Good evening. This is the Chorus Call conference operator. Welcome, and thank you for joining the Moncler nine-month 2022 interim management statement conference call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Ms. Elena Mariani, Strategic Planning and Investor Relations Director of Moncler. Please go ahead, madam.
Thank you, operator, and thank you all for joining our call today. The interim management statement call is hosted by Luciano Santel, Chief Corporate and Supply Officer, and by myself. I will start providing a brief overview of our results, and then Luciano will be happy to take your questions. Before starting, I need to remind you that this presentation may contain certain statements that are neither reported financial results nor other historical information. Any forward-looking statements are based on the group's current expectations and projections about future events. By their nature, forward-looking statements are subject to risks, uncertainties, and other factors that could cause results to differ materially from those expressed in or implied by these statements, many of which are beyond the ability of the group to control or estimate.
Let me also highlight that given the nature of our business, interim results can be influenced by seasonal effects and therefore cannot be taken as a proxy for full-year trends or results. Finally, I remind you that the press has been invited to participate to this conference in a listen-only mode. Now, moving to page two and three of the presentation, I would like to start our call today commenting on the celebrations of Moncler's seventieth anniversary, which were kicked off by an unprecedented event in Piazza Duomo in Milan on September twenty-fourth. I hope you are able to watch it, or at least to catch a glimpse of the show.
It was the biggest brand event in Moncler's history, with an impressive performance that featured 1,952 artists, which is the year in which Moncler was founded, centered around a revisited version of our iconic Maya jacket. The results have surpassed any expectation. The show was attended by over 18,000 people physically, and in the first 48 hours, the event recorded a reach of around 2 billion across all digital platforms. This event was just the start of the celebrations. The show in Piazza Duomo kicked off a 70-day program of events, activations, and experiences to connect and engage with our communities all around the world. Also, if you move to page four, you can see that as part of our anniversary, we conveyed the idea of Extraordinary Forever, which became the brand statement during the celebrations.
We created a unique and bespoke brand logo inspired by the infinite logo, connected with the idea of Extraordinary Forever. We also launched the Brand of Extraordinary, a two-minute brand film narrated by Alicia Keys, which was viewed over 20 million times in the first few hours. We also launched the Extraordinary Forever brand campaign, showcasing the 16 images inspired by the brand heritage that defined the history of Moncler. The quarter was not just about the seventieth anniversary. As you can see from page five, it was also the quarter of Moncler's footwear reset. Moncler established Studio Ascenti, a space to explore new footwear design, where we invited key members of the sneaker community to learn and to try on Moncler's new footwear lines.
In September, Moncler launched its new Trailgrip footwear line with its debut product, the Trailgrip GTX low-top sneaker, made in partnership with outdoor specialists like Cordura, Gore-Tex, and Vibram. We also had a Genius launch, 2 Moncler 1952, a collection that included also collaborations with Barbour and Clarks. Last but not least, moving to page six, let's talk about Stone Island brand initiatives. From an operational standpoint, in August, we took direct control of the Japanese market through a JV 80% controlled by Stone Island for the management of the local wholesale relationships and 16 DOS. We also integrated most of the retail distribution capabilities under the group logistics systems in Piacenza.
From a brand perspective, we launched the fall/winter Ghost collection, inspired by the concept of camouflage and monochromatic, and also the fall/winter Stellina collection, including a range of products with clean lines and urban performance identified by a small star embroidery. Let's now move to page seven, where we comment on the Group nine-month revenue results, focusing on growth at constant FX. In the first 9 months of the year, the Group generated over EUR 1.5 billion revenues, up 30% versus 2021, and 50% versus 2019. In Q3, the Group grew 12% versus 2021 and 50% versus 2019. The Moncler brand in Q3 was up 13% versus 2021 and 24% versus 2019, broadly in line with the growth of the H1 of the year when looking at 2019.
Stone Island grew 8% versus 2021 and 51% versus 2019. We remind you that Stone Island was fully consolidated from first of April 2021. Let's now focus on Moncler brand only and move to page eight of the presentation, where we analyze in detail the performance by region. Asia, that, as you know, includes APAC, Korea, and Japan, generated EUR 548 million in the first nine months of the year, contributing to 44% of total revenues. The region rose by 14% in Q3 year-on-year, and by 40% versus 2019, driven by the recovered performance in China, in particular during July and August when all the stores were open. Japan and Korea also continued to report a good performance. Both the DTC and wholesale channels in Asia recorded double-digit growth in the quarter.
EMEA reached EUR 486 million in the first nine months, contributing for 39% of Moncler revenues. Q3 was up 16% versus 2021 and 15% versus 2019, driven by strong demand from both local customers and American tourists. France, Germany and Italy were the countries that contributed the most to the growth in the quarter. The DTC channel in this region continued to grow at a high double-digit rate. Revenues in the Americas in the first nine months reached EUR 218 million, contributing to 17% of total sales. Q3 was up 6% year-on-year and 16% versus 2019. During the quarter, we recorded a significant outflow of U.S. tourists towards Europe. Let's now focus on Moncler brand revenues by channel on page nine of the presentation.
