Valentino, the renowned Italian luxury brand, has managed to overcome the challenges caused by the Covid-19 pandemic in 2020 and bounce back to profitability in 2021. After a net loss of €127 million in the previous year, Valentino has reported impressive figures for 2021, although the exact details are yet to be approved in the financial statements. Both net profits and EBIT surpassed the levels achieved in 2019.
In 2021, Valentino achieved a revenue of €1.231 billion, representing a significant increase of 39.5% compared to the previous year. When considering constant exchange rates, the growth rate stood at 41%, and revenue grew by 3% compared to 2019. The last quarter of 2021 saw a notable 11% increase in sales compared to the same period in 2019. The greatest growth was witnessed in Valentino’s direct retail channel, with sales surging by 29%. December 2021 was particularly successful, marking a historic milestone in terms of sales.
Several factors contributed to Valentino’s positive results. The brand’s increase in full-price sales, the introduction of enhanced personalized concierge services available both online and offline, and a strategic repositioning in the high-end market segment all played a role in its success. CEO Jacopo Venturini has led the brand’s efforts to target a wealthier clientele while also attracting younger consumers. The highest growth rates were observed in Europe, North America, and the Middle East.
Valentino’s direct retail channel has become increasingly significant, accounting for 57% of total sales. The brand aims to expand this channel further and achieve a 70% share by 2024-25. With a presence in over 100 countries through more than 200 directly owned stores, Valentino is already well-established. In 2021, the brand opened 15 new stores and plans to open 21 more in 2022, particularly in China, Asia, and Europe. The brand’s e-commerce platform also experienced remarkable growth, with its revenue share increasing from 5% in 2019 to 16% in 2021. Online sales saw double-digit growth in 2020 and triple-digit growth in 2019. In response to this success, Valentino decided to bring its e-tail operations back in-house, transitioning from its previous outsourcing arrangement with Yoox Net-a-Porter starting in February.
Valentino has also implemented strategic changes in its wholesale channel. In 2021, the wholesale channel accounted for 41% of sales, a smaller share compared to previous years. The brand currently has 1,600 multi-brand clients worldwide.
Accessories played a crucial role in driving Valentino’s sales in 2021, constituting 66% of total revenue. Ready-to-wear accounted for 32% of sales, with other categories making up the remaining 2%. Notably, the fragrance and beauty lines, managed under a license agreement with L’Oréal, experienced an impressive 97% increase in sales in 2021.
Valentino’s recovery in 2021 is a testament to the brand’s resilience and adaptability. By focusing on key growth areas, strengthening its direct retail and e-commerce channels, and appealing to a wider customer base, Valentino has successfully regained its pre-pandemic levels. As the fashion industry continues to face uncertainties, Valentino’s performance serves as an inspiration for other luxury brands seeking to rebound and thrive.
Useful links:
1. Valentino Official Website
2. Business of Fashion
