Luxury Goods Market in Crisis, and Here Billion-Dollar Growth! How Does the Prada Miracle Work?
Let's be clear: the luxury goods market is in crisis and is facing many serious challenges. Meanwhile, the Prada Group is not only maintaining its position on the market, but is actually strengthening it. In the first quarter of 2025, the group recorded a 13 percent increase in revenue, reaching €1.34 billion, exceeding analysts' expectations. This result is all the more impressive because it was achieved at a time when competitors such as LVMH and Kering are experiencing sales declines.
For many experts studying the luxury goods market, the latest financial data from Prada Group came as a surprise. Despite serious challenges in the industry, the Italian group is doing not quite well, but very well. In the first quarter of 2025, Prada Group recorded 1.34 billion euros in revenue, which is a 13 percent year-on-year increase.
- How is that possible? - analysts ask, wondering what exactly is behind the success of the brand that is giving a "flick on the nose" to such luxury giants as LVMH or Kering.
JournalDuluxe.com decided to take a closer look at the "Prada miracle", presenting 4 key principles to which the Italian group has been sticking for years and which - according to the website - are the foundation of the financial success of the Prada Group.
Prada boutique in London / ShutterstockPrada does not only create fashion. It is part of an ongoing dialogue with art, cinema and architecture. Andrea Guerra, the group's CEO, talks about "shaping the company's culture". This approach gives the brand a rare depth and consistency - describes the JournalDuluxe.com website.
2. Stability as a competitive advantageIn an industry that is constantly undergoing creative upheaval, Prada is an exception. Miuccia Prada has been in charge since 1989.
- Stability today is a very positive signal - comments Andrea Guerra, quoted by the website.
This continuity allows the brand to combine solidity and boldness at a time when many are still searching for their direction.
3. Development without cannibalizationPrada has just announced its acquisition of Versace for €1.25 billion , an ambitious move in a tight market that reflects the group’s desire to create new vectors of growth.
According to the service, this expansion does not come at the expense of any brand that already operates within the group. On the contrary, it complements the portfolio.
The strategy is clear: each brand in the portfolio must retain its DNA and its audience.
- We are constantly developing brand by brand, and within the brand, consumer segment by sub-consumer segment – explains Andrea Guerra. - We are not thinking about cross-branding, overlapping or anything like that. It will never be like that.
According to JournalDuluxe.com, Prada Group is obsessed with this - it wants to avoid at all costs a situation in which Miu Miu encroaches on Prada's territory, and Versace on Miu Miu's territory.
This methodical separation helps maintain clarity of the value proposition and maximize the performance of each unit.
4. Beauty - the future of the luxury goods marketUnder Yann Andrei's leadership, Prada Beauty is consolidating its position as an emerging force in the beauty sector. The Prada Group sees the potential in creating its own distinctive and unique cosmetics, which are often the entry point into the world of luxury.
Miu Miu - the driving wheel of Prada GroupIs there anything else, apart from the principles mentioned by JournalDuluxe.com, that guides the Prada Group that determines the success of the Italian fashion empire? In our opinion, the driving force of the group is the Miu Miu brand , which - according to the WSJ service, recorded a 60 percent increase in retail sales in the first quarter of 2025. This brand, aimed at a younger clientele, has gained popularity thanks to bold collections and effective marketing campaigns, which contributed to increased visibility and sales of the entire group.
Prada Group - investments in technology and sustainable developmentIn addition, Prada consistently invests in digitalization and sustainable development, which responds to the growing expectations of consumers. Cooperation with e-commerce platforms and the development of its own online sales channels allow it to reach a wider group of customers and increase sales.
Prada Group - Think Big, Build ConnectionWe have already mentioned that Prada has been investing in projects combining fashion with art and architecture for years, but that is not all. It supports activities related not only to art, literature and film, but also wants to be present in the creation of new technologies and innovations. It is enough to mention here the cooperation of Prada Group with NASA.
One of the group's latest activities is its involvement in the construction of the Olympic Village in Milan. These activities are living proof that the Italian company does not focus only on selling fashion, but on being a "real architect" of modernity.
Prada shows that in the world of luxury, success is achieved not only through the quality of products, but also through a coherent strategy, innovation and a deep understanding of culture and customer expectations.
