Investors aren’t very good at predicting fashion trends. Sandal maker Birkenstock’s initial public offering was panned, with the company’s preferred price of $46 a share deemed “reckless” given that it’s unclear when consumers will tire of strappy shoes. Since then, the company’s shares have risen 45%, and sales rose 20% last year. Meanwhile, Dr. Martens shares soared during its 2021 debut, valuing the brand at about $5 billion, but its market capitalization is now one-fifth of that.
Golden Goose, which is set to start trading on the Milan Stock Exchange on Friday, has the advantage of having learned from the mistakes of its predecessors. Demand for the company’s shares was strong last week after it priced it at between 9.50 and 10.50 euros a share, suggesting a valuation of around $2 billion. Earlier this year, largest shareholder Permira was reported to be seeking a buyout of more than $3 billion.
More importantly, the brand aims to be more than a one-hit wonder, or to keep customers hooked by endlessly re-releasing core products, as so many brands have done, from Levi’s to Moncler. Luxury sneakers are a competitive category, and demand is uncertain due to the general downturn in luxury fashion, but pricey sneakers exist mainly as an extension of luxury brands, taking up a few tables in Gucci stores or lining the same walls as the rest of Louis Vuitton’s footwear range.n. They’re the stars of Golden Goose’s 200 stores, and the brand takes advantage of this with in-store customizations like graffiti and hand-distressed designs that lure returning customers and aren’t easily fooled.
Golden Goose has also stepped up its marketing efforts, pitching itself as a “cultural brand” like Louis Vuitton and Moncler. Collaborations and performances with Native American activist Quanna Chasinghorse, architect Fabio Novembre and K-pop musician Seungmi could help it connect with niche communities and tell a story about something other than shoes. It would also reduce the brand’s reliance on mainstream stars like Taylor Swift choosing to wear distressed sneakers to generate buzz.
Golden Goose’s strategy has turned what many previously thought was a passing success into a €500 million-a-year business. The question now is whether customers will come back for a second pair. The brand claims that repeat purchases are quite high, but the key to its long-term success will be whether the formula can be applied to new markets and new products, such as handbags.
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Men’s shows will still go on in Milan, with Gucci getting another chance on Monday to convince skeptics of the brand’s direction under Sabato De Sarno. On Tuesday, Louis Vuitton will close out the first day of Paris Men’s Week. In addition to the usual logistical challenges, attendees will also have to prepare for next month’s Olympics.
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