In the first nine months of 2022, DTC revenues reached EUR 903 million, contributing to 72% of Moncler brand total revenues. In Q3, DTC rose by 21% versus 2021 and 39% versus 2019, accelerating sequentially versus Q2 thanks to the strong performance of European and APAC stores and a triple-digit growth in the direct online channel. Moving to the wholesale channel, it grew by 2% in Q3 versus 2021 and by 4% versus 2019, in line with management expectations. Q3 performance was influenced by some conversions into retail of shop-in-shops and e-tailers. In terms of year-end indications, we can confirm that we expected the channel to end the year at mid- to high single-digit growth year-on-year. Before moving on to Stone Island, let's quickly pause at page 10, which provides some highlights of our exceptional direct online performance in the quarter.
All our dot com KPIs were up significantly versus 2021, and revenues in the first nine months of the year were up more than 80% at constant FX. Our direct online channel was also used as a platform for some of our pre-launches, including our first Trailgrip and our exclusive triple white Maya 70, and both were sold out, or the launch of our unique personalization project, Moncler by Me. Moving now to Stone Island regional trends on page 11. EMEA, which is the most important region for the brand, grew 1% in Q3 year-on-year due to a different timing of shipments in the wholesale channel. Italy outperformed the rest of the region in the quarter, reporting a double-digit growth. Asia grew 45% year-on-year in the quarter as a result of both excellent organic growth in APAC and some conversions from wholesale to retail.
In particular, the Japanese market was fully converted to retail at the beginning of August, and I remind you that the Korean market was fully converted at the beginning of January. Americas recorded a growth of 21% year-on-year in Q3, mainly driven by the wholesale channel. Looking at Stone Island trends by channel on page 12, wholesale, the most important channel for the brand, recorded a decrease of -3% in the quarter due to the conversion into retail of Korea in January, UK DTC in July, August, and Japan in August, but also due to some different timing of shipments compared to 2021. The DTC channel instead benefited from these conversions and was up 59% in the quarter with a good underlying performance even excluding these conversions. The direct online channel continued to register solid double-digit growth.
Finally, let's briefly examine our store network on page 13. At the end of September, our group's retail stores reached 313 units, 242 for Moncler and 71 for Stone Island. In Q3, Moncler saw two DOS net openings, among which Düsseldorf, for which you can see some pictures, and two conversions at Zürich Airport and Paris La Samaritaine. The Stone Island network grew on the back of the conversions of the 16 stores in Japan and of the London store.
Last, but absolutely not least, in terms of sustainability update, page 15 of the presentation, let me highlight that for the fourth consecutive year, Moncler is confirmed at the top of the textiles, apparel and luxury goods industry, obtaining the highest score in the 2022 S&P Global Corporate Sustainability Assessment among the companies eligible for the Dow Jones Sustainability Indices. We're extremely proud of this result, and it's definitely a great way to end our presentation. I will now hand over to the operator for your questions. Operator, please, open the Q&A session.
Thank you. This is the Chorus Call operator. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. To remove yourself from the question queue, please press star and two. Please pick up the receiver when asking questions. Anyone who has a question may press star and one at this time. The first question is from Melania Grippo with BNP Paribas Exane. Please go ahead.
Good evening, everyone. This is Melania Grippo from BNP Paribas Exane. I have two questions.
The first one is on Mainland China. Could you please comment on what was your performance in Mainland China in the quarter and what you are currently seeing in October? If possible, also, what was your exit rate in the country in September? My other question is on prices. You recently implemented a price increase for both brands. How is it perceived by consumer? Have you seen any impact on volumes? If it is possible to break down your Q3 performance by price, the mix and volumes. Thank you.
Okay. Hi, Melania. Thank you for your questions. About, your first question, Mainland China. Of course, this is a very, very good question considering, the overall scenario in that country. In Mainland China in Q3, that was positive, very good, in July and August, in line with June. You may remember that, Q2, was, very weak, in China because it was affected by the several severe lockdowns in June as, the stores in the most important, two cities, Beijing and Shanghai, were open again. I mean, our business not only started to do very, very well. June was good. In July, and August, in line with June. September, end of August, actually, because of, new lockdown, business, was weaker.
I mean, at the end of the quarter, just to answer your question, the Mainland China was positive. Current trend in China, of course, there are a lot of uncertainties in China due to the COVID issues. I can tell you that, the first week of October and the second week of October were very, very strong for China. You know, you may remember that the first week of October is the Golden Week, and our results during Golden Week were very, very good. Very, very good. Strong double-digit growth. This of course due, I believe, we believe, due to the impact of our seventieth anniversary event that was at the very end of September.
Even taking out the possible impact of that event that has been driven by the launch of the new Moncler Maya 70, the performance was good. Unfortunately right now I cannot say the same, because now we are still under the uncertainties associated with the COVID problems and the COVID restrictions. Some stores are closed. Some stores have been reopened and then closed again. I mean, situation is still volatile, uncertain, and not the ideal situation for business. In any event, of course, we keep monitoring the situation. What I can tell you that is very important from our perspective, that is more focused on the long term, is that the brand in China is really very strong.
