Good morning. Good morning, ladies and gentlemen. Welcome to Moncler 2018 Capital Market Day. I'm happy to share with you our strategy to make Moncler walk into the future. Fine-tuning, for me, is a must. The vision is bold and yet simple. Function, beauty, quality, research, and innovation must perfectly match with energy and uniqueness. Moncler will become an even more exciting and enjoyable experience for our current clients and as well for the new one. We want to talk to everyone, everywhere, and to all generation. We did this in the past, and this is what made us successful. We want to continue doing it in the future by using new language and new tools. This is why we have created a concept with the name that tell you more than many words. One House, Different Voices. This is not a claim. This is the essence of our strategy.
Our Moncler house has eight window. The first one, flexibility. A fast changing world require a flexible attitude. To be successful and keep the pace with clients, you need to constantly re-engineer your business, and you need to do it at the speed of digital. We always change ourselves to find new way to fine-tune our engagement with the clients. We're not in between. To become a community where closeness and quick interaction play a key roles. Number 2 is evolution. We are not sleeping at wheels. We are ready to change when everything is going well, and we don't wait until the problem come along. We know that if we wish everything to stay successful, we need to keep an open mind and constantly evolve. More than ever, we have welcomed change, and we have quickly fine-tuned our mindset. Strategy and communication, we remain loyal to our DNA.
Moncler strategy has evolved with client attitudes and behaviors. We will offer something extraordinary and new in a continuous way. This is very important for us, not only product, but engaging experience in a direct and fast outgoing dialogue. Multiplicity. We believe in borderless horizon. We provide elegance, comfort, quality, functionality, uniqueness, and this make us always contemporary. The idea that there are no more season, for us, is not just a jingle. Rules has changed. The concept of seasonality has become meaningless as client are looking for continuous emotion and newness. Conventional shopping occasion are gone. Always on shopping is the new normal. Travel is becoming an important shopping occasion. We have really disruptive answer to all of this. Editorial project on monthly basis able to create expectation and also representing powerful engaging moment with client.
Product that speak to a multiplicity of clients, current and new one, traditional, millennials, Generation Z, as well as those I like to call the individuals, who express themselves through social and visual media. Store that are home away from home, maintaining a strong local flavor, and that always offer new, tailored, eye-opening experience with a touch of discovery. Uniqueness. We need to continue amazing and be surprising. We do that through an internal collaboration with my exceptional team members and through open source collaboration with great artists and creative people who interpreted Moncler code and identity. Uniqueness has always been the milestone of our strategy, and we never stop exploring its surrounding spirit. Our uniqueness also express itself in the way we present our collection. Honestly, forget about traditional runway presentation.
We welcome new creative path and conceptual space like the one you saw yesterday night at the Genius building. Creativity is like love. You must let it run free and wild. We have to put together, under the same roof, very different talent and creativity that speak different language. Again, one house, different voices. The result is a multiverse of distinctive creation, where the Moncler DNA is traceable and respected. As you have seen, audacity is not lacking at all. New code. Communication and relationship building are the other magic crucial ingredient of our secret sauce. If we don't follow the rules, people will not play the game. If we don't speak their language, people will not listen to us. We work on new codes and use new tools and touch points. In design to be communicate through different channel at the same time.
Contents are engaging and viral, developed to break through the digital world and create a Moncler community. Number seven is very important point. It's something very new for us, a new kind of community. Our messages will be direct with no in-between. In close collaboration with strong business and media partner, it will be a new kind of community under the hashtag We Are Part of Genius. From June, a monthly editorial project will be circulate through media and digital partner. Our selected retail network, exclusive retailers, best specialty store, influencer, pop-ups, wholesale exclusive distributor, as well as retail window and direct marketing activities. Final, between me and you, the real key of success for me is the energy. We are used to give our all because we are fueled by energy. Energy is what feeds our passion, and passion create loyal to the brand.
Energy is driving force of our community, client feel it in everything we do. I want our store to have the vibrant energy you find in the best specialty stores, driving clients in a discovering journey of the Moncler experience. Moncler is a place where curiosity, emotion, and expectation are always rewarded. Moncler future start now. Flexible in planning to be able to fine-tune quickly, full of energy and act of creativity and innovation, tuned into people and their language, paced at the speed of digital, always quality and technology-oriented, open to looking for still unexplored territories. In a nutshell, know how to make it work, creativity to make it magic, simplicity to make it happen. As beautiful, as simple as that. Thank you very much.
Good morning, everybody. Thank you for attending this second Capital Market Day. It's a privilege to have now to translate, in action, the vision of our chairman. Today, for us, it's what we qualify as a good Moncler day. A good Moncler day is when you have blue sky, sunny and below zero.
I think it's a good way to start and to share with you what we have been accomplishing with the team. It has been a long journey. The last 12 months has been very intense for all the different people in the company, because what the vision of Remo, in order to translate that, it implies a lot of changes in the way we work. It's a real evolution, but it's giving a lot of energy and passion in all the company. I'm greeting also all the people that are showing us live in the different markets. We gave the opportunity to our team in the different region to watch this Capital Market Day. Big hello to everybody. I will start shortly with some of the things you already know.
This is helping us to shape our vision about the market, what are the current trends that we see in the luxury industry. Well, first of all, have my screen also, it will be helpful. Thank you. My screen is not moving
Thank you. The current trend on the luxury industry is positive. We expect a growth of 4%-5% on a yearly basis for the next three years. The total market is supposed to achieve a growth and reach EUR 300 billion by 2020. What we see also as big changes is an uncertain scenario. We believe that what is going to be a winning solution is going to be flexible and to be able to react quickly. I think the shape and the size of Moncler, the energy we have inside, is something that is going to help us to continue to outperform the market. Second point, the weight of the younger generation. It's already now a little bit more than one-third of the total sales in the luxury market.
This is expected to continue to grow in the future and to reach almost half of the total sales in the luxury sector. Here also, I think that with what we have seen with Genius yesterday evening, we are in a good shape to be able to shape that future. The expectation and the desire of this new generation is different. They are looking more for experience than for product. They see fashion trends, they see it as a mean of self-expression where they showcase themselves as being part of a community. We see also that impulsive buying is becoming more and more important. We need to change the way we communicate. We need to be faster, more frequent, dynamic, and energetic. We believe that quality and uniqueness is what is going to make the difference with this new generation.
Other important elements, the increase of the online business. Currently, I think it's Bain and Euromonitor and McKinsey, they agreed on the current market share of online on the luxury sector. This is including cosmetics around 7%-9%, probably more 7% for the fashion industry, a little bit higher for the rest. It's supposed to grow and to reach between 20% and 25% by 2025, which means that online is becoming more and more important, but also that retail will continue to play a key role. I think you need to be able to manage both. We believe that the companies that are going to be able to deliver superior client experience are the company that are going to be able to merge the in-store activity with all the data that is coming from the online.
Taking all the customer inbound, the way they navigate on the web, the way they are active on the social media, and to mix this with data that you have through the internal CRM to develop a superior client experience. We are going to show you what we are currently doing to really take advantage on the job that has been done over the last 2 years. Finally, in terms of the way the market is moving, you see that there are very different markets, American and European market that are mainly local. Japanese market and the Chinese that are much more buying, traveling. The data you see here also include cosmetics. Of course, if you talk about just pure fashion, the weight of the local market is a little bit higher, but it's giving you a flair of the way the market is moving.
If you look at the same market, but with the vision of the different generation, you see that travel is playing an even more important role for the new generation that are traveling much more frequently and buying also when they are abroad. I think being able to be relevant on the local market and at the same time being able to shape and to take advantage of this traveling community will be one key of success for the future. I think a great strategy is great only if the implementation and the execution is correct or is enhancing the strategy. Before starting to disclose the action plan that stays behind the vision of our chairman, I would like to come back on some of the elements that we disclosed during the previous Capital Markets Day that took place in December 2015.
First, we talked a lot about outerwear, saying that we wanted to remain at the top edge of the outerwear category while developing complementary categories. Here you see the evolution that we have had in terms of revenues on the different categories. Outerwear, that represent now a little bit less than 80%, as being a category that has been growing by 28% since 2015, with an average CAGR of 13% from 2015 to 2017. The knitwear category, where we have been investing a lot in terms of technology, savoir-faire, culture, and implementing pilot lines for the development of the knitwear internally, recruiting people who have the technical knowledge about this product, has been the fastest-growing and best-performing category. We have been growing on average by 32% year-on-year. We have also increased the visibility of this category in store.
You see now this category much more present and visible in the stores. This total growth has been of 75% between 2015 and 2017. Shoes was a big focus that we have had with a shoe pilot project where we have changed the way we sell. We have been training our people in the store. We have developed experts. There is a training path now that is implemented in the most important Moncler store on the retail side. We have reviewed the location of the storage of these shoes, the way we display them, the selling ceremony. We have been able to grow by 46% since 2015 with an average CAGR of 21%. Distribution always an important item for us. Here we wanted to be able to deliver superior experience. One of the aim was also to start the development of flagship stores.
In total, we have been opening 28 new stores. We also take very much care about the existing network, not to have it outdated. 23 relocation expansion took place over the last two years. Part of the strategy was also the development of shop in the shop in wholesale. We opened 25 wholesale shop over the last two years. Just looking at last year, there were 17, 11 in the last quarter of 2017. We opened 8 flagship stores, 8 airports location at the end of 2015. 4 are new openings between 2015, 2016, and 2017.
I think one of the question we always get when we were discussing about the expansion and the store size that was increasing, as you see here, the store size increased from 120 to 135 sq m, was our ability to maintain best-in-class productivity, while basically what we have been doing is not only we have been able to maintain it, but we have even been able to grow it, from EUR 32,000 to EUR 35,000 per sq m. These we have been, and I will disclose that when talking about the flagship store and the global stores. This thanks to increased UPT because of our capacity to display new category, and also the increase of the average selling price. These two factor together has helped to increase the productivity.
One important focus of the strategy that we disclosed two years ago was the focus on the client, the new client experience, the fact of also knowing and getting to know our client much better. In 2014, our capture rate for new clients was 44%. We have been able to increase it to 74%. Basically, our database increased from roughly 300,000 new clients to 1.3 million. This knowledge about the client has been leveraged, allowing us now to have a daily dialogue with our consumer. We have been training our sales force, our client advisor. We give them a tool that we call MonClient. Here you see there with this tool that is an app, they have the ability to follow their clients, on a worldwide basis. We are still in the process.
We have finished the rollout, they are still increasing the number of clients they are following. On average, every client advisor is following now 50 clients. We think that there is the potential probably to follow between 100 and 120 clients per year. Just last year, we had 105,000 clienteling actions. What we are doing also, we are measuring their level of satisfaction. Of course, if you do mystery shopping, you get some knowledge about the way your store is being managed. I think the best feedback you can get is the direct feedback from the client. We introduced last year a program that we call VIBE for getting the VIBE from the consumer. Now after every single transaction, we get the immediate feedback of the client who wants to answer, and the response rate is quite high.
We have more than 25% response rate. What is interesting is to see the level of commitment of the client, because not only they are giving us their rate about their experience in the store, we have 30% of the clients that are giving us written suggestions on how to improve, enhance the client experience with Moncler. This is showing a very high level of commitment and involvement of the client with the Moncler brand. Some of the figures that are showing that we know our client better, of course, the gender, this we knew it in advance. We are now able to track also the age of the client, so which generation and how each generation is buying. We are capturing their level of spend.
We know that the 14% best clients, the top of the pyramid of the Moncler clienteling, is generating 38% of the revenues. We have attached every client advisor a number of clients that we call preferred clients. I state we attach, which is wrong. We don't attach. They choose the client they want to follow. Currently, as the rollout finishes in August last year, we are following 10% of the database. This 10% of the database is generating 20% of the total revenues. The objective that we have for the end of this year is to be able to track the best 20% of the clients and directly interact with them on a daily, weekly, monthly basis, probably getting an impact of one third, 35% of the total revenue of Moncler.
Some of the retail KPIs that we usually don't disclose, we always give figures that are in the range. We thought that after two years, it was also important to show that the strategy that we have started to put in place two years ago is working. You see here the level of repurchase rate that we had in 2015 when we just started Retail Excellence project. We are at 22.6. This has been increasing, is now at 25.4. It has been increasing year after year in a consistent way. I think there is still potential to do better in the future, and of course, this is one of the targets we are giving to our store managers. Basically, this is having an impact on 44% of our client value that are repeat purchaser in our database.
You will see that with the Genius project, I think that now we have a stronger collection. We have been working a lot to enhance our retail network and the quality of our network, but also, the quality of our wholesale distribution, and we know our client better. I think we have set the base for what we call the new challenges of Moncler. What are these challenges? I think clients are looking now for new values. They are looking for experience. They are more buying on an impulse base instead of repeat purchase. They are more digital, and they don't look at one channel specifically, but they are moving from one channel to another. They are really omni-channel.
The answer of Moncler, and this, I think, is one of our strengths, is the product development, the creativity through the Genius project, the communication revolution that we are currently starting to implement with our first native project, that is Genius, that has been thought digitally from the very first day. The distribution development where we foresee still potential to grow in terms of network and in terms of size of our stores, and what we call Retail Excellence 2.0. That is the further step that we want to put in our Retail Excellence project. We think we are the start of a new phase. We try to look back on what has been achieved over the past 15 years since Remo took over Moncler in 2003, and we think we are at the beginning of the third phase.
