Following yesterday’s strong set of trading results, Yoox Net-a-Porter Group chief executive Federico Marchetti speaks exclusively to Drapers editor Keely Stocker about the team he is building and his vision for the future.
Federico Marchetti is in a good mood, and he has every right to be. This week, Yoox Net-a-Porter Group (YNAP) – the new luxury giant formed through the merger of Yoox Group and Net-a-Porter Group last October – revealed that profits were up 26% year on year to €133.1m (£103.2m) in 2015. Revenue increased 31% to €1.7bn (£1.3bn).
“I’m very pleased,” Marchetti tells Drapers. “The two teams have become one dream team, working successfully on both, and they managed to get amazing results. I congratulate them.”
Last month, YNAP announced an internal restructuring, splitting the business into three divisions. Alison Loehnis was promoted to president of in-season, responsible for luxury womenswear etailer Net-a-Porter, its menswear counterpart Mr Porter and Porter magazine. Luca Martines was made president of the group’s off-season business, assuming responsibility for The Outnet in addition to Yoox.com. And Paolo Mascio was made president of the group’s 40 online flagship stores.
All three report directly into Marchetti. He says it is going well so far, but he is not one to rest on his laurels: “I am pleased with the structure, but as a business we are always trying to recruit talent. It’s a continuous evolution – you can never settle in this industry because everything moves so fast.”
Eva Chen, previously head of fashion partnerships at Instagram, and Vittorio Radice, vice-chair of Italian department store chain La Rinascente, were also appointed independent directors of the company.
When YNAP was formed, there was speculation that off-season luxury fashion sites Yoox.com and The Outnet were similar and could merge, especially after they subsequently combined their buying efforts.
But Marchetti insists this is not the intention: “The Outnet and Yoox are very different businesses with a different customer base. They are both in the luxury fashion ecommerce space but require different strategies and mindsets. I expect a very brilliant future for both businesses.”
Two businesses that did not fare so well within the new group structure were multibrand in-season sites TheCorner and Shoescribe, which are due to close at the end of the spring 16 season.
Marchetti explains this was a strategic decision to ensure internal efforts and resources are focused on the right brands: “We closed TheCorner and Shoescribe because it doesn’t make sense to put energy, teams and resource into those two. I’d prefer to invest that resource into our other sites.
”The overlap of customers between The Corner and Shoescribe, and Net-a-Porter and Mr Porter, makes us confident that we are going to retain most of the customers.” The group has plans to further develop Net-a-Porter’s footwear business by building on the experience of Shoescribe.
Since the year-end, the group has signed five-year global partnerships with luxury brands Chloé and Alfred Dunhill to set up and manage both their online flagship stores. Chloe.com is set to launch later this year, while Dunhill.com went live on February 23.
YNAP also renewed a five-year contract to manage Moncler.com with its owner, Industries. Contracts to manage online stores for Pringle of Scotland, Barbara Bui, TRS Evolution, Roberto Cavalli, EZI and Brunello Cucinelli will not be renewed, which together account for 0.6% of the group’s pro forma net revenues.
Looking to the future, Marchetti says in 2018 the group could expand into new markets, but until then it will concentrate on growing its existing operations.
“We can go much faster in terms of growth [in some of these markets],” he says. ”We are in many markets where the potential is higher and we can do much more.”
YNAP will re-launch Yoox.com in the third quarter of this year but Marchetti is reluctant to go into further detail.
He jokes: “That’s like asking Apple to tell you details on their latest launch.” What we do know is that the group has said it plans to invest around €150m (£116m) in technology in 2016 and has already started working with US technology consultancy IBM to bring all of its brands together on a single, shared platform and develop new in-house technology. The latter will cover personalisation, mobile and app innovation, customer analytics and social media marketing.
After a successful start, the group looks set for a busy 2016.
Marchetti confirms it is on track: “The next six months are about keeping everybody all working together. As a team we will make this company a great success.”