Of course, we have to live with this, with this situation. The second question about the prices. You're right. We for the first time increased prices in this season. The impact, the response, has been honestly good. I would say unrelated to prices, of course. Now, we're talking about China before. I mean, currently weaker than the first week of October. That was amazing, but I would say totally unrelated to the price increase. The impact on volume in Q3, honestly, I mean, the impact of price increase was higher than volumes. I mean, we still maintain our historical guidance that the volumes for the year end, for the twelve-month period should represent 2/3 of the growth and the price 1/3 of the growth.
In Q3, considering the price increase in fall/winter, the price represented over 50% of the growth rate.
Thank you.
Retail growth rate.
Oh, thank you.
The next question is from Chiara Battistini with JP Morgan. Please go ahead.
Hello. Hi. Good evening, Elena and Luciano. Thank you for taking my questions. The first one, maybe to follow up on Melania's question on the current trading in China, maybe if we could expand on the current trading also for the rest of the world, in Europe and in the U.S. We saw the comments from Remo yesterday that October seemed to have started well, so maybe if you could provide further color on that comment and just generally globally. Specifically on China, actually following up on your answer regarding September and Q3, you mentioned positive double digit or actually really normalized in September, so more on a single digit level. Then my second question is on the U.S. in Q3.
I was wondering if you could expand a little bit more on your performance for the Moncler brand in Q3 in the U.S., that saw quite a slowdown. To what extent maybe this was related to the shift of spending with the tourists into Europe? Possibly commenting on the American cluster overall and whether there was anything else in the U.S. going on impacting the performance and taking it to single-digit. Thank you.
Okay, thank you, Chiara. Your first question, okay, first of all, the performance of China in Q3 was positive. Okay? Let me stay on positive. Was not amazing, but was positive. Please don't ask me a precise number. In any event, we are happy because it was positive. About the current trend, current trading, okay, region by region. Okay, China, we discussed a lot. Unfortunately, very volatile, but with a very strong first and second week of October. Korea, very strong. Honestly, I would say as usual, because Korea has been doing very, very well, at least for three years. No surprises. I mean, surprising because it's doing very well. Japan also very well. I mean, Asia overall, well, with the uncertainty associated with the current situation in China.
Europe, well, DTC specifically is doing very well, considering that, of course, needless to remind you, but we still miss the tourism coming from Asia, from China. We have the benefit coming from the tourism coming from North America, the U.S. Of course, locals. Yes, locals, business with locals is doing, is still very strong, is doing very well. Again, this is something we discussed already at times. This is the result of a very important activity work that has been done over the past years, not just months, to develop a strong local customer base. Talking about the U.S., I mean, there are two faces of the coin. One face is the very strong results of business with Americans in Europe.
The other face is what you call slowdown. I'm not sure that slowdown is the right word, even if, I mean, the percentage is evidently lower than in Q1 and Q2. But okay, first of all, again, in part it's been offset by the business we did in Europe with Americans. The second factor is associated with the base of comparison. Because last year, you may remember that America started, let's say, to take off. I mean, to do very well, exactly in August, I think, but, I mean, in Q3. Now the base of comparison, Q3 on Q3 of last year is, let's say, tougher than what it was before.
Important to highlight that if we look at 2019, and if we look at the U.S. cluster, okay, the U.S. cluster is strongly up in all three quarters with even a light acceleration in Q3. I mean, overall, we are happy with America. Again, you are right. I mean, the Q3, we reported a 6% growth rate. That is apparently a slowdown. I mean, overall, honestly, we are happy with America. I think that I answered your question. Okay.
Thank you very much. Just a very small follow-up on the U.S., actually. Was there any wholesale impact timing-wise or maybe lower shipments that went into the U.S. in Q3, or nothing to call out there?
There are, in the U.S., not only some timing issues in deliveries, honestly, but not meaningful. I mean, I would love to say that we are very late and you will see in Q4 a lot of deliveries that we missed in Q3, but this is not the case. There are a handful of EUR million that probably, I mean, will be reported in Q4, but nothing really material. Handful of EUR million, I mean overall, not in the U.S. only. In any event, the answer is yes, but meaningless.
Super. Thank you very much.
Bye.
The next question is from Anne-Laure Bismuth with HSBC. Please go ahead.
Yes. Hi, good evening. I have two questions. The first one is regarding the performance in retail for the Moncler brand in Q3. I know you are no longer disclosing the like-for-like performance, but I was just wondering if it's fair to assume that the contribution from new space in Q3 was around 10%, thus implying like-for-like up 11%. The second question is, would it be possible to remind us what percentage of sales is coming from local clientele in Q4? What are the key initiatives that you are planning around November and December to keep the brand heat with the local consumers in Europe? Thank you very much. Also globally. Thank you very much.