The first phase, if we think about product, was the development of the iconic product, really developing of the outerwear category. In 2008, we introduced the Gamme, and we started to develop new categories, the knitwear, the shoes, the bags, the soft accessories. For us, 2018 is the start of a new era with the launch of Genius. If we talk about distribution, we start really as a wholesale company. We had 3,300 stores at the time. The business was purely wholesale until 2007. 2007, we started the retail development. It was really the moment where we started to expand geographically also Moncler. We think that now, we are ready to face this new challenge of the omni-channelity. I will come back to this. We are currently having a pilot, and we plan to have a full rollout on Europe in 2018.
In terms of clienteling, clearly by the redevelopment of the collection, at the beginning, we targeted new high-end segments. With the expansion of the geographical presence of Moncler, it was the opening of China, the opening of Asia. Clearly, new nationalities get to know the brand that was very much focused on Europe till 2008. We think not only new nationalities are the new paradigm, but also have the new attitude. How to respond to new expectation from the clients in the future. Finally, in terms of communication, it was pure traditional media, mainly above the line communication at the beginning. We started in 2014, 2015 with tailored CRM communication, leveraging more and more now the database that we have, and this will continue. I think now we need to add a new pillar, which is the digital part.
You will see that we are currently shifting our spending from traditional media into more and more, let's say, outdoor communication and digital communication that will represent 70% of our spending by 2020. Some of you, or most of you have had the possibility or the chance, I will say, to visit Genius yesterday evening. We wanted to showcase it the way it has been presented to distributors, to the press, to the media, with a huge success. Moncler. It's a new way to talk to consumers. It uses new codes and goes beyond the stated rules and opening new paths for Moncler for the future. Let's have a look at what is this collection. Eight different voices that are shaping the universe of Moncler, every one of them with his own vision, but combining them is giving this new identity, evolved identity of Moncler.
The first, the number 1 is for pure essence for us. You know Pierpaolo Piccioli is the current creative director of Valentino. I think he has developed a collection that is really enhancing the essence of the brand and the purity of the brand with a real couture Gamme is the couture part of the Moncler collection in Genius. 2 stays for pop-up trademark. This is coming back to the essence of Moncler, the very start, 1952, where the brand was born, enhancing our best sellers, our iconic product with pop-up colors and contrasted enlarged logo. I think a product that is perfect for the online business and to be leveraged on the social media side. Number 3, stay for playful flair. This is the DNA of the brand.
Grenoble, with this unique approach of combining technology, technicity, and creativity, fashion elements on the ski wear, but also on the after-ski, something that is unique today on the market. This has been also the fastest-growing part of our outerwear collection over the past three years. Number 4 stays for pragmatic femininity. Simone Rocha, the British award-winning designer from the U.K., she is getting inspiration from the Victorian climbers with a multilayer approach, really enhancing the femininity. This is the most feminine part of our collection for the launch of Genius. Number 5, Craig Green, another British awarded designer, probably one of the most talented one that is on the market. He won the prize in 2014. Craig conceived the items and rewrite the dialogue between clothing and body, dress and habitat.
He's also the one that has been probably leveraging, in the best way, all the technology and knowledge and expertise of Moncler, developing new shapes, and really looking for functionality as well as protection. Number 6, one of our two Japanese designers, Noir Kei Ninomiya, one of the designers of Comme des Garçons. He's also somebody who has been able, through craftsmanship, really to reinterpret Moncler and to define new wearable geometries with a lot of handcrafted work, not only on the outerwear, but also working on accessories and on shoes. Fragment, the number 7, for subcultural subtleness. He's called the king of streetwear, probably the one that are going to generate the largest volume and probably the highest expectation. He's going to be also the first launch that we are going to operate on the 12th of June of this year.
He's going to be also the only one having two drop, the first one at beginning of the year, and the other one at the end of the year on the 2nd of December. Finally, the last one, for going viral, Palm Angels, like when you visit a museum and when you get out of the museum, you have usually this bookshop, I think is our interpretation of the Genius building. When you get out of the building, this is our bookshop. He's reinterpreting the merchandising and translated that into a gift shop, one of the very successful presentation we had last week in Milano.
If one of the criteria of success would be to define the perception and, let's say, the feedbacks we are getting from the press, I think that's been one of the most impactful presentation because it was bringing completely new codes and, let's say, in terms of the way the digital world and also the press has been embracing this change in Moncler, has been very, very positive. Other elements are, of course, the selling campaign that we have had last week. We met 350 wholesaler in the same location where we had the show, carefully selected out of the 1,500 that we have. I must say that the feedback we are getting from them is very encouraging. If we look at the Genius project, we will look at it as a virtual circle. It started very much as a communication project.
As I was saying, it's the first digitally native project. We started from not only the product, but from the communication. How do we want to express? How do we want to interact with our consumers in the future? I think the time where we had two big fashion shows and two advertising campaigns is gone. I think the new consumer wants to have monthly, weekly, daily interaction with the clients. In order to be able to do it, you need to not only to come with product, we need to come with content. A nice advertising campaign is not enough anymore. I think you need to bring content that is interesting for the client. Of course, this has had a tremendous impact in terms of distribution. We have been reviewing, revisiting completely the way we will sell our Genius campaign.
We selected the number of people or number of wholesaler that will be able to sell it also in our network. It's not old collection in all the stores. We carefully select, depending on the size, the potential of the stores, the typology of clienteling, which collection will arrive when. It's of course, a big challenge in terms of design and production, because we have shortened the time of development. We are faster on the market. Our presentation in February with the first drop in June, it's a challenge in our industry. We are at the beginning, but we are confident that we'll be able to deliver it. In terms of merchandising also, bringing in new product on a monthly basis in-store is going to bring a lot of energy, and we want also to increase the desirability of the brand.
Finally, this has had an impact on the total supply chain from the product development, to the production, and to delivery on time in the market. I think Remo was saying we are going to launch the first project on the 12th of June, and it's the 12th of June is not the 13th, not the 15th. We want to have a worldwide launch in all the stores. Fragment is the only collection that will be full network on the very same day, at the same time on the retail, on the best wholesaler, and there will be a pre-launch that is done with one of the onliner. I think I could have had a circle number 6 maybe on the middle. I think it's a project also that has been involving all the company in all the different aspects of the company.
I would put people also in the middle because this has been letting us work in a different way, interacting much more between the different departments because it's, as we say, it's omni-channel when you sell, but it's also omni-people in the company that has been pushing the people with merchandising, with production, with the wholesale, with the retail, with the creative communication, with the digital team to meet on a weekly basis. I think also internally, this has been creating a lot of energy, I would like to take the opportunity to thank all the team internally that have been working very hard. I'm saying this, but it's not finished. I think that the first presentation that we have seen is already a reward for the people that have been working to make this company evolve.
If we look at the way we plan to launch the different collections, without going too much into details, you see that the first collection is going to be presented in June, is Fragment. We wanted to start with the first collection that is going to involve all the stores. On the 12th of June, all the retail stores will get the first drop of Fragment. We selected one onliner that is going to pre-launch at the same date as the retail on the wholesale side. This collection is going to be MATCHESFASHION. You see that for each single drop, there is this icon with the touch because for each one of them, we are going to leverage this launch with one of the wholesale onliners. With Pierpaolo Piccioli is going to be also MATCHESFASHION, with Noir is going to be Dover Street Market.
I think this Genius has also opened new doors for Moncler. We are currently closing a deal with Dover Street Market, allowing us to have in each single Dover Street Market shop a permanent store for Genius, which was not possible before. Clearly, this new creativity, this new collections are also a door opener for a new distributor where we couldn't enter or where we couldn't have a permanent presence before. Craig Green is going to be launched in August with a Canadian onliner called SSENSE. 1952, which is our iconic collection, is going to be launched with all the onliner wholesale department stores. Simone Rocha is going to be launched with NET-A-PORTER.
1st of October, it's an important moment for us because the objective of each one of these drop is to have the product arriving in store, having this presentation as being the main presentation for 3 weeks to 1 month, then to retrieve the collection in order to give space to new collection to arrive. Fragment will arrive on the 1st of June. On the 2nd of July, there will be the presentation of Pierpaolo Piccioli, little by little, the presence of Fragment drop 1 will fade down in order to give visibility to Pierpaolo. The same when the Noir collection will arrive at the end of July. October is going to be the first moment where the Genius building will be completed. All the collection will be presented in 15 shop-in-the-shops worldwide.
You will find, again, Fragment, Pierpaolo, Noir, Craig Green, 1952 in 15 shop-in-the-shops worldwide that will have a presence between 15 days to 1 month and presenting the full collection, plus some exclusive that were not presented when the first launch was done. To give you some of the stores where this will be done, we have now negotiated, and sometimes getting a lot of requests from retailers and onliners to get and give us visibility for this Genius building. We have Printemps with a full takeover. We have Dubai Mall. We have Isetan in Tokyo, IFC in Hong Kong and Shanghai, Plaza 66 in Shanghai, Shinsegae, Gangnam in Seoul, Macau Galaxy that is giving us also a free space.
We're also going to have shop-in-the-shops with wholesalers like TsUM in Moscow, Barneys New York with the windows, Holt Renfrew in Vancouver, GUM in Moscow, BOONTHESHOP, Maxfield in Los Angeles. Really a strong request to give visibility to Genius collection for 2 weeks to 1 month then in October. Finally, we are going to have the last drop is going to be Grenoble in November, and the second Fragment drop in case we were afraid not to have traffic at the end of the year, which is usually the very peak of the season. We gave a little bit more with the launch of the second drop of Fragment, for all the people that would not have the opportunity to buy during the first drop.
You see new way to communicate, a lot of energy, a lot of content, communicated and leveraged through the best wholesalers, department stores, our retail network, and the online business. This is not the only one. We talked a lot about Genius, which is the most visible part or the emerged part of the iceberg. Below, there is the rest of the collection that is doing the largest part of the sales of Moncler. I will start with the main collection. Main collection is our milestone. We have a project here for main that we call Icon Lab, with the idea of reinterpreting and reinventing the DNA of Moncler. This will include, in the course of 2019-2020, a project of customization of the main collection. The growth that we expect from the main collection is a high single-digit growth between 2018-2020.
Grenoble, as I was mentioning, the DNA of the brand, one collection that is going to be available all year long is the Moncler Lab for new innovative materials. It is also where we are going to leverage the presence of Grenoble in our resort store on a permanent basis. Here we are confident, looking at what has happened over the last few years and the creativity that has been shown through the Genius part of Grenoble. We expect a good double-digit growth between 2018 to 2020 for this collection. A part of the collection, we do not get a lot of question when we meet you, but maybe because also we did not speak a lot about it in the past, but I think the other part that is having a very nice development over the past few years has been the Enfant collection.
Here, we want to reinforce the leadership that we have in the outerwear for the Enfant. We want to expand the retail and the online distribution. We are having currently 12 shop in the shop worldwide. We opened the first dedicated Enfant shop in Spiga. I think for the people who will come this afternoon to visit Montenapoleone, will pay a visit also to the Spiga store. I must say that is working extremely well here. We expect a high single-digit growth between 2018 to 2020. Other categories, the knitwear, as I have said before, from 2015 to 2017, this has been the fastest growing category over the past few years. We want to further increase the visibility of this category, enhance design and merchandising. Here, we expect also good double-digit growth between 2019 to 2020.
Finally, a category that is relatively new for us, it was really the accessory of the accessories, was really something that was in the past developed when the full collection was developed, when we had all the outerwear collection developed, there were people starting to think, "Hey, maybe we should add some gloves and hats." But really at the end. Now what has changed is that over the past two years is really we have, first of all, a dedicated creative person to develop the category. We have been enhancing the visibility on the store, and I think that is potentially the category with the highest growth potential that we have for the next three years.
Footwear and leather goods, we are going to complete the U.S. penetration of this category, adding another 27 stores this year in our, what we still call footwear pilot, which is more a new way of selling the shoes in our network. Here also, we expect a double-digit growth in the next few years. Finally, eyewear. You know that we signed two years ago a new partnership with Marcolin. We have reviewed completely the collection of Moncler that we find are much more qualitative. It has been very much welcome, both by the market because of course we are not only selling our store, but there is a dedicated distribution for the eyewear, roughly 2,000 stores that we want to double in the next few years.
I think here there is still, and we have seen potential to leverage on the price, selling higher at higher price because there is a request for higher priced Moncler sunglasses in the network. Here also, we expect a good double-digit growth in the next few years. Uniqueness and human creativity, different messages, digital drives them forward. If you have a good idea now, you need to express it also digitally. Here, if we talk about the way we want to change the way we communicate, as I mentioned, Genius is the first digitally native project that we have. It has been thought digital. We talk about digital now internally in the company, and we communicate digitally. The rhythm of communication is also changing, as I was saying, from two campaigns per year to something that is more now on a monthly basis, weekly basis.
The main project for the next few years is Genius that we want to leverage at 360 degree. It is also a project that we want to continue. It was a project that was initiated through a partnership with Vogue U.S., and we call it We All Wear Moncler that has had the highest number of, let's say, consumer involvement tags and social media exposure. We want to continue this, which is really giving to not only celebrities but also to normal people that are Moncler client, the possibility to showcase themselves in the digital world. Finally, the last but not the least, is the what we call the Moncler Moments.
Moncler Moments, we had 105,000 clienteling action last year involving connecting directly through our client advisor with the end consumer. Here we want to integrate in our CRM activities and client activities, also all the data that we are getting from the social media sites. It's the last shot of my presentation. We give you the vision on how we want to go to a Moncler 2.0, how we want to be able to enhance the client experience in-store for our clients. With the aim for us is to really shift from this traditional media investment into something that is going to be mainly digital, but also leveraging on the outdoor advertising and reaching at least 70% investment, in terms of media spending by 2020.
