Miu Miu’s Explosive Growth

To understand the business momentum and aspirations of Prada‘s Miu Miu label, there’s no better place to start than the runway show it staged on the last day of Paris Fashion Week.

Designer Miuccia Prada sent out a lineup of wearable looks, referencing life’s many stages, from girlhood to adulthood, on a cast that included Gigi Hadid, 28, and Kristin Scott Thomas, 63.

Originally conceived as a youthful sibling to grown-up Prada, Miu Miu, which last week reported retail sales that were up 58 percent in 2023, has in recent years turned its little sister positioning on its head, opting for a new strategy that speaks to a broader church of customers.

“The point is you can choose what you wear,” Miuccia Prada said after the show. “I have to decide every morning if I am going to dress as I was as a 15-year-old girl or the lady I am today.”

The offering has become not only ageless, but increasingly genderless, too. Today’s Miu Miu aims to “speak to a universe of people,” said the brand’s chief executive Benedetta Petruzzo, herself a thirty-something, in Milan the day after Prada Group released its latest set of results.

“The opening up of the casting of the runway show says a lot,” Petruzzo added. “It says: I know the rules and I will have fun subverting them. There’s a joie de vivre about it. It’s a youthful energy linked, not to age, but to attitude.”

In other words, it’s more about psychographics than demographics. And while Miu Miu’s brand is still about the younger, freer, less conceptual side of Mrs Prada, the clothes and styling have changed dramatically in recent years, in part due to the arrival of super-stylist Lotta Volkova.

It was during the pandemic lockdowns that the revamp started in earnest, according to executives. And last week’s results showed that the project is gaining pace: retail sales accelerated by 82 percent in the fourth quarter with strong momentum in China and the rest of Asia. EBIT margin improved to 22.5 percent of revenues.

Growth, said Petruzzo, is “transversal; it’s happening across products and geographies.” Miu Miu now accounts for 15 percent of sales of Prada Group compared with 12 percent in 2022.

“Miu Miu has always had a strong potential. It’s the most free expression of Signora Prada,” Petruzzo added. “The strategy from here is clear: we keep going in this direction.”

How to keep up the pace in a year when the steam has come off luxury’s post-pandemic boom is the challenge. But Petruzzo is convinced Miu Miu is just at the start of its growth spurt.

There is room to grow, in large part, because the brand is stretching its customer base. Miu Miu’s historical positioning as the sister brand of Prada means its core customers skew younger. Some two-thirds are millennial and Gen Z. But millennials are getting older, so Miu Miu has made a point of speaking to those with a “youthful attitude” and that means more than aging millennials.

That’s reflected in the retooled product offering. Miu Miu’s viral micro-miniskirt is one of the brand’s top-sellers. But so, too, is a cashmere cardigan. Miu Miu is building its offer on both trend pieces and wearable riffs on preppy daywear. “We are biker boots to ballerinas,” said Petruzzo.

The brand is also building out key product categories, crucially in all-important leather goods with the launch of its Arcadie bags, and via collaborations like Church’s X Miu Miu brogues and a tie-up with New Balance.

Another key part of the strategy is “about starting conversations,” said Petruzzo. In other words: generating earned media mentions to telegraph the brand to a bigger potential audience.

Miu Miu’s micro-mini for Spring/Summer 2022 was a media sensation, its slashed hem a howl of liberation after the dark days of Covid-19 lockdowns. It landed on scores of celebrities and magazine covers, and helped drive demand for mini skirts to a three-year high, according to Lyst.

Critically, you didn’t actually need to buy Miu Miu’s skirt to participate in the conversation — you could slash your own skirt at home and still feel part of the moment. It’s all part of a strategy to create more noise than the brand’s present marketing budgets would otherwise allow.

Creating a solid foundation for growth is crucial not just for Miu Miu, but also for Prada Group, which needs the greater stability of a multi-pillared business in an increasingly ferocious competitive environment dominated by the financial firepower of French luxury colossus LVMH. Sales at Prada Group, which also includes Prada, Church’s, Car Shoe and patisserie chain Marchesi 1824, rose 17 percent in 2023 to €4.7 billion. By comparison, LVMH’s fashion and leather goods division generated sales of €42.1 billion last year.

Less eye-catching than the micro-miniskirt but also crucial to Miu Miu’s success has been a push to strengthen the operational side of the group. Prada co-founder Patrizio Bertelli, during the company’s latest earnings call, described Miu Miu’s recent success as the result of “strategic choices made over the last few years in product communication, distribution and human resources.”

Petruzzo’s arrival as chief executive for Miu Miu, the first time the brand has had a dedicated executive, is emblematic of that change. A former Bain management consultant who worked at Kering, most recently as its US executive vice president of eyewear, she joined Prada in 2020. The appointment was part of the broader managerialisation of Prada Group that’s taken place since 2017 when Lorenzo Bertelli, son of Mrs Prada and Mr Bertelli, joined the family company to lead marketing and communications.

The group’s executive team also includes Paolo Zannoni, a former Fiat and Goldman Sachs executive who serves as executive vice chairman. Andrea Guerra, another veteran executive who led eyewear giant Luxottica for a decade and was most recently a senior manager at LVMH, became CEO of Prada Group in 2023.

Petruzzo defines her team today as being “not necessarily bigger, but there is more definition,” both in terms of roles and in its separation from the Prada brand. After several years of exits from Prada, it’s a telling break from the past that Petruzzo describes Miu Miu’s staff as “solid and motivated.” “We are feeling empowered to take this path of strong growth,” she said.

It’s helping momentum, too, that tourism is finally coming back to Europe. Chinese and Americans are returning to the region, according to Prada executives. On a visit this past Saturday, Miu Miu and Prada’s flagship stores in Milan were thronging with American and Chinese shoppers, as well as Italians and Russians.

Petruzzo points out Miu Miu has reduced its network of stores over the past couple of years which makes its like-for-like growth even more notable. Organic growth is the aim for the coming years, too, even if “we may have more square metres of store in 2025-2026.” Bertelli has said investment in real estate worth €1 billion is a business priority, especially in the US.

There is more brand extension to come with the launch of fragrances in 2025. Miu Miu inked a multiyear deal with L’Oréal’s luxury beauty division this year and Petruzzo doesn’t rule out further expansion into beauty, such as cosmetics, or other areas such as interiors — but not yet. “There is certainly the potential to open other areas, but not at the moment,” she said.

One thing that’s not changing for Miu Miu is its Paris runway home. Mrs Prada moved the brand’s show to the French capital in 2006, and since 2011 it has presented its new collections in the Palais d’Iéna. “Although it’s a very Milanese brand, it is also a way to separate the vision of Miu Miu from Prada,” said Petruzzo. “Miu Miu is also born from an international spirit.” It’s another sign of Miu Miu’s intentions to conquer a global audience.

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