MILAN — La Perla is steamrolling ahead with its expansion in Asia with 19 flagships slated to open by year’s end. The additional units will join 22 franchise partnerships and freestanding shops, totaling 41 doors.
This story first appeared in the May 23, 2011 issue of WWD. Subscribe Today.
La Perla, an upscale Italian lingerie and swimwear brand, began assessing the business potential in Asia five years ago. But cultural differences proved to be a challenge at first.
“It was quite difficult when we started out, as is usual when introducing a new type of product onto a market. We faced a lot of skepticism and resistance,” said Andrea Bonardi, managing director of La Perla Asia.
Bonardi said there were several indications it was the right moment for growth.
“First of all, there was a gap in the market for luxury intimates,” said Bonardi. “We are intercepting customers as they discover this new niche and I believe this will create brand loyalty.”
Bonardi went on to describe the evolution of the typical Asian shopper as more luxury brands enter the marketplace.
“Consumers here are becoming wealthier and more and more sophisticated. Interestingly, 50 percent of our clients are between the ages of 20 and 30, and the average age is significantly lower than that of Europe,” said Bonardi.
He added that women have also become an important consumer segment, because of an increased focus on aesthetics.
“Women have spent years spending money on handbags, clothes and beauty products. Now, they are paying more attention to their bodies as well,” said Bonardi, noting that the popularity of cosmetic surgery among Asian women is on the rise.
Bonardi pointed out another advantage for La Perla is the Asian market’s penchant for luxury.
“About 85 percent of our revenues come from the main La Perla line. That number is around 60 percent in Europe,” he said.
Though La Perla stores in Asia tend to be smaller than their European counterparts, they bring in more revenue per square meter. Bonardi said Hong Kong has proven to be a particularly booming market with its five stores bringing in 15,000 to 20,000 euros, or $21,174.90 to $28,233.20 at current exchange, per square meter annually. For the first four months of the year there, sales have increased 60 percent compared with the same period in 2010, he said.
The brand has also tapped South Korea as a strategic market, planning to open two corners with luxury department store Shinsegae in the latter part of the year. In October, La Perla will venture into Indonesia as well, with a store at Plaza Senayan in Jakarta to be followed by another in Plaza Indonesia for 2012.
In addition to five units in Hong Kong, La Perla operates six shops in Mainland China, one unit in Macau, four boutiques in Singapore, two stores in Japan and Vietnam, and single units in Taiwan and Thailand. Sales from Asia, which account for about 5 to 7 percent of total revenues, stood at 6 million euros, or $8.3 million last year. That figure is expected to reach 10 million euros, or $14.3 million in 2011.
Bonardi anticipates Asia’s piece of the pie to grow, but the results won’t be immediate.
“From this point on, we are planning to open an average of five stores per year, and given the non-dynamic nature of this growth, we expect to make a significant impact on total revenues in three to five years,” he said.