Valentino Eyes China Expansion In 2010


Valentino SpA CEO Stefano Sassi Says Retailing Revenue Rose At “Double-Digit” Pace In Last Two Months

华伦天奴SPA CEO Stefano Sassi 说,上两个月的零售收入

Valentino Fashion also includes German suit-maker Hugo Boss AG and licenses for Marlboro Classics and M Missoni.

Valentino Fashion also includes German suit-maker Hugo Boss AG and licenses for Marlboro Classics and M Missoni.

Late last year, the Italian fashion house Valentino SpA announced that China sales of the brands controlled by the Valentino Fashion Group (including Valentino, Hugo Boss and Marlboro) leapt 40% between September and October, powered by new store openings and Chinese consumer interest in Valentino’s popular brands.

Despite the group’s concerns about sustained consumer demand in the Greater Asia region, Valentino SpA CEO Stefano Sassi told reporters in October that his company was committed to opening even more stores, mostly in China, saying, “These are not great times to open shops, but we are going ahead with what needs to be done.”

This week, Sassi appears to have been heartened by figures that show Valentino sales increased at least 10 percent in December and January and has decided to pull the trigger on greater China expansion. According to a BusinessWeek article, Valentino has announced that it is focused on new store construction and building a broad, strong distribution platform in mainland China by 2010 or 2011:

Valentino has five directly operated stores in mainland China and eight in Hong Kong. Having a strong distribution in China by 2010 or 2011 will be “crucial,” Sassi said, adding that the country was the only market growing in 2009.

China will likely become the world’s biggest luxury market in the next five to seven years, Boston Consulting Group said in a Jan. 21 report. Female-led categories, such as bags and jewelry, and “entry-level luxury” prices will drive growth, HSBC analysts Erwan Rambourg and Antoine Belge wrote last week.

As we wrote yesterday, marketing “entry-level luxury” to younger women in first- and second-tier cities, while marketing the higher-end products to a predominantly middle-age, male demographic is probably the best strategy for a brand like Valentino to take in China — although they certainly already know this. Much like the strategy employed by Hermes, which attracts entry-level female customers with their silk scarves and wallets, Valentino’s wider China strategy going forward will probably be very much influenced by female consumer trends there.