Internationalization of Luxury Fashion Firms

Andrea Runfola is Associate Professor of Marketing and Management at the Department of Economics of the University of Perugia. His research interests include international business, international marketing, business networks, supply chains, business models and digitalization. He has been researching fashion and luxury for about twenty years. He is the author of book chapters and two books. He published numerous articles in leading national and international academic journals. Matilde Milanesi is Assistant Professor at the Department of Economics and Management of the University of Florence. Her research interests lie in international business and international marketing, industrial marketing, buyer-supplier relationships, and luxury and fashion marketing. Her works are published in academic refereed journals. She is also the author of chapters in edited books and has recently published a book on liabilities and networks in the internationalization of fashion retailing. Simone Guercini is Full Professor of Marketing and Management at the Department of Economics and Management of the University of Florence. His research interests include business marketing, international business, qualitative research, heuristics in behaviour and cognition. For over twenty years, he has investigated textile and leather goods companies. He held courses and invited talks at many universities. He authored books, chapters in books, and he was editor of edited books. He published more than 80 articles in academic journals.

CHAPTER 1. INTRODUCTIONThe chapter introduces the theme of the book. In particular, the need to study luxury companies from the point of view of the business model and the relationship with internationalization is highlighted. The research gap is then discussed, highlighting how the sphere of small and medium-sized enterprises (SMEs) of luxury fashion have been substantially neglected by the academic debate, which focused mainly on large multinational brands (MNEs). The chapter then presents the structure of the text, highlighting the logical path followed by the authors, which leads to the construction of a theoretical model, the implications of which may also be useful for luxury managers. CHAPTER 2. LUXURY AND INTERNATIONALIZATION: MOTIVES AND FEATURES The chapter discusses the relationship between luxury and internationalization. In particular, the main features of luxury companies are outlined and the reasons that led them to face internationalization processes, often since their establishment. Among these, some relevant reasons are discussed: the size of the demand, since luxury companies seek foreign markets to obtain additional volumes; the global image, essential for obtaining legitimacy and orienting consumer preferences; the characteristics of luxury customers, such as international mobility and specificity of lifestyle; management of distribution and communication channels, especially digital. CHAPTER 3. THE INTERNATIONALIZATION OF LUXURY FASHION The chapter discusses how luxury is developed in the field of fashion and examines the companies of luxury fashion in terms of types, characteristics and relevance. In particular, with reference to luxury fashion companies, the main contributions of academic literature that have examined this category of companies are identified, with a particular focus on issues related to entry and expansion into foreign markets. The chapter concludes with a review of recent literature to understand what are the emerging themes and current trends in relation to luxury fashion companies, such as the relevance of social media and sustainability. CHAPTER 4. INTERNATIONALIZATION AS A COMPONENT OF BUSINESS MODEL This chapter considers the business model as a necessary construct to be studied for the understanding of the international development of luxury manufactures. It then proposes a systematization of the contributions of academic literature dealing with business model components. The chapter continues showing different luxury fashion business models, pointing out how internationalization may represent a relevant aspect of any business model. It specifically draws attention to how internationalization relates to the other components of the business model of a luxury fashion company. Then, the chapter specifically considers the case of SMEs compared to MNEs in luxury fashion. It ends with a discussion on how business models of luxury fashion SMEs may be put under pressure by new trends in the global scenario. CHAPTER 5. METHODOLOGY AND EMPIRICAL SETTING The methodology of the study is presented in detail, which concerns the construction of business cases through a process of research of the authors, who conducted in-depth interviews with managers and entrepreneurs of luxury fashion companies. Data are then presented on the empirical context of reference, the Italian fashion luxury. The specificities of made in Italy luxury fashion are also highlighted compared to the main international luxury competitors. CHAPTER 6. CASES OF ITALIAN LUXURY FASHION MANUFACTURERS The chapter is dedicated to the development of cases of luxury fashion companies. We examine 5 cases of small and medium-sized enterprises that have embarked on a path of internationalization. The cases concern business-to-consumer companies that deal with clothing, leather goods, and accessories. For each case, the process of expansion into foreign markets is analyzed, the difficulties encountered