The Italian luxury auto brand is looking to drive up profits in a different industry.
In 2019, just before the world was thrown into the throes of a pandemic, Ferrari announced that it was considering increased streams of income, but from a niche other than auto manufacturing. It was transitioning into a full lifestyle brand, and would now become a major player in the fashion, fine dining and perfumery industries, among other.
By 2021, Ferrari had launched its first full fashion line: a collection of ready-to-wear pieces that came to life on a makeshift runway in the production line of its auto plant in Maranello. Two days after, it relaunched Il Cavallino, the same restaurant where founder Enzo Ferrari once dined with friends and Formula One stars.
Now, continuing on the same path, Ferrari has once again announced plans to further strengthen its presence in the world of luxury lifestyle goods.
Ferrari aims to double revenues in its luxury lifestyle division by 2026
At Ferrari’s Capital Markets Day on June 16 2022, chairman John Elkann said, “Ferrari is at its core a luxury company and the most distinctive and innovative luxury brand, and we see huge opportunities lying ahead in further developing its lifestyle [while] never compromising to be the unmatched expression of Italian excellence.”
Chief executive officer Benedetto Vigna also said that by 2026, Ferrari aims to double revenues in the lifestyle division through luxury goods, the brand’s experiential parks and museums, and collectibles, compared with 2019, while not providing a breakdown.
“We only touched the surface, and our lifestyle pillars can be used to delight customers in different ways and in different moments. We have a strong legitimacy,” Vigna enthused. “Either you are fully committed or you are not — and we are. We are serving only a fraction of the $300 billion market. This is a unique opportunity to make the brand relevant for a wider audience. Focus is key and we must address this with the right partners and talents to make it happen. It’s a new world.”
Ferrari has been seeing a rejuvenation of its loyal customer base in the 2018 to 2022 period, and a 60 per cent growth in new collectors, with a 25 per cent gain in the average number of cars. This is seen as a potential new customer pool for the brand’s luxury fashion, too, as are key regions such as Asia. “Women are also increasingly more interested, they become our ambassadors and help influence the purchases,” Vigna said.
The global appetite for luxury is growing, he said, but he insisted that Ferrari produces “unique cars and unique products,” and he is adapting founder Enzo Ferrari’s motto of delivering “one car less than the market demands” to the lifestyle division to maintain exclusivity.
Ferrari is hardly the first luxury auto brand to venture into fashion and other lifestyle niches
Others like Mercedes-Benz, Lamborghini and McLaren have launched fashion collections, and only recently, Bugatti teamed up again with UYN to release a clothing line that includes jackets, sneakers and polo shirts made using advanced technology.
But these apparel are usually made in collaboration with other fashion brands, and while they may have made the news at the time they launched, they have not made quite the splash after.
Perhaps, Ferrari is looking at Hermès which started out as an equestrian accessories company but has now grown to be one of the top luxury fashion brands in the world. It clearly is just as committed to top-tier excellence as the latter, having recruited some of the best and brightest to handle the various categories of its lifestyle division: former Armani designer Rocco Iannone is the creative director of its fashion line and Massimo Bottura, Italy’s most famous chef heads its restaurant.
Whether or not Ferrari will be just as wildly successful remains to be seen. However, judging by its Fall-Winter collection in Milan earlier this year, it is definitely taking steps in the right direction.