When we disclosed the Moncler client promise during the last, marketing investor day in 2015, we mentioned the fact that we wanted our people, our client, to be feeling at home when they are in the Moncler store. I think this is something important that we are now not only putting words in a claim, but that is something that has been lived by all our team on a daily basis, in the stores. What we see here, it's four pillars to enhance and have a more connected and integrated network. We want to create a very large Moncler community with our clients. We are going to leverage this on four pillars. The first is the in-store experience. The second is leveraging the mountain DNA. The third pillar of expansion is the travel retail. The fourth one is the digital world.
The focus for us on this will be the strengthening of the organic growth of Moncler and of course, the expansion and integration of the channels. First of all, we opened 7 flagship stores over the past three years with Moncler. We had one that was working extremely well, which was Paris Faubourg. We have had the opportunity to open 1 flagship store in each one of the region, the last one being Canton Road, and Moscow that we open at the end of 2017. What we have noticed is not only that the client experience for the client is elevated to a completely different level, but also that the comp, for this store, has been largely above the regular store in full year 2017.
For the people who have forgotten 1 of the figures that we mentioned yesterday, we had a 14% comp growth rate in 2017. These stores have been largely outperforming the performance of the traditional stores. UPT is larger also. We are 6% above the unit per transaction, and this is very much linked to the fact that we are able, in a larger store, to showcase and display more categories. The loyalty rate, which was probably the largest surprise that we have, for the people attached to a flagship store, the loyalty rate is 19% above the one of the other store, probably linked to the fact that you have a larger assortment. This is driving more frequent purchase, of the client attached to the flagship store.
The second point was, we started this project already in 2015, is really coming back to why are we present in ski resorts. We have 13 of them. We think that we have the possibility to selectively enlarge the network, probably 2 or 3 more openings in the 3 years to come, to enlarge the existing. You see on the left, the picture of the store in Gstaad and in the middle, the store of Megève. These were 2 stores that were relatively small. Megève, I think it was the, Andrea, the smallest store that we have in the network, 30 sq m, now it's 130. Of course, it's difficult to deliver a superior client experience in a 30 sq m store. We decided to invest in the stores.
I must say that we are getting now a lot of positive feedbacks from our clients because we have started the development of specific visual merchandising, specific windows, specific product for the resort. This is the part of the network that has been growing the fastest between 2015 to 2017. We are also having now on a yearly basis events driving customer satisfaction, enhancing the experience of the clients. You see on the right, 1 of these events where we introduce new partnership that we had, one with ski with a Swiss company called zai, another one with a company from Bergamo called KASK. We did some specific development on to complete the universe of Moncler, not only with the outerwear, but also with helmets, with gloves, and with the specific ski, very high-end position ski.
Airports is another possibility for us to further leverage the trend that is a natural trend of the younger generation that traveling more and more. This is a part of the luxury industry that has been developing, if you look back the 15 years, at twice the pace of the rest of the industry. In 2014, we had four location. We opened four location between 2016 and 2017. For 2018, we have already secured seven new location That you see here, and we plan to reach at least 30 locations by 2020. Here also, dedicated product, dedicated visual merchandising, dedicated windows, and also a push for us to further continue to harmonize the pricing that we have around the globe, because these consumers are traveling around the world, and there is the need for us to further align or decrease the price gap between the different regions.
Things that we have been doing. We are decreasing the price and cutting the price gap between the regions by half over the last few years. We are going to continue to harmonize this pricing on a continuous basis. Online. The best performing channel with the results over the last few years. Yearly average increase of 30% over the past two years. Also, a presence with e-tailers, online as wholesale that has been increased, but in a qualitative way, always leveraging on events. Here you see two of the events we have been doing with two German onlineers. One is STYLEBOP, the other one is Mytheresa in [inaudible]. The other one was an event that we did with them in Berlin. There is a pilot project that has been started in November last year, that is with three stores where we are piloting our new omni-channel approach.
One of these stores is here in Milano. We have Torino, and we have Bond Street in London. What we plan is to have a fully operational omni-channel ready for mid of this year. This will include the exchange in store and to have a full rollout of the omni-channel by the end of 2018 in all Europe. Europe represents today roughly 60% of the sales that we have online. The network rollout of the omni-channel will be completed by the end of this year. Our focus for the future is to continue to create this online digital culture. We have a plan for end of 2018, beginning of 2019, to internalize Korea and to develop our own online platform with full omni-channel capabilities in Korea by end of this year, beginning of 2019. This is to further increase our knowledge about the online business.
We want to continue to reinforce the partnership with the e-tailers wholesale for Moncler Genius to have a fully operated omni-channel by 2019 in all the regions, not only Europe. We'll start with Europe. Then 2019 will be the rollout of Americas and the rest of Asia. We have a strong belief that China needs to have a dedicated approach. We think that the recipe that is working for Europe, that is working for Americas, need to have a dedicated, specific, different approach for China. We have started with the launch of our Hong Kong flagship, a partnership with WeChat, with the pop-up store that we are now, let's say, increasing the visibility of our online pop-up store with the launch of Genius. We are currently working with other projects. We are currently assessing the possibility to enter with Tmall in the Luxury Pavilion.
It's still the phase of assessment. We haven't decided yet. What we are sure is that clearly, this needs a specific approach. Our goal is to double our online revenues in the next three years. Control selectivity of the network is what is going to continue to drive our decision. We believe that the brand has still important levels to drive growth in all channels, growth through new store expansion and organic growth. If we start by retail, in blue you see the existing roadmap, the existing map of the presence of Moncler in retail. What we plan is to open two new countries on average per year over the next three years. In the plan, we have Mexico, that we are going to open by July this year. We have Spain and Portugal in the pipeline for 2019.
We have Oslo that is going to open in June this year. We have the opening of Dubai on the 5th of March. We have also plans to open in Thailand and South Africa by 2020. If we talk about wholesale, here also we think that there are still growth potential for Moncler. We started the development of a shop in the shop strategy, what we call the retailization of the wholesale. We have been opening 17 doors in wholesale in 2017, still cleaning our distribution. We have been closing 100 doors last year. We have seen the growth rate of wholesale has been a double digit last year, plus 10%. The performance of the shop in the shop, we are carefully measuring the investment. We are doing that.
That are usually share investment between us and the department store with dedicated sales floor, dedicated merchandising, increasing the quality of the merchandising also in the store. The average growth rate that we have had over the last two years for the shop in the shop is 39%. I think this is something that we can still continue. There is, for the three-years plan, in the pipeline, an opening of 15 to 17 stores year-on-year, an additional 50 shop in the shop for Moncler in the next three years. In terms of integration with retail, we have now teams that are in charge of the merchandising for both channels. It's the same visual merchandising team that is taking care of the Moncler retail stores, also of the wholesale.
We have more integration, leveraging on the knowledge that we have in the retail side, also to be leveraged on the wholesale side. You see here some of the examples of the shop in the shop, the opening. This is the airport of Doha that we opened in January last year. This is the second Moncler Enfant shop in the shop that we opened in Munich with Oberpollinger. The first one was the one we opened in 2015 with Harrods. We have the opening of Ala Moana in Hawaii with Saks. Marbella, another kid store that we opened this year. This was a pop-up store that we have now also presence of three shop in the shop in Moscow with TsUM that has been a big success. This was the largest pop-up we have ever been doing.
It was at the end of 2016, a 250 sq m pop-up that we had with them on the ground floor. Wholesale is also an opportunity to test markets, to open new markets, to see if this is the presence, if there is a potential to further develop the retail possibility there. We have in the pipeline, you see here some potential openings for the next few years. You see Manila, Bali. Bali is confirmed for the opening of 2018. Kuala Lumpur is also confirmed. Saipan is under assessment. Bogota, Lagos, Lahore, Mumbai. In some of these markets, the presence will be probably always only wholesale. Some of them, if proven to be successful, could become potentially a retail store in the future. There is also the strong potential to further develop the presence in selective e-tailers.
We foresee there a potential to at least double our sales in the next few years. Talking about Retail Excellence, I go quickly through 2008-2014 to spend more time on what has been achieved over the past few years and where we want to go. Clearly at the beginning, when we started the initial development of Moncler, the focus was more on store openings and on acquisition of new clients. Not too much about our people, not too much about the process. It was really opening, opening. Always in qualitative location, but without a strong retail culture. The knowledge about the client was limited, and the communication was very much a corporate communication which was more above the line. What we did with the launch of Retail Excellence 1.0 was to revisit, reshape the client experience in the store.
This has been, I remind you, something that we have developed with our client advisor in the store, with the region, with the store manager. The second pillar was the people, so developing the internal culture. We have multiplied between 2015 and 2017 our training hours by four. We have been increasing the retention of our client advisor and store manager. We have decreased the rate of people leaving the company by half. All the investment we are doing now are investment for the future, and we believe that if you want to loyalize the end consumer, you need first to loyalize your employer and your store managers. It's something that is part of the project, and the final part of the Retail Excellence 1.0 was the focus on the operation where we have aligned the operation worldwide.
At the worldwide scale, we have now one way to operate Moncler. The client has been the focus over the last two years. It will continue to be the focus. As there was mentioned, we multiply our database almost by four, leveraging now, giving the tools to our client advisor to be able to interact, putting a frame but giving them the freedom to freely communicate with them, and we have seen that the loyalty rate has increased. We have also developed personalized communication. We are giving tools to our client advisor, giving them content to communicate to the end consumer. What we think, what is the next step for us in terms of Retail Excellence is the focus on the omni-channelity.
We still believe that the client advisor needs to be the true brand ambassador of the brand, and we are currently testing the KPIs in order to allow them and push them not only to sell to the people that are in store, but leveraging all the levels of the omni-channelity to give an enhanced client experience. We think, and I will come back to this, that linking the world of digital, the work of the navigation, the way people navigate on the website, the way they interact on the social media, can clearly give, if leveraged in the right way, without being too intrusive, can be leveraged by our client advisor. I'm going to show you what the architecture we have in mind for 2018-2019.
Finally, in terms of communication, we want to leverage much more on the digital world. We want to develop CRM enhanced tool to be able to deliver the superior and integrated services through our device that is Moncler. This is our vision on what we want to achieve, and the opening of the Korea market that we are going to manage directly is going to be the pilot for us to integrate this one client vision, the Moncler view of the client worldwide, having on one hand what we have already, the Moncler app, the order that people can see already on their app. They already see what has been purchased, which items, at which frequency, in which store.
We want to integrate all the social listening, the in-store analytics that we have, also the e-commerce behavior of our clients in one tool, leveraging on Google Analytics and CRM to be able to first have marketing automation, not only the client advisor pushing information to the client, but having tools that are going to facilitate and improve through data intelligence the way we communicate with the consumer. This should be a way to increase even further loyalty that we have to deliver and also to look at the clients at 360 degree in this experience, also having post-sales customer service, not only after-sales, but also other services that we can provide, improve the way we are doing the omni-channel, finally giving a superb clienteling experience. This is the vision that we have. This is the challenge that we have to develop this Retail Excellence 2.0.
I thank you for your attention. We have now 10 minutes break, coffee break, before having Luciano coming back on stage. Thank you.
Come on, get out of that. Get out the door like this. Girl, I'm in love with you. This ain't the honeymoon. Past the infatuation phase. We're right in the thick of love. At times we get sick of love. It seems like we argue every day. I know I've misbehaved, you made your mistakes. We've both still got room left to grow. Though love sometimes hurts, I still put you first. We'll make this thing work, but I think we should take it slow. We're just ordinary people. We don't know which way to go. 'Cause we're ordinary people. Maybe we should take it slow, take it slow. This time we'll take it slow, take it slow. This time we'll take it slow. This ain't a movie, no. No fairy tale conclusion, y'all. It gets more confusing every day.
Oh, sometimes it's heaven sent, we head back to hell again. We kiss, we make up on the way. I hang up, you call. We rise and we fall. We feel like just walking away. As our love advances, we take second chances. Though it's not a fantasy, I still want you to stay. We're just ordinary people. We don't know which way to go. 'Cause we're ordinary people. Maybe we should take it slow, take it slow. This time we'll take it slow, take it slow. This time we'll take it slow, take it slow. Maybe we'll live and learn. Maybe we'll crash and burn. Maybe you'll stay, maybe you'll leave, maybe you'll return. Maybe another fight. Maybe we won't survive. Maybe we'll grow, we never know, baby, you and I. We're just ordinary people. We don't know which way to go.
Hey, because we're ordinary people. Maybe we should take it slow. Hey, we're just ordinary people. We don't know which way to go. This time we'll take it slow. Take it slow. This time we'll take it slow. Take it slow. Slow. This time we'll take it slow. Take it slow. This time we'll take it slow.
In a sentimental mood, I can see the stars come through my room. While your loving attitude is like a flame that lights the gloom. On the wings of every kiss, drifts the melodies so strange and sweet. In this sentimental bliss, you make my paradise complete. Rose petals seem to fall. It's all like a dream to call you mine. My heart's a lighter thing since you made this night a thing divine. In a sentimental mood, I'm within a world so heavenly. For I never dreamt that you'd be loving sentimentally. In a sentimental mood, I'm within a world so heavenly. For I never dreamt that you'd be loving sentimentally.
Olha que coisa mais linda, mais cheia de graça. Ela, menina que vem e que passa. Num doce balanço, caminho do mar. Moça do corpo dourado do Sol de Ipanema. O seu balançado é mais que um poema. É a coisa mais linda que eu já vi passar. Ah, por que estou tão sozinho? Ah, por que tudo é tão triste? Ah, a beleza que existe. A beleza que não é só minha, que também passa sozinha. Ah, se ela soubesse que quando ela passa, o mundo sorrindo se enche de graça e fica mais lindo por causa do amor.
