For our first day back in Milan, we learned a lot about a company based in Milan called Velasca. Before lunch, we met with the marketing director of Velasca so she could give us an introduction to what the company does and tell us about their marketing strategies. Velasca is a shoemaking company that makes high-quality, handcrafted leather shoes for men that are completely made in Italy. It was founded in 2012 by Enrico Casati and Jacobo Sebastio, and when they first started they made shoes for women too, but they decided it would be better for them if they specialized. These two chose to name their company Velasca after a tower in Milan by the same name. This tower was built right after the end of World War 2 as a symbol of change and progress, which are two things that they want their company to represent. Velasca focuses on making reliable shoes with a timeless style. They hope to eventually become the reference point for high-quality shoes.
Velasca has a direct to customer business model, and they only have two very small stores, as their focus is on selling their shoes through their website. By selling their shoes directly to customers through their website, the overall cost of making the product is very low. This means they can afford to sell their shoes for about $185 per pair, where most other retailers sell handcrafted leather shoes for prices around $500 for one pair. Many startups in the United States also sell exclusively online because it is the cheapest way for them to get their products to customers. It is also a way for these small companies to reach customers that are not near them physically. Today we also got to visit the Fiege Logistics Center, which is a company that ships many products, including Velasca’s online orders. Once the shoes arrive at Fiege’s warehouse, a worker takes them out of the box to check for any imperfections before they are put on the shelves with the rest of the stock. They have a catalog with pictures of what every type of shoe should look like so they have something to reference. Once someone orders a pair of shoes, the employees pick out the correct pair, pack them in a box for shipping, print out a label, and ship them with an Italian carrier. The whole process from when the customer places the order to when it is being shipped takes about 24 hours.
The woman from Velasca that we met with this morning is the marketing director, so we got to learn a lot about how they are trying to reach new customers and get their name out there. To start out, they have to identify their target market, which is businessmen and other male professionals, like doctors, ages 30 and up. One of the reasons they decided to stop producing women’s shoes was because the more concentrated your target market is, the easier it is to advertise efficiently. Velasca has carefully chosen the design of their stores and their website to give off a classic, timeless feeling in order to appeal to the kind of people who would want a classic, timeless shoe. All of the marketing that Velasca does is online. This is because it is much cheaper than any other form of advertising, and they can track how effective their different ads are. The first step in marketing is acquisition, which is just getting the name Velasca seen by potential customers. Much of the advertisement they do is on Facebook, and they also try to use keywords on their website that will get their site to be higher up on the list when someone searches for something relevant on Google. After that, the next step activation. This is when a customer actually clicks on a link that takes them to the Velasca website. At this point, when a person first visits the website, there will be a pop-up offering a discount if the visitor enters their email and signs up for the mailing list. Once a person signs up, Velasca can send them more information to keep them interested in the company. Even though Velasca started out with an exclusively online business model, their physical store in Milan was able to account for 30% of their profits. Seeing this has inspired them to expand, and they have recently opened a store in Rome. Velasca is always looking for ways to improve and reach further and further markets.