Why Did Moncler Cut Off Two High-End Fashion Lines?

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Plans to invest more energy, strike while hot, filling has become star products of luxury down jacket.

According to the world clothing and shoe net, recently, according to the latest statement released by Moncler (BIT:MONC), the brand will be cancelled because of the strategic adjustment.

Thom Browne and Giambattista Valli are responsible for the high-end fashion series Gamme Bleu and Gamme Rouge.

In a telephone interview, chairman and chief executive officer Remo Ruffini explained that the decision was made for brand innovation and sustainable development. The Gamme Bleu and Gamme Rouge series have been launched for more than ten years, and the idea is outdated.

Moncler has been growing for 15 consecutive quarters.

According to the data, in the third quarters ended September 30th, Moncler sales increased by 15% to 329 million euros, and sales in the first nine months rose 15% to 737 million euros, while retail channel sales rose 19% to 478 million euros compared with the same period, and wholesale sales increased by 8% to 259 million euros over the same period.

The picture shows the Moncler Gamme Rouge 2018 spring summer series, designed by designer Giambattista Valli.

The picture shows the designer Thom Browne and Moncler Gamme Bleu 2018 spring summer series.

Sustained strong growth in performance has largely benefited from down jacket products, and Moncler's annual sales expanded nearly 10 times in 15 years.

Moncler, founded in 1952, originally focused on outdoor mountaineering products such as tents and sleeping bags.

In 2003, after being acquired by Remo Ruffuni, a fashion family, it gradually became fashionable and formally entered the luxury industry. At that time, the brand had annual sales of only tens of millions of euros.

In fact, behind fashion lovers' purchase of luxury down coats as an investment, capital is aware of this trend earlier.

It is worth noting that Remo Ruffuni is another CEO of Moncler, the president and chief executive of Carlyle capital, a private equity fund.

Carlyle capital, a far sighted capital, predicted the popularity of luxury down products, and its latest move was to buy half of Supreme's stake in 500 million dollars.

After buying Moncler, the first step of Remo Ruffini is to recover all agency rights outside the brand, and it is clear that Moncler will use down garments as the core product while expanding new product categories, including summer clothing.

The second step is to improve the fashion of Moncler products. In 2006, Remo Ruffini invited Valentino original creative director Alessandra Facchinetti to launch the high-end product line Moncler Gamme Rouge Line for the brand, and the 2009 high-end men's wear Gamme Gamme was formally launched.

In order to get more recognition from fashion people, Moncler frequently shows up in Paris fashion week and Milan fashion week.

At the end of 2013, Moncler was successfully listed on the Milan stock exchange.

Over the past few years, Gamme Rouge and Gamme Bleu have entered the regular schedule of Milan fashion week and Paris fashion week. Remo Ruffini also expressed satisfaction with the sales performance of the two, and did not disclose the specific sales data of the two series.

But Moncler's response to the capital market also illustrates some problems.

In 2015, Moncler's performance exceeded market expectations many times, stimulating the stock price to rise by more than 50% in the first four and a half months. The majority shareholder Eurazeo sold Moncler3.34%'s stake, cash in about 208 million euros, earning 188 million euros.

At that time, Virginie Morgon, deputy chief executive of Eurazeo, said that the strong and sustained growth of Moncler proved that the brand still had great potential for development and said that the sale of shares was a regular adjustment of the group portfolio.

In 2016, Remo Ruffini also reduced its cash holdings. It has proved that the capital market has gained substantial returns from the rise of Moncler and luxury feather.

Remo Ruffini emphasized that the abolition of Gamme Bleu and Gamme Rouge series does not mean that Moncler will abandon the fashion industry, but rather relies on the brand itself to enhance the fashion.

When asked about the detailed plan, Remo Ruffini revealed that Moncler has embarked on a new project since February this year, and is very innovative and will bring new surprises to consumers.

The picture shows Moncler 2017 autumn winter advertising blockbuster.

In addition to Gamme Bleu and Gamme Rouge series, in recent years, Moncler has also launched exclusive capsule series with Alexandre Mattiussi and other designers, and has co worked with Leica, Rimowa and other luxury brands. Its latest glasses licensing business has also been actively reflected in the market, creating additional revenue for the brand.

It is reported that Moncler's latest innovation has once again attracted the attention of the industry. For the first time, the brand has introduced a mini feather clothing series for pet dogs, priced between 370 US dollars and 450 dollars.

Luciano Santel, chief business officer of Moncler, has pointed out that the brand will invest more in digital and social media marketing in the future to promote communication between brands and consumers.

He also revealed that with the gradual cooling of the weather, Moncler10 month sales have increased significantly, and it is expected that the sales performance of Moncler in November and December will continue this positive trend.

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Mario Ortelli, director of luxury industry at Sanford C.Bernstein consulting, said that Moncler is one of the few companies that are still growing in the luxury sector, and pointed out that there will be room for further development after the brand entered the 1 billion euro club for the first time last year.

Another brand that benefits from the rise of luxury feather is Canadian brand Canada Goose.

Canada Goose, known as the "fashion Land Rover" by the industry, landed in Toronto and New York stock exchange in March this year.

In the second quarter of September 30th, sales of Canada Goose surged 34.7% to 172 million yuan, or about $135 million, and net profit surged 85% to 37 million 120 thousand yuan, up from 29 million 240 thousand yuan a year from the same period of last year, with a gross margin of 50.5%, which is higher than analysts' expectations.

In the first quarter, Canada Goose sales surged 44%.

Similarly, Canada Goose is also favored by capital.

In 2013, Bain Capital acquired a stake in Canada Goose 70%, while Dani Reiss, the founder of the brand founder, retained a minority stake.

In March of this year, Canada Goose officially landed on the stock exchange of New York and Toronto, and the stock price code was GOOS. The opening stock price rose by 40%. The first day of listing was raised by US $255 million.

Analysts at Wells Fargo and Instinet in Wall Street later gave a positive assessment of the brand's market prospects and expect its shares to outperform in the next year, up to 18.74 to 19.49 dollars per share.

The analysis indicates that as the domestic demand of the brand continues to grow steadily and the demand for foreign trade soars, its sales will be double digit growth this year, and the target will reach US $1 billion in three years.

Obviously, according to the current situation, luxury down garments will continue to rise.

In the past, due to seasonal and weather factors, a little warmer was affected by the down jacket products. Nowadays, "Moncler" and "Canada" Goose do not need to look at the old man's face because of the "luxury" and "fashion".

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