Tall and tan and young and lovely, the girl from Ipanema goes walking. When she passes, each one she passes goes, "Ah!" When she walks, she's like a samba that swings so cool and sways so gently. That when she passes, each one she passes goes, "Ah!" Oh, when he watches so sadly. How can he tell her he loves her? Yes, he would give his heart gladly. Each night when she walks to the sea. She looks straight ahead, not at he. Tall and tan and young and lovely, the girl from Ipanema goes walking. When she passes, he smiles but she doesn't see. Oh, how he stares so sadly. How the moonlit sonnet sobs her. Yes, he would give his heart gladly. He knows when she walks into scenes. She looks straight ahead, not at he. Dark and tan and young and lovely.
The girl from Ipanema goes walking. When she passes, he smiles but she doesn't see. She doesn't see. No, she doesn't see.
When I am down and, oh my soul, so weary. When troubles come and my heart burdened be. I am still and wait here in the silence. Until you come and sit a while with me. You raise me up, so I can stand on mountains. You raise me up to walk on stormy seas. I am strong when I am on your shoulders. You raise me up to more than I can be. You raise me up, so I can stand on mountains. You raise me up to walk on stormy seas. I am strong when I am on your shoulders. You raise me up to more than I can be. You raise me up, so I can stand on mountains. You raise me up to walk on stormy seas. I am strong when I am on your shoulders.
You raise me up. No, I said I'm not nothing. You raise me up to walk on stormy seas. I am strong when I am on your shoulders. You raise me up to more than I can be. You raise me up to more than I can be.
Okay. Good morning, everybody, and thank you for coming here today. I'm Luciano Santel, and I'm responsible of all corporate divisions, which include finance, information technology, HR, legal, logistics, and supply chain. You all know how important is the machine for the execution. Over the past two years, we have invested a lot of money in the organization in order to make the machine more and more solid, stronger and stronger, in order to be ready for the challenges we face. What you expect from a machine is reliability, first, of course, which is very important, essential. Reliability, essential, but it's not enough. In a fast-changing world, reliability is not enough. You must be fast, fast, and flexible. Today, we will give you an overview of what we are doing in the organization, where we are, what we plan to do.
We set these five focus areas, five main goals for this year and for the next two years. Number 1, Supply Chain. Of course, critical, instrumental, essential to make the dream come true. If you visited, as you did last night, our Genius building, you know exactly what I mean, and I'm sure you realize and you understand the complexity behind the product you saw. Which is not only the complexity to make that product, but also the complexity we face now to make that product on a larger scale, and to be ready to deliver that product at the time we want that product to be in the store. Number 2, Information Technology. We have invested a lot over the past few years in Information Technology. Of course, a critical factor across the board in all the different processes of the company. Number 3, people.
Everything is possible with people. Everything becomes very, very difficult, very, very complex if you don't have the right people. People are essential for everything we want to do, and our job, and I will show you later what we are trying to do to protect this very important asset. Logistics. Logistics is the other face of the Supply Chain. As we said before, we have to make the dream come true, and then we have to deliver the dream everywhere in the world the same day at the same time. Obvious, believe me, not so easy. Last but not least, Sustainability. Sustainability is becoming more and more important, an intrinsic and essential component, not of our business only, but of our life. Also in this area, we will show you what we are doing, the most important projects.
We are going to start with the supply chain. Head of the supply chain is Francesca Bacci. Francesca joined the company in December of last year, so she has been with the company for just less than three months. She has already realized where and what the areas of improvements are. She knows our strength, many. Also our weaknesses, a few, and I'm sure she will be able to convert weaknesses in opportunities. Before joining Moncler, Francesca worked for seven years in Valentino, and before Valentino, she spent over 10 years in.
18 years.
In Prada, where practically we can say she grew up professionally, and saw two important pillars of the luxury industry. Francesca, thank you for being here, and please come.
Thank you. Thank you again, Luciano. Good morning to all of you, ladies and gentlemen. I'm very happy and honored to be here today, and I'm also excited because today is my first Capital Markets Day. I would like to introduce myself again. As Luciano said, I joined this company in December. I've worked all my life at a luxury goods company, and I met many designers. Some of them are here. At the beginning of my career, I worked a lot on collections, on product development, and design divisions. After, I managed production and operations, and I have already faced many critical issues that are related to fast-growing companies that need to reshape or re-engineer their supply chain.
I think this is very important. I think this experience gave me the possibility, it was the basis for my deep knowledge of how collections are and should be developed in order to manage and to anticipate all those critical issues that might hinder production deliveries. Now this is more true and very important here at Moncler, where we are facing this milestone evolution of how our collections are created, how we are presenting and delivering them. Quality is really the mantra of our group. I like this very much. This has always been and will continue to be our main focus on every process. Starting from the choice of very good raw materials, to an accurate industrialization, until production by very selective suppliers, trained and supported by our people. This is not enough.
Here at Moncler, we have a department which is called Quality Development and Innovation. It does not report to me, nor to Luciano. It reports directly to our chairman. This department has the mission to help all our divisions to continuously look for improvement, because this is our DNA. We will never stop to look for new and innovative ways of operating. We were speaking of Moncler evolution. Of course, it is important for the supply chain to evolve and to focus on time to market. If I have to summarize what I've just been saying, Moncler will continue to deliver the best products with the highest quality standards and innovative design at a planned time, at a very carefully planned time. Therefore, our main four goal for the next four years are, first and foremost, Genius. Second, processes optimization.
Third, enhance our complementary categories like knitwear, shoes, and leather goods. Last but not least, Moncler Clinique. Moncler has been very strategic with this Genius project. Already Roberto spoke a lot about it. I think, I believe that you now have a clear idea of what a great effort it was for the supply chain to manage eight designers and eight collections at the same time. Genius is also something more. Because it goes beyond seasons, and it will have monthly drops into the stores. This means that the supply chain must fine-tune. For the supply chain, it will be very important, timing and planning of collections.
Of course, when we are planning our briefing of our collections, we have also to plan very carefully and define very carefully the times, the timing when we are going to deliver them, the timing of events, the time for communication, time of windows, of distribution. You can understand that this will be a very challenging task. Of course, the strict timing dictates now our master calendars. I mean, all the production activities. With Genius, it will be important to move from a traditional sequential process of activities and for one where the activities are carried out at the same time. For example, industrialization of products along with collection development. Although Moncler is a very powerful machine, I believe the Genius project proved that, we have also to improve. We have just launched internally a project which is called Supply Chain Excellence.
To support these changes and to follow these changes, it is important that the supply chain becomes more efficient, more responsive. Of course, this will allow us to reduce time to market. This project will allow to bring integration between all departments and also among divisions. It will align all the investments needed by IT department in order to support these changes. It will promote best practices and assess lead times. As far as knitwear, shoes, and leather goods are concerned, we believe the culture and know-how and innovation are the pillars of the supply chain. Knitwear. For knitwear, we have created in Trebaseleghe, a very beautiful and amazing site of prototyping and production. Its director is doing a very good job. I think the path is well-traced.
For shoes and leather goods, we have hired a very experienced technical director, I think we still have to enhance culture and know-how. Of course, we will have to invest in new designers and production managers. Moncler Clinique. This is the best part because I love Moncler Clinique. I've been there about 10 months ago, and I must say this is a very amazing facility. It's our facility in Romania. I'm not exaggerating saying today that this is one of the most beautiful and one of the best facility that we can find for outerwear and high technical garments. What is next for Moncler Clinique? We have two main projects. These projects are, we would like Moncler Clinique to become a technical hub for the whole group. We would like to develop their techniques that will then spread among our core suppliers.
At Moncler Clinique, we have already a very important R&D department, and they are already using 3D pattern technology. That's very interesting. I think there's another very important project, which is, we want to build there a training center for new people that we will hire, people that will have the task of guaranteeing that the quality in our person will be the same provided by Moncler Clinique. I now leave you with a beautiful picture, and I hope you can share our pride for what has been created, because I think it's really unique. I thank you very much, and I hope that by now you will appreciate fully both the beauty and the technicalities of our projects. I now leave the floor back to Luciano, and thank you again.
Hi again. Thank you, Francesca, very interesting. Within very deep and important words you spent, it's difficult to understand the complexity we face. Nice picture. Let's talk now about information technology. As I said before, needless to say how important is information technology, digital, whatever, is going to help us to make things well, but faster and in an efficient way. What is our mission? Is it to develop solutions that must be secure, reliable, and integrated. Three words that are three stones. Very important, these are the driver of our strategy. In this slide, we report only some of the many projects in information technology we have in our pipeline. We wanted to present to you only most important projects strictly associated with our business strategy.
We have not included some other projects, not to talk about everything we are doing to help Francesca in the supply chain. Also, for example, one project I want to mention that is not in the slide, which is related to one of the stones we said before, security, is a cybersecurity project that started about six, seven months ago and is still in progress. Very important, very complex, but very critical for our future. Okay, let's get back to business projects. Some of them, three of them actually, are projects we presented the last time we met, the previous Capital Markets Day. First project is the Enterprise Business Intelligence. You may remember that when we met last time, we said that we were planning to implement this project. Now the project has been not fully, but more or less 70% implemented.
It has been implemented under a technology for front-end, which is MicroStrategy, and technology for the data warehouse, which is SAP HANA. I mention technologies because some of you may be interested in understanding what is behind the words I'm spending. Two technologies, first in class for front-end and for the back-end as well. The rollout will be completed by this year, 2018. We have a few projects that are still associated with the retail business, front-end and back-end. Clienteling, all business information in one device. The device is the iPhone. You know very well, and Roberto already explained to you several times in the past, but today too, what MonClient is. MonClient is this application that has been developed in Moncler with all the business information within that device. That device of course, is connected with the database, which is behind the scenes.
That is a CRM, a customer database, under a Microsoft Dynamics technology, where we report all business transactions with our customers. Not only since about one year ago, business transactions in our physical stores, after about May or June of last year, we integrated our business transactions with the online transactions that were in the data warehouse of YNAP. Now in the same database and visible and accessible by the same device with MonClient, we can see all the business history of our clients. Not only, we have also introduced other information within the same device, like the possibility to see the availability of the product you may be looking for. If the product is not on the shelves, you can see if the product is in the back house or if the product is available in other stores nearby.
Everything again, with the device on hand by our client advisors. MonPOS. MonPOS is a project that is under pilot now, that is still within the same device, the same iPhone, that will permit, actually, it permits now in the few stores under test to do the checkout and to make the payment. Wallet payment is another piece of the same chain, is the possibility that is still under test, but will be rolled out shortly, to accept payments from WeChat or Alipay, for example, needless to say, Apple Pay, of course. This is what we are doing technologically in the store. Behind this is the machine is still extremely important. You may remember that two years ago we said that we were starting a project to implement a retail planning, a demand planning project.
This project has been developed under TXT e-solutions, which is a technology that was born in Italy, but right now, for the one of you who are familiar with technology, has been taken over by an American company a few months ago. What is retail planning? Retail planning is everything about how we price our product, how we plan our sales first, and then how we plan our collection, then how we plan the assortment we want to put in the store, how we allocate the product, and then how we replenish or how to replenish the product itself. The best sellers, of course. All these phases of the project, most of them have been implemented. Last two, assortment planning, allocations are under construction now. Also we are looking at make the auto-replenishment system more powerful. Because auto-replenishment started about one year ago.
We are very happy on how it works, I think. Andrea, what do you think? Because we are even too happy, we believe that we have to think about something even more powerful. Last but not least, a project that two years ago was not in our pipeline. We are talking about online. Two years ago, probably we were at the time to sign the agreement with the YNAP to extend the contract that is still in force. I think that over the past two years, we have developed a solid, strong, not yet very strong, but much stronger than before culture in online. From the opportunities that the online offers, and this is something that already Roberto covered a lot, but also from the technological point of view.
We are working with YNAP, as you know. YNAP has implemented, over the past couple of years, a very important and complex project of IT transformation. They migrated their platform to IBM platform, which is, just to let you know, but I'm sure you do, one of the three, four most powerful IT platform for online. We, as a pilot, Moncler, as a test, started first last year in June for this conversion. Honestly, and transparently with all of you and with YNAP too, with some problems, honestly. This is the price you have to pay if you want to start first. Now, the platform is much more solid, and we are happy because, of course, the platform is by far more powerful than the previous one. It is opening the door to the omni-channel model.
Omni-channel is something that we still have to implement, all the classic traditional phases of the omni-channel have been already started, and they are under pilot. I wanted to go through the different transactions. Home delivery is a traditional transaction, so nothing to say about home delivery. Click and collect in store is when you place the order online, but you want to collect the product in the store because maybe you want to see the product, you want to see if it fits well or whatever. This is something we are doing in this small number of stores under pilot. Click and reserve is when you're looking for something you can't find online, but you see, because the platform gives you the information that product you're looking for is available in a physical store, which may be nearby where you live.
You reserve the product, then you visit the store, you collect the product. Two faces of the same coin. The first one you pay upfront, the second one you pay when you take the product in the store. Click from store, very important. Something Roberto and I honestly both believe a lot is the possibility to generate online orders into the store. If you visit a store and you can't find something you're looking for or your size is not available, with the help, with the assistance of a client advisor, you can place an order online and to have the order delivered in the store itself or at home. Return the product in store, exchange the product in store.
Another pillar, another component of what we said at the beginning, the focus areas for the time being and for the next couple made that dream come true, made that happen. What is our job? Our job is to make talent is within the DNA of some people, but it is in everyone, in all the people who work with us. We have a project that is starting shortly, in a few weeks, I want to mention, which is Mon One Year School with the teachers coming from outside and of course, teachers inside the company. Our management team all together will contribute to this school. Very important, I want to say that in my mind, is a first phase of something that we have to think even bigger.
