Report From Italy – How Consumers Act As Retail Reopens

I was recently introduced to Ms. Francesca Venturi who is the founder of Elevate, a Fashion PR and Communications consultancy located in Rome, Italy. Francesca has had an international career in fashion PR, shaping communications for luxury brands such as Valentino and Karl Lagerfeld.

I asked for her insights on the impact of COVID-19 on consumer behavior in the Italian retail sector. In particular, I wanted to hear her thoughts about how consumers are acting in Rome following the reopening of retail trade on Monday, May 18^th.

The customer:

Based on the description by Francesca, there are very few consumers shopping aggressively after 67 days of lockdown. While locked up, consumers shopped for food, including ingredients to make homemade pasta and pizza. They have also been purchasing beauty products and sports apparel on-line. Francesca felt that grocery shopping (and cooking) was pretty much the only way to see light and find a bit of excitement during the days the country was locked up.

Now, some shoppers are looking for gifts weddings, christenings, or graduations - many were celebrations that had been postponed for many families. She pointed out that the emphasis is on gifts, not apparel for the occasion.

According to what she has seen, one in three women prefers to wait until the end of the emergency to shop while the rest want to gingerly go back to their shopping routine. Most likely those living in the city will shop in the outskirts of Rome rather than in the historic city in an effort to limit their movements and minimize the risk of contagion in more crowded areas.

Those who are starting to shop want to buy affordable items such as on-sale clothing and necessities including hosiery, lingerie and shoes. It is interesting to note that there is scant interest in fashion apparel as every garment that has been tried on for look or fit has to be sanitized afterwards with ozone spray or high temperature steamers. As a result, the garments tend to already look as if they have been worn before actually being purchased by a customer. In fashion, looks count and that visual appearance affects customer interest.

Retail reopened:

In the week since, retail reopened, this is what is going on. Small, 400 square foot boutique stores are limited to have only one customer in the store at a time, and customers stand patiently outside stores to wait to get in. Much interest is in home stores, and the lines are longest in front of the Ikea store. One can conclude that the Italian shopper does not see herself going out very much yet, but she wants to create a more beautiful home for herself. Combined with the point I made earlier about the need to sanitize every garment tried on and how that undermines a fresh fashion look, I think that is a clue why the ready to wear stores and fashion boutiques are not attracting her.

On opening day May 18, there was also intense consumer interest at Zara, H&M and Bershka stores. Many waiting in line were non-resident students who needed to buy summer clothes since they are unable to return home as travelling between regions is not fully permitted at this time. One cannot travel without a valid reason, and shoppers are stuck in the hosting city with a closet full of winter apparel.

The luxury stores:

35% of the luxury stores have not opened in Rome and fewer than that have opened in Milan. The Via Montenapoleone in Milan is virtually empty, and few stores are open because of the lack of tourists. Among the luxury stores that are still closed in Rome (on Via Condotti and Via del Babuino) are Prada Men’s Store, Miu Miu, and Max Mara. Since borders are closed, many luxury boutiques suffer from the absence of international tourists. The Italian tailoring brands, distinguished by their impeccable made-to-measure suits, lament the lack of American tourists in particular.

Last Saturday:

On Saturday, May 23, Francesca confirmed her earlier observations with a personal stroll through the city. She wrote that she walked on Via Condotti and that it does not look anymore as it was. Many of the high-end luxury stores were not open, and only alluring mannequins in the windows reminded her what fashion once was. Luxury stores that were open were empty, and their sales staff was standing outside – waiting.

Francesca feels that brands like Ferragamo, Etro, Armani and others who have consistently nurtured their relationship with top spenders will recover in short order. A genuine dialogue with the end consumer will accelerate recovery.

The environment:

Italy has about 60 Million inhabitants, and 32,000 people have died of the coronavirus COVID-19 infection to date. (In contrast, almost 100,000 people have died in the United States.) The government closed air traffic from China and subsequently closed all borders. People who are now entering Italy have to sequester themselves for two weeks before seeing anyone else. Once the borders open, this restriction may be lifted to boost trade and encourage tourism while coexisting with the virus.

Conclusion:

It has only been one week; I think activity will steadily pick up as long as the pandemic does not spike up again, and the winners will be the retailers who show their commitment to support their customers with the merchandise they want and a shopping environment that is reliably safe and healthy.