From catwalk to laptop, fashion houses embrace web

"In five years, 30 percent of (fashion) goods will be sold on the Internet in America," Prada Chief Executive Patrizio Bertelli was quoted in Italian newspapers as saying, without giving a comparative figure.

When Italian online fashion retailer Yoox launched in 2000, there was a lot of "skepticism about the Internet in general and online sales," founder and Chief Executive Federico Marchetti told Reuters.

Now it also operates retail sites for brands like Valentino and Marni. Yoox is poised for an initial public offering this week in Milan.

"Increasingly fashion brands are shifting their communication budgets to the Web, and have a greater understanding of its potential and in particular they now are all requesting an online store," he said in emailed comments.

Luxury groups are focusing on winning customers as they emerge from the worst economic crisis in decades. Bain & Co, a consultancy, expects luxury sales to fall 8 percent this year to 153 billion euros.

While online sales are unlikely to make up the difference soon, consumers' growing confidence and comfort in using the Internet to shop provide positive signals.

Bain says "luxury shame" -- the fear of being seen shopping for luxurious items in a recession -- is also helping. It sees 2009 online luxury sales up 20 percent to 3.6 billion euros -- representing 2.35 percent of total luxury sales this year.

Luxury goods companies "were very traditional in their advertising methods and tools and in what they thought of consumers," Bain partner Claudia d'Arpizio said.

"Now they understand the consumer age is different and their values are changing so (they) need different tools to attract and interest them."

In the United States, while most sectors of the economy experienced a downturn in the first quarter of 2009, online sales for 80 retailers rose by an average 11 percent, according to a report by the Organization for Economic Cooperation and Development.

Ferragamo Chief Executive Michele Norsa said he saw its online store becoming "a nice shop" next year with "several million euros" in sales.

Echoing Norsa, Valentino's top executive, Stefano Sassi, said its store that sells accessories and its younger line was "in constant growth."

ALLURE OF THE WEB

The Web's allure is easy to understand. Designers can present their creations directly to customers without relying on media reviews, which may not be favorable.

Designers can also save on advertising, especially as they cut marketing budgets.

When it comes to global advertising, the Internet is the only medium expected to expand -- with 9.2 percent growth forecast for 2009 -- while all other media are set to shrink, according to media agency ZenithOptimedia.