Coin's 100-Year History as Italy's Leading Department Store
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Coin is an Italian department store chain established in 1926. It has grown significantly over the past century through strategic acquisitions and store openings. By 2014, Coin had over 77 stores in Italy generating €413 million in net sales. Coin has pursued a strategy of trading up its brand mix to focus more on accessible luxury brands through its concession model. This has helped increase average ticket prices and market share. Coin is also converting flagship stores to its Coin Excelsior format to create a premium shopping experience centered around luxury brands.
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Coin's 100-Year History as Italy's Leading Department Store
- 2. 2 • 1916 Vittorio Coin starts the Gruppo Coin activities • 1926 First Coin Store (Mirano, Venice) • 1965 Coin P.za 5 Giornate opens (Milan) • 1972 First “Organizzazione Vendite Speciali” (Oviesse) store • 1986 Coin is the first retailer to develop a fidelity card program in Italy • 1995 Oviesse become an apparel retailer • 1998 Acquisition of La Standa • 1999 Listing of Gruppo Coin on the Milan Stock Exchange • 2005 PAI equity fund becomes Gruppo Coin majority shareholder • 2008 Acquisition of Melablu • 2010 Acquisition of UPIM • 2011 BC Partners becomes Gruppo Coin majority shareholder • 2011 Excelsior opens in Milan • 2012 Acquisition of IANA • 2013 Excelsior opens in Verona • 2014 Coin Excelsior opens in Rome COIN: one hundred years of history
- 3. Established in 1926, Coin is the largest Italian department store €413,2 m net sales in 2014 77 stores in Italy and 20 abroad, located downtown in the most important Italian cities and shopping areas Portfolio of 800 brands 46 million visitors every year 21,6 million items sold and 12 million receipts 3 Coin in a snapshot
- 4. ● NET SALES ● SQM BUILDING 2012 43% 22% 35% SQM: 91.335 2012 33% 17% 50% NET SALES (€/1000): 276.158 2010 41% 24% 35% NET SALES (€/1000): 273.814 2010 48% 26% 26% SQM: 82.010 2008 57% 32% 11% hb ws concession NET SALES (€/1000): 232.935 2008 61% 31% 8% hb ws concession SQM: 74.100 Where we come from: Net Sales and Sqm building 2008–2010–2012 TOTAL CATEGORY (Beauty and Home not included) 4
- 5. Where we come from: Trend 2007-2011 5 *Capex 2007-2011: 61,7 mio € (Italian new openings, conversions and refurbishing) Bridge Ebitda (2007-2011) Ebitda trend (2007 – 2011 ) is positive thanks to network development otherwise is offset because of division costs and the decrease of LfL Ebitda Store ∆ Division Costs ∆ HQ costs ∆ Ebitda Coin 2011Ebitda Coin 2007 ∆ Store Ebitda ∆ Store Ebitda LfL New opening/closure
- 6. Store Ebitda ∆ GM ∆ Personnel ∆ Rent ∆ Space ∆ Operating ∆ Rent Store Ebitda ∆ 2007 costs costs costs income 2011 2007-2011 Partners 0,6 0,0 -6,5 -8,0 -2,6 -4,2 41,4 20,7 20,1 Wholesales 7,5 -11,8 2,4 1,4 0,6 0,9 0,0 1,0 -6,5 Housebrand 31,4 -34,0 8,2 4,2 1,9 2,9 0,0 14,6 -16,8 Total 39,5 -45,8 4,1 -2,4 -0,1 -0,4 41,4 36,3 -3,2 M€ Space Impact: -36,1M€ Sales Density: -7,7M€ Gm Impact: -2,0M€ Network 2007 Bridge Ebitda of the same dos from 2007 to 2011 Ebitda trend is negative because of the Gross Margin decrease is higher than rent incomes increase Where we come from: Trend 2007-2011 6
- 7. 1. WHAT WORKED AND WE FURTHER IMPROVE: • Concession Model • Cost control • Format Coin (customer experience) Going Forward 2. WHAT HAS NOT WORKED AND WE ADDRESS: • Wholesales man/woman/ accessories: reduction of sales density and Ebitda • House brand: fall of sales density • Upim conversion and new opening underperforming 3. WHAT WE “ TURN AROUND” • Customer Experience “consumer have to dream while walking” “memorability and uniqueness of the experience” 7
