Salvatore FERRAGAMO’s Head of Latin America shares expert understanding on luxury
Mr Diego Stecchi, President Latin America & Caribbean at SALVATORE FERRAGAMO, one of the most experienced luxury professionals in the region, shares exclusively with CPP-LUXURY.COM his expert understanding in the potential of the luxury market. Stecchi also speaks about the exceptional performance of Ferragamo in Latin America.
Salvatore Ferragamo is one of the international luxury brand pioneers in Latin America. What is Ferragamo’s main competitive advantage in comparison with other international luxury brands?
Salvatore Ferragamo’s competitive advantage is its heritage, design/quality of products, and ‘made in Italy’ process. it is one of the world’s main players in the luxury goods sector, whose origins date back to 1927. sf is active in the creation, production and sales of shoes, leather goods, clothing, silk products and other accessories, as well as fragrances, eyewear, watches, and now jewelry. attention to uniqueness and exclusivity, uniting style, creativity, and innovation with the typical ‘made in italy’ quality and craftmanship have always been the hallmark of the brand’s products.
Your company has one of the most extensive retail presences among major international luxury brands in Latin America. How is your retail network currently operating and what is your near future development strategy?
Currently, we have 84 points of sale in Latin America, of which 28 are directly owned stores (dos), and 56 are non-dos (franchise and wholesale clients). The directly operated stores are located in countries such as Mexico, Argentina, Chile, St. Thomas, where the non-dos exist in countries such as brazil, Colombia, Peru, Panama, Costa Rica, and Dominican Republic among others. We are currently analyzing markets particularly in South America where we are planning future developments, such as Chile, Brazil, and Mexico.
What is the percentage split between city retail locations and airports in Latin America? (Percentage in terms of turnover). How important has been airport retail in this region?
Currently, out travel business accounts for 10% of the total. We are looking to increase the size of our actual multi-brand locations at airports and to develop more mono-brand locations at airports as well.
Are Latin Americans more drawn to Italian or French luxury brands (fashion)?
It is difficult to determine given that many Italian brands are now owned by French companies and vice versa. However, Italian brands are mostly known for their expertise in leather goods including shoes, bags, etc. and French brands are known for their expertise in cosmetics, fragrances, and jewelry.
Which is the best performing country in Latin America, in terms of sales performance?
Mexico is our primary market in terms of sales performance, followed by Brazil.
You have recently opened a mono-brand store in Bogota, Colombia – one of the regional emerging markets in an incipient phase of development in terms of luxury. Brands such as Vuitton or Fendi are present with mono-brand stores with very small sized locations. What are your expectations or the Colombian market? What do you think are its weaknesses and strengths in terms of luxury retail?
The Colombian market is well developed in terms of fashion and luxury. They have had access to many international luxury brands for several years now, given that many have opened points of sales in Bogota, as well as other cities in Colombia. Overall, the Colombian consumer’s knowledge of fashion is well developed and continues to grow. they travel the world and are constantly exposed to the different trends and collections occurring globally. Overall our expectation is for Colombia to become one of the top 4 markets in Latin America.
What are, in your view, the most important differences between the profiles of US versus Latin American luxury consumers? (fashion and accessories)
In Latin America, the consumers can be divided into two areas: classical luxury & aspiring. The ‘classical luxury’ consumer is more conservative and has always been surrounded by luxury goods and therefore does not believe the brand name one wears defines their status. Whereas the ‘aspiring’ consumer, buys a luxury product because they believe it defines their status. They are less conservative and more inclined to spend significant amounts of money. In the us, the consumer is more mature in terms of the fashion world and rather than focus on the brand, their choices are led by the trends and latest collections.
Human resources are vital to any luxury business. What is your assessment of human resources in Latin America?
There is a lack of experience in the human resources area within the retail luxury industry. We are investing to improve and further develop this area, especially in terms of the training of sales staff. It is a continuous challenge and we are constantly looking for ways to further advance.
Diego Stecchi is President Latin America and the Caribbean at Salvatore Ferragamo, a position he has held since 2000, when Ferragamo Latin America was established. His University education was in Italy in both Perugia and Milan.
He and his wife are also the Founders of Librosinfronteras. Created in 2005, Libros Sin Fronteras is a non-profit organization to promote education among underprivileged children by building libraries in their communities within Latin America. The organization also provides the tools to facilitate and promote primary education via teaching materials, computers and school supplies to the benefit of the children and their teachers.