Following a couple years of stratospheric surges, sales at Kering star Gucci have begun to plateau.
Revenues at the Italian fashion house rose 10.7% during the third quarter on a comparable basis, to 2.37 billion euros, which topped consensus bets of an 8% increase. However, the brand’s growth was lower than the 12.7% bump recorded in the second quarter —and far below the 35.1% increase seen during the same period last year.
As Gucci’s sales continue to slow, Bottega Veneta has emerged as the luxury conglomerate’s rising star. Despite taking a hit in the Asia-Pacific region due to exposure in Hong Kong amid ongoing protests, sales at the brand were up 6.9% on a comparable basis to 284.3 million euros, with its retail stores rising 7.5% and wholesale climbing 4.1%.
“We are pleased with the progress of the brand and the great success of the new product introductions for women in handbags, shoes and ready-to-wear that are more than offsetting the downtrend of the previous collections,” said CFO Jean-Marc Duplaix in a statement. “The response from both existing and new customers is very enthusiastic, especially with local clientele in Western Europe and North America.”
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He added, “We expect the house to gradually return to the status it deserves within our ensemble of brands.”
Kering cited Bottega’s new leadership as one of the primary reasons for its ascent. Under new CEO Bartolomeo Rongone, the label has been putting more resources behind speeding up production, accelerating its marketing investments and strengthening its teams.
One such addition to the team was Daniel Lee. The former Celine ready-to-wear director was appointed as the brand’s creative director last July and unveiled his debut men’s and women’s collection for the pre-fall ’19 season. Since then, Bottega Veneta has generated significant buzz, thanks to the British designer’s millennial touch.
And the Bottega shoes have been particularly impactful: The mesh and square-toed looks from Lee’s initial collection were a breakout hit. And his spring ’20 show — featuring puffed leather styles and the brand’s signature intrecciato detailing — was met with much fanfare.
At the time, Browns Fashion womenswear buying director Ida Petersson remarked, “If Lee keeps moving the silhouettes on like he did today whilst still maintaining that timeless luxury look that he has mastered, then Bottega Veneta is here to stay.”
Overall for Q3, Kering logged a 14.2% revenue gain, or 11.6% on a comparable basis.
“We achieved another strong quarter, and all our segments contributed to our solid top-line gain,” chairman and CEO François-Henri Pinault said in a statement. “Our progress, on top of considerable expansion in the past two years, is healthy and well-balanced across all houses.”
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