Strategy

“CLAIM 5” Growth Strategy

Our ”CLAIM 5” growth strategy – introduced in August 2021 – is closely linked to our vision and ambition of being the leading premium tech-driven fashion platform worldwide and becoming one of the top 100 global brands. In this context, more than ever before we are putting the consumer at the center of all our activities, especially focusing on younger customer groups, such as Millennials and Gen Z. We are turning consumers into true fans and retain their loyalty to BOSS and HUGO.

Two years after introducing “CLAIM 5”, HUGO BOSS looks back on significant progress achieved across all five strategic priorities. Driven by the powerful and rigorous strategy execution and supported by its bold branding refresh initiated in early 2022, momentum for both BOSS and HUGO has since accelerated sharply. In doing so, both brands have strongly expanded market shares worldwide and made significant progress in increasing brand relevance.

Consequently, in June 2023, HUGO BOSS raised its 2025 top- and bottom-line ambition, being confident of generating revenues of around EUR 5 billion by 2025. The superior top-line ambition is coupled with significant improvements in EBIT, which is forecast to grow to a level of at least EUR 600 million by 2025. Consequently, HUGO BOSS targets an EBIT margin of at least 12% by 2025. To deliver on our 2025 financial targets, we will continue to invest into our business and rigorously execute our “CLAIM 5” strategy.

Learn more on our 2025 financial ambition

‘CLAIM 5’ Strategy

  • CLAIM 1 – BOOST BRANDS

    In order to significantly increase the relevance and perception of our brands, we comprehensively renewed the brand images of BOSS and HUGO in January 2022 – from logos, to product and marketing, up to new design concepts for our consumer touchpoints. To further increase brand relevance, particularly among the younger audience, we will continue to pursue our two-brand strategy. 

    Two clearly distinguishable marketing strategies for BOSS and HUGO aim at activating consumers across all touchpoints. In this context, we will continue our successful digital-first marketing strategy, supported by star-studded campaigns, strong collaborations, and unique brand events. Marketing investments will continue to range between 7% and 8% of Group sales until 2025. By 2025, we are targeting sales of around EUR 3.5 billion for BOSS Menswear, around EUR 500 million for BOSS Womenswear, and around EUR 1 billion for HUGO.

  • CLAIM 2 – PRODUCT IS KEY

    Our products are at the very heart of all our business activities. As part of “CLAIM 5,” we put strong emphasis on enhancing both brands’ 24/7 lifestyle images, ensuring that customers are perfectly dressed for every occasion. To live up to this target, we will fully exploit the potential of our BOSS Black, BOSS Orange, and BOSS Green brand lines for the Menswear collection, and leverage the exclusive BOSS Camel line introduced in late 2022. Further building on these successes, BOSS reintroduced its Orange line to Womenswear while also introducing the Camel line. In addition, with the upcoming launch of the HUGO BLUE brand line in early 2024, HUGO BOSS will explicitly seize opportunities in denimwear to further win over the Gen Z and young-minded consumers. Both brands, BOSS and HUGO, will maintain their superior price-value proposition, thus fostering their unique positioning in the premium / affordable luxury segment.

  • CLAIM 3 – LEAD IN DIGITAL

    Leveraging the full potential of digitalization will be a key driver to deliver on our vision of becoming the leading premium tech-driven fashion platform worldwide. Over the past two years, we achieved strong progress in further digitalizing important business activities – from digital trend detection and product creation to AI-enabled pricing and innovative experiences in the metaverse – thereby laying the foundation for further initiatives. 

    The HUGO BOSS Digital Campus, established in late 2021 and physically inaugurated in Porto, Portugal, in 2022, is at the heart of our digital journey as it significantly expands our data analytics capabilities. By capitalizing on data-driven insights, the Digital Campus drives meaningful insights and efficiencies along the value chain, while also supporting the goal of creating a seamless customer experience across all consumer touchpoints.

