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Luxury e-commerce platform Mytheresa continues to sidestep the struggles of its many competitors, with first-quarter revenues up 12 per cent year-on-year on a constant currency basis to €187.8 million. The figure is in line with expectations while building on the momentum of last year.
The Q1 results reaffirmed that the Mytheresa strategy of focusing on high-spending customers and the US market is reaping rewards. The segment of its customer base that it defines as “top spenders” grew by 19 per cent in Q1 (three months ending 30 September).
“The business is really driven by our core focus on the best customers,” says CEO Michael Kliger. “The quarter really underlines that the Mytheresa business positioning is quite different from the rest of the market.”
By contrast, in the most recent quarter, Yoox Net-a-Porter saw revenues fall by 8 per cent and Farfetch by 1.3 per cent, while Neiman Marcus also reported a slowdown.
Mytheresa’s GMV (gross merchandise value) grew 8 per cent to €204.1 million in the first quarter, while gross margin was 42.5 per cent. It reported a 0.4 per cent EBITDA decline year-on-year — already predicted in the last quarter. Kliger ascribes this to heavy discounting. “It is, of course, not good, but [it is a] stark contrast to the triple-digit millions that are lost somewhere else,” he says. “The sector is in a difficult moment with too much inventory in the market… the focus on high-end top customers makes a difference, but we cannot insulate ourselves completely because what we offer sometimes at full price, customers can get somewhere else on markdown.”
The luxury retailer offered discounts of up to 50 per cent during the Black Friday weekend. Kliger reports strong demand, suggesting that the “aspirational customer” (who has been shunning luxury spending during the cost-of-living crisis) may have returned to make the most of the deals.
Gross margin is expected to improve by Spring/Summer 2024 as the inventory situation in the market improves, says Kliger. He also cites the positive impact of Mytheresa’s new distribution centre, launched in September. For the full fiscal year ending 30 June 2024, Mytheresa confirmed its prior guidance on the lower end net sale ranges and GMV growth of 8 to 13 per cent, gross profit growth of 8 to 13 per cent and adjusted EBITDA margin of 3 to 5 per cent.
Europe has remained stable although Asia is still uncertain. “We’re trying to gauge when the right time is to push again,” says Kliger. Mytheresa is planning a big event during Shanghai Fashion Week next April, which Kliger thinks could be “good timing”.
Net sales in the US grew 28.9 per cent in Q1, with the number of top customers up by 56.1 per cent. As with other markets, the US strategy focuses relentlessly around big spenders on ready-to-wear rather than aspirational customers, who tend to invest in accessories or bags. Mytheresa has been building its profile in the US through pop-ups in The Hamptons this summer and in LA in December, with an expansion of its personal shopping teams in Chicago, Arkansas, New York and LA.
Kliger said the US market was boosted by strong capsules from the likes of Loro Piana and Brunello Cucinelli, as well as pre-launches from Alexander McQueen. “We use our personal relationships that we establish through events and pop-ups and maintain through our personal shopping to go after the wardrobe-building customer that looks for inspiration and curation,” he says. “It’s not the customer who wants a Gucci bag, which is more the aspirational customer. It’s the customer who’s saying ‘I’m planning for resort in St Barts or Tulum, so help me build my wardrobe.’ That is a market not well covered by the incumbent players in the US.”
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