Benetton Group sets out to conquer the Russian market
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.jpg "Benetton Group sets out to conquer the Russian market")
Marco Airoldi: First of all, Russia is a very important market for Benetton. This is historically an important market for the Group because we first launched 20 years ago, in 1994. We have been presented in Russia for a long time. During the last year we have increased our presence throughout the country. Previously we operated through an agent, but now we control hundred percent of our operations in Russia directly. Out of all of our overall portfolio markets, Russia is one of the fastest growing and most exciting markets. We are currently in the process of opening four new stores in Moscow alone, three of which are already open to the public, regardless of any difficulties there may be with the ruble and other macro-economic issues affecting this market, including the reduction of consumption in certain product categories and consumer segments. We have launched a new flagship store and restructured the old shops. It was important to the company to invest in our flagship store in Russia. Why? First of all, the brand is a very strong in Russia. It is a country where the consumer, who is already familiar with the brand Benetton, is interested in purchasing it and ready to buy it. Russia comes in second place, after our home market Italy. Second of all, despite the current strain which is present on the global market due to the loss of the ruble which has led to a decline in Russian sales, we believe that all of these fluctuations will pass. We look at the long term effect, and we are confident that Russia will certainly grow in the future and will become a big market.
Have you adjusted any plans regarding Benetton's business in Russia due to geopolitical and economic difficulties currently occurring in the country?
Marco Airoldi: We have not made any changes to our business plan for Russia this year or for the next year, as opposed to other fashion brands who have been leaving the Russian market or suspending their activities due to theses difficulties, because we choose to maintain our long-term relationship for years to come. We certify that we have our own three-year plan, during which we plan to open 40 stores. During our three-year plan, we envisage increasing our presence in Russia via standalone store openings that we will operate in Russia by ourselves, and we will continue to develop the business with our partners. Our strategy in Russia rests, so to speak, on twopillars: our historical partners and direct management of the stores. Why direct stores? Not to compete with our direct partners; on the contrary, we see our DOS network as a means to strengthen the position of the brand in this market with a benefit for their business as well. Because when we have a store we have equipped and are investing in, it helps to strengthen our brand, allowing us to express a new concept of the stores and also to show our clients the evolution of the offer as well as to present the most interesting product.
How much investment has been spent on the new Benetton flagship store in Moscow on Tverskaya Street and three other boutiques?
Ruslan Malich: Investments amounted to more than 2 million euros for the new flagship store on Tverskaya. We had a global structural change - decoration, light engineering.
The new concept, which you presented in Moscow these past few days – is it based on the Italian store concept - On Canvas Benetton? Did you modify it especially for Russia?
Marco Airoldi: The store concept was born in Italy. It is virtually the same there as it is in Russia. If you look carefully at the store in Milan and a boutique in Moscow, of course, there are a few subtle differences. Because we continue to evolve and try to improve our project. The latest version of the concept On Canvas was presented in Moscow. Within this store canvas we can "weave" different displays and feelings, which is something that we want. We can change the thread, plexus, and so on, when we create something new, working with fabric. The same with the canvas in the stores - we can always modify it. We tried to adjust to the structure of the store when needed.
Let's talk about the internal restructuring of the Group. It is known that in the next Benetton waiting for radical renewal. Tell us more, what will happen next?
Marco Airoldi: Our company has grown dramatically over the years, and as such our range of interests has also expanded, to real estate and manufacturing. We think that to function at our best, we need to separate the activities and business of the company to concentrate on its core business - our brand (production, distribution, and marketing). We have decided to separate our real estate activities. We have a few stores that are our property, but the company also takes into consideration some of the buildings we rent. The same goes with the factories. We have our own production factories in Serbia, Croatia, Tunisia and partly in Italy, and this industrial activity is also separate from our core business. In the meantime, Benetton will focus on the marketing, distribution and sales. Over the next few years, all our energy and investments will be directed to this type of activity. On the industrial side of our business, we shall be selecting those suppliers that meets our best needs. This is a very big change, because all the attention, all the investments and efforts will be directed to it.
How many Benetton stores do operate throughout Russia now?
Ruslan Malich: At the moment we have three stores which will feature our new store concept of On Canvas. Two are currently under construction, which we will open within the next month and all subsequent retail stores in Russia will also feature the On Canvas concept. Some boutiques in which we operate, will also be translated into the new format. We currently offer Benetton within 108 stores throughout the country.
Except Italy and Russia, in which countries do you plan to open new stores with the concept of On Canvas?
Marco Airoldi: Our new concept, On Canvas , is a global project as well as a new image of the company. First, we have developed it at home to bring it to the necessary standard, the first three Canvas stores were opened in Italy, one in France, and now we also have them in Russia and in Germany, in Spain and in Mexico. Our goal is to upgrade all our stores in all countries. And this is the only time, I must say that there are more On Canvas stores in Russia than in any other countries , except Italy.
Translated from Russian, original interview by Galina Utesheva, FashionUnited