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Ferragamo’s sales dropped 7.6 per cent year-on-year to €1.16 billion in 2023, according to the company’s preliminary earnings, as the luxury slowdown hampered its turnaround.
Sales fell across all regions except EMEA, where they rose 3.3 per cent. North America was down 19.2 per cent, APAC fell 13.1 per cent, central and south America were down 7.1 per cent for the full year, and Japan — which has been a fairly robust market for many luxury brands — was down 12.6 per cent.
Retail channels were down 10.8 per cent year-on-year, as the market conditions impacted off-price sales, while wholesale channels dropped 12.1 per cent.
The luxury sector has been reporting a mixed bag of results for 2023: Burberry issued a profit warning in January, blaming weak demand in the US and EMEA. Tapestry has also been reporting a slowdown this year. However, those with a focus on the higher end, such as Brunello Cucinelli and Zegna have fared better. LVMH yesterday reported a 13 per cent increase in revenue for the full year, also bucking the downward trend.
Marco Gobbetti joined Ferragamo as CEO two years ago and has been steering a turnaround of the brand, hiring Fashion East graduate Maximilian Davis to lead as creative director. Ferragamo is still largely in its “transition” phase, according to Gobbetti. Earlier this week, the group named Pierre La Tour as CFO.
“We are conscious of the work ahead of us and remain confident that our strategy will unleash Ferragamo’s potential,” said Gobbetti in a statement. “The complex market environment with the slowdown of luxury demand may impact the timing of our initial assumptions, nevertheless the commitment to our ambition is unchanged.”
He said the company has been progressively increasing the share of new products in its stores, and focusing on a communication strategy that places emphasis on social media. “We have been infusing heat into the brand and, especially at the end of the year, started to see some pleasing signals from new products. We also worked on optimising the network and on the new store concept that will be revealed in the Milan women’s store, reopening in February for the fashion show.”
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