Initiated with the eponymous mass market brand, the British group Sports Direct, renamed Frasers Group after acquiring the department stores House of Fraser, is eyeing luxury. While its recent acquisition of Matchesfashion fell short, it hopes to make amends with its latest targets, THG and Ted Baker. Nonetheless, it also continues to be interested in more accessible shopping malls for the average consumer…
Can a mass market retail group transform into a luxury group?
Coming from sports retailing, through the Sports Direct brand, the British group Frasers believes so and is accelerating its diversification into the ultra-high-end segment.
Having already acquired the department store House of Fraser and taken a stake in Hugo Boss, it has now purchased some luxury assets of THG and is eyeing the UK operations of Ted Baker.
To dare such an elevation, has its founder Mike Ashley taken inspiration from the example of French billionaires Pinault father and son? By changing names, for example, transforming a “commoner” group into an “aristocrat”?
Kering: Its French Model?
Not everyone remembers, but before transforming into the luxury group we know today, Kering, the ex-PPR (Pinault-Printemps-La Redoute) founded by François Pinault, first built its foundation in public retail (through the acquisitions of Conforama, La Redoute, Le Printemps, and Fnac).
In 1991, François Pinault bought the furniture chain Conforama from… Bernard Arnault, CEO of LVMH, who himself wanted to focus solely on luxury!
In 1999, PPR (Pinault-Printemps-La Redoute) began its strategic shift towards luxury by acquiring 40% of Gucci and 100% of Sanofi Beauté, then owner of Yves Saint Laurent, right under the nose of LVMH, which was also in the running. Its CEO, Bernard Arnault, saw another contender for a luxury empire with a very bad eye.
A quarter of a century later, it’s clear that PPR, renamed Kering and now led by François-Henri Pinault, François’s son, has successfully completed its total transformation into a full-fledged luxury giant. Even though it is currently experiencing a slowdown as its flagship house Gucci, the one that started it all and was long its driving force, faces challenges…
In the Beginning: Sports Direct…
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Featured Photo: © Frasers Group
