Condé Nast withdraws £234m Farfetch stake over marketing excesses
US publisher Condé Nast has severed ties with luxury fashion marketplace Farfetch amid concerns over its spendthrift marketing practices.
Conde Nast dumps Farfetch stake over marketing excesses
The Vogue owner established a commercial relationship with the online luxury fashion retailer in 2017, directing its own readers towards the Farfetch website. In return it held 6% in shares in turn, but with losses mounting on the back of spending overseen by founder Jose Neves it has now dumped its stake.
Neves' high-risk strategy has seen sales jump 56% to £475m, however, losses stacked up to £122.7m last year.
Farfetch has defended its outgoings, arguing that ‘customer engagement’ and new technologies were crucial in order to cement future growth. In the first quarter of this year the business reported a loss of $109.2m – up from a loss of $50.7m over the same period a year prior.
The writing was on the wall for Farfetch as early as March when Condé Nast chairman Johnatahn Newhouse stepped down from the retail platform’s board.
The publisher has been busily cutting its own cloth, selling off underperforming titles including Brides, Golf Digest and W magazines in recent months.
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