Okay. Your first question, Anne-Laure. Hi, first. About the contribution of space and organic growth. The vast majority, I mean, the majority of our growth rate in retail in Q3 was organic growth. Okay? Please don't ask me how much was the comp, because you know that we don't report the comp in Q1 and Q3. But again, if I can give you more color, the majority was comp, in line with the previous quarters. This is because, I mean, the space contribution was much lower, but this is simply because in Q3 this year we opened 4 stores, I think. Last year we opened about 10.
Also important stores, because it's not only that, this year we are a little bit late in the new openings, and most of them, all the stores that will be open this year will be open in the current Q4. It is even more about the fact that last year in Q3, we opened not only many stores, but many important stores, because Milan Galleria, the relocation in the flagship store in Hangzhou, the Chengdu flagship store, the expansion of Sanlitun flagship store, you know. Last year, Q3 was a quite important month for new openings and the relocations. This year, much weaker. The contribution of space in Q3 is not particularly strong, but is expected to be much stronger, of course, in Q4.
In Q4, I mean, the contribution of our local business in Europe, because, I mean, I think you are thinking of Europe that is the most important region for contribution of tourism in Europe. In Q4, contribution of locals is much more important than tourism. I mean, tourism historically, talking about before COVID, when the Chinese were coming to Europe, Q3 business was strongly impacted by tourism. Q4, much less. Q4 is more a local business quarter. Of course, what are we doing in Q4? We are doing exactly what we have been doing for at least the past five, six years. We started to develop a strong clienteling strategy that is about building, developing and protecting relations with our customers. Again, we have a plan that is in line with what we have been doing so far. Nothing special, no particular events are planned, but again, a constant work to maintain this kind of relations that are very important.
Thank you very much.
The next question is from Zuzanna Pusz with UBS. Please go ahead.
Hi, good evening. Thanks for the invitation. My first one, I just wanted to follow up, because it was very helpful to hear about the U.S. cluster. Given that Europe, as you just mentioned, is so important with locals in Q4, I was wondering if you can give a little bit of color also on the European cluster. Because you mentioned in the release as well, the markets such as Germany are also very strong for you. Whereas we have heard from some of the other peers in the industry that Germany is maybe the one market that is already a bit more volatile. If you can add any color, that's super helpful. Secondly, on sales, can you provide an update on what we should expect for the full year sales? H1 was around 12%.
Should we expect something along those lines for the full year as well? Third question on Stone Island. This month, you opened the first retail concept in the U.S. Can you give a little bit of color on your plans for the rollout of this concept store and what kind of opening number of openings we should expect in the coming quarters and in the next year or so? Thank you.
Yes. Hi, Suzy. Okay, the first question was about the European cluster. The European cluster is doing well. I mean, the regions, the countries we mentioned that are the ones you did mention, Germany, France, U.K., I mean, are doing pretty well, honestly. Honestly, I mean, nothing to add to what we said and what you stated. Unless you have additional question, but I mean, overall, I mean, the European cluster is very good. The other question was about space contribution. I mean, for the year-end, we still maintain our, let's say indication guidance to achieve a high single digit contribution. Again, in Q3, this was not the case, but for the reasons I said before.
Considering the impact, the expected impact of the new openings, that will be eight in Q4, I think, because at the end we are still missing eight stores that will be opened in Q4. At the end of the year, the contribution will be much higher, but still in line, more or less with what we normally expect. That is a high single digit. Stone Island, we just opened the only store this year, because all the retail contribution we reported in the Q3 is totally driven by the conversion of a business in Korea, Japan and the business in the U.K. The very first store we opened was in October in Chicago, which is very important also because not just for business, I mean, the store just opened a week ago, I think. It is very important because it represents the new store format that has been designed by,
OMA.
OMA, yes. I mean, an architectural study that interpreted, in my opinion, very well the essence and the DNA of the brand. We are very happy with the design and with the final result of the store. I can't tell you yet anything specific about business results, but again, we are very confident. About 2023, I mean next year we will open some stores for Stone Island, and there will be new openings. Honestly, let me mention a couple of them. There will be a store in Vienna, there will be a store in Zurich, and others. Honestly, the retail expansion next year and, I mean, the current retail strategy for Stone Island is not driven by the let me say, aim to increase volumes or to chase additional volumes.
That could be the case, but it would be a short-term strategy. Our priority now is to build a real strong retail culture in Stone Island, which is something that takes some time. The second point, we are also opening some important stores like the ones I told you, Vienna and Zurich, because we believe that, I mean, these stores are in very, very good locations, will be very strong way to communicate, to properly communicate the values of the brand. Again, brand strategy first, and retail business as a consequence of the brand strategy.
Thank you. The next question is from Charles-Louis Scotti with Kepler Cheuvreux. Please go ahead.
Hi, good evening. Three questions from me, if I may. The first one on your full year sales target for this year, that implies low double-digit organic sales growth in Q4, on tougher comps on a three-year stack. Considering upcoming stores opening, and what seems to have been a good Q4, good start into Q4, are you still comfortable on this objective? Second question on footwear. Is there any chance you can share with us the preliminary results of your recently launched footwear collection and whether the reception from clients is positive or not? Third question on pricing. Some of your competitors have already announced sizable price increase for next year. Shall we expect another significant price action at Moncler in 2023? How do you see the risk of negative price elasticity on demand, especially in Europe? Thank you.
