:Benetton Group’s overall relaunch has just started and its two major brands are being overhauled as part of it. Here is the new business model of the brand focusing on consumer needs, faster production rhythms and more frequent product deliveries.
Benetton Group’s new courses just started through the appointment of new CEO Marco Airoldi and the overall redesign and debut of its two major brands–United Colors of Benetton and Sisley–and the opening of a few totally redesigned concept flagship stores. A new business model, more focused on customers’ needs, faster production rhythms and more frequent product deliveries will be key to this evolution.
In April 2014 UCB unveiled its new collection redesign and the debut of its new “On Canvas” flagship store in Milan, parallel to other openings according to the same concept in Nice, Florence, Verona, and soon Moscow. The new masstige collection–made up of about 560 items, 380 of which are for women– wants to be “masstige,” that is fashion minded, designed in Italy with top quality Italian materials but offered at affordable prices. It will offer a new flash collection every two weeks and will include easy to match urban, sophisticated and smart apparel as well as young casual wear, jeans wear, sportswear and accessories. Its cotton/silk knits retail for €29.95; a
lace-like dress is €39.
The new Sisley, positioned in the bridge segment, debuted in February 2014 in Germany, with the opening of the first global flagship store in Berlin. The new collection has a contemporary-meets bohemian cosmopolitan feel and is offered with seven deliveries per season at a very interesting price-quality ratio. Other stores, while all different one from other, have opened according to the new “Rich & Raw” cozy-cool intimate atmosphere. They are located in Padua, Orio al Serio, Rome, Naples, and Venice. By end 2015 there will also be one in Tokyo. In 2012 and 2013 the company started rethinking their business strategies and set the basis for changes that could generate new growth. They expect the year 2014 as an implementing year, while in 2015 they expect the first truly positive recovery signs. The group wants to abandon its less strategic markets and concentrate on 60 markets out the previous 120 ones and focus the activities of the Benetton brand mostly on Italy (40% of its sales), Europe and places such as India, Korea and Mexico. Sisley repositioning started in Germany because it is a high performing market in terms of results, says Martin Beuker, general manager for Germany: “In Germany we closed 2013 with a 17% growth in sales on 2012.” It is a great result considering that Germany is Sisley’s second most important market, counting for about 12% of the brand’s revenues after Italy.
Benetton Group is presently managing more than 6,000 stores, 600 of which are managed directly. The group closed 2013 registering €1.6 billion in sales, about 10% less than in 2012. Some positive signs are already showing up from the beginning of 2014 since the company has registered a 17.7% increase compared to similar selling areas. It registered an increase in margins of similar entity thanks to an increase in the new Benetton store’s traffic (10%) and conversion rate (7%). Already from f/w 2013/2014 the group saw a cut of half of their indebtment to less than €300million. They expect to invest for the next three years a total of €300 million.