Hugo Boss is launching a new five-year plan, aiming to double its turnover by 2025. The German fashion house wants to attract younger people and is revamping its stores.
New look and feel
Hugo Boss is aiming for a new look. As part of its new growth strategy, the German company is polishing the style of sub-brands Boss and Hugo. The logos and marketing are getting a fresh makeover, as will 80 % of the company's stores over the next three years. With this new look and feel, Boss wants to reach a turnover of 2.6 billion euros in menswear and 400 million euros (twice the current number) in the women's department by 2025. The younger brand Hugo should be worth 800 million euros.
In total, Hugo Boss aims to double turnover to four billion euros by 2025. The company is doing this with its 'Claim 5' strategy: "It is our vision to become the leading premium tech-driven fashion platform worldwide, and in this context, we will revolutionise the way in which we interact with consumers", CEO Daniel Grieder says.
Youth and digitisation
On top of an additional marketing budget of more than 100 million euros, the brand wants to win over younger consumers with the Hugo brand in particular. The fashion house therefore also invests 150 million euros into digitisation, from trend detection and digital product development to AI-based pricing options and the global roll-out of digital showrooms. In Germany and Portugal, the company will build digital campuses for data analytics and tech staff. The desired result is that online sales will exceed a billion euros and reach 25 % of group sales by 2025.
The strongest growth will continue to be generated from Asia: the region's revenue share is expected to exceed 20 %, with special thanks to China. In Europe and both Americas, Hugo Boss plans to focus on the trends towards more casual clothing, with outfits for every moment. By 2025, the company also expects to achieve a gross profit margin of around 12 %. As sustainability goals, the German company is aiming for climate neutrality along the entire value chain by 2045 and for 80 % of its products to be circular by 2030.
These announcements come in the wake of the new quarterly figures. CEO Grieder is satisfied with a good recovery from the coronavirus crisis: sales rose by 133 % compared to the second quarter last year and are only 4 % lower than in the same period pre-Covid. EBIT amounted to 42 million euros. For the year as a whole, the group expects sales growth of 30 to 35%.