The proposed merger between Italian online fashion retailer Yoox and designer clothing website Net-a-Porter will be approved by shareholders this month (June). It will become the world’s largest online outlet for luxury brands. Mr Rupert told The Business of Fashion that he had spoken to LVMH chairman Bernard Arnault and Kering in a bid to persuade them to join the platform. By committing to sell their brands through the site, they would get equity in the company and deliver the critical mass in e-commerce that luxury goods manufacturers need to stand against the competition, he said. 

Redefining the fashion media and retail landscape

Yoox’s founder Federico Marchetti is to be chief executive, and the company will be based in Italy and listed on the Italian stock exchange. Natalie Massanet, the founder of Net-a-Porter, will be executive chairman. Combined net revenues of the two companies in 2014 were €1.3bn. The deal brings together 15m users from Yoox and 9m from Net-a-Porter under the new name of Yoox Net-A-Porter Group. Announcing the deal, Ms Massanet said: 'Together we are redefining the fashion media and retail landscape. The best way to predict the future of fashion is to create it.'

Richemont has majority stake

As well as its own site, Yoox operates the online websites of more than 30 luxury brands such as Diesel and Dolce and Gabbana, while Kering’s brands include Balenciaga, Stella McCartney and Yves Saint Laurent. Mr Marchetti told the Financial Times: 'We plan to expand on our many combined successes and industry breadth to strengthen partnerships with the world’s leading luxury brands and harness a significant untapped growth potential.' Richemont, owner of the Cartier, Piaget, Montblanc and Chloe brands, has a majority stake in Net-a-Porter and is expected to have a 50 per cent stake in the parent group (but with voting rights of 25 per cent).  

HIgher end shopping experience

Between them the two existing companies have high fashion retailing sewn up, with Yoox selling previous season pieces from high fashion houses at a discount, which increases the longer an item stays on the site. Net-a-Porter offers in season lines, and with additional French, German and Chinese sites delivers to 170 countries. It also has a discount website, The Outnet, selling items at up to 60 per cent below the original price. The combined platform is promising to offer a higher end shopping experience than that offered by the largest online retailers. Customers of the two sites are said to have an average spend of €318, compared with a figure below €100 for Asos.

Online clothing sales to rocket

The merger comes as Mintel predicts that online clothing sales are set to rocket. According to the report Women’s Clothing – US (May 2015), 67 per cent of US women purchased clothing online in the past year, up from 63 per cent in 2013. 'The channel once considered less trustworthy and reliable is now set to change the face of the women’s clothing market,' it says. The women’s clothing market in the US is expected to increase in sales by 14 per cent by 2019, it says, but online sales growth will dwarf this, with a projected increase of 77 per cent. Purchases made on a mobile device will comprise 25 per cent of all online sales by 2017, Mintel predicts.