After Gucci, Louis Vuitton; Prada finally sells online in China
Prada realized her mistake in underestimating the importance of an e-commerce site after her contemporaries. Prada said that this well-thought-out measure is to stabilize the company’s profits and also to recover from the declining sales in recent years.
The Internet has quickly become the norm of life, and the one that enters into this spectrum is “ready to wear” and “pretty lines” of luxury brands. These flowered homes see it as a way to bridge the gap between consumers and them by serving the former on a silver platter served with affordability in it. China is one of the largest markets for global brands, from which profits can be made. Gucci, Louis Vuitton, and Bally have already announced their e-retail websites and are also earning high revenues.
The newest addition to the draft horse is Prada, who has made the mistake of understanding the importance of an e-commerce website to its contemporaries. Prada said that this well-thought-out measure is to stabilize the company’s profits and also to recover from the declining sales in recent years.
When Patrizio Bertelli, CEO of Prada, was asked in 2014, “Why not e-commerce?” He responded, saying, “More important things to do, such as opening stores.” Despite the expansion of the business, it could add no value to the profits. The rate of profit fell to 27 percent in 2016, the lowest in the last five years. It’s interesting as Gucci and Louis Vuitton saw a significant increase over the same period.
The CEO has since recognized that Prada was indeed wrong to underestimate and understand the importance of the digital luxury selling market.
Prada’s online website offers a wide range of products. However, digital e-commerce director Tosato has predicted that by the end of 2018, the e-commerce website will account for only 5% of total revenue.