- 8. 8 The market share of department stores in Italy is the lowest in Europe but… % share men/women/kids clothing market in terms of value per sales channel Source: European Customer Panel 2012
- 9. # Monobrand POP breakdown by channel of distribution: Based on 21 brands 9
- 10. 38,7 41,2 44,0 3,2 3,6 4,09,0 7,5 7,1 34,7 32,7 29,7 3,5 3,4 3,3 7,1 7,0 6,5 3,0 3,0 3,0 0,8 1,5 2,4 2011 2012 2013 OtherChannels(w/oOutlets&E-Commerce) Market Hyper+Super Independentstores E-Commerce LargeSurfaceretailers DepartmentStore Specializedretailchannels Multibrand Channels 10 …showing significant growth opportunities vs. independent multibrand -3,0% -5,0% -6,5% Market Share 3,2 3,6 4,0 Department stores
- 11. 11 Italian Market Concentration sport 5,5%children 14,1% leather 2,5% underwear 4,4% apparel 54,9% footwear 18,6% In 2013, over 7.000 independent apparel stores went out of business; (1°quarter 2014 -3.000) Multibrand apparel channel 51.000 (without footwear) Source : Fashion Bank
- 12. 12 Apparel/accessories consumption according to price range BRIDGE / BEST MASS MODERA TE GOOD BETTER -3,3 -5,0 -10,0 -8,6 -4,6 -6,6Total Var VAR % 13/12 CORR. VALUE Source: Fashion Consumer Panel and internal elaboration 50 98 141 204 310 Price index numbers 2012 2013 49 95 141 209 323Luxury Accessible luxury Medium price Low price
- 13. 13 WHAT WE HAVE DONE: Coin Strategy CONSOLIDATE THE MARKET, CREATING A PREMIUM DEPARTMENT STORE NETWORK: •Increase the space allocated to brands in concession (33%) with a positive impact on the business profitability and working capital (stock/sqm -29% in the last 4 years), limiting the presence of housebrands/wholesale to the minimum •Trading up brand mix, leveraging concession model with accessible luxury brands, growing average ticket. • Progressive conversion of the most relevant stores in the Coin Excelsior format (premium contemporary) following Coin Excelsior Rome extremely positive results. • Optimizing sales people kpi efficiency (sales/eft, sqm/eft), improving performance via selection training and incentive plans EBITDA + + CASH FLOW ++++ BRAND POSITIONING UPGRADE +++
- 14. 14 Sales and sqm per commercial mix TOTAL CATEGORIES (Perfurmery and Home escluded) ● NET SALES ● SQM BUILDING 2013 43% 19% 38% SQM: 90.797 2013 30% 15% 55% NET SALES (€/1000): 268.215 2010 41% 24% 35% NET SALES (€/1000): 273.814 2010 48% 26% 26% SQM: 82.010 2008 57% 32% 11% hb ws partner NET SALES (€/1000): 232.935 2008 61% 31% 8% hb ws partner SQM: 74.100
- 15. 15 Italian Market Share: upgrade evolution . Luxury 0% Accessible luxury High 0,8% Accessible luxury medium low 1,9% Medium price 1,9% Low price 0% Market share 2013 Coin Italy LV, Chanel, Dior, Cucinelli, Gucci, Lanvin, Prada…. Ralph Lauren, Moncler MaxMara, Zegna, Fay Twin Set, Liu Jo, M. Kors, MbyM, Paul Smith, … Seventy, Longcha mp, Furla, Boggi,… Upim, Piazza Italia, Terranova, Iper, mercatini OVS, H&M Zara, Mango, Motivi.. Marlboro Classics Marina Yacthing Miss Siixtiy Stefane l, THilfige r, Esprit Benetton 2013 Market share 2013 Luxury 12-13% Accessible luxury High 38-45 Fast fashion Medium price 32-38% Low price 11-13% Coin MKt Share: 2012 1,36% 2013 1,49%Luxury Over 400% of leverage price More 200% of leverage price Accessible Luxury From 125 to 200% of leverage price From 75 to 125% of leverage price Fast Fashion Medium Price From 50 to 75% of leverage price Low Price Up to 50% of leverage price ?
