Hit by the crisis of the luxury goods market, Valentino ended 2023 on a low note. As the Roman luxury label prepares to start a new chapter with the arrival of Alessandro Michele as creative director, after parting ways with his predecessor Pierpaolo Piccioli, it has announced sales of €1.349 billion, down 5% (-3% at constant exchange rates) from €1.419 billion a year earlier.

It also reported lower profits, with operating profit (Ebit) at 99 million euros and gross operating profit (Ebitda) at 314 million, both down by 7% compared to 2022. In a press release, the company referred to “a difficult global context for the luxury goods industry.” “In 2023, the luxury and fashion industry faced a series of challenges,” added CEO Jacopo Venturini, who commented on the annual results in a personal e-mail to the press. “Nevertheless, as a company, we have managed to maintain our market position and brand awareness, thanks also to our vision of putting customers and employees at the centre of our values,” he added.

This strategy, together with a rebalancing between the wholesale and retail distribution networks, has particularly enabled Valentino’s sales in its directly managed boutiques, including those of the e-shop, to grow by 3% in 2023. The retail network, including e-commerce, now accounts for 66% of total sales, compared with 62% in 2022. This rationalisation among multi-brand retailers has weighed on wholesale sales, which fell by 12% last year.

Growth in retail sales was driven mostly by Asia-Pacific and Japan, while “Europe had a difficult second half.” Over the same period, “the Americas showed encouraging signs.” He added that offering customers “unique, emotional and immersive experiences” has helped the brand to “consolidate its bond with customers and strengthen their sense of belonging to a community.” As a reminder, sales in the directly-operated boutique channel, including the e-commerce site, were up by 21% in 2022.

Aware of the importance of this direct network, Valentino has focused on its physical points of sale with a new layout concept unveiled at the end of 2022. This concept, developed in-house, was rolled out over the course of 2023 with new openings or re-openings in Geneva, Florence, Avenue Montaigne in Paris, Plaza 66 in Shanghai and Madison Avenue in New York.

Another strategic point is the takeover of e-commerce, which now accounts for 11% of Valentino’s total sales. Valentino has taken over the management of its e-commerce site, which was managed by Yoox-Net-A-Porter until 2022. The transition was on-going until 2023 in the various markets, enabling the brand to accelerate its omnichannel integration. To grow in the online market, whether in-house or with external players and via concessions, and to manage the whole with greater consistency, Valentino has created a unit dedicated to e-commerce and omnichannel. “The aim is to maximise customer interaction and guarantee a seamless customer experience at all points of contact,” he says.

For the rest, accessories continue to dominate the brand’s sales, followed by ready-to-wear. The brand also highlights the good results of other categories, such as perfumes and beauty, managed under licence by L’Oréal, which saw its sales jump by 42% in 2023.

Valentino, which was acquired in 2012 by the investment company Mayhoola, the fund of Qatar’s royal family, sold a 30% stake to the Kering group in July 2023 for €1.7 billion, with an option to increase to 100% by 2028.