Why Prada Works: The Power of DTC
Image Credit: Prada S/S 1994 : Christy Turlington by Peter Lindbergh
The collapse, and request for protection against creditors, of multi-brand retailers such as MatchesFashion, LuisaViaRoma, and Ssense highlights the fragility of wholesale. Delayed payments, shrinking margins, and bankrupt intermediaries leave brands exposed to risks outside of their control. By contrast, Prada Group and Moncler demonstrate the resilience of a Direct-to-Consumer (DTC) model. In 2024, 89% of Prada’s revenue and 86% of Moncler’s came through their own channels, securing margins, customer relationships, and cash flow. This strategy not only delivers stronger growth, Prada reached €5.4 billion in revenue with a 23.6% margin, but also future-proofs brands against volatility. For independent creative houses, the lesson is clear: sustainable growth comes from owning your sales channels, whether through flagship studios, curated e-commerce, or hybrid approaches.
According to Business of Fashion, LuisaViaRoma, one of Italy’s most prestigious luxury retailers, recently filed for court protection after failing to keep up with payments to brands. Vendors are waiting months for money owed. Orders are still being placed, often with the knowledge that invoices may never be settled. For independent businesses, that kind of uncertainty is not just inconvenient, it’s existential.
The answer is Direct-to-Consumer.
Prada Group’s latest annual report offers a clear example of why this strategy works, and why it is increasingly essential for creative brands.
What the Data Shows Us
89% of revenue comes through retail (their own stores and e-commerce)
Just 9% from wholesale and 2% from royalties
Figure 1 / Image Credits: Prada Group’s Annual Report 2024
*The annual report does not break out exactly how much of that 89% comes from physical stores versus e-commerce (Prada’s Net Revenue Channel 2024).
That 89% is a decisive shift. By owning its distribution, Prada owns the customer journey, the pricing, and most importantly the cash flow.
The results €5.4 billion in revenue in 2024, up double digits year-over-year. Miu Miu, part of the Prada Group, nearly doubled sales in the same period and an operating margin (EBIT) of 23.6% in 2024.
Prada isn’t alone. Moncler’s 2024 results show a similar balance: 86% DTC, 14% wholesale. In volatile markets, that ownership makes the difference between resilience and vulnerability.
Why It Matters for Creative Brands
Wholesale still has value. It can provide visibility, credibility, and initial reach. But the risks are mounting:
Delayed payments
Squeezed margins
No direct customer relationship
For independent brands, those risks can derail growth. By contrast, DTC safeguards three things every creative business needs control over margin, data and customer relationships. It doesn’t take a global retail network to make it work. Take Saman Amel, the Stockholm-born tailoring brand. Its Mayfair atelier operates as both a store and a brand destination, creating intimacy, exclusivity, and resilience. All without dozens of global flagships.
Or consider Heaven Mayhem, the Los Angeles accessories label founded in 2022. With just $900 in startup capital, it scaled to a $10 million business in three years, maintaining 80% of sales DTC. Even with a pop-up at Selfridges, the brand’s growth comes from keeping control at the centre.
Lessons from Industry Failures
Over the last 18 months, several once-dominant retailers have collapsed or sought protection:
MatchesFashion: collapsed, leaving brands owed over £50 million.
Saks Global: pushing payments as far as 2026
LuisaViaRoma: filed for court protection in 2025
Ssense: once valued at $4.1 billion, filed for bankruptcy protection in 2025
These aren’t isolated failures. They reveal a systemic fragility. Even well-capitalised and culturally relevant platforms can collapse, leaving brands unpaid and exposed.
In Summary
Prada works because it owns its sales. Moncler thrives because it owns its margin. Independent brands scale when they own their customer relationships. Wholesale can play a role, but it cannot be the foundation. In today’s market, resilience comes from control and control comes from Direct-to-Consumer.
For creative-led businesses, the lesson is simple, growth that lasts comes from the channels you own.
References:
Prada Group
Moncler
Burberry
LVMH
Industry News & Analysis
