomes more relevant because even people who bought designer in the past are looking for a realistic way to stay in touch with luxury. But it works in different directions – for designers, diffusion was originally a way to open up their brand to a wider audience."

Curran agrees, however, that consumers nowadays are too design-savvy to accept the uninspired wares that used to pass for diffusion lines: "I think D&G is an excellent example of the total repositioning. Until five years ago that line was under license and it had become something that was really nothing to do with the main line.

It was heavily logo-ed, a lot of denim, streetwear almost, which is so different from the glamour and polish of the ' brand – chalk and cheese. So they brought it back in-house and under the control of Domenico Dolce and Stefano Gabbana. Now it's incredibly desirable – fabulous bags, shoes and incredible jackets. It's the perfect example of making something more accessible price-wise, but keeping it in a luxury space. Diffusion labels are not a poor cousin anymore."

In fact, so keen are designers and retailers to move away from the old categories, that most prefer to avoid the "d" word when christening these new lines, either giving them an entirely different name or referring to them as a "weekend" collection. The industry term is "bridge" brand, a word that better reflects the new, dual status of the ranges in relation to the main collection as linked but separate entities.

Curran points out that Miu Miu was originally a type of diffusion line for Prada, although the cachet it has acquired (and its prices) mean few would ever call it that.

In some cases, the lower prices and appeal to a younger consumer produce a more playful aesthetic. "Designers can be a bit more adventurous, so you get the same handwriting, but with a few more quirks. It's fun, but with all the design integrity and quality you'd expect from a high-end label," says Barr, who cites Marc by Marc Jacobs as a prime example and arguable template for others since its launch in 2001.

Among the items available in Jacobs' lower-priced line are the now-iconic "mouse" pumps – ballet flats complete with eyes, whiskers and tail drawn – and plentiful nylon bags emblazoned with off-beat illustrations. At the Marc by Marc Jacobs store in London's Mount Street you can get in on the action with only a quid to your name thanks to his cute lipstick-shaped pens and friendship bracelets. All of which have been phenomenally successful – not to mention lucrative – without damaging the kudos of his other work one bit.

Alice Temperley, who this year added Alice by Temperley to her eponymous mainline, says that she too wanted to have a little more fun with her new label. "Temperley London is about investment pieces, whereas Alice is all about easy to wear staples for rock'n'roll, city girls," she says.

"It's by no means limited to that younger consumer, though," says Barr. "You have women who can and do buy high-end picking up such as the Wang tees to mix into their look."

Curran agrees: "It's not just a price thing. I love Alexander McQueen, for instance, but even if I could afford it, it just wouldn't suit my life to wear it every day."

She admits that brands such as Anglomania and Moschino Cheap and Chic are, though more affordable than their "big sister" labels, stronger on the "chic" side of things than the "cheap": "You do get some pretty hefty prices, I'm well aware of that. But if you love fashion and clothes, then what you are getting is two or three items of designer-quality clothing, including substantial pieces such as dresses and coats, for the price you would have had to pay for one small thing from the main line."

No escaping some sort of compromise, then. But if it means living on baked beans for a month in order to end up with a couple of great outfits as opposed to a postage-stamp sized clutch, it doesn't sound like such a bad one.