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Priyanka Chopra Jonas takes a pit stop at the Ferrari garage during the 2023 Etihad Airways Abu Dhabi Grand Prix. Photo: Clive Mason/F1. |
While the aforementioned automakers produce millions of cars annually, Ferrari released only 13,663 vehicles last year. Nonetheless, this was sufficient for the Italian marque to surpass Hermès as the most valuable luxury goods business globally.
In a recent report, luxury goods analyst Luca Solca from Bernstein research firm noted the similarities between Ferrari and Hermès. Both brands occupy the pinnacle of the price pyramid and are well-positioned to benefit from the burgeoning global elite.
CNBC interviewed Ferrari’s CEO, Benedetto Vigna, to gain insights into the success of this prestigious car brand.
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Ferrari’s sales volume consistently falls short of market demand. Photo: Ferrari. |
An Elusive Brand
As highlighted by Luca Solca in his recent study, Ferrari and Hermès sell fewer products than their customers demand. Ferrari estimates that it could easily double or triple its current production volume.
Even if customers have the financial means to purchase a Ferrari with an average price tag of 380,000 USD, securing the opportunity to own one is a different story. The waiting time for a Purosangue, for instance, is approximately three years.
According to CEO Vigna, this limited production adheres to the founding principles of the company. “We pursue a strategy of selling less than the actual market demand. Ferrari aims to increase profits from a product rather than the number of cars sold,” Vigna asserted.
In 2010, the brand manufactured 6,573 cars. While the production volume has doubled over the past 14 years, the number of global billionaires has tripled during the same period.
Spotting a Ferrari on the road is akin to encountering a rare animal species. This rarity bestows an elevated status upon the brand, and the act of waiting becomes an integral part of the customer experience.
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Ferrari’s CEO takes a hands-on approach to pricing their products. Photo: Ferrari. |
The Art of Pricing
According to CEO Vigna, the price of a car is determined about a month before its launch. The brand’s approach to pricing is quite unique.
“About a month before unveiling a new model, I, along with the marketing and financial directors, test-drive the car for a day. We then discuss and decide on the appropriate price based on our experience,” Vigna explained.
Generally, the price of Ferrari cars increases over time. The most affordable Ferrari in 2021 was the California, priced at 195,000 USD. In contrast, the current base model, the Ferrari Roma, starts at 273,000 USD.
Personalization is one of the factors that contribute to the high prices of Ferrari vehicles. Custom requests, such as special leather, fabric, or paint colors, can add an extra 100,000 to 500,000 USD to the cost of each car.
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Ferrari requires customers to spend significantly and demonstrate brand loyalty before accessing limited-edition models. Photo: Ferrari. |
The Path to Becoming a VIP Client
Similar to other luxury brands, Ferrari employs a strategy that encourages customers to build a substantial shopping history. Specifically, consumers must spend a substantial amount and purchase multiple products to gain access to newly launched models or limited editions.
This journey mirrors the path that Rolex customers must traverse to acquire the new Daytona or that Hermès patrons experience to obtain a Birkin bag.
Ferrari clients typically start with a basic model, then graduate to a more desirable car, participate in the brand’s racing events, and eventually succeed in acquiring a limited-edition vehicle.
Three-quarters of Ferrari’s sales go to existing customers. This ratio underscores the exclusivity of attaining VIP client status with the brand.
“Ferrari and Hermès reserve their most desirable products for their most loyal and highest-spending customers. This policy reinforces the privileges associated with being a VIP consumer,” Solca remarked.
Re-commerce in the Fashion Industry
Ron Gonen’s book, The Waste-Free World, invites readers to join the environmental protection movement for a sustainable and prosperous future. In it, the author highlights the term “chemical recycling,” which refers to an exciting new process that can break down textiles into their basic chemical components, creating a circular source for generating new fibers.
The Ultimate Supercar Duo: LaFerrari and Daytona SP3 Rumored to Arrive in Vietnam, with a Potential Price Tag of Over 40 Trillion VND.
The Ferrari Daytona SP3 is an incredibly exclusive and rare car, with only a handful of units known to exist in the entire Asean region. Therefore, should a Vietnamese entrepreneur successfully bring the Daytona SP3 to the country, it would undoubtedly cause a massive sensation and captivate the nation’s automotive enthusiasts.
“Unveiling the Ultimate Automotive Experience: Hoàng Kim Khánh’s Exclusive Ferrari Purchase at Universo Ferrari, Thailand.”
Although the Ferrari model remains undisclosed, it is likely to be the highly anticipated SUV Purosangue or a stunning supercar from the 12-cylinder range.
The Capital’s Supercar Sanctuary: A Stunning Pair of Ferraris Parked Side by Side
Both of these stunning supercars are now part of the Hanoi automotive scene, proudly sporting the iconic Ferrari red. However, these two beauties are not just any ordinary Ferrari models; one is the sleek and agile F8 Spider, while the other is the powerful and innovative SF90 Stradale. With their unique features and jaw-dropping performance, these cars are sure to turn heads wherever they go in the bustling city of Hanoi.
The First All-Electric Ferrari Unveiled
The first all-electric Ferrari has been spotted undergoing road tests in Italy, close to the site of the marque’s new factory.
The Electric Prancing Horse: First Glimpse at Ferrari’s Electric Supercar
Rumours are rife that the first-ever electric supercar from Ferrari will be priced at no less than half a million dollars.
