Moncler & Burberry, Two Titans of Outerwear, Could Come Together. Should They?
Is Moncler acquiring Burberry? Well, let's not get ahead of ourselves. After all, do Moncler and Burberry even make sense together?
In early November, the fashion industry's resident gossip girl, Miss Tweed, reported that Moncler was rumored to be eyeing Burberry for its latest high-powered acquisition. Moncler snatched up Stone Island in 2020 and recently cozied up to LVMH, with the French luxury conglomerate picking up a minority stake in Moncler in September.
The deal was mutually beneficial, giving Moncler access to LVMH's vast resources and further tapping LVMH in with one of the most ascendant names in luxury.
Despite some recent minor revenue slowdown, for instance, Moncler mostly shrugged off industrywide slowdown, boosting sales by 15% in the first half of 2024.
Now, what's all this about Burberry?
Moncler is supposedly weighing an acquisition of the British label, according to aforementioned rumors, a proposition that LVMH head Bernard Arnault is said to support. "Moncler does not comment on unsubstantiated rumors," Moncler said in a statement provided to Highsnobiety.
This follows several reports about various issues plaguing Burberry, including notable underperformance that goes beyond the struggling luxury market, leading to a modest estimated valuation of £3 billion (about $3.9 billion).
Compared to other luxury peers (large conglomerates like LVMH, Kering, and Richemont notwithstanding), Burberry stands especially small — it was absent from a summer 2024 ranking of the most valuable luxury labels, which put Prada at number 10 with an assumed value of over $5 billion.
Further, like Chanel, Tod's, Hermès and Goyard, Burberry is one of the few heritage houses not owned by a larger conglomerate. This may make Burberry a covetable acquisition.
After all, it's one of the world's most recognizable fashion brands both in terms of name recognition and imagery — the Burberry Check and trench literally speak for themselves.
Under the direction of former Bottega Veneta overseer Daniel Lee, Burberry has attempted to stake out a fresh presence, with mixed results. On one hand, Burberry has successfully nabbed a host of young British talent to model its wares, reflective of reaffirmed Britishness.
However, beyond not combatted the wider luxury slump, this approach's woes even predate it. “Our first-quarter performance is disappointing," Burberry chairman Gerry Murphy admitted to reporters in mid-2024, right before the broader luxury downturn became especially visible.
Incoming CEO Joshua Schulman, a former Bergdorf Goodman president and Jimmy Choo CEO, is expected to announce a fresh scheme for Burberry in the coming weeks, though he's already clarified that Lee's vision will remain in place.
While Burberry is in flux, Moncler has never been stronger.
Part of Moncler's strength comes down to its canniness for reassessing luxury fashion, which it's demonstrated for the better part of a decade, at least.
Its landmark Moncler Genius program, which invites creatives as disparate as A$AP Rocky, Rick Owens, Alicia Keys, Dingyun Zhang, Pierpaolo Piccioli, and former Apple designer Jony Ive to remix signature Moncler tenets, is key in demonstrating Moncler's far-reaching aspirations.
Ever since 2019, Moncler has not merely been a luxury skiwear label. No, it's a hub for A-list talent, experiential activations, and next-gen design.
This is the sort of, well, genius that's made Moncler an appealing partner for similarly forward-thinking LVMH. This kind of unboxed thinking could even set up Moncler as Burberry's savior.
Like Moncler and Stone Island, Burberry has its own recognizable traits (beyond recognizable outerwear) that could be finessed to create broader relevance without sacrificing the all-important heritage at the core of it all.
As proven by earnings reports issued earlier this year, Moncler is a capable manager of its fortunes, both for the Moncler brand and Stone Island. Like with the latter company, Moncler wouldn't have to build a reputation for Burberry as much as it'd simply have to right the ship.
Still, that could be a tall order.
For one, Burberry's oeuvre is more classic than Moncler and Stone Island's innovative offerings, making it a less neat stylistic fit. There's more going on here than just outerwear.
And perhaps more importantly, though a Burberry acquisition could set Moncler up as the first proper Italian luxury conglomerate in the making, it may also prove to be an unwieldy addition to Moncler's strategy.
Schulman has affirmed plans to keep Burberry premium (and focused on outerwear, at that), rather than moving to more affordable goods as some analysts have suggested.
This is a better fit for Moncler's own direction, which leans hard into luxury, but is it wise for Burberry to stay the course amidst turbulent waters?
For now, at least, that's not a question Moncler has to answer.
