Luxury fashion and lifestyle conglomerate Richemont has announced that “further progress” has been made in the development of an enhanced partnership with the online retail platform, Farfetch.
Richemont, whose portfolio consists of the likes of Chloé, Net-a-Porter and Cartier, stated in the announcement that the advancement puts the two companies on track to creating “a neutral, industry-wide platform”, centred around omnichannel retail technologies and supporting the digitisation of the luxury industry.
New discussions regarding the partnership could see the two take further steps into merging, with Richemont Maisons possibly joining the Farfetch marketplace. The conglomerate could also gain the possibility of utilising Farfetch technology to accelerate it’s ‘Luxury New Retail’ strategy, developed last year as part of the partnership.
Furthermore, Farfetch is considering investing directly in Yoox Net-a-Porter (YNAP) as a minority shareholder, with other investors to be invited to participate. Richemont stated that there has already been a number of parties indicating interest in the investment opportunity, with the ultimate goal of the multibrand retailer becoming a neutral platform with no controlling shareholders. If agreed, YNAP will be able to leverage Farfetch Platform Solutions to support its ongoing transition to a hybrid first-party/third-party business model.
The digitisation of luxury
Established last year, the partnership was put in place, alongside Alibaba, to elevate the digitised presence of luxury brands in China. As part of the agreement, Richemont invested 300 million dollars in Farfetch, with an additional 250 million dollars in the retailer’s China platform, taking a combined 25 percent stake in the joint venture.
The new announcement counteracts reports from back in October that suggested Richemont was exploring options to offload YNAP entirely, which is reportedly losing market share to Farfetch. According to the online fashion platform, Miss Tweed, the luxury e-tailer is not keeping up with the technology race. However, it seems Farfetch could be willing to take the investment risk.