Why money-can’t-buy experiences are key to Mytheresa’s success

Last week, luxury e-commerce platform Mytheresa posted strong third-quarter growth at a time when many luxury retailers, both online and brick-and-mortar, are struggling to maintain stability let alone grow. 

Mytheresa reported €233 million ($380 million) in net sales in the quarter ending March 31, a 17.6 per cent gain from the €198.9 million ($323 million) the year before. 

“As the global luxury market gropes with an economically stressed aspirational consumer, stalled growth in China, and an eroding profit profile for e-commerce luxury players, Mytheresa’s recent fiscal third quarter results were a standout as customer count, average order value, business with top customers and reduced acquisition costs all exhibited gains during the quarter,” Marie Driscoll, an expert on luxury retail and the founder and chief analyst at Driscoll Advisors, told Inside Retail.

Why Mytheresa stands out in the luxury e-commerce market

While other luxury e-commerce retailers like Yoox-Net-a-Porter and Matches are trying to regain their footing, Mytheresa has been able to push ahead thanks to three factors: the return of the high-income, luxury shopper, focused attention on the US market, and its unique events and experiences for new and returning shoppers alike.  

As Mytheresa’s chief executive officer Michael Kliger noted on a call with analysts on May 15, high-income spenders have been returning to luxury shopping at steadier rates versus the aspirational shopper.  

“The US is by far the strongest region in luxury spend, and this is also due to the fact that the aspirational customer is coming back,” Kliger stated.

“The only thing I want to stress is our fast acceleration in the third quarter is really much, much more driven by our success with the big spenders while we do observe the green shoots on the aspirational customers.

“Our clear focus on big-spending wardrobe-building top customers resulted in both, strong growth of the number of customers, as well as the average spending of top customers.

“This highly desirable audience makes us the best-positioned platform to partner with luxury brands for exclusive activations.”

Examples of the company’s exclusive activations include several exclusive capsule collections with designer brands Gucci, Bottega Veneta, Loewe, and Brunello Cucinelli. 

Driscoll also theorised that a large part of Mytheresa’s success derives from the one-of-a-kind, premium experience it offers to its loyal fanbase, such as the 24-hour event in Shanghai it recently produced alongside the Paris-based label Courrèges. This included a brand exhibition and a meeting with the brand’s creative director Nicolas Di Felice.

“Mytheresa’s singular blend of must-have trending luxury fashion, brand activations and engaging events support customer loyalty and has allowed the retailer to operate a full-price strategy, they are not competing on price, but access to product and events designed to thrill fashionistas around the world. Unique events and experiences (fashion previews, dinners, fashion week) for Mytheresa’s top clients solidify loyalty and speaks to the importance of offline relationship building to drive online success,” Driscoll said. 

What else Mytheresa has up its sleeve

While it would be relatively easy to chalk up Mytheresa’s recent success to some exclusive collaborations and events, that is just part of the story. Additionally, Mytheresa has been tailoring its product offering to top spenders, who make up 40 per cent of the brand’s revenues.

Last year, Mytheresa partnered with Bucherer Fine Jewellery to become the brand’s first stockist. Additionally, as Kliger mentioned, the US has been a large part of the luxury retailer’s recent financial prosperity.

As Driscoll noted, “The US propelled topline growth as gross merchandise value growth accelerated to 41.6 per cent versus the year prior, positioning the US as Mytheresa’s biggest market, accounting for 22.3 per cent of total gross merchandise value.”

The increased attention from US consumers was certainly not achieved by accident.

Last year, Mytheresa, a German-based company, began hosting pop-ups in the US, first in the Hamptons, and following the success of the temporary retail experience, an additional holiday pop-up in Los Angeles. 

Mytheresa’s personal shoppers also work with its top clients to host events in their local communities in high-spending cities like Nashville and Miami.

Last year, the retailer also opened a high-tech, 600,000-square-foot distribution center to ensure speedier processing of incoming merchandise, outgoing orders, and customer returns. 

Another ace Mytheresa has up its sleeve is its focus on modernising the digital shopping experience. 

In February, Mytheresa became one of the first luxury retailers to design a shopping app for Apple Vision Pro, a spatial computer platform. 

In partnership with Obsess, a leading immersive shopping technology platform and visionOS developer, the app enables users to experience an “immersive” digital luxury shopping trip to Capri, Italy and Paris, France.

As Kliger stated in a release announcing the app’s launch, “Mytheresa firmly believes that selling luxury products needs emotions and unique experiences for customers. That is why we have become famous for creating true money-can’t-buy physical experiences for our best customers.”

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