- 16. 16 Italian Market Share: upgrade evolution . Luxury 0% Accessible luxury High 0,8% Accessible luxury medium low 1,9% Medium price 1,9% Low price 0% Market share 2013 Coin Italy LV, Chanel, Dior, Cucinelli, Gucci, Lanvin, Prada…. Ralph Lauren, Moncler MaxMara, Zegna, Fay Twin Set, Liu Jo, M. Kors, MbyM, Paul Smith, … Seventy, Longcha mp, Furla, Boggi,… Upim, Piazza Italia, Terranova, Iper, mercatini OVS, H&M Zara, Mango, Motivi.. Marlboro Classics Marina Yacthing Miss Siixtiy Stefane l, THilfige r, Esprit Benetton 2013 Market share 2013 Luxury 12-13% Accessible luxury High 38-45 Fast fashion Medium price 32-38% Low price 11-13% Coin MKt Share: 2012 1,36% 2013 1,49% 2014 1,62% Luxury Over 400% of leverage price More 200% of leverage price Accessible Luxury From 125 to 200% of leverage price From 75 to 125% of leverage price Fast Fashion Medium Price From 50 to 75% of leverage price Low Price Up to 50% of leverage price
- 17. LOW PRICE CLASSIC CONTEMPORARY . TRADITIONAL NEO TRADITIONAL CONTEMPORARY TRENDY entrypricemediumhgh HIGH PRICE luxury Brand Mix Evolution 17
- 18. 18 Stores and Brand Mix Evolution 2005 / 2008 2009 / 2013 2014
- 20. 20 COIN EXCELSIOR - Roma Cola di Rienzo 20142012 (K/€) Building Sqm 3.140 4.240* (+35%) Concession Sqm 1.232 2.320 * (+88%) Building Sales 27.816 45.790 (+65%) Sales Density 8.858 10.800 (+22%) Average Ticket 49,16 70,26 (+43%) *with food market ** current rent ***calculated on building net sales
- 21. 21 Store Clusters – Clusterization CriteriaMBASSADOR (12): • Market > 500 mln € • Population > 1 mln • Average market income > 100 • Sales/sqm > 4.500 • % of total Building Sales Coin: 42% • % of total Store EBITDA Coin: 48% • Central locations • High quality stores CITY BOUTIQUE (28): • % of total Building Sales Coin : 40% • % of total Store EBITDA Coin: 39% SHOPPING CENTER (5) • % of total Building Sales Coin: 13% • % of total Store EBITDA Coin: 13% COIN FACTORY STORE (8): • Size < 2.000 mq • % of total Building Sales Coin: 5% • Rent ≈ 10% • Popular areas in large cities or central areas in small cities AMBASSADOR (12, of which 5 potential Coin Excelsior) • Market> 500 mln euro • Population> 1 mln • Average market income > 100 • Sales/sqm > 4.500 • % of totale Builiding Sales Coin: 42% • % of total Store EBITDA Coin: 48% • Central locations • High quality store CITY BOUTIQUE (11) • % of total Building Sales Coin: 40% • % of total Store EBITDA Coin: 39% SHOPPING CENTER (7) • % of total Building Sales Coin: 13% • % of total Store EBITDA Coin: 13% OTHERS (24) • Size < 2,000 • % of total Building Sales Coin: 5% • Rent 10% • Popular areas in large cities or central areas in small cities
- 22. 22 Direct Store Network - 2014
- 23. Becoming a Total Retailer 23
- 24. ON LINE • Email • Web Site • Social Network • Ecommerce OFF LINE • In Store Windows • Video Wall • Digital Totem • Radio • TV • Leaflet BETWEEN ON & OFF LINE • SMS • Push Notification • App Becoming a real omnichannel retailer:CRM to enhance the Customer Experience 24
- 25. CRM : the Key for Omnichanneling CRM is the Bridge between the Customer and the Brand channels. CRM is the key to obtain a omni-channel retail strategy to promote your brand, improve the consumer experience and increase revenues. Customer Omnichannel Experience 25
- 26. In-Store TV 250 monitors located on the ground floor of 33 stores Digital Communication – In-Store TV 26
- 27. Radio & Digital Totems • Coin Music Design is present in all stores with a radio station broadcasting the best of international pop, electro dance and R’n’B music. Digital Communication – Radio & Digital Totem 27
- 28. Digital Showcase Innovative Digital Windows: a backdrop comprising FullHD screens to combine digital contents and product display Digital Communication – Digital Windows 28
- 29. iBeacons & Proximity marketing • Innovative Third Parties APP to start using iBeacons tecnology in the Store Digital Communication – Proximity Marketing 29
- 30. In Store Event, using Video Wall Blogger Engagement Coin FaceBook Page Google Glass test in store Digital Communication – Events combining Online & Offline 30
- 31. Digital Communication – Google Hangout 31
- 32. Digital Communication – Google Virtual Tour 32
- 33. Coin.it 200,000 unique visitors per month // 1 million page views per month // 11 millions DEM sent per year // Social Networks with a high level of fan activities Twitter // Facebook // Google Plus // Andorid & IOS App Launch in March 2015 Coincasa.it Launched in November 2014, the first Coin E-commerce. From April 2015 Click & Collect will be available Digital Communication – Digital Assets 33
- 34. Coincard Large database (over 2 millions people) 862,000 active consumer (84% women, 16% men) 47% of Coin sales Virtual Coincard From March 2015 even on your Smartphone for existing users and new ones Customer Omnichannel Experience – The role of COINCARD 34