Compared to its competitors, Ferragamo didn’t push sneakers. The Italian brand, point out Retviews analysts, has more accessible prices (specifically for accessories), which could be a lever to attract younger consumers. Beside from the strategies being defined by the new CEO, Marco Gobbetti for the start of 2022, Ferragamo’s semester closed with revenue up by 44.1% on yearly base. The data is in line with analysts’ expectations, equals to -20% the amount of 2019. The pandemic’s effects are still impacting performances. Leather goods beat footwear.
The value of accessories
According to Retviews, Ferragamo must focus on footwear and leather goods (as together they make up nearly 90% of all revenue), but there are challenges to face. The digital one, for example. Retviews sees it as an opportunity (to reach new customers), but it can also be a threat that can destabilize the most loyal customers. Another challenge consists in generating more sales. The brand’s strategy seems to focus on putting goods on the market for a lower price, compared to its competitors (Retviews compared them with Bally, Prada and Gucci).
Salvatore Ferragamo announced its preliminary revenue for the 1st semester of 2021: 524 million euro (+44,1%). An amount in line with analysts’ forecasts, but still 20% below that of the same period of 2019. Yet, it must be said that the brand only had 53% of its stores operating at full regime as of June 30th, 2021, due to the restrictions from the pandemic. Sales during the 2nd quarter of 2021, on the other hand, went up by 91.3% on yearly base, and business continued to show solid growth during the month of July in the USA, China, South Korea and South America, compared to both 2019 and 2020. Ferragamo pointed out that the posted revenue excludes the perfume division, for which activities will be licensed out to Inter Parfums starting in October.
Footwear sales increased by 40% to 223.2 million euro, or 42.6% of the total revenue. Leather goods sales increased by 48.5%% to 235.4 million euro, or 45% of the total revenue.