Prada reportedly in talks with Richemont and Farfetch for joint eCommerce platform

Prada is expected to join talks between Cartier-owned Richemont and online retailer Farfetch about launching a joint eCommerce platform. The launch of the eCommerce platform is expected to boost online sales and grow overall revenues by 40%, said Reuters. MARKETING-INTERACTIVE has reached out to Prada for additional information regarding the joint eCommerce platform.

Prada has shown strong progress in its retail avenues despite the continued restrictions, said its consolidated financial results for the half-year ending on 30 June 2021. The luxury house's eCommerce segment has also been growing by a triple-digit percentage for the fifth quarter in a row. Furthermore, the gross margin has improved at 74.3%. With a strategy to increase brand momentum and profitability, Prada has continued to strengthen and invest in its brands through strict control of the distribution channels online and offline, enhancement of the product offer, and a further improved customer experience.

The potential partnership with Richemont and Farfetch comes as both brands are in advanced discussions with Farfetch to enhance the partnership they established last year. With the enhanced partnership, Richemont would be leveraging Farfetch's technology to accelerate its luxury new retail developments. According to Richemont, the scope of current discussions includes:

1. Farfetch investing directly in YOOX NET-A-PORTER as a minority shareholder, with other investors to be invited to participate alongside;
2. YOOX NET-A-PORTER leveraging Farfetch Platform Solutions to support its ongoing transition to a hybrid first-party and third-party business model;
3. Richemont Maisons leveraging Farfetch technology to accelerate its Luxury New Retail developments; and
4. Richemont Maisons joining the Farfetch marketplace.

Other industry players and investors have already indicated their interest in investing in YOOX NET-A-PORTER alongside Richemont and Farfetch. The ultimate objective is for YOOX NET-A-PORTER to be a neutral platform, with no controlling shareholders. Meanwhile, Richemont and Farfetch also inked a global strategic partnership with Alibaba Group last year to offer luxury brands with enhanced access to the China market as well as accelerate the digitisation of the global luxury industry.

These developments in the eCommerce space come as online retail boomed amidst the pandemic. Furthermore, online retail in Southeast Asia is expected to reach US$53 billion by 2023, accounting for 6.5% of all retail sales, Forrester said. At the same time, the region is touted to be entering its "digital decade" as the Internet increasingly becomes an integral part of consumers’ daily lives, said a recent report by Google, Temasek and Bain & Company. According to the report, Southeast Asia's Internet economy is predicted to reach US$1 trillion by 2030. Since the pandemic began, Southeast Asia has added 60 million new digital consumers, of which 20 million joined in the first half of 2021 alone. 

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Photo courtesy: 123RF

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