Yoox Net-a-Porter exits Chinese market
The China-based joint venture between Alibaba and Yoox Net-a-porter (YNAP), Fengmao, will be axed according to its CEO Yating Wu.
YNAP had operated in China under a joint venture with Alibaba, but now a report states it “will be liquidated”. The dissolution of Fengmao is part of YNAP’s strategy to exit China to focus on more profitable geographies, according to WWD.
Reports suggest that luxury giant Richemont, which owns YNAP, is setting out to sell the underperforming business this year. With this move, it may be tidying up the business before a sale.
Richemont revealed that sales at YNAP declined by 14% in fiscal 2024 “in a challenging environment for luxury e-commerce.”
Net-a-porter entered the Chinese market in 2013. Later that year, its discounted sister company, The Outnet, exited the Chinese market due to stiff competition.
In 2018, Richemont signed a joint venture with Alibaba Group to puncture a larger chunk of the Chinese e-commerce market. The following year, Net-a-porter opened a flagship brick-and-mortar store at Tmall’s Luxury Pavilion. However, by 2020, the retailer closed its China website.
Ultimately, rival JD.com's offering of omnichannel solutions for luxury third brands saw Alibaba's reign over luxury e-commerce in China to an end in 2020 and the business has been suffering ever since.
