Italy’s luxury brands defy economic crisis

Italy’s luxury brands defied the country’s economic downturn to record impressive growth in 2014, according to the latest research by a Milan consultancy firm.

Italy's luxury brands defy economic crisis
Some of the biggest names in Italian fashion, including Salvatore Ferragamo, posted positive revenue growth in 2014. Salvatore Ferragamo photo: Shutterstock

Studio Pambianco said some of the biggest names in Italian fashion, including Salvatore Ferragamo, Tod’s leather goods, cashmere king Brunello Cucinelli and eyewear giant Luxottica, posted positive revenue growth – ranging from slight to substantial – from worldwide sales in the first nine months of 2014.

The Milan-based studio, which specializes in market research and consultancy to fashion and luxury brands, said 11 leading Italian companies had posted total turnover of €12.4 billion in the first nine months of 2014, 1.5% higher than for the same period in 2013.

Profits before tax for these companies totalled €2.6 billion for the first nine months, up 21.4% in 2013.

Research showed that Luxottica, the world leader in eyewear production and distribution, posted revenues of nearly €5.8 billion ( + 2.1%) and Salvatore Ferragamo had recorded €957 million (+4.6%) in the same period.

Prada’s turnover for the first three quarters of 2014 was slightly down (0.9%) but the global fashion giant still posted revenues totalling €2.5 billion.

The research showed the fashion company’s profits remained strong despite protests in Hong Kong, while Brunello Cucinelli’s revenues were up 10.2% to €277 million.

Alessio Candi, a consultant with Studio Pambianco, told The Local that these luxury brands had weathered Italy’s economic crisis better than others.

He also noted the luxury brands had not suffered seriously from the downturn in two major emerging markets Russia and China.

Meanwhile, annual sales were beginning earlier than expected across Italy on Friday in a bid to stimulate sluggish consumer spending, Italian news agency Ansa reported.

According to research by employer group Confcommercio, one in two Italians is expected to take advantage of discounted prices even though consumer spending at Italian sales fell 7.3 percent in 2014, Ansa reported.

Sales with 40 percent price cuts began in the southern regions of Basilicata and Campania on Friday and were expected to begin elsewhere in Italy on Saturday.

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Inside the world of Italy’s designer to ‘the 0.001 percent’

Florence-based luxury designer tells of super-rich customers who shop by private jet, and his experience of dressing the Pope.

Inside the world of Italy's designer to 'the 0.001 percent'
Italian luxury designer Stefano Ricci (C) poses with his sons Niccolo (R) and Filippo, during a preview of his Spring/Summer 2020 collection. Photo: AFP

Italian luxury clothing designer Stefano Ricci and his sons are touring the sumptuous Reggia di Caserta near Naples by horse-drawn carriage as they unveil their latest clothing collection.

The tour the vast gardens at sunset, stopping to sip champagne as models in impeccably-tailored suits in grain yellow, flaming red and galactic blue pose near an ancient fountain.

The grounds of the Reggia di Caserta palace  near Naples. Photo: ANDREAS SOLARO / AFP

The decision to host an intimate preview of their Spring/Summer Collection 2020 at the UNESCO world heritage site, rather than during Milan's frenetic fashion week, is emblematic of a brand the New York Times dubs “Clothier to the 0.001 Percent”.

The Florence-based menswear and accessories brand, founded in 1972, has outfitted celebrities from Andrea Bocelli to Morgan Freeman and Tom Cruise, as well as world leaders like Nelson Mandela, and even Pope Francis.

The latest collection, which features pinstripe suits, colourful knitwear, field jackets and a tux, is named “King for a Day”.

Models wearing Ricci's creations. Photo: ANDREAS SOLARO / AFP

In an era where designer goods can be bought online or snapped up in outlets, Ricci says he offers the world's wealthiest men a personalised experience in buying Made in Italy items created using traditional Florentine sartorial techniques.

“Our customer still needs to experience the emotion, to touch the product. Have it explained to them in person, see the tailor, have his measurements taken, be told a story,” Niccolo Ricci, the company's CEO, told AFP at the preview this week.

“He wants to be pampered for an hour,” he said.

Collected by private plane

“Sometimes we have superstitious customers who want trousers, a suit, shirts for example for important appointments, and given the extremely tight deadlines they give us to deliver the clothes, they send their private plane to get them on time”.

Whether hankering after a 5,050 euro suede jacket or a 1,600 euro silk-and-crocodile baseball cap, the typical client is an “alpha-male”, preferably an outdoorsy type with “a love of antique art”, according to Stefano Ricci.

Stafano Ricci. Photo: AFP

“The Ricci man loves the mountains, the woods, dogs and – I'm not afraid to say it – hunting,” he said.

The bearded designer, 67, a keen hunter himself, says his passion for high-end tailoring is “a virus”.

“When it gets hold of you, you produce more, more, more, until you say 'what the heck can I invent now to better this?'”

His latest challenge? “Creating a material which has a compact structure but is at the same time extremely soft… and luminous, not like polished glass but like the skin of a beautiful young girl”.

“No price limit”

Focusing on the richest segment of society in emerging markets like Russia, China and the Middle East – the brand is about to open a shop in Turkmenistan – has shielded it from factors weighing on sales at other luxury houses.

“We've found there is no price limit if the customer finds himself with a quality product,” Niccolo Ricci said.

READ ALSO: The richest Florence families in 1427 are still rich today

“So even for a suit that costs 25,000 euros, if the customer understands the work that has been done on it, the quality of the fabric, our commitment to sourcing quality raw materials for our exclusive collections, then the customer is on board”.

The 2018 financial year closed with a turnover of 150 million, and the company registered a five percent growth in the first quarter of this year “despite difficulties such as the tariff war between the US and China, (and) Brexit or no Brexit”.

Photo: AFP

“I have been lucky enough to do something I love, to work with my wife, my family, and I've now passed the baton to my sons,” Stefano Ricci says as he stands at the top of a vast marble staircase leading to the royal apartments.

“I design the collections a bit, I give guidelines, I participate in the process, but I'm much more relaxed now”

Among the highlights of his career is a white silk vestment made for Pope Francis in 2015.

“I dressed the pope! I can't do better than that, it's the truth,” he laughs. “I couldn't hope for more”.

READ ALSO: The little-known tax rule that's got the super-rich flocking to Italy