Something important to say, I'm sure that talking with Roberto, you're familiar with what our MIT project is. That stands for Managers In Training. The possibility, the opportunity we give to our more talented people working in the store, client advisors, to become managers, of course, by giving them the opportunity to get trained. We have to develop the talent in our people, then we have also to engage them. Something important, a project we have implemented recently is called Mon Voice. Mon Voice is not in the bullets, but it's something I wanted to mention. Mon Voice is some kind of a permanent survey we have put in place, by which we get all the thoughts, all the feelings, the suggestions, the objections as well of all our people. This is very important to make them feel an essential component of the organization.
All these phases are under pilot in a small number of stores, we expect the rollout in Europe for sure by the end of this year. One full inventory we have mentioned, which is another important transaction associated with the multi-channel model that has not been evaluated yet because we gave priority to the phases I mentioned before. Single customer view is something that relates to what I said before and what Roberto said in his presentation, very self-explanatory. Business architecture is everything associated with what we are doing together with the YNAP our information technology platform, their IBM platform, and honestly, very complex integration between the two platforms. Important, I was forgetting to tell you that, we are planning to spend about EUR 30 million in CapEx only in the next three years.
After the survey, we have activated this group of people that are committed to follow up the results of this survey. We have to develop talent, we have to engage people, we have to measure their performance and to reward them. Here are a couple of comments that I believe are important. The way our performance management system works, of course, is based Leadership, vision, capability of execution, everything very important. Our store is based, of course, on financial results, but not only. Financial results, of course, they're very important. To be fast, we need an agile organization. Agile organization means not many people. Let's go ahead. The logistics, the future is now.
In the slide before we said that the future starts now. To be in the store, to be in the window, when they open the door of the store on June 12th, 9:00 A.M. Where we are putting all the quality console and the aftersale. This is a project that will be implement, important, I would say, essential in everything we do, not only here in the company, but also when we go at home. Most important material we use is down, as you know. I think you remember, you know already Which is a label DIST in all our garments in order to let our customers know that the product they buy has this. This is not just an instrument of investigation, but is instrumental to increase their awareness.
Proud to be Moncler is about mostly what we said before, giving a voice. To let you know, we are working on a project which is promoted by the United Nations. This is something that, of course, we believe, once again, is extremely.
The first chart, please. Yes, please, go on. You received the statement yesterday evening. Especially happy to comment these results, the strong double-digit growth that we had with part of our sales are happening in quarter four, and quarter four has been completely in line in terms of growth at +17%, as the growth that we have had on the yearly basis. A solid growth of the Italian market, both on the wholesale and the retail side. As you know, the most important store that we have in Italy is the one some of you are going to see this afternoon in Montenapoleone. Montenapoleone has been closed for four months because of construction. We closed the year on a positive base also for Montenapoleone because the results since the reopening with the extending flagship has been really good.
Globally, despite the four months closing, the results of Montenapoleone has been positive last year. If we look at the results of Europe, that now represent 30% of the total sales, it is +19%, supported by double-digit growth not only in U.K. and France, that has been the best-performing market, but also in Germany, Austria, Switzerland, and Eastern Europe, especially with the opening of the new store in GUM that has been driving strong growth in December this year. We look at the results of APAC. As you know, APAC for us, it is three regions. It is Asia, it is APAC, Korea, and Japan. And we have registered double-digit growth in all of these markets, including China and including Hong Kong. There also with a very strong impact of the opening of our Canton Road store with a +20%.
Finally, the U.S. at +14%, growing U.S. Americas, mainly U.S. and Canada, growing double-digit at +14%, and a growth that has been both supported by the wholesale business and the retail business, with a slight acceleration in Q4 for the Americas market at +15%. I think we can move to the next chart. Here you see the split revenues between wholesale and retail. The balance between the two channels now is at 25% for wholesale and 75% for retail. I must say, for us, we were planning to have this balance between the two channels. At constant exchange rate, a +10% in wholesale, which is a very strong result that we have been achieving, supported by the strong growth that we have had with the online wholesaler and the shop-in-shop result.
Remember what I showed in my previous presentation, the +39% comp growth rate that we have had in the shop-in-shop. We have had here a strong opening part during the last part of the year, which has helped us to grow double-digit in wholesale and a +19% in retail. This has been supported by the strong growth in some of the categories, complementary categories, in line with the result of the past two years. Tricot and cotton growing at 37%, soft accessories also at 37%, and shoes growing at 26%, so in line with the growth of the last two years.
This growth, and this very good comp growth at +14%, has been basically, let's say, what was the outcome of the result that we have had in units per transaction that grew at more than 4%, orders per transaction that grew at more than 5%, and an increased loyalty rate in our stores with an increased conversion rate when people are entering the stores. Regarding the development of the retail and the wholesale network, we reached, at the end of 2017, 201 retail stores with the strong openings that took place on the last quarter of the year. If we look at the way we have been opening stores in 2017, it is a little bit unbalanced. Usually, we try to have openings that are a little bit more spread throughout the year. Usually, targeting to open with the fall/winter season in June, July.
For technical reason, like for the opening of Dubai, we were ready in November, but it's just the mall itself that has been switched, so the opening has been switched also. Basically, we had a lot of openings towards the last part of the year, which will, of course, have a positive effect for the full year 2018. We opened GUM, which was a relocation in December. We opened two stores in Rinascente, Rome. We opened a store in Chongqing IFS. We opened Firenze, Stockholm, which is a new market for us, and a second store in Toronto. Regarding the opening of the wholesale, we had 17 openings of wholesale shop-in-the-shop and mono-brand stores towards the end of the full 2017. 11 took place in Q4. Amongst them, the most important ones are three airports, Charles de Gaulle, Taipei Airport, and Bangkok, that are managed in wholesale.
We opened two shop-in-the-shops with Breuninger in Stuttgart in Germany, Bloomingdale's in Dubai, and then three openings with DFS. Some of them are new countries for us, Auckland. The first store we have in Macau with the Four Seasons and Guam. Finally, two stores in North America with Holt Renfrew. Globally, the number of wholesale shops that we have for at the end of 2017 is 59. We believe that we'll be able to open a similar amount of shop-in-the-shop, mono-brand stores in 2019. Currently, we have secured 15 U.S. openings for 2018.
Okay, thank you. Thank you, Roberto. This is a pretty dense chart as usual, numbers are nice, I'm sure you will enjoy them. It's nice also for myself to comment them. Top line, has already been presented in depth by Roberto, up 15% at current rates, 17% at constant exchange rates. The bottom line, with a growth rate of 27%. Let me jump for a second to the bottom line, because the growth of net income is almost double than the growth of the top line. Of course, the EUR 250 million, EUR 249.7 million, have been achieved with the help of tax that, as you probably know, you probably remember, we signed at the end, mid-December, in agreement with the tax authority in Italy to obtain the patent box benefits.
Patent box, together with a penalty we were required to pay for an old investigation, tax authority, provided a net benefit of about EUR 20 million. This is what made the tax rate so low as compared to last year. Let's go back now to more business metrics. Gross margin, 76.9% against 75.7% of last year. Of course, as usual, our gross margin grows because our retail business grows faster than the wholesale business, even if you have seen one minute ago that the wholesale last year in 2017, grew very nicely, very strongly, I would say, first time in the last year, double digit. The growth of retail, which delivers a much higher gross margin, as you know, is not the only explanation. All the retail machine, and not only also the wholesale machine, has worked very efficiently.
The inventory management has been very efficient, we will see that in a second when we will see the net working capital. An efficient inventory management means as a retail metric, a very high sell-through. The sell-through in spring of last year and in this fall, which is ending now, but not yet, because as Roberto said, we are still below zero today. Our sell-through is very high and probably the highest since, I don't know ever, but probably for the last I joined the company five years ago, so I'm not sure, but you can confirm. This is another important explanation that I wanted to highlight because this is something very healthy for our business. Another point is that within retail, our regular stores performed very well and better than outlets. Outlets also discounted the product much less than the year before.
All of these components put together delivered this amazing gross margin. Amazing also because if you look at the selling expenses, of course, they grew from 30% to 30.6%, but just half of the increase of gross margin. G&A are substantially in line with last year, from 9% to 9.1%. They totally reflect our strategy that has been explained several times to make the organization stronger and to hire the right talented people we need to implement all the projects. Advertising is in line with last year, even higher on a percentage basis than last year. As an indication for coming years, we believe that we'll still be in the region of 6.7% but even something higher, up to 7%. As we said the other time two years ago when we met, we believe that advertising can go up to 7%, more or less.
Stock-based compensation is the non-cash cost associated with our stock-based plans, stock option plans that is expiring and the new performance share plan that is more important in 2017 because of the new performance share plan that was approved in mid-2016. Net financial results, negatively affected by FX and at the end, the net income I told you before and last but not least, and still very important, our EBITDA, which was 34.5%. I said last but not least, because EBITDA, as you all know, is still a very important metric. Probably next year will not be so important as it is still, it was in the past because you know that there is a new accounting principle that we start in 2019 that will change the way we report our leases.
We will not report any longer our rent cost, but we will report as a financial debt our liability coming from all the leases we have signed, which is over EUR 400 million, EUR 405 million, and as an asset, the right to utilize these leases. That right, that asset, will be amortized. We will have a huge EBITDA because in our books, we have about EUR 180 million rents. EBITDA will be higher on these numbers, EUR 180 million, but of course, the other face of the coin is that we will have a much higher DNA below EBITDA. Having said that, we believe that from now on, EBIT will be the metric all of us as a management team, but also in the market should look at more. Okay. This is the slide about the CapEx. Very simple and nothing particularly different from what we planned.
Yes, probably more money than what we planned originally because the store in Milan, Montenapoleone, and not only also Canton Road, are for the ones who visited the store and you are visiting Montenapoleone this afternoon, are really amazing. The other face of the coin is that we spent more than what we planned, but we are happy. We spent EUR 72 million, but still 6% on our sales like last year. Again, the majority, as you see, have been spent for the retail network. A growing number for the wholesale shop in shop, which is an important project Roberto told you about. An important portion of this CapEx, about EUR 11 million in what we call corporate, that is mostly information technology, all the projects we discussed about before.
Of course, for next year, I want to give you some indication that CapEx will not be lower because we still have to invest a lot in our business, retail and wholesale, and believe with all the projects that we have to implement in information technology, the total number will definitely not be lower than this. Net working capital. Net working capital, very nice. Let me say too nice. Please believe me that this number is You are laughing, but you don't believe me. Net working capital, 8% is the result of an amazing job that this company has developed. Honestly, we planned 9%, and we ended up with 8%.
The difference is about EUR 20 million accounts payable that were not paid at the end of the year because associated are stores that have been opened very late in the year, and most of them in December, like Stockholm, Florence, whatever. This EUR 20 million is something that you should take out, considering that 9% is in any event a very good number, and that comes from a very strict, very strong control of inventory for everything I said before. I mean, sell-through very high at the end. The amount of inventory this year, exactly the same than the year before with 17% more business. A good control of our credit, which is growing naturally because of the growth of the wholesale business, but also our concession business, which is retail, reported under retail, but we collect the money from department stores the month after.
Net financial position, very nice. Very happy with the EUR 305 million net cash, which, as you see, the real cash is EUR 394 million, but we report as a financial debt, not a real financial debt, not debt with the banks, but the financial debt we report with our partners in the joint venture. The EUR 67 plus EUR 20, the EUR 85, EUR 86 million is most of them a long-term debt with partners in Japan and Korea. Talking about Japan, I want to remind you that right now, in a few weeks, we will take over a 9% of Moncler Japan. We now own 51% based on the contract that we signed last year, as you may remember. Now we are allowed to buy 9% and to go up to 60%. Having said that, cash is good.
Something important I want to highlight is that the board has decided yesterday to propose to the shareholder meeting a substantial significant increase of our dividend payout from EUR 0.18 to EUR 0.28, which is almost a 60% increase, which is about EUR 70 million, EUR 71 million. On balance sheet, honestly, I do not have any comment unless you have questions later. On cash flow statement is some kind of summary of everything we said. Very strong cash generation driven by EBITDA, driven by the fact that working capital inject cash instead of absorbing cash. Change in other current is deeply negative. This is a technical point, because the patent box benefit I was talking about is not cash in 2017, but will be cash now in 2018 at the time we will pay the first tax payment. Having said that, no other comments, again, unless you have questions.
Very strong cash generation and very strong free cash flow.
We now can open to the Q&A session, which I already see hands on. First one and then second.
Good morning. Mélanie Flouquet, JP Morgan. I have four questions, please. The first one is, if I can go back to space growth. Space growth appeared to have decelerated in quarter four quite meaningfully. Well, I do not know whether the calculations are right, but around 3% on our calculation, 3%-5%. Clearly part of this was a delayed opening, it re-accelerates into full year 2018, I suppose. Could you first confirm that we will be on double-digit space growth in full year 2018? Moving forward, in your presentation, you did allude to the fact that you are opening 10 stores on average versus the full 2018, so I suspect there is a deceleration in 2019 and 2020 in the store openings. You are also referring to outerwear being up high single digit, which also suggests a deceleration in space growth.
I was wondering whether you could confirm whether in 2019 and 2020, you're factoring in a deceleration in space growth and a refocus maybe on like-for-likes, given the sharp acceleration you have in like-for-likes, notably driven by your own online. My first question is on space growth, and it has multiple things in it. Sorry. My second question is on shop-in-shops versus concessions. Why do you choose shop-in-shops versus concessions? I was curious. The third question is on inventories. Inventories are running flat year-on-year. Is this an issue for H1 like-for-likes? Are you running out of stock for the first half of this year? My last question, sorry, is on omni-channel. If I understand well, you're working hard on a soft omni-channel business in 2018, but behind the scenes now, we're also working on inventories being plugged in directly.
