Mytheresa Aims to Be ‘Winner’ of Luxury eCommerce Downturn
If the luxury eCommerce space is tumbling down, Mytheresa plans to come out on top.
“I think there is an understanding in the market that the industry is consolidating, and that there are some winners and some losers,” Michael Kliger, the company’s CEO, told the Financial Times (FT) Sunday (May 5). “We believe, and the stock market certainly believes, that we are one of the winners.”
The report said the Germany company — which is listed in New York — has seen its stock jump more than 30% this year. While its market value — $362 million — is down sharply from the $2.3 billion it reached when going public three years ago, the FT argued that’s an indication of where investors are putting their bets.
“The valuation we received [at IPO] was sumptuous, generous, maybe was overrated … then we went into a situation where eCommerce started to become a bad word,” Kliger said.
Following a difficult year for both eCommerce firms and the luxury sector, Mytheresa is “pivoting … as a company for sure and as a sector, I have confidence as well,” he added.
Meanwhile, the company’s rivals have struggled. Farfetch was sold to Korean online retailer Coupang in order to escape bankruptcy, while Matchesfashion was put into administration by Frasers Group in March just three months after it was acquired.
Another luxury group, Richemont, has spent years trying to offload its online retail division Yoox-Net-a-Porter.
Meanwhile, PYMNTS last month examined the role trust plays in luxury brands’ relationships with their consumers.
“Luxury shoppers may be willing to shell out quite a lot online for high-quality products, but only if they can trust that they are getting their money’s worth,” that report said.
Despite the challenges facing these high-end retail platforms, their shoppers still want digital platforms from which to purchase premium products online.
Research by PYMNTS Intelligence shows that 67% of luxury shoppers said stores should feature higher levels of digital integration. Additional research cited in the study found that online sales make up about a fifth of all sales in the luxury space.
“Yet while luxury brands and retailers have had centuries of experience in creating immersive, highly curated brick-and-mortar experiences, the digital journey has not yet caught up,” PYMNTS wrote.
“These stores often have elegant interiors, personalized services and attentive staff that contribute to the overall luxury atmosphere. Translating this ambiance to an online environment is challenging and requires innovative approaches to digital marketing and website design.”
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