Okay, thank you for your question. About your first question, the targets for the current fiscal year and the consensus, I mean, we said, and I can tell you again that we believe consensus is reasonable, but I have also to highlight that we have had the three months, actually two months and a half, most important for our business. It will totally depend on the overall scenario, let me say geopolitical, macroeconomic and also associated with the COVID, considering what I said before about China, but not only. Overall, we have it very clear in mind the consensus, and we believe that target is achievable. To answer your second question on footwear, I mean, I could share some results, but honestly, please don't ask me to share this result.
Let me give you some color. I mean, we are very happy with the first results, but numbers are totally meaningless and irrelevant. What is very important is that this product line we have been working on for more than one year, investing in design, investing in product, investing in communication. I think that for the first time, let me say, we seriously invested in a category we want to become relevant, not only for our business, but also for our brand identity. The first results are very good. I mean, we're talking about small numbers because we didn't put in the stores a lot of shoes. This was not our intention, our goal. What we put in the stores is performing very well with a very strong sell-through.
I mean, the first pre-launch online was sold out in a few hours. Small but very clear and strong signs that, I mean, we are getting there. Of course, it will take time. We are not in a hurry, I assure you, not at all. We are very confident for the future. I can tell you that in the upcoming spring/summer season, the future collection will be broader, and in the next fall/winter season will be even broader. The perception of our customers, of our people for the time being is very, very good. Again, we are confident, but again, numbers are still meaningless. Last question was about pricing. Yes, we increased the prices in this season, and we plan to increase the prices.
I mean, for sure, prices will be increased in spring/summer 2023 of the same, about 10%. Of course, the 10% is an average. I mean, let's say it's more an indication of the price increase in Europe, because in the other countries, it totally depends on the trend of the currency trend. There are some countries like the U.S. where the price increase will be way lower. Other countries where the price increase like Japan will be higher. I mean, of course, it totally depends on the current level of the individual currencies.
About the H2 of next year, right now, I can tell you, even if the decision has not been made yet, but it will come over the next few weeks, because we are now ready, almost ready to finalize our collection, to present the collection to the buyers and to finalize also the pricing strategy. I can tell you that right now we see I mean, the potential price increase also for winter season, because I mean, the production costs are still growing, even if I mean, if we talk about energy, but I don't want to get into this conversation. There are some signs that energy costs may be lower than just a few months ago. Anyway, for spring, for sure, there will be a more or less 10% price increase. For fall/winter, right now, I expect more or less the same.
Thank you very much.
The next question is from Thomas Chauvet with Citi. Please go ahead.
Good evening, Elena and Luciano. Three questions, please. The first one following up on the pricing question. So you said, Luciano, +10% in Europe for spring/summer, and I guess you want to reduce the price gap with other regions, so less than that in the U.S. and Asia. So I don't know if I say 5%, 6%. Does that mean that on a weighted average basis, you will have a pricing effect of, you know, around 7% perhaps on spring/summer, and you said the same for autumn/winter? Or did I get this wrong, that this is 10% increase in all regions? Secondly, on coming back to the slowdown in the domestic US markets. The U.S. clusters you said did not slow down in Q3.
How do you explain that Europe is slowing down on a year-on-year, but also three-year stack basis? Can you comment on whether some European markets are seeing a weaker local demand at the end of the summer? Then finally, a broader question on retail. I remember last summer, Roberto talked about new ways of selling. He mentioned 30% of Korea sales now and 20% of Japan sales are done through private appointments. I was wondering whether there are other important markets where you are starting to see this trend emerging. I was thinking, you know, particularly China. Is this a trend in China? What is a comparable number in China versus the Korea and Japan number?
You know, as China, it doesn't seem to want immediately to relax the zero-COVID policy. I guess that could be an interesting way of continuing to grow in China in the coming quarters. Thank you.
Okay, thank you for your question. First of all, price gap and price increase. First of all, price gap in the current season as we speak is very, very high, unfortunately, but this was not planned. This is because the U.S. dollar is very strong. Strongest than ever. I mean, strongest than in the last 20 years. We have, let's say, price gap issue with the U.S., but with China too. The price gap we plan for next year will be, let's say, back to normal. You know that we have a long-term target to go down to 30% price gap in China. Next year, we are planning 40%, but of course, it will depend on the currency fluctuation.
The price increase is driven by production cost increase, so it is to be considered, let's say, across the board. Of course, the way we operate our pricing strategy in order also to decrease the price gap is such that in Europe that 10% maybe a little bit higher than in China, also because China is facing a revaluation of their currency. At the end, I mean, to make the long story short, our plan is to reduce the price gap, at least to go back to what it was before COVID, about 40%. Then we still maintain our target in the long term. I mean, let's say a couple of years or three years to go down to 30% price gap with China.