How long will it take to have a hard omni-channel? Thank you.
Many questions.
Okay. I answer the first question. You already gave the right answer. I just confirm that the reason why our space growth has been lower than what myself honestly have said several times is because we ran late in the opening of several stores. Some have been opened late in December. One, for example, that was in our pipeline in 2017, which is Dubai, will be opened shortly in 2018. Everything should be offset in 2018.
Yeah. Maybe to give some additional information.
Yeah.
We didn't mention 10 openings per year. We are still on 15 openings per year, both in retail but also in terms of shop-in-shop is what we are targeting, plus another 15 renovations because we want to keep our renovation expansion, and we always look when we need to renovate a store, if there is potential to deploy our ideal format, which is a 200 sq m store. I think you can count on a low double-digit growth in terms of space increase for 2018. The corollary, if you allow me this Frenchism, of being late with some of the openings is that we are early in the openings of 2018. Some of the delays we have had are helping us, and we are planning now to have four openings in Q1, which we didn't achieve last year.
Dubai Mall will open on the 5th of.
March
of March. We will reopen the Incheon Airport in early January. I think we are going to have a more balanced year in 2018 concerning growth space. Regarding your question on the choice between shop-in-shop and concession, I think it's the market that is deciding if it's a concession or if it's a shop-in-shop. Clearly, in Europe, department stores have been open over the last five years to convert their business from wholesale into retail. One of the last conversions has been done in February this year with the shop-in-shop we had at Harrods, which was wholesale, and we converted it into retail. I think we have almost now completed the transformation. There will be one left over with KaDeWe that is planned for 2019 when they are going to redo the floor.
Basically, department store Europe will be all in concession in a couple of years. It is already more than 90%. Regarding the U.S., their business model is still to have the brands that are mainly ready-to-wear into shop-in-the-shop, into wholesale. We are going to start now the first conversion from wholesale into retail with Bloomingdale's in San Francisco. It is a store that is going to be open in July. We are going to close the shop-in-the-shop we are on the upper floor. We are going to open a retail store concession, ground floor, opposite Louis Vuitton, end of this year.
We have also agreements with a department store in Canada with Holt Renfrew to have already embedded in the contract of the shop-in-the-shop, the possibility for us after two years if we want to convert at a predefined condition, the shop-in-the-shop into concession. For Canada, it is going to move forward. I think U.S. is still the part of the world where this is going to be more difficult. I hope that this opening with Bloomingdale's now in San Francisco will set the path for some changes. Other openings in shop-in-the-shop, so in wholesale, are the one linked to the airports. As you are probably aware of, it is not the brands that are imposing if an airport wants to manage its retail operation in the U.S. or in shop-in-the-shop, it is the airport deciding.
It is either you embrace and you decide because of the potential, because of the quality of the clientele, because of the quality of the footfall to be present, and then it is wholesale. When possible, of course, we prefer to be retail. In Italy, airports are in retail. For example, we open in Paris, Charles de Gaulle with Lagardère, it is wholesale. We open in Qatar, it is also in wholesale. Each time it is possible to be retail, we are retail. When it is not possible, we go under wholesale. There is one thing I would like to mention that is important because I think I make the distinction between airports and shop-in-the-shop in a department store.
I think if you are in Saks or if you are with Neiman Marcus in the U.S. and you have a 15, 20 square meter shop-in-the-shop, most of the people are aware that this shop-in-the-shop is being managed by the department store and it is the rule in the U.S., nobody's surprised. I think that when it is airport location, the difference for the consumer, they shouldn't see any difference. For him, if it is retail or wholesale, you need to have exactly the same level of service. Not only we are investing in terms of CapEx, which is usually shared investment with the wholesale operator, but we invest in uniforms, we invest in training.
In most of the case, the store manager that is running the airport operation under wholesale is a Moncler employee because we want that the quality of service is exactly the same.
Inventory.
Okay. Inventory, Mélanie. Yes, believe me that our inventory level is good. I'm not going to tell you again how happy we are when we run out of stock and how happy is our chairman when we run out of stock. Seriously, our inventory level is good and just to tell you something you have not asked, but in retail business in the first two months of the year is not suffering at all. It's doing pretty well with our inventory level. Also, you know that right now with the change of the weather, but we will start shortly with the new season that was not all in part in the number we reported at the end of the year. Inventory, no problem at all. About omni-channel, this is a more complex matter.
I'm not sure, Mélanie, that what we are doing is correct to be called soft, what we have decided not to do yet is hard. Hard probably because from the complexity of integration of systems is definitely more complex. The way we decided, we selected to start with the transactions, I told you before, is because we looked first at our clients' experience. We wanted to give priority to the service to our clients. The transaction that is still on the side, it is the so-called one pool inventory. One pool inventory is a very powerful way to make your online business very, very efficient. Very, very efficient means two things, minimizing the stock level and maximizing the sales level. About minimizing the stock level, I think that is not our priority. Maximizing sales level Yes, it is an understandable and legitimate priority.
Honestly, again, right now our priority is to offer to our clients the full range of opportunities online and offline. Again, this is something we are still in pilot. I will tell you, I will let you know, probably six, seven months from now how the progress is evolving, but this is our priority. The one pool inventory is something that we will think about later.
Elena. Excuse me, Luca.
Elena Mariani from Morgan Stanley. I've got three questions as well. The first one is again on like for like. You mentioned in the past that you've always budgeted for a mid-single digit like for like, and clearly you were positively surprised by the results you have achieved. How should we think about this going forward, given that clearly the Retail Excellence Program number 2, is going to imply further improvement in your retail KPIs? How should we think about pricing in the context of like for like? I mean, your brand momentum is fantastic. Do you see room for price increases, or for anything that is going to increase the price mix? Second question, going back to online and digital.
Clearly this is a big focus for you, and I was very curious to understand a little bit better how dependent you are from YNAP, and whether in the long term you could see a scenario where you fully internalize your operations to capture 100% of the economics. The third question is for Mr. Ruffini. I think Genius is a huge revolution in the way you are doing business, and talking to some of your managers yesterday, I understood that you first thought about this a long time ago, a few years ago. Which I think is impressive given that this is exactly where the market is going now. I was curious to understand where you find your inspiration, first of all, where did you find it a few years ago? Thinking about the future, now Moncler has achieved almost EUR 1.2 billion of sales.
How large do you think the brand could be in the future without impacting its DNA, its scarcity and exclusivity? Thank you.
Yes. Like for like, I have to confirm what you said because again, myself, what I said is written. I confirm honestly, Elena, that the way we plan our retail business, because it is not what we plan for the business, but the way we plan, which is different because we buy product to support a mid-single digit growth. If the reality is better, hopefully, as it was evident last year, of course, we end up, as I said before, with a higher sell-through, with the risk that Mélanie said to run out of inventory. Honestly, again, notwithstanding the sell-through was very high, there was not this risk. Looking at the future, I think that notwithstanding all the projects, and I will let Roberto to reiterate or to say something more, but I still believe that planning the business at a mid-single digit level is safer. Okay?
My opinion, and I think all of us, is that we will continue to plan mid-single digit.
Maybe I add something, Elena. I think it is a prudent approach that has proven to be successful even when we are growing faster than that. The corollary is that you basically improve your sell-through and your productivity and your profitability at the end. In case it will turn the other way around, it is also a safer way to plan. I think this year all the conditions, weather conditions, climate, everything has helped us to achieve and really overperform, is we are probably one of the only brand that is still selling so much for winter in mid of February. Honestly, nobody has a crystal ball to be able to predict it.
I think with also a more agile supply chain, we will be able, in the future, to be more responsive to the demand of the market and out of something that has been planned, probably the additional flexibility will allow us in the future to be even more reactive. Regarding the pricing, I think we are currently right positioning all of the markets. We are working in the pricing architecture to harmonize our price even more. If you remember well, 2015, there was a price gap with Asia that was, in Japan, twice the price of Italy, where it has now been reduced below 60%. I think we will use the leverage of sometimes price increases to further reduce this gap while maintaining the level of marginality that we have.
Of course with Retail Excellence, there is still the focus and we foresee potential to further develop the unit per transaction and the sales per transaction. Always having in mind that we serve the client, but when possible, trying to uplift the pricing and also increasing, with the level of UPT, the average basket. There is a potential still to further improve the price mix. No big price increase because we want to stay attractive for the young generation, and we don't want to make the mistake of increasing too much and to be cut from what is going to be the growth engine for the future of the luxury industry.
About our current relation with the YNAP. Honestly, we don't feel bound or stuck with this relation. We totally agreed with their choice to implement this new technology. As I said before, there are four technologies at top, and IBM is one of these. On the other side, first of all, I have also to say that as you know, in respect to a few years ago, now many activities have already been sourced. We are talking about practically as of now of information technology, infrastructure, and the logistics. Because customer service, which is still under their responsibility but is in progress to be in-sourced internally in-house. All of the activities associated with the relation with the market will be in-house. About the technology, we are looking at the technology world. Again, there are other technologies we are exploring.
IBM, SAP, Oracle, Salesforce, these are technologies, not so many, but they are all very, very strong. As Roberto said, we are in-sourcing an online business in Korea at the end of this year or early in 2018, and this will be some kind of test to understand how to run the business by ourselves. Of course, this is something we do totally transparently with YNAP. They are even helping us because Korea is out of the scope of the contract. This is something that is very important to develop culture, to understand how this world works. We will see, honestly, when the contract will expire, we will see what to do.
If I may add something. When we had the discussion with them a couple of years ago and we renegotiated the contract, we left the door open to internalize part of the service they are providing. We thought, and we are still convinced that this is the right choice, that the first things that needed to internalize is the client management. Not only we have merged the database during the second half of 2017 and now have full visibility on how the clients are buying also online, but we have this merged database, and we are now also progressively going to internalize the client service. We started with the Italian market to be followed by European market, because it's where we are going to start the omni-channel, progressively to internalize also the other platforms.
Basically, the clienteling management and the way we are managing the website, what is visible, we have already an internal studio since 2 years. The visibility of the look and feel is managed by us. They are the power machine on the back to make it run, but all the important elements that are elements to communication with the end consumer are managed directly by us.
Talk about the strategy, I think we have to go back a little bit in the beginning of our history. In 2005, when we bought the company, I think, as you know, the company was very sport, with a strong sport attitude, soon I realized that I have to move from this channel distribution into more, let's say, luxury environment. Soon I decide to work with other designer. We was one of the first company in this industry to make collaboration, and I think only maybe Puma with Jil Sander was at the moment. We did the collaboration with Junya Watanabe, was the guys from Comme des Garçons group. We worked with Nicolas Ghesquière and then many, many other until 2008, 2009. At this moment, I become afraid because we have a lot of success, especially for the young generation.
The macro logo was at that moment very fashionable in our collection. We decide to change strategy because I think to last in this industry, we have really to have, as I said before, a lot of energy, but a lot of energy for different generation. I move on to the, basically, fashion show. That was not really in our DNA at that moment. My feeling was really I can reach another crowd, another voice around the world. I did this strategy until basically yesterday, but one year and a half ago, to answer your question, I feel that the world was really changed. Thanks to the digital, you cannot last with the old strategy. You really have to talk with customer, to client every day, every hours, every week. Thinking and thinking, we build up the strategy we show you yesterday.
I think we don't want to call it delivery, I think we want to work in editorial projects starting from June that is including collection, including delivery, but is not only this. It's really something to, again, talk with the client, give energy to the market, increase traffic in our stores, and demonstrate to the world that our strategy is on the market.
Especially for our kind of brand. The future is, I don't know. The future is first, we just start the strategy. I think, I quite trust that we can develop this in the right way, and I feel it's the right solution for our crowd at least. Let's see. I think we have many thing to do. For sure, I will never betray scarcity, DNA of the brand, the value. For me, they are very important. We try to do our best.
Luca.
Thank you very much. Luca Solca from Exane BNP Paribas. At the risk of stating the obvious, I was very impressed by your Genius project. Newness is key in driving organic growth and pushing out brand trivialization. I think you're doubling up and coming to the fore with an innovation strategy that is probably second to none in the industry. Having said that, how do you anticipate the operational implications of this newness? Do you anticipate that you will have a higher number of SKUs, and as a consequence of that, could the very high full price sell-through that you're experiencing today be marginally reduced? Is that at all an issue, on top of the challenges that you were referring to of coordinating deliveries more accurately to the store? Looking at your P&L, another line that I thought was possibly even too good is the achieved gross margin.
I can only imagine what the initial gross margin, if you buy at full price, could be, I would risk to say that it's probably above 90%. How do you see that and how do you think about that versus perceived consumer value, considering the increased competition you have in your space? A point on M&A. Moncler is doing so well that I've been hearing from a number of corners that there are fantasies about Moncler becoming an aggregator and building a conglomerate. I don't believe those, I just want to hear what you say about that. Last but not least, one of your peers has secured direct control, or will be securing direct control of YNAP. How do you feel about others using the data and the transaction data that you produce with YNAP online? Thanks very much.
Okay, about your first question, Luca. No, the answer is no. Of course, behind the complexity, there is other complexity. Your concern is understandable. Honestly, the way we plan our collections, we look very closely and strictly at the number of SKUs we want to develop. Altogether, even before starting the project, we have a very strict briefing documents on which we put a piece of paper exactly for each category and for each line, including Genius, how many SKUs we want to develop. Also, something important to say, and probably to say again, because Roberto already said that, but Genius is a style communication project. We don't aim to develop enormous volumes with Genius. About your second question, gross margin is not exactly 90%.
