SANT’ELPIDIO A MARE, Italy (Reuters) - Turnaround efforts at Italian luxury group Tod’s are starting to bear fruit with e-commerce sales growing at a “high-double digit” pace, owner and Chief Executive Diego Della Valle told shareholders on Thursday.
The shoes and leather goods company, famous for its Gommino loafers, has been struggling to revive the appeal of its brands to attract younger luxury shoppers, focusing on digital and more frequent collections and collaborations.
“Our recipe is known and unchanged. We want to keep our long-standing consumers and attract millennials,” Della Valle, who is also Tod’s chairman, said.
“We’ve got to the operational stage on some fronts and this gives us a little more confidence that the road taken is the right one.”
He added the company, which launched a new business model in late 2017 to reverse falling sales and refresh its namesake brand, could have moved earlier to tackle issues.
“But we’re doing what is needed”, he said listing among actions taken a management reshuffle that led to the appointment of a joint-CEO which Della Valle said was working out well.
Online sales, which account for 7 percent of total revenue, are growing at a “high double digit” pace and the firm hopes they will keep expanding at this rhythm in one or 1-1/2 years’ time so that the contribution to group sales can become more sizeable, Della Valle said.
To complement the online expansion in line with current multi-channel consumer trends, Tod’s is also planning to open a new flagship store on Milan’s famed Montenapoleone fashion street in a month.
Della Valle said disappointing quarterly earnings were the result of a push to “achieve sustainable results quite quickly”.
The company, which has fallen short of market expectations in recent years, has said 2019 will be another “year of transition” in terms of profitability.
The Della Valle family has been gradually increasing its stake in Tod’s as a sign of confidence in the company of which it now owns 63 percent.
“I’m happy where I am,” Della Valle said when asked about his role at the company.
Reporting by Claudia Cristoferi, editing by Emelia Sithole-Matarise