About U.S., your question was about US market that is doing well, but again, there is a slowdown in the growth rate, a part of the slowdown. What I said before is that, I mean, there is a base comparison with last year because the US market started to do very well, I think in August or so in Q3. The base comparison in Q3 was more difficult, tougher than in the first two quarters. In fact, if we look at the comparison of the U.S. cluster against what it was in 2019, we see, at least we ourselves see, and I can tell you, that the growth rate in Q3 was very strong and in line with what it was in Q1 and Q2. This is not a number we report. Of course, it is a detailed number, but it is very important also for us, for the management team, because of course we look at these numbers also to understand if there is any issue, and we believe there is not an issue in the U.S. But I'm not sure I answered your question, so please let me know.
Thanks, Luciano. No. I mean, if the U.S. is slowing down, but the U.S. consumer is not slowing down because they're buying in Europe, we should probably see stronger numbers in Europe. That was my question in a way, you know, why is Europe perhaps not a bit stronger in Q3, whether year-on-year or three years back? Are any kind of local markets slowing down? Could you comment on that, whether that's in September or throughout the quarter?
I mean, Europe is doing very well. If you compare the growth rate of Q3 with what we reported in Q1 and Q2, you have to consider, forget the US customers, but you have to consider that Europe in Q1 and also in Q2 faced a base comparison with the last year that was very, very weak. Because last year, Europe in Q1 was, I mean, 60% of our stores were closed. In the Q2, 25-30% of the stores were closed. Q1 and Q2, Europe did very well, but also the base comparison was very weak. In Q3, Europe is doing very well with the base comparison that is, let me say, comparable much more than in Q1 and Q2.
Honestly, there is no slowdown at all in Europe, not at all, for this reason. Okay, Thomas, for...
Thank you.
Okay. Your last question was about distance, yes, distance sales. I mean, after COVID, we learned a new way to do business, and that right now represents a growing significant portion of our business in the countries you mentioned, like Japan, China and Korea. Distance sales overall may represent about 20%. Of course, all inclusive distance sales is also the click and collect, which is an omni-channel sale. You know what I mean. Click from store is when people are coming to the store, they can't find what they are looking for, and with the help of our client advisor, they can order the product from online. All of these different typologies of sales represent in these countries about 20%.
Thank you, Luciano.
The next question is from Flavio Cereda with Jefferies. Please go ahead.
Thank you very much. Of course, welcome, Elena, Nicole, and hi, Luciano. I have three quick questions here. The first one is, if you look at the wholesale momentum, and we look at offline versus online, and specifically on the momentum that you're seeing comparing to the two, what can you tell us? Can you shed any light on this? Have you closed more offline accounts in the meantime? I was wondering if that was still a thing. Second question, I'm afraid going back on prices. The price increase, the mix, and it's pretty clear, you said with a mix of price increase for spring/summer is going to be.
Was it the same for fall/winter, or did you tweak it with higher price increases coming in spring/summer and in the following fall/winter as opposed to the fall/winter 2022 collection? I was just wondering whether that mix had changed. I appreciate they're all about the 10% mark, but within that. Lastly, in Europe, I also was wondering, have you seen any weather effect this summer? Because I suppose when you have the Chinese tourists 40-degree heat still bought the full price jacket because it was so much cheaper than buying it back home. I do wonder whether the Americans did the same in spite of price delta that is equally as big.
perhaps there was less of a propensity to buy a you know a down or full winter jacket in the middle of the summer in Europe. Thank you.
Hi Flavio, thank you for your question. About wholesale, I didn't mention, but of course, we keep working on our wholesale network to further select our wholesale network. Also, as you probably know, even if I didn't say, we keep converting some shop-in-shop into retail. This is also an element that should be taken into consideration when we look and evaluate the numbers. Specifically in Q3, I mean in this season, in full winter, we closed a total of about 5% of our total doors, wholesale doors. That is, I mean, that is not a meaningless number.
We also converted, let's say, in the online wholesale, two important accounts that are Mytheresa and LuisaViaRoma. This is important. Something I didn't say, but thank you for the question because it gives me the opportunity to add some important information about wholesale and retail, because of course it's a business that is converted from wholesale to retail. About pricing, I mean, in fall/winter 2022, we are increasing, I mean the average is 10%. A little more in Europe, a little less or even much less in countries like the U.S., where there is an important devaluation of the local currency.
Of course, in Turkey, sorry, but Turkey is a quite important market for us, affected by a strong inflation and the consequent strong depreciation of their currency. Of course, in that market, we have increased and we keep increasing prices much, much more. What I told you is the average. Some countries with stronger currencies got the benefit of the strong currency with lower price increase. Other countries with the weaker currencies didn't get this benefit, and they face a higher price increase. I don't know if it was clear, Flavio. Yes, in spring, summer 2023, it's the same. I mean, I don't think you expect me to give you country by country price increase. The methodology and the strategy is exactly the same.