What we normally say is that the retail business delivers 80%, which, because it includes outlet, regular stores, of course, is higher than 80%, but not as much as what you said. I can tell you that it's closer to 85% in any event. 84%, 85%, which is still a respectable gross margin.
Maybe just one element, because you talked about perceived value, Luca. I think perceived value, it's a mix of different elements. You have the visibility on the margin. Of course, it is creating a bias on the way you look at the different product. I think the end consumer is much more looking at the perceived value with different terms. The level of creativity, the level of desirability of the product, the level of quality, how the product is made, how is it manufactured, is it a sustainable product? I think these are criteria that more and more relevant for the end consumers. Of course, the margin, it's a nice, let's say, consequence of all the work that has been done. As you have seen, Genius is really a project that is focusing on the creativity and creating desirability of the brand.
As mentioned by Luciano, when we did the briefing with the merchandising team regarding the collection, we had exactly that in mind. Developing the creativity, not having too much depth in what we are selling. Basically, we would like, ideally, to be sold out with each one of the collection. Let's see if by the design, we are going to create the buzz around the brand, we are going to be able to achieve that. I wouldn't be too scared. I think we have been planning on Genius with the same cautious approach that we have when we plan for the main collection.
Talking about M&A, first of all, I don't know which other company could be part of this group. I read as well in the newspaper a few weeks ago, it's not honestly on our plan today. I feel we have a lot of things to do. I think Moncler has a strong potential with new face to the market and talk with every generation, means I feel I want to be concentrate for the future. Having said that, I don't see any opportunity. Maybe it becomes something very interesting, let's see.
Okay, we start here and then
Thanks. It's John Guy from MainFirst. Three questions, please. With regards to price mix uplift, Roberto, you mentioned that you weren't going to raise prices, but there are opportunities, or too much on the prices, but certainly price mix emphasis. When you think about the increased product diversification that Moncler Genius brings to the table, I think reducing outerwear, probably driving up. In addition, historically, when you've done collaborations, you've also driven a higher price mix as well through your collaborations. Maybe there's some support there. My second question around when you're working with these designers, what are the financial terms or if there's anything along those lines? When we think about the very good uplift in sales per square meter, and your push more into travel retail, would EUR 45,000 per square meter be too high by 2020? Thanks.
Is it a joke?
45.
Why not?
Why not 50?
(Robert)
Just on the price mix. It's true that when we usually plan for collaboration, the price level is slightly higher than the main collection. This being said, as you have seen with the Fragment collection, which is going to be the one with the largest volume, we try to really stay attractive for the new generation. I don't foresee a big uplift compared to what we had with Gamme Bleu, Gamme Rouge, but clearly creating much more excitement internally. Where I do foresee a price lift is in the category that we have started to develop three, four years ago in more intense way, the soft accessories, the knitwear, the tricot, the shoes. When you develop the culture, when you develop the legitimacy in that category, you have a pricing power that is much higher.
As we are still really in the infancy of the development of those category, I think there is strong potential there to grow in terms of price mix. Regarding the development of travel retail and the dream figure, your dream figure, not ours, on the sales productivity, I think as we usually say, we do everything to protect the current level of productivity per square meter. We have been proving on the past that by doing the right things, there was a potential uplift on this. Honestly, to tell you where we are going to land, it's a little bit too early. What we see is that for stores with the average square meter that we are targeting, this 200 square meter, and also with travel retail, the level of productivity is slightly higher. This will also be a consequence on how the market is going to move.
I still think that with Retail Excellence, we have started, we are halfway, we have started to scratch the surface in terms of potential elevation of UPT and sales per transaction. I also think that the omni-channel that we are going now to embrace with the team on the floor, there is another potential uplift in the market. Luciano mentioned the click from store. We both strongly believe in it because this is, for me, the way to make out of every single small store that we have, and remind you that having an average of 130 square meter per store, 135, we still have half of our store below 100 square meter. I think that this is giving the possibility to those stores that have, by essence, a limited amount of outerwear and limited assortment, the capability to enlarge and become a small flagship store.
I think that if this is properly executed, and it will take some time for the route, I think there I foresee a potential for another growth.
Okay. Now your question about the designer-
Yeah
how we pay. Normally, we pay them based on a fixed amount. In some cases, there is a variable component, but I would say that majority is fixed. Also because, of course, we're talking about the big designers behind Genius. Also because again, Genius is not a project to develop high volumes. Quality is by far more important than quantity. There was a question. Yeah. Here.
Here.
Thanks. Hi. Piral Dadhania from RBC. Three questions, please. On internal production, I think that you now produce 20% of your volumes internally, based on a slide you showed earlier. Could you give us an update as to whether the production efficiencies are in line with your external suppliers, so you're now producing at a similar level of cost, and where that internal percentage could reach in the future? Is the potential to continue to increase that and to reduce your reliance on external suppliers over time? Secondly, on Moncler Genius. Does moving to specific date drops, such as the 12th of June, quarter here or there, is that significant in the future? Finally, on your shop-in-shop opening guidance, I think you've moved from the U.S. to ensure that you try and push as much product at full price. Are there terms in the contract to minimize markdown?
Primo. Yes, about your first question. Actually, something is better to clarify. We aim to produce up to 20%. We are not producing now 20%. We are in the region of 15%, but the percent keeps growing, so we may go over 20%. It may be higher than 20%, but we still believe that it's important for many reasons, including flexibility, to have also a network of high-end, high-quality factories to work with. Also because each factory may have a different specialization on different specific products. Pretending to do everything on yourself would not be correct, honestly. The strategy is to produce up to 20, maybe 25, but again, not much more than that. About efficiency. Efficiency, productivity. Let's start from quality first, because the project was a quality project first.
I think that, as Francesca said before, this is now the best factory for outerwear in the I don't know, in Europe, in the world, I don't know, but it's a very high-end factory with a very high quality of the product that they make. About the productivity. Productivity is getting better. We have other partners that are delivering better efficiency, honestly. I can tell you that we don't care because we do care, but it's something that will come step by step. This side. Hi. I answer maybe on the question on Genius. I think the flexibility you were referring to, for example, the fact of being able still now to sell full winter because the weather condition, this will remain. Because that has nothing to do with the Moncler Genius project. I think the main collection will remain.
We are going to continue like we are currently doing when there is the change of season, to manage the change of season store by store, door by door. I think the Moncler Genius project and the date of drop has another objective. The objective is to create desire, to create expectation, to be able to leverage it at CRM level, to digitally able to leverage on the online, and create expectation and desire for the new collection to arrive. I think this is another way, and also to create content, to create the buzz related to leverage. When you don't know exactly when the collection is about to arrive in the store, if the timeframe is 2-3 weeks, what's the reason for you to go and to be the first to be able to buy it? I think it's 2 different purpose.
We are not less flexible in the way we push the different collection, and especially in the change of season. We are just creating more desire and communicate it in a different way with the end consumer, regarding the most visible part and attractive part of the collection. Regarding the shop in the shop, I think, the point regarding the markdowns in wholesale, it is not different if you have a shop in the shop or if you don't have a shop in the shop. I think it's just the opposite.
I think by creating a more bound and stronger collaboration with the department store by co-investing in building shop in the shop, having more quality in the buying, because of course what is related to the shop in the shop, which is bringing everything under one roof with the Moncler branding, is that we have much more interaction with the department store. We have sales advisors that are dedicated to the area and so on. It's just the opposite. Usually, what we have seen in the past two years, which have been years of test in terms of shop in the shop, is that we improve the sell-t hrough. We have more quality. We are not only selling permanent product, but we have much more novelties.
It's much more reflecting and qualitative compared to being present in a multi-brand area where the sales is less supported, where we have people that don't have the technical knowledge, the product knowledge, that then don't know the story about the brand. The risk there of having a low level of sell- through is higher. We say level of sell- through lower means higher risk in terms of markdowns. I think this shop in the shop project that took some time to develop because they needed to be convinced and so on, but that's really changing the paradigm of collaboration that we have with department store, especially in the U.S. That is helping the brand to grow in an environment in the U.S. that is currently not doing so well.
We are probably one of the best top 2, 3, if not number 1, most of the time, performing brands that they have in the ready-to-wear department. Last two
Thank you. Fred Speirs from UBS. Two questions. I think there was a very good detail slide from you, Roberto, on how loyalty has been improving across a number of metrics in the business. A higher repurchase rate plays a bit into spring-summer, which perhaps we haven't discussed as much. We're quite a way away from seeing what Moncler Genius might mean for spring-summer next year, when it could perhaps come in. Just very interested to get your updated thoughts on how much you hope spring-summer could be contributing within this business by 2020. Perhaps linked to that, how you see the balance between energizing existing customers versus attracting new customers. Are we moving into a phase where loyalizing the customer base is becoming a much more important driver for the like-for-likes? That'll be the first question. The second question was around Korea.
Since the joint venture with Shinsegae a couple of years back, there's been this focus on elevating from quite a low, iconic positioning to a more developed positioning, more in line with the rest of the world. How is the journey on that going? How close are we to seeing Moncler expand outside Seoul and developing the Korea business to a more aligned global view? Thank you.
I will start maybe, Fred, with the loyalty and the weight of spring-summer. First on the loyalty, I think we need to work on both elements. Both on the recruitment, making the brand attractive, and one of the objective of Genius is not only to serve our existing client. We have seen how different the collection is, reaching on some part of the Genius collection, the more feminine part, some other is more streetwear, something is more for younger people. We have also product for, let's say, more mature generation. I think the objective there is really first to please our existing customer, but most importantly, to be a driver also of new consumers and attract new consumers into Moncler.
All the activity that we are currently developing in terms of clienteling and so on, I think through the global vision, this one client data, also getting inputs from the existing information you have on the way they are browsing the digital world and so on, is going to further enhance the client experience. I don't want this experience to become intrusive, but I think there are now levers to deliver a more qualitative client experience with the more information that we have in the past. I think the things needs to be balanced. To tell you if it's 60% recruitment, 40% loyalty or the other way around, I don't think it's really important as long as we continue to improve on our retail KPIs and retention rates. If it's going to be 60%/70%, I don't think it's the most important thing.
Regarding the weight of the spring-summer, I think you need always to think that, as Remo was mentioning, people are going in the direction of no season. The fact also of bringing the man and the women collection together, the fact of deseasonalizing and having a monthly drop is something that is becoming less relevant. We have also been the first one to develop an offer with the long season of down jacket for the summer. This is something that is working extremely well. We don't think really in terms of spring-summer, fall-winter, but more proposing items to the end consumer that are relevant, whatever the timing of the year is. Genius is something that is going to help us on this, and also the development of the new categories.
Korea.
Korea.
Korea.
The Korean business, as it was integrated a couple of years ago, has been developing really well. It is still a market that is mainly for us, a local market. We don't have a lot of travel retail. We now recently opened the two stores. One is in January in Incheon at the airport, and we have one duty-free store that opened early 2017. The three of them are doing extremely well. I foresee a potential for development on the travel retail side and the duty-free business, because I think for most of the luxury brands in Korea, 40% of the business is a duty-free business. For us, it's less than 10%.
There is where I foresee a potential growth. Also it's a market where we have started to develop the Enfant business and the shop in the shop, and is one of the most responsive market that we have there also, I see. It's a market that has been growing completely in line with the growth rate that we have shown for Asia-Pacific, so for Asia. A growth rate that was above 20% in 2017.
There was a question there. Mario.
Mario Ortelli of Bernstein. If I may, three question. The first one is about CRM. You build up a strong infrastructure with many data about your customer. Can you please tell us if the perception among customer of the Moncler brand of attributes are the same, or you have got quite a different perception of Moncler among customer segment? If there is any specific customer segment in which you are not satisfied of the current perception, and you want to address them. The second one is about the use of cash. Your company is highly cash generative. In the future, how you want to prize your shareholder, more dividends, extraordinary dividend, buybacks? The last one, Mr. Ruffini, is about the future. You are always a visionary. Let's talk about fashion in 10 years. What excites you the most?
The opportunity of doing co-design with a customer, 3D printing, collaborative work with digital creators. Try to share a bit with us what makes you really excited. Thank you.
Mario, thank you for the easy question on the CRM. First, we have started to gather data that we honestly didn't have. We had mainly purchasing behavior data, what people were buying, not so much about their behavior. Clearly, the merge of the database with YNAP is going to help us to even better understand the needs of our consumers. Now, we have segmented on our database on criteria of spending, but also behavior. Many categories they are buying, clearly, there is something quite obvious, is that the more loyal client that we have, the one with the higher spending power, are the one that are buying across categories and not only buying outerwear.
Clearly, one of the push, and if you think which part of the segment are you less happy, is the one that are stopping to buy. This is not only for Moncler, this is for all databases. Clearly, there is a focus for us on, we call them sleepers. These are the clients that have not been buying Moncler for the last six months, and there is specific action plan that have been now deployed in all markets, in all stores to awake the sleeping consumers. After six months, you are not really sleeping, you are on the verge of become a sleeper. There we try to reactivate them through content, in-store activation, sending them information, and so on. I must say, if I look at the improvement of the loyalty rate, is something that is working.
As mentioned, we finished the rollout of the MonClient app in the different store worldwide just in August last year. Basically, some of them, they are doing that since more than one year. Some others, it's less than six months. We need now time to really have the full-fledged effect of this. I think the improvement we have had in the loyalty rate is showing that there is potential. We are currently managing directly influencing 10% of the database. We want to grow it to 20% at the end of 2019, having an impact on one third, 40% of the business. If successful and with the help of automated CRM data analytics, I think we can, in the future, 2019-2020, have an impact on the rest of the database. We do it step by step.
