Moncler said it recorded double-digit sales growth in China during June after lockdowns on the mainland ended and the Italian luxury brand was able to reopen stores.
News of Moncler’s summer rally in China came as it reported market-beating sales figures for the six months to June 30.
Milan-headquartered Moncler saw its revenue leap 46% at constant exchange rates to 918.4 million euros ($939.1 million) for the first half of the year from a year earlier. The numbers topped a consensus of financial analysts’ forecasts of 894 million euros.
“Even though the first half of the year was marked by strong macroeconomic and geopolitical instability, we have exceeded our expectations,” Remo Ruffini, Chairman and Chief Executive Officer of Moncler said in a statement.
Several luxury brands have reported a bump from revenge spending, a tendency to splurge after a frugal period among Chinese consumers as they came out of lockdowns across mainland China. The phenomenon has helped merchants recover their financial poise following a sales slowdown during the coronavirus pandemic.
“We will continue to focus on China,” Ruffini told financial analysts in a presentation about the first-half results.
Moncler, whose brands include Moncler and Stone Island, is launching on Alibaba Group’s business-to-consumer digital marketplace Tmall this year.
“We have already started our journey with Tmall with a gradual launch right now in the last two weeks. And then the official one, which will take place on October 1,” he added.
So far, so good said Roberto Eggs, Moncler’s Chief Business Strategy and Global Market Officer, and customers have reacted positively to the soft launch.
“So, there is every reason to believe, if there are no lockdowns, that China could be as positive for us in the second half as it has been for the first half of the year,” Eggs said on a call with financial analysts.
The Tmall launch has long been in the works as Moncler looks to attract a younger audience in the world’s second-largest economy.
At its 2022 Capital Markets Day in May, Moncler’s Chief Digital Officer Stephan Garandet said: “Today, all the Gen Z, all the new generations are on Tmall. You want to reach out to this younger audience, you have to be on Tmall. Don’t copy-paste your flagship on Tmall, adapt to Tmall.”
The cohort of consumers born between 1980 and 1995, also known as Millennials, make up over 67% of shoppers on Tmall Luxury Pavilion, while the more digitally-native Generation Z born between 1996 and 2010 takes up over 17%, according to a recent report.
The Moncler brand, famous for its down jackets, generates the largest share of its revenues by geography in Asia.
In Asia, which includes Japan, Korea and China, Moncler’s first-half revenues grew 16% at constant exchange rates to 333.112 million euros compared with the first half of a year earlier.
Moncler’s revenues in Korea more than doubled compared with pre-pandemic levels in the second quarter. Japan followed with accelerating growth compared with the previous quarter.
Lockdowns on the Chinese mainland prompted Moncler to close around a third of its stores during April and May. However, Moncler’s performance in June showed “a strong improvement” with the reopening of all the stores, the group said in a statement.
“We head into our most important part of the year with confidence,” said Ruffini.