In The News

Catching Up with Dr. Aniello Musella

 

February 03, 2010

Dr. Aniello Musella, the Italian Trade Commissioner for the U.S., oversees all of the Italian Trade Commission’s six regional offices. But in his New York City division, he has the pleasure of keeping watch over three of Italy’s most celebrated exports: fashion, food and wine.

We spoke to Dr. Musella about Italian business and fashion shortly before the MRket Las Vegas trade show, which will have 37 different companies represented in its growing Made in Italy section.

What kind of work does the Italian Trade Commission do to help retailers?

From the 10th to the 22nd of December, during the Christmas shopping season, we organized a promotion called “Made in Italy on Madison” with more than 40 Italian retailers on Madison Avenue. We did quite a lot of incentives and advertising, really trying to capture the attention of consumers during this two-week period. These are the kind of activities we are trying to do more and more.

The Italian government works with the apparel business on two sides. On the domestic side, the Italian government tries to support Italian companies through a sort of fiscal incentive in order to enhance and make new business. This is on the production side. On the other side, if you go to the exporting market, there is support by the Italian government, and the Italian Trade Commission makes it its main mission to promote Italian fashion to, in this case, the American consumer.

There are different kinds of promotional activity, from participating in a trade show like MRket, to organizing a big advertising campaign to consumers like the one I mentioned earlier, or big events with independent retailers.

With so many Italian vendors at MRket Las Vegas in February, are Italian companies making a bigger push in the American market?

The American market is the biggest market for Italian manufacturers outside of European countries. For some Italian companies, it’s the biggest market, period. No matter the economic crisis, there are some Italian brands that have invested so much in this market that they still have great expectations. During the economic crisis, we all know that consumption has gone down, and it’s not exactly the same as we had in 2005 and 2006. But during 2008 and 2009, most of the Italian companies tried to reduce their profit margins and tried to be more efficient on the production side to be as competitive as they could. But still, they want to stay in this market even though, of course, most of them don’t have the same market share they’ve had previously over the last ten years.

How is retail business in Italy right now?

Business in Italy is not what it was before the economic crisis, which affected not only the U.S., but Italy and Europe. So you could say that the Italian consumer is very concerned about his appearance and what he wears. But the consumers, even in Italy, are much more selective. They buy fewer items, so they choose all the items with great intention. They look for quality and value and they expect more from what they pay for. The discount distribution segment has increased a lot during the last two years.

How are Italian companies doing in this economy?

Italian companies with stores in the U.S. are still doing good business. Of course, not like two years ago, but still, they have business. This is the most important thing. Most Italian companies told me that they did more business through their own stores on the street level than the corner they have in the department stores. Companies with their own stores have windows on the street, so this is much more attractive to the consumer.

There’s a second segment of Italian companies, the ones that have high quality level of production but they don’t have their own brand. They have been affected quite a lot.

Companies with brands that are recognizable to the American consumer have coped with the crisis quite well.

There’s a lot of competition from Asian sourcers, and the American consumer is very price sensitive. How do you convince this market to buy Italian?

Italian fashion is not for every pocketbook—it’s expensive. It’s not as cheap as Asian manufactured goods. With this as the starting point, you cannot compare Italian fashion with Asian and Chinese production. They are two different segments. Consumers who are used to buying from Saks Fifth Avenue, Bergdorf, Neiman Marcus or independent retailers are looking for quality. They buy less but they still buy for quality. In this segment of the market, Italy can cope quite well.

The point is when you go down to a medium, medium-low level, manufacturers in Italy cannot really compete with a price range that’s ten times less. So I would say they are two completely different worlds. People who buy fashion from Italy very seldom buy fashion from China. Or if they do, they do it for free time and sports. But if they have to buy a formal suit, if they have to buy fancy things, they buy Italian.

Italian companies have always been strong on quality, craftsmanship, tradition and new design—every season.

 

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