What Is The Reason Why Some Chinese Consumers Finally Put PRADA In The Cold Seat?

A few days ago, I saw many friends in my circle of friends turning an article "the loneliest Prada shop in the world".

The elegance of independence, I am also drunk.

If elected

The story is far ahead of the products and companies that run the company. Probably no one can go to Prada before.

Advanced basic data.

Prada (PRADA) brand files:

Founder: Mario PRADA

Designer: 1913 Mario Prada (Mario PRADA); 70s began Miuccia Prada (Miuccia PRADA).

Brand line: PRADA, Miu Miu (sub line)

Category: clothing,

Leather goods and accessories

In 2006, the movie "devil wears PRADA" promoted the recognition of Italy brand PRADA in China.

When the Korean opera sold the beer fried chicken sauce soup to the people of the Chinese Empire, the European PRADA left the power to make this movie a luxury brand beloved by the Hongkong ladies and the mainland's freedom rich.

In the spy 4, Mona, a heroine killer, carries and covers a pistol, a diamond and a striking triangular mark. It appears on the big screen many times. Every time it comes to a low scream in the Black Cinema, PRADA!

This bag not only touched me deeply, but also to the people, all kinds of fashion editors put it in the name of "killer bag".

So whenever you mention PRADA, you can't help thinking of Killer's s Bag.

At that time, almost every PRADA shopping guide in the world would take the killer bag first if it saw the Asian face.

But in Europe, PRADA has not had such a face in life.

European people have many critics of PRADA, including product quality, CEO's hot temper, aggressive shop sales strategy and executive turnover.

The most interesting thing is PRADA's listing and listing. Oh, no, it's sixty percent off!

A wave of sixty percent off listed roads

In 1999, PRADA group first launched the idea of listing, so it bought Helmut Lang and Jil Sander in a big way. However, it never occurred to me that the works of the two designers were not good enough (no money, no good, no use!), causing huge losses to PRADA. Poking, the plan for listing was instantly empty.

In 2001, the PRADA group resumed its losses in the past few years, and then attacked the capital market again. It plans to go public in 2001. Unexpectedly, 9. 11 incident occurred, and IPO was forced to stranded. It was a big crash in the past few years.

In 2002, PRADA made two attempts to make a comeback. However, because of the financial scandals caused by the accounting scandals of WorldCom, PRADA had to delay IPO again and again.

In 2008, PRADA spent more than five years in prison, and finally brewed the fourth IPO plan. As a result of the magic spell, the global financial crisis in 2008 turned out to be the death of PRADA IPO! Oh, God, why is it always hurt me?

If you want to ask "what is the experience of repeated defeats and defeats?", please remember to invite PRADA to answer! To interpret the virtue of "never give up", please take PRADA's IPO course as an example.

Who said that heaven helps those who help themselves? It is useful for those who say that they are born.

You guys all come out, PRADA wants to talk to you!

Later, the news that "PRADA is going to be listed" is like crying wolf, and the people who hear it are laughing and saying nothing. Ghost knows what will happen. Some people even regard "PRADA to be listed" as one of the black swan events in the capital market.

But you all laugh!

In June 2011, PRADA group listed on the Hongkong stock exchange, and finally fulfilled its dream of IPO for many years.

The result was a great deal of discussion at that time, because it was the first luxury company listed in Hongkong.

In the interview with the financial times, PRADA CEO Patrizio Bertelli clearly stated: "the location of IPO actually represents the market we want to go to."

This is obviously directed at China and Chinese tyrants.

Listing in Hongkong at that time did seem a good choice.

The 2011 China Luxury Market Research Report released by consulting firm Bain showed that with the increase of disposable income and the growth of high net worth, wealthy families and middle class, the growth of luxury consumption in mainland China in 2011 was expected to reach 25%-30%.

It's hard to make money without fanaticism.

In 2012, at the peak of PRADA, the group's global profits surged 44.9% to 625 million euros (4 billion 254 million yuan) over the same period last year. Sales of 130 stores in the Asia Pacific region (28% of the world's stores) broke through the one billion euro mark for the first time, reaching 1 billion 160 million euros (about 7 billion 895 million yuan), and the proportion in global revenue rose to 35.6%.

However, the writing will start at this point, and then it will be a sharp turn. If you want to interpret the rule of "extremes and extremes," you can also take this as an example.

Radical shop strategy

In 2013, PRADA barely gained 0.3% profit growth, and the group's revenue rose by 8.8% under the promotion of 79 new stores in the world.

In 2014, it encountered Waterloo. In the 2014 fiscal year, the group's total revenue was 3 billion 552 million euros, down 1% from the same period last year. This is the first time PRADA group has seen its performance decline in recent years.

Profits fell by 28.2% year-on-year, while sales in the Asia Pacific region shrank by 3.1%, and global sales dropped from 36.4% in 2013 to 35.7%.