  • CLAIM 4 – DRIVE OMNICHANNEL

    We will continue to fully leverage our high-quality channel mix on a global scale. We thus aim to increase revenues in brick-and-mortar retail to more than EUR 2.5 billion by 2025. In this context, we are targeting store productivity improvements of at least 3% per year, supported by investments of up to EUR 600 million between 2021 and 2025 to modernize, further optimize, and selectively expand our global retail footprint. At the same time, HUGO BOSS will continue to build on its regained strength in brick-and-mortar wholesale. To take our business in emerging markets to the next level, we will strengthen our global franchise business. Overall, HUGO BOSS is targeting brick-and-mortar wholesale sales of around EUR 1.3 billion by 2025. Our digital business is expected to continue its double-digit growth trajectory in the years to come, with digital sales expected to mount up to more than EUR 1 billion by 2025. In this regard, we will focus on further driving traffic and conversion at our digital flagship hugoboss.com while, at the same time, fostering growth with digital partners. Our license business is expected to contribute up to EUR 200 million to Group revenues by 2025.

    From a regional perspective, HUGO BOSS will drive broad-based momentum. We remain committed to fully exploiting our strong momentum in EMEA, where sales are forecast to grow at a mid to high-single-digit CAGR (2022–2025) to a level of more than EUR 2.8 billion, with strong contributions expected from both key markets and important growth markets such as the Middle East. In the Americas, revenues are projected to grow at a high single-digit CAGR (2022–2025), mounting up to around EUR 1 billion by 2025. In particular, we will push our 24/7 brand image in the important U.S. market. In Asia/Pacific, revenues are set to grow at a low double-digit CAGR (2022–2025) with the region’s revenue share to expand from currently 13% to around 20% by 2025, implying a revenue level of around EUR 1 billion. In this regard, unleashing the brands’ full potential in China will be of particular importance. In addition, we are equally committed to leveraging our full potential across South East Asia & Pacific.

  • CLAIM 5 – ORGANIZE FOR GROWTH

    Over the past two years, we successfully transformed our operating model to a platform approach and implemented a streamlined, brand-led organizational setup that enables profitable growth and ensures rigorous strategy execution at a global level. In order to foster growth and further drive efficiencies going forward, we will step up investments into our supply chain.

    We recently launched the important Digital Twin initiative, aimed at enabling smart decision-making through a tech-driven business operations platform and being a key enabler to meeting consumer demand even better in the future. While further increasing the stability and transparency of its global supply chain, the Digital Twin will positively contribute to our future growth, profitability, and sustainability ambitions. At the same time, we are expanding our global logistic capacities by around 40% as well as continuing our nearshoring initiatives by bringing production even closer to EMEA and the Americas.

Sustainability throughout

Sustainability is at the heart of “CLAIM 5” – a cause that is essential to our corporate responsibility and ongoing business activities. We will therefore further intensify our efforts in this important area, focusing primarily on making our contribution to a planet free of waste and pollution. As part of our sustainability strategy, we will, among other things, strongly increase our circularity initiatives, leverage nature-positive materials, fight microplastic, and keep pushing towards zero emissions.

Learn more on sustainability at HUGO BOSS

Shareholder value creation

The focus on driving superior top-line growth and significant margin expansion is expected to result in strong cumulative free cash flow of around EUR 2.5 billion between 2021 and 2025. Fully in line with our capital allocation framework, the majority of free cash flow will be either reinvested into the business or distributed to shareholders through regular dividend payments, with the Company’s payout ratio being in a range between 30% and 50% of net income attributable to shareholders until 2025.

Further details on “CLAIM 5” can be found here and in our 2022 annual report.

Further information

Group Strategy

Learn more on "CLAIM 5“ in the Annual Report 2022.

Brands

More than the perfect suit. The BOSS collections also feature casual and athleisure pieces. With its progressive and cool looks, the HUGO brand inspires true style individualists.

2025 Financial Ambition

With its strategy ‘CLAIM 5’, over the next five years, HUGO BOSS is fully committed to strongly accelerate top-line growth. Learn more on the financial ambition 2025.