The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
FLORENCE, Italy — It's all a matter of taste.
Luxury labels are accustomed to tempting fashionistas, and now they're stretching from haute couture to haute cuisine.
Gucci opened a 50-seat restaurant, Gucci Osteria, in Florence on Tuesday where three-Michelin-star chef Massimo Bottura will serve up high-end dishes.
The Italian fashion house, owned by Kering, is not the only luxury company to foray into food; LVMH announced late last year it would open a second branch of its gourmet grocer La Grande Epicerie in Paris, days before Tiffany's & Co opened its Blue Box Café in New York.
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Gucci Osteria | Source: Courtesy
"The big brands are following where their high-spending clients' cash is going," said Fabrizio Pini, professor and joint director of the International Master in Luxury Management of Milan's MIP Politecnico business school.
Gucci and its rivals do not expect these investments to yield significant financial returns, for now, but they are seen as a way of enhancing their global brands. In some cases, eateries can also be a way to make the most out of large, city-centre store sites as customers increasingly shop online.
The Gucci restaurant is sited behind the walls of the 14th century Palazzo della Mercanzia building, overlooking the city's most famous square, Piazza della Signoria. Visitors can treat themselves to the likes of Parmigiano Reggiano tortellini, Peruvian-inspired tostadas, pork belly buns and mushroom risotto for €20 to €30 euros per dish.
Few strategies come without an element of risk, however.
Bernstein analyst Mario Ortelli said that if luxury companies did not provide a gastronomic experience that matched their other goods, it could dilute their brands. "The experience has to be luxurious and recognisable," he said.
While labels are looking to these investments for marketing rather than profits, a presence in food could offer some financial returns in the long run.
With a global luxury market estimated to be worth €1.2 trillion in 2017, sales of luxury wines and spirits and food, together worth just under 120 billions, last year grew 6 percent, more than personal luxury goods such as bags, shoes and clothing, according to Bain & Co's yearly report on the sector.
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"Food is luxury as much as fashion," said Stefano Cantino, strategic marketing director at Prada, which owns exclusive Milan patisserie Marchesi.
"Barriers have been broken."
The Gucci Osteria restaurant is part of "Gucci Garden," which includes an exhibition area, a bazaar-like boutique and a cinema room. "Haute couture and haute cuisine are a recipe made in heaven," Bottura told reporters.
By Giulia Segreti; editor: Pravin Char.
The luxury goods maker is seeking pricing harmonisation across the globe, and adjusts prices in different markets to ensure that the company is”fair to all [its] clients everywhere,” CEO Leena Nair said.
Hermes saw Chinese buyers snap up its luxury products as the Kelly bag maker showed its resilience amid a broader slowdown in demand for the sector.
The group’s flagship Prada brand grew more slowly but remained resilient in the face of a sector-wide slowdown, with retail sales up 7 percent.
The guidance was issued as the French group released first-quarter sales that confirmed forecasts for a slowdown. Weak demand in China and poor performance at flagship Gucci are weighing on the group.