A few days ago the world of luxury was (positively) shocked by the publication of the 2016 financial statements of one of its flagships, Kering. As LVMH and Hermés, even the multinational-led by François-Henri Pinault, shows flattering numbers. Apart from a slowdown and saturation of the high- end compartment. 12.38 billion of Euros in cash, 6.9% more on 2015. “Despite an industry that is changing,” says Pinault, “there are spectacular performances from Gucci and Yves Saint Laurent” that have grown in the year respectively by 12.7 and 25.5% (Gucci, note, + 21.4% last quarter). In this “spectacular” context, Bottega Veneta situation does not align with the other successful brands. In the last 18 months, the company lost 8.7% of its sales. What’s happening? Luxury has changed, Bottega Veneta probably not so much. As Jean-François Palus, Group Managing Director explained during the presentation of Kering financial report: “From 2005 to 2015 Bottega Veneta has generated annual average growth of 23%, exceeding the turnover of one billion euro. However, the combination of several factors has contributed to its current weaknesses as, for example, the decline of tourist flows from China. “Bottega Veneta – continues Palus – is a brand of high exclusivity and we must reiterate this identity, producing the most top quality items in line with consumers seeking luxury. However, a ” revamp of collections of leather goods, footwear and ready-to-wear is needed”. The brand trademark, “the braided” needs to be re-developed into new forms and styles to meet the demand of the “the extreme loyalty base of our existing consumers as well as attracting new ones”. A refresh should also be given to the communication with a focusing on digital.” An ambitious challenge which falls on the shoulders of the new Bottega Veneta management, new CEO, Claus-Dietrich Lahrs.
Kering: Gucci does not stop growing, Saint Laurent outdo expectations while Bottega Veneta struggles for 18 months in a row