In spring summer, of course, due to the stronger U.S. dollar, the price increase in the U.S. will be, let's say, meaningless, but in any event, much lower than in Europe. Let me give you this example, because again, we face a U.S. dollar that is the strongest ever. Also in China, because RMB also is quite strong. Japanese yen is much weaker. In Japan, the price increase will be higher. Again, the average is about the 10% I told you, but the distribution, the allocation of this 10%, is different country by country, in this fall winter and in the upcoming spring summer 2023.
I mean, weather effect, we face since a couple of weeks ago a quite mild weather. You know that we like cold more than warm. But I mean, we have to live with the cold, hopefully, but also with warm. You know, you may remember that over the past 10 years, at least since we joined the company, there have been many mild fall winter seasons. Nevertheless, I mean, the results at the end have been very good. This is because our collection now is not focused, but since many years ago on down jackets. We have a very broad outerwear category. We have implemented new categories.
I mean, overall, we are not worried about the weather, and then we have to live with the weather. About the approach of our customers, foreign customers, honestly, I don't see any specific difference between Chinese and US customers. I mean, they buy in our stores because they like the brand. Of course, there is a convenience for the U.S. because of the price gap we said before. I don't see any specific preference for, let's say, some categories rather than others.
Perfect. Thank you.
Welcome.
The next question is from Piral Dadhania with RBC. Please go ahead.
Hi, good evening. Thank you for taking my questions. I'll be brief, but could you just give us an update on your Tmall launch in China? I believe that's taken place at some point in October. I think, Luciano, you mentioned in your prepared remarks or earlier that, you know, October trading in China has been very, very good. I just wanted to understand how much of that is underlying related to your existing distribution network, and how much relates to the incremental contribution coming from the Tmall launch. My second question is on footwear. Obviously, we heard a lot about the category at your Capital Markets Day, but and it sounds like the initial launch has been well received.
In the midterm, what sort of percentage of revenues do you think footwear could contribute or constitute, as a percentage of Moncler brand total? My final question is, again on pricing for 2023. I'm sorry for having to come back to this, but what you've said quite clearly in 2022 is that the price increases that you've taken for autumn/winter, at +10% is purely to offset input cost inflation, and there will be no drop through to the margins for this year. Could you just help us understand whether the same is true for autumn/winter 2023? Are you expecting the same level of cost inflation relative to the price increases you're putting through, or will cost inflation moderate a bit and we could get a little bit of margin benefit for next year? Thank you.
Okay, thank you for your question. About your first question, Tmall. Tmall was launched in a silent way in July, and with some results that nobody knew that, except the people that looking for the Moncler brand found out that we were in Tmall. The official launch was at the end of September, around the 25th. You know, since that date, Tmall honestly is doing very well with very high volumes. Of course, let me go back to the reason why, to the strategy that drove the decision to open Tmall. Tmall is an extremely important and powerful platform for traffic.
To get traffic from cities where we are not present and to get a younger generation traffic that right now we get, but not 100%. This is the reason why Tmall is important, to develop a new audience for the brand. Of course, volumes and business we may or may not do with Tmall, it totally depends on the way we want to approach Tmall. Should we decide, but this is not the case, to chase volumes, to chase additional revenues, we could easily put a lot of our icons and believe me, that Tmall would take off. This is not our strategy. Again, Tmall, we want to grow reasonably and wisely the Tmall business step by step.
Your second question was about footwear. Footwear contribution. We maintain our, let's say, plan, is not a guidance yet, but the plan to achieve by 2025 about 10% of our business. Right now, I can't tell you anything different from what we said in the past during the Capital Markets Day. Again, we are confident about the first result, but there is still a lot of work to do. About pricing. Yes. The question was about eventual margin benefit. I would like to tell you yes, but unfortunately right now we are increasing prices only to offset the production cost increase. As I said before, this is a sure 100% for this season and for the upcoming spring/summer 2023 season.
There are still some doubts, but not many on the full winter 2023 because the cost of energy is decreasing and so we don't know yet. Honestly, our pricing strategy and the strategy to increase retail prices is driven only by the production cost increase. If the production cost should for any reason increase less, we may increase the prices in full winter a little bit less. Honestly, right now, no additional or incremental margin expected also because honestly, our margins are already very high and we don't need, let me say, to speculate on this.
Okay, that's great. Thank you. The next question is from Rogerio Fujimori with Stifel. Please go ahead.
Hi, Elena and Luciano. I have two questions. The first one is on the Moncler Grenoble reboot. I think during the CMD, we heard about your ambition to triple the incidence of tech performance as a percentage of sales. I recall that you have mentioned that the initiative would be launched in December. Any update of your plans for Q4, Q1 would be great. A small follow-up on your comments about the European cluster trend in Q3. Could you talk a little bit about the local Italian cluster sequential trend and the exit rate? Thank you.
I'm sorry, Rogerio, can you repeat your second question, please?
It's about the Italian cluster in Q3. Within your European cluster, what was the sequential trend for the Italian cluster? Thank you.
