Strategy

In order to significantly increase the relevance and perception of our brands, we comprehensively renewed the brand images of BOSS and HUGO in January 2022 – from logos, to product and marketing, up to new design concepts for our consumer touchpoints. To further increase brand relevance, particularly among the younger audience, we will continue to pursue our two-brand strategy. 

Two clearly distinguishable marketing strategies for BOSS and HUGO aim at activating consumers across all touchpoints. In this context, we will continue our successful digital-first marketing strategy, supported by star-studded campaigns, strong collaborations, and unique brand events. Marketing investments will continue to range between 7% and 8% of Group sales until 2025.

Our products are at the very heart of all our business activities. As part of “CLAIM 5,” we put strong emphasis on enhancing both brands’ 24/7 lifestyle images, ensuring that customers are perfectly dressed for every occasion. To live up to this target, we will fully exploit the potential of our BOSS Black, BOSS Orange, and BOSS Green brand lines for the Menswear collection, and leverage the exclusive BOSS Camel line introduced in late 2022. In 2023, building on the success within BOSS Menswear, the Camel line was also introduced to Womenswear while also having reintroduced the Orange line. In addition, we will explicitly seize opportunities in denimwear with the launch of the HUGO BLUE brand line in early 2024. At the same time, the existing product range will be available under HUGO RED from now on, placing a strong emphasis on street tailoring. Both brands, BOSS and HUGO, will maintain their superior price-value proposition, thus fostering their unique positioning in the premium / affordable luxury segment.

Digitalization is an important enabler to deliver on our vision of being the leading premium tech-driven fashion platform worldwide. An essential part of our Group strategy is therefore our clear commitment to further driving digitalization along the entire value chain. Since the introduction of “CLAIM 5,” we achieved strong progress in digitalizing important business activities – from digital trend detection and product creation to AI-enabled pricing, digital showrooms, and innovative experiences in the metaverse. 

The HUGO BOSS Digital Campus, launched in 2021, is at the heart of our digital journey. It significantly expands our Company’s digital analytics capabilities, first and foremost aimed at taking the consumer experience to new levels through the systematic use of data. Serving as an innovative and creative data hub, the Digital Campus puts strong emphasis on strengthening our global online business while driving meaningful insights and efficiencies along the entire value chain. In this context, HUGO BOSS also aims to make the best-possible use of the many advantages offered by AI. Among other things, this should enable us to link digital and physical retail even more closely in the future, to provide consumers with a seamless, best-in-class omnichannel experience.

We will continue to fully leverage our high-quality channel mix on a global scale. With brick-and-mortar retail contributing more than 50% of Group sales also going forward, this channel is, and will remain, by far our largest in terms of revenues. In this context, we are targeting store productivity improvements of at least 3% per year, supported by investments of up to EUR 600 million between 2021 and 2025 to modernize, further optimize, and selectively expand our global retail footprint. At the same time, brick-and-mortar wholesale is expected to continue contributing around 25% of Group sales. Since the introduction of “CLAIM 5,” we have made important progress in fostering our position in brick-and-mortar wholesale, having noticeably increased visibility and market presence of both our brands. To take our business in emerging markets to the next level, we will strengthen our global franchise business. Digital revenues are expected to continue their double-digit growth trajectory also in the years to come. Accordingly, the share of our digital business is targeted to increase to a level of more than 20% of Group sales by 2025. Above all, we aim to continuously improve the digital journey and drive further market share gains – from our own online flagship hugoboss.com, to our online concession business as well as digital wholesale. For its license business, which among others includes fragrances, eyewear, and watches, HUGO BOSS sees revenue potential of up to EUR 200 million as part of “CLAIM 5.”

Besides further growing across all consumer touchpoints, as part of “CLAIM 5,” it is our clear ambition to continue driving broad-based growth and gaining market shares across all geographies. In the EMEA region, key markets such as Germany, the UK, and France, as well as important growth markets such as the Middle East, are all set to contribute to further revenue improvements. Growth will be supported by further enhancing and upgrading our distribution network, accelerating our franchise business, and capitalizing on business opportunities across brand lines. In the Americas, we will continue to push our 24/7 brand image particularly in the important U.S. market, where we recorded exceptionally strong momentum over the past two years. On top of that, HUGO BOSS aims to further expand visibility in U.S. department stores, rolling out digital marketplaces, and strengthening its store network in Latin America. For Asia/Pacific, the region’s revenue share is expected to grow to around 20% as part of “CLAIM 5.” In this context, HUGO BOSS will continue to unleash the brands’ full potential in both China and Southeast Asia & Pacific. To secure our affordable luxury position across the region, we will further strengthen our distribution footprint, which also includes boosting digital and social commerce with key partners.

Over the past two years, we successfully transformed our operating model to a platform approach and implemented a streamlined, brand-led organizational setup that enables profitable growth and ensures rigorous strategy execution at a global level. In order to foster growth and further drive efficiencies going forward, we will step up investments into our supply chain.

We recently launched the important Digital TWIN initiative, aimed at enabling smart decision-making through a tech-driven business operations platform and being a key enabler to meeting consumer demand even better in the future. While further increasing the flexibility and transparency of its global supply chain, the Digital Twin will positively contribute to our future growth, profitability, and sustainability ambitions. At the same time, we are expanding our global logistic capacities by around 40% as well as continuing our nearshoring initiatives by bringing production even closer to EMEA and the Americas.