Mytheresa 3Q 2024 results indicate a noticeable increase in the affluent aspirational shopping activity in recent months.
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GLOAfter years of economic hardship and resulting consumer cutbacks, luxury retailers have been catering to affluent shoppers. However, it seems the aspirational customer is making a comeback.
Just three months ago, luxury eCommerce platform Mytheresa informed investors of its strategy shift away from aspirational shoppers to focus on its “top customers.” Now, the company is reversing this approach. On a call with analysts on Wednesday (May 15) to discuss the third-quarter fiscal 2024 financial results, CEO Michael Kliger highlighted this change.
Kliger acknowledged that while demand from aspirational shoppers is still “slower” compared to top customers, there has been a noticeable increase in their shopping activity in recent months.
“The U.S. remains the strongest region for luxury spending, partly because aspirational customers are returning,” Kliger said. “Our rapid growth in the third quarter is primarily driven by success with big spenders, though we are seeing positive signs from aspirational customers.”
This shift follows years of reduced spending by aspirational shoppers. Just last month, LVMH commented on this segment’s conservative spending habits.
For Mytheresa’s high spenders, Kliger emphasized the importance of exclusivity in attracting and retaining luxury shoppers—a strategy also employed by companies like Saks and Gucci. He highlighted the retailer’s collaborations and limited-edition collections in driving customer engagement and loyalty. Additionally, Mytheresa has hosted “exclusive events” for its top customers worldwide during fashion weeks and other high-profile occasions.
The company reported double-digit sales growth and a 12% rise in gross profit, achieving a 43.4% margin, while many eCommerce apparel retailers face profitability challenges.
Luxury goods typically offer higher profit margins due to premium pricing and perceived value compared to mass-market apparel. By curating its inventory to include only premium and in-demand items, Mytheresa minimizes inventory risk and markdowns, optimizing its sales mix for maximum profitability.
All customers including affluent consumers demand more eCommerce options, which is indicated in multiple surveys.
“Our focus on big-spending, wardrobe-building top customers led to significant growth in both the number of customers and their average spending,” Kliger told analysts. “This highly desirable audience positions us as the best platform for luxury brands to partner with for exclusive activations.”
Source: MyTheresa