About cash, I hope you appreciated that we increase our payout from EUR 0.18 to EUR 0.28, almost 60%. This is what we believe we will be doing in the future to reward our investors. About buyback, our plan is to implement buyback plans only to the extent we need shares to deliver to our employees, to our managers. Not like, let me say, speculative instrument to give back cash to the market. Dividend, we will try dividend depending on, of course, the important projects we still have ahead, and the cash generation that hopefully should still be very healthy like it was in 2017.
Talk about the future. Our jingle last week was, The Future Start Now. It's not easy to say what's going to happen in the future. For sure, as you mentioned, 3D. 3D will be something very interesting. It's already on the table. I think will be very strong especially for shoes. I don't know, for our product, we can work on this technology, but we already work on that, on this, to understand what's been going on. I don't think we can make a 3D product in the store. I think we can use 3D in the factory to do better quality, better technology, and better production. Total, you asked me about the different energy, different designer is in our pipeline. We start already this strategy maybe too early.
More or less seven, eight years ago, we asked Pharrell Williams, that was a singer, that was not very popular at that moment, to design our eyewear collection, design a jacket collection, marketing-wise, was very successful. I think for, as I say, the Genius building, the doors are open, and I feel to attract different people, not come from our industry, they come from music, from art, could be a very interesting approach. We start working already.
Omar, I think. Sorry, Omar, I couldn't see you from here.
Hi. Thank you. It's Omar Saad from Evercore ISI. I have two questions. The first one's about the category, the luxury outerwear category, for lack of a better term. It's experienced pretty explosive growth over the last 10 years in a lot of ways led by Moncler. How do you think about the evolution of the category? Do you see that kind of strong growth globally ahead? From a competitive standpoint, given the profitability and the growth and the visibility of the category around the industry, are you seeing new entrants and new competitors emerge? That's my first question. The second question I wanted to ask you about marketing in the digital era, essentially. Digital has obviously been a very prominent theme throughout the last couple of days, something the company is very focused on.
Maybe you could talk about your view on the cost of marketing and advertising and building a brand in the digital era, the efficacy of digital technologies for marketing, social media, and the returns on investment and how attractive it is to build your brand using a lot of these new platforms and media. Thank you.
Talking about competitor, the first of your question. Honestly, I don't feel too many competitors on the market. Everybody say that the Parka guys came from Canada is our major competitor. I think they are a very good company, but I don't think they compete with us. They are very functional. They are very no designing, very what I say, premium on North Face. This is my feelings since the beginning when Canada Goose and the other brands start to be on the market. Honestly, I feel our competitor is all the good brand. They have a good outerwear. Honestly, one specific brand, I don't feel compete with us. We have for sure to be careful. I think the last show was a lot of good outerwear, starting from Prada. I think the collections men's and women, they show as again, Prada Sport, let's say Luna Rossa.
We have to be careful. We feel that with new strategy, with new ideas, with new technology, to have really a strong power in outerwear, especially in outerwear. Go ahead, Roberto.
Regarding your question on digital, I think here the paradigm is changing in the sense that if 5 years ago, most of the media spend was on the media buying and less on the creativity. I think here we see really a shift where you need to come and invest more on the content side because for the time being still, even if it's increasing rapidly, the cost of the media buying on digital is still lower than traditional media. I think the shift needs to happen because on traditional magazines you have less and less people and especially new generation, they think mobile, they look mobile, they don't go on print anymore. I think outdoor advertising is still something that is relevant because it's a message that is very visible and it's a mix of the two. This is the direction to go.
Regarding your question on the influencer, I think what we have been noticed and we don't have yet a real, let's say metrics on return on investment, but you need to find a good mix between influencer that have a lot of follower that are there for the reach and then having a set of what we call micro influencer, which are people that have between 20,000 to 30,000 followers that are the one that are generating much more purchasing behavior. What we have been measuring so far is that the difference in influencing the purchasing behavior between a micro influencer and an influencer is one to seven. Usually they are, in terms of advocacy, much more relevant if they are talking to a smaller community than the big ones.
Of course, if you have 2, 10 million followers, your reach is so big that in the end you generate also. I think it's the mix in finding the influencer that is not going to all brands but has a focus that where you can really interact and link and that is a fan of the brand that you can become credible. Just looking at influencer that are one day with us, the other day with our neighbor Fendi and then going, I think is becoming, in my view, less relevant for the end consumer. It's the mix between the two that is the current future. It may change as this world is changing so fast. It may change in a couple of years' time, but currently I think this is the right strategy to go.
Okay, Anne-Laure.
Alone.
Hi, good morning. It's Paola Carboni from Equita SIM. Three quick questions. The first one is on the supply chain. Apparently we came all here a bit worried about this new Genius project and you seem since that quite, I wouldn't say relaxed but confident, let's say, because of the way you planned everything in advance because of not so huge volumes involved. I would change the focus to your usual work for the supply chain and how are you improving in particular on the side of auto-replenishment and if any with the idea of producing the seasonal items in season. If you can share with us where are you on these two direction on these two path, let's say. In particular, we understand that the possibility to exceed the mid-single digit same-store sales growth also comes from the auto-replenishment opportunity.
I just wanted to understand whether the surprise we have seen is also because you made big progress in this respect, or this is also your simple buffer you have usually with the auto-replenishment option. On the shoe category, you seem having hired a new technical director. I would like to know a bit more on what you are doing on the supply side, on the prototyping side for this category, because this was one of your aim to replicate at least what you did with knitwear. Where are we also on this side? Last, very quantitative and quick question on CapEx. We understood the floor, let's say, but not the maximum level. Thanks.
Okay. About your first question, Paola. First of all, believe me that we are not relaxed. We are confident, you are correct. We are confident because we believe to know exactly how to fix our complexity. I think that Francesca, as I said before, has been with the company for a few weeks, but believe me, she has already understood very well how we should work differently. What she said is the key. We have to anticipate problems better and more than what we used to do in the past. It's easy to say, much more difficult to do, but I think that we will make it. About auto-replenishment, as you know, is for the time being something that does not involve the production.
It involves the production for a small percent, which is still about 8% of what we call permanent products, which are not seasonal products. We keep producing permanent products all the year long based on the market demand. This works, but has not been implemented yet on seasonal product, because first we have the priority to make the changes I told you before.
Shoes, new technical director.
Okay, shoes. Yes, sorry. You may remember what we said we wanted to do a few years ago on knitwear. Knitwear a few years ago, not many, was honestly not at the level of our brand image. At that time, we realized that we had to bring in-house culture, so we invested in a small production unit, but even more important, we hired a responsible director of a knitwear department. This person has developed other people, other technical people, and at the end, in two, three years, we have developed a pretty good culture in knitwear. What is important, we have developed a good credibility with our customers. Know-how, the deep knowledge of the product, of the materials, in this case of the yarns, makes the difference.
In shoes, I think that we have and we are doing exactly the same we did for knitwear and many years ago for outerwear. First step has been to get this person who is a very expert person, technically expert in the shoe technicalities. Together with this person and together with Francesca, we will create a team of technical people and at the end we want to develop a culture also because shoes have specific requirements that are more critical than outerwear or knitwear because if the size of the fitting is not correct you can't wear the shoe. Shoe is a difficult animal but we are confident, really confident that by doing this step-by-step we will build the culture we need to get then the credibility.
CapEx, the floor because you said the representation not less than.
Yes, CapEx. For sure not less than EUR 70 million. I think that looking at the %, you should still think about of a 6%. Even if right now to be totally transparent with you, the CapEx we have in our pipeline are a little bit lower. Based on our experience, I'm sure that if we get opportunities along the road, we will get it. For the time being, I would suggest you to take 6%.
I think we have couple of more. There was a Flavio hand there. Flavio. Let's start there and then we move to Flavio.
Anne-Laure Bismuth from HSBC. Is it possible to know how many stores do you have in China and out of the 15 store opening plan per annum, do you plan to open in mainland China? My second question is about the tax rate, what we should expect for full year 2018. Is it possible to have a rough guidance about the tax rate for this year? Thank you.
Very simple answer. We have currently 29 stores in China. We have planned to open in April three stores in Xi'an, one men and one women. I think you can count probably on one to two openings per year on the next three years. We don't want to reach the level of some of the luxury brands that have 50, 60 store, but I think some additional stores, we have potential for that. We're also working on the refurbishment and enlargement of some of our shops. One of our dream is to have one day also a flagship store in China. We are currently looking at this. It's in the three-year plan. We hope to be able to secure the right locations for it.
Flavio.
About the tax rate, Anne-Laure. Tax rate for 2018 and 2019 will be slightly higher than 2017. I can tell you around 27%, because we will still have the benefit of patent box, but not as much as in 2017 because we got also the two years before. Important to say that in 2020 this benefit will expire. In 2020 we will get back to the 31%, which was our old guidance before patent box.
Flavio.
Thank you. It's almost lunchtime, so I keep it quick. It's Flavio Cereda from Jefferies. Two questions really. Compared to, say, three, four years ago, are you still having to chase the issue of fakes on the market, which of course goes hand in hand with you being successful, but potentially could be an issue with the whole Genius project coming up. The other thing is, I do ask brands this recently. If you keep an eye on the secondhand market, so the pre-worn market. I just had a quick look at the two main platforms, and I'm finding almost 18,000 units, SKUs for Moncler. Is this something which you as a brand, but you can't control it, but are you getting involved? Is that something that you're monitoring? Is that something that you plan to collaborate in any way?
Of course the issue is in a year's time it might be 50,000 units that you'll find. Thank you.
Hard question. To fix that too.
About fake. Fake is a big issue, is a bigger problem. You know that recently Gucci and Diesel have tried to fight with ironic way the fake industry because unfortunately this is the case. Fake is an industry. I don't think that Genius honestly is going to worsen the situation also because you have seen that that kind of product is very, very complex, very, very particular. The brand itself is very hot more and more. Fake is a never-ending battle. We have a department, as you probably know, that is spending all the time, all the day long, to close online sites. As you close one, another one comes up. We have agreements also with all the most important online players from Amazon to Alibaba, together with the European Union to fight the counterfeiting. Again, it is a problem.
Regarding your second question, Flavio, you were referring to platforms like FARFETCH, right? No.
The second one.
Secondhand platform.
Secondhand.
Honestly, this is something that we are not currently monitoring. We know that there is a secondhand market, but this is relatively small. We have much more been investigating on the reselling platform like FARFETCH and collaborating with them in order to ensure that the correct pricing is being managed. We're also working very hard with our wholesale partner to develop the highest level of sales flow as possible in order to avoid markdowns on product that are being resold by current wholesaler. I think this is a new phenomenon that has been arising that has not been pointed out by our consumers as a concern. To tell you the truth, for the time being, I don't really see what concrete action you could take on the secondhand market. That is something that there is no rules and regulation to follow this market.
It's something that we'll have probably to have a closer look in the future. Of course, the more collected your product is, the longer its lifetime, the more risk you have. If you are a very fashionable product that is going out of date after one season, it's less of an issue.
Okay. The very last one. Very, very short question, please.
Thank you. I'll make them very short. Ashley Wallace from Bank of America. Three questions from me. First of all, back on Genius, but they're quick, I promise. Just on Genius, obviously, the collaboration and frequency of drops is going to have a very positive impact on traffic and just brand desirability. Can you maybe give us some color on the economics of Genius? Maybe the volume of the eight collections as a percentage of the group, or what percentage of space contribution they'll take up. Secondly, just online, earlier you put up a chart which showed that online penetration in the luxury market is 9%. Can you maybe give us some color of where Moncler sits relative to that, and then also how online profitability sits relative to the rest of the group.
Lastly, a housekeeping question, corresponding uplift in D&A, and you've previously spoken about EBITDA margins being broadly stable. Now that you're going to talk to EBIT margin.
As you rightly mentioned, Moncler Genius is more a new approach to consumer, a new way to communicate, more than a project where we have been looking at making it a big volume maker and turnover maker from the beginning. I think just we want the opposite to play on rating, both from our team that has been buying the collection in January. There was a lot of enthusiasm from all the region, most especially from the Japanese one that were probably the one the most scared because they were with the Italian market, the biggest designer, especially with Fragment, has been completely reassuring them. There we have been positively surprised by the internal demand of our buyers. Secondly, we have been meeting now 350 wholesalers over the past 5 days in the Moncler Genius premises, making appointments in these 5 days.
There also, the demand has been bigger than what we had initially planned. The volumes, instead of giving you a bracket on how much is represent on the total sales, I will maybe make the comparison with what was the weight of Gamme Bleu, Gamme Rouge, is going to be for the first season, slightly higher than what we had for Gamme. I think the potential is probably much bigger, but as I mentioned, it's not a project to push sales. It's a project to increase desirability of the brand and to be able to communicate and interact with the client on a weekly basis. I think online for the luxury sector is including cosmetics. I think if you look at it, and Luca is probably even more informed than I am on the penetration for the fashion industry, but I think it's more around 7%.
We are currently around 7.5%, we are in line with the performance of that in 2015. We see tremendous potential on this segment. With the omni-channel, I think this we will further accelerate.
Yes, about the question on leases. I made it simple before because of the technicality behind this accounting principle is much more complex. We do not expect a material impact at the EBIT level because we expect the EUR 180 million rent to move from the line rent to the line DNA. Will be probably a little bit less because there is an actualization impact that will move a portion of this cost below EBIT in the financials. I don't think that will be material. Talking about metrics, of course, EBITDA will not be any longer, not for us, but for everyone, significant and meaningful. That's why I think that all the market and all the companies will look more at EBIT. EBIT was 28.6% last year, in line with the year before, which is honestly a very high-end operating income.
For the future, we don't give any indication, but of course, everything which is included in our strategy is expected to deliver a strong result on our operating margins. Believe me that number is already a very good number.
Okay. I thank you. There is the lunch ready for you right now.