Business

Prada seeks younger customers in bid for growth

A model carrying a Prada bag Image copyright AP

Italian luxury fashion group Prada has predicted a return to growth as it seeks to connect with younger customers through online sales and flexible pricing.

First half profits fell 25% to €330m (£282m) due partly to falling demand in China and Italy.

But Prada said it saw 2016 as "a turning point."

It has been reviewing prices, product variety and online marketing to appeal to more customers.

Revenue fell 15% to €1.55bn compared to this time last year and in April Prada announced its lowest profits in five years.

'Millennials'

It was previously criticised for opening too many new stores and failing to invest enough online.

Prada said it was on track with plans to double its e-commerce sales over the next two years by increasing the number of products it offered online, particularly shoes.

It will also expand its social media activities so it can raise its profile among "the 'always connected' millennials," referring to the 20s -30s age group.

The company added it was working on a "potential launch of 'shoppable' content with selected key items on Instagram".

Image copyright Getty Images
Image caption Mulberry's new approach to pricing and products has boosted profits

This at a time when rival luxury brand Mulberry, also known for its leather handbags, reported a trebling of profits in June following a switch to more affordable products.

Mulberry has struggled in recent years as a result of the company's failed attempt to compete with higher end brands, such as Prada and Fendi.

Mulberry has spent the past two years introducing new designs and bringing in lower priced bags in the £500 to £800 range.

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