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In 2013, PRADA group opened 27 new stores in the Asia Pacific region, with a year-on-year increase of 11.4% in net sales (35.6% in 2012).

The shrinking of profits and sales directly led to the suspension of the aggressive expansion policy. In 2014, the number of new outlets in the Asia Pacific region was only 18, the lowest in 3 years.

Earnings data show that PRADA group has been bullish all the way since its listing in 2011. In the 2012 and 2013 fiscal year, it rose 44.9% and 12% respectively over the same period last year. In just two years, its performance in the 2014 fiscal year ended, and the Asia Pacific region, where the Chinese market was located, was the most serious decline in the group's performance. However, the Japanese market was very active and sales growth rate was higher than that of other regions.

In fact, the danger began to surface very early.

Bain's 2012 luxury market report shows that the annual growth rate of luxury goods in mainland China has decreased to around 7%.

Under the combined effect of the two factors, the continued decline of the euro and the warming of overseas travel, Chinese consumers have accounted for 60% of the total consumption of luxury goods overseas.

Although Chinese consumption growth in Macao is still strong, the growth rate in Hongkong has slowed to 10%.

In the past 2013-2014 years, China's luxury goods market, which has been growing rapidly for many years, first appeared -1% negative growth for the first time in 2014.

Bain survey shows that more and more Chinese consumers choose to travel to Japan and South Korea for shopping.

As of April 2014, the value of sales of jewellery, clocks and gifts in Hongkong declined by 39.9% compared with the same period last year.

Quality injuries

The executives of the PRADA group are smart enough to take the full responsibility of their performance down to the East, and publicly say that their performance is poor because the environment is not good.

But consumers are not blind, and the quality of products is also bruising.

Prior to its listing in 2011, Goldman Sachs put PRADA on the table with many factories in mainland China.

However, this quality risk factor did not hamper the listing of PRADA, because at that time more buyers were only concerned about the "Made in Italy" logo on the bag, even though it could only refer to a suture or a zipper.

But PRADA has been hard to emulate the integration of Apple's global industrial chain to achieve greater success. The purchase of luxury goods is more enjoyable psychological experience. When this "superiority" is discounted, some consumers will lose.

For example, luxury brands such as LV and PRADA have raised prices many times, but consumers do not rise or fall, showing that they are fundamentally different from the general retail industry.

So what is the reason why some Chinese consumers finally put PRADA in the cold seat?

In June 2015, Beijing industry and Commerce Bureau conducted a spot check. Among the 95 unqualified products, PRADA was on the list.

Now you can see through Baidu search "PRADA fade", "PRADA zipper", "PRADA offline" to see, these negative news abound.

There is a passage on the Internet: "imagine, when you walk on the road with a PRADA handbag over five thousand yuan, suddenly the handle is broken, and all the belongings inside the bag are out of the bag. This scene is embarrassing enough."

What's more, PRADA is trying to reduce the number of shops in addition to reducing the carrying capacity of the 1000 euro -1200 euro (about 6790 yuan to 8148 yuan).

Moreover, the biggest killer is to quietly reduce prices in Hongkong and Macao. It is reported that the price of PRADA 80% products has been cut by 10%, and the Miu Miu part of the United Group has been reduced to hundreds of thousands of handbags.

The 2015 annual earnings report released earlier this year showed that PRADA group's net profit in 2015 was 450 million 730 thousand euros, down 28.2% from the same period last year. This unsightly performance report once again touches the fragile nerves of investors. The stock price of PRADA Hongkong has plummeted, and many investment banks have also lowered the rating and target price.

Although it may not be fair, but like PRADA, outlet and counters sell the same product at different prices, often with low to the heinous discount, often using cheap materials such as nylon, and working in the same fashion. A large number of colors in the same style (see killer, shell and so on, and even match color) are sure to be criticized, and the performance is sure to drop.

It may be a way to save performance by reducing the number of shops, reducing prices, lowering the threshold and taking the civilian line.

Now the luxury industry has formed "three giants", namely, Richemont, LVMH and PPR in France, and Paris spring (PPR), the three group companies have more than 50% in the high-end brand market and the strong loyalty of consumers, and the other companies in the pre - market can not compete with them for at least forty or fifty years.

Although the market is changing rapidly, consumer preferences are constantly changing. However, the increasingly concentrated capital makes it difficult for newly entered companies to operate. The future luxury goods industry is likely to evolve into several oligarchic markets.

Compared with other luxury brands, PRADA's performance seems to be the worst performing among all the luxury brands, plus the negative factors such as brand weakness, lack of innovation and lack of brand strength in the past few years. If PRADA can't break through the bottleneck, it will become the next Gucci.

Of course, from another point of view, if there is no PRADA, the threshold for the working class to own luxury goods (not the fake ones) is higher.