Okay, thank you. Okay, your first question about Grenoble. I mean, Grenoble is one of the three pillars of our strategy, as you know, as I'm sure you remember. What we wanted to implement within this strategy is to open, let's say, to increase our conversation with the performance audience of Grenoble. Because Grenoble differently from any other brand, let me say that with all due respect to the other brands. Grenoble, more than any other brand, has a strong heritage in performance coming from, I mean, many years ago, but I mean, the Olympic Games in 1968, just to give you one example. We believe that there are opportunities to grow Grenoble in this segment.
To increase the credibility of that line of Moncler Grenoble for all the products in our assortment. This is, of course, the strategy also for this current season, but will be the strategy for the next years. The other question was about the Italian cluster in Q3. That was good, honestly. Still very good, looking at our retail network, but also the wholesale business. Honestly, overall, the Italian cluster is good as well as, I mean, the other European countries we mentioned before.
We have time for one last question. The last question is from Luca Solca with Bernstein. Please go ahead.
Thank you very much indeed for taking my question. Ciao Luciano, ciao Elena. The first question is about retail space productivity. If I remember correctly, one of the potential stretch targets you were putting for yourself is reaching EUR 40,000 per sq m in the Moncler brand. I wonder if you think that you're still on track for this target this year, and how you see retail space productivity development. There are different puts and takes in your retail results today. You have some wholesale to retail conversion. So if you can help us with that would be really fantastic. Now, going forward, my second question is focused on wholesale and how you see this channel growing moving into 2023.
I was under the impression that you have a very buttoned up and very clean wholesale exposure, and that as a consequence, the growth in this channel could be quite healthy. Given the various actions you've been taking, I was wondering whether this assumption is correct or not. Thirdly, as you mentioned, quite a significantly punchy price increase required to offset cost inflation. I was wondering how you're coping with the different sources of cost inflation. You were mentioning energy. I wonder if you could maybe give us a bit more color on what is driving cost inflation the most and your actions to try and contain it. Thank you very much indeed.
Okay. Hi, Luca, and thank you for your question. About the retail space productivity, we are right. We said that we target that magic 40,000 EUR per square meter one day in the future. I mean, we don't know when, but of course, it is doable. For sure it is doable, but honestly, in a normal world, if we never will be back to a normal world. Staying in the current world we live, sales density this year is still slightly below what it was in 2019. The last number, the best number, and the last before COVID we reported was over 36-something thousand EUR. Right now we are slightly below. For all the reasons you know very well, I mean, China, whatever.
I think that EUR 40,000 is reasonable, not this year, I don't know next year, but I mean, for sure it's difficult to predict Chinese customers next year coming back to Europe. I would tell you that it's totally impossible. It's difficult to tell you when this EUR 40,000 is doable. Again, under normal circumstances, EUR 40,000 is doable. For sure, I can't tell you when. About wholesale, I mean, your question was about, I mean, next year, I mean, we see a wholesale growing in the region of mid-single digit.
I mean, in line with our, let's say, usual and historical plan that is based, of course, on two main factors, the increasing contribution by a single customer, but also on the other side, on the reduction of the wholesale network. In order to make the network cleaner and cleaner, to use your word. I'm not sure if this is the right answer you expected, but please let me know if I didn't answer your question. About cost inflation, the question is important, and thank you for asking the question because, I mean, I mentioned energy, and you may be wondering about how come that a company business that is not energy-intensive depends on energy.
Actually, you know, if this was your thought, you are right, because we ourselves are not energy intensive, but our suppliers, unfortunately, yes, they are. I mean, it's not the energy cost for Moncler that is impacting our production cost, but the raw materials that we buy from our suppliers that use energy that is impacting our production cost, you know. It's of course the supply chain is such because our suppliers and also suppliers of our suppliers because, to give you an example, we buy fabrics, but the chain, I mean, the step before fabric is the production of yarn. That kind of production is energy intensive. That's why we depend indirectly on the energy cost. Let me-
Wonderful.
Let me know if I answered your question.
Yeah. Yes, Luciano, you did. Just one sort of additional question on this. How is labor cost inflation moving? Is that a concern of yours at all or not?
Yes. Labor cost is another component. Again, thank you for your question because it give me the opportunity to add more color. Labor cost in the countries where we make the majority of the production, which is Romania, as you know, labor cost is increasing a lot. Why is increasing labor cost? There are two reasons why. First, because, I mean, the government strategy is to increase salaries and to align step by step to the European salaries. The other driver of this labor cost increase is again, the cost of living. The cost of living depends on inflation and energy, you know, whatever. At the end, I mean, there are many different components, but the cost of living, the inflation and the energy is still one important component also for the labor cost. Labor cost is another important reason why our production costs are increasing. Again, for the reasons I just told you, but again, we are talking about inflation. Look, this is the problem now.
Understood. Thank you very much indeed. This is super clear. Thank you, Luciano.
Okay. I think that we can end the call here. Thank you very much to everyone for participating in the call. As usual, for any follow-up questions, feel free to get in touch with the IR team. Thank you again, and have a great evening, everybody. Ladies and gentlemen, thank you for joining. The conference is now over, and you may disconnect your telephones.