But the social network’s advertising revenue grew 18.4% during the quarter.
Analysts say fashion leads Italy’s e-commerce growth—and it’s only going to get bigger.
E-commerce—both at home and abroad—is shaping up to be a winning strategy for fashion retailers in Italy, says Lodovico Marenco, founder of web marketing and e-commerce consultancy, LML Company. In fact, the fashion, accessories and clothing industry is leading sales growth in Italy’s blossoming online retail sector, he says.
“Online retail is a huge opportunity for ‘Made in Italy’ brands to broaden their market,” Marenco says. A major reason for the global success of Italian fashion brands, he adds, is the country’s reputation for manufacturing quality goods, which are exported under the ‘Made in Italy’ trademark. “The quality that distinguishes the production of Made in Italy brands, particularly clothing and footwear, thanks to the web, can find new opportunities of expanding internationally,” he says.
Upcoming research supports Marenco’s claims. A report slated for release mid-April from Milan-based Internet retail consultancy Casaleggio Associates will announce a 30% hike in online clothing sales in Italy in 2011. Marenco and other industry players forecast that exports to other countries will play an increasingly vital role for Italy’s online clothing retailers, alongside a swelling domestic market.
“Fashion is seeing many new players emerging since the big brands opened up to e-commerce,” says senior partner Davide Casaleggio “We have recently seen many companies specializing in clothing and shoes launch retail web sites. Many Italian companies are studying or have implemented a strategy to sell abroad, partly to face increasing competition from international businesses operating in Italy.”
Recent research released by Italian e-commerce consortium Netcomm also named fashion as the leading online retail growth sector in the country. In 2011, Italy’s online fashion sales grew 38% year-over-year, bolstered by such fashion retailers as Yoox.com and members-only sites BuyVIP and Privalia, the report says.
Yoox, a web-only retailer, says its global multi-brand fashion retailing sites Yoox.com, thecorner.com and shoescribe.com account for more than 70% of its net earnings.
Yoox, which says sales in its home market of Italy increased 17.3% to 57.7 million euros ($76.7 million) in 2011 from 49.2 million euros in 2010, is putting a major focus on international expansion, CEO Federico Marchetti, says.
“Yoox.com is a platform of distribution and communication which allows us to be a channel for the promotion of Made in Italy in over 100 countries,” Marchetti says. In 2011 international markets accounted for approximately 80% of total net revenue, he adds.
Yoox says sales at its global online fashion sites increased more than 50% between December 2010 and 2011 to 78.4 million euros. In the U.S.–its leading market, accounting for 20% of its net revenue–sales rose by 41.5% in the same period, despite the unfavorable exchange rate.
As Yoox gets ready to expand its number of online stores from 34 to 50 by 2015, Marchetti says much of that growth will focus on China. With the planned opening of 3 to 4 local language sites in China each year up until 2015, he says, the country is set to become one of Yoox.com’s top three markets within three years. Marchetti says quality control will be a top priority during the brand’s expansion into Asia.
“The thing we will keep a check on most during this growth is the quality of the products,” Marchetti says.
The IRCE $200 early-bird discount expires Mar. 31.