Hi. In order to understand business models, we firstly need to understand, which are the different market segments, in which fashion and luxury companies compete. The most common criterion to segment a market is price. And this leads us to the so-called fashion pyramid, which is the reference for everyone in the industry to position its brand. I speak about brand more than about company, because the same company may have different brands; like Armani having Prive, Giorgio Armani, Collezioni, Emporio Armani, Armani Exchange, and so on and so forth. So we will see that those different brands, occupy different market segments in the fashion pyramid. The fashion pyramid identifies five price segments. On the top we have couture, then we have ready to wear, diffusion, bridge, and mass market. The higher on the pyramid, the higher the price gets, but the same for level of creativity and quality and therefore, the value proposition that is offered to the customer. Let's start by analyzing the top of the pyramid. The segment so-called haute couture which means high fashion. Here we find dresses mainly for special occasions such as parties and ceremonies, with prices that are outrageously expensive. So they may go from 20,000 up to 50,000 euros or dollars. So you will wonder, who is buying those expensive dresses, and why are they so costly? Who is buying them? I have to admit, very few people. Today there are very few customers that may afford to by haute couture dresses, and those are the very few customers that can have the opportunity to participate in the events of acquiring those fabulous pieces of art. However, we still have customers for haute couture and we also have many celebrities that for the red carpet, probably don't buy the dress, but receive it as a nice present from the company. And by doing that, they also promote the brand. So few customers; but products that are very important in order to build the image of the brand. It's thanks to haute couture, that companies really sell, the dream. You will see in a magazine, on beautiful celebrities, a super-beautiful dress, that maybe you cannot afford, but because of that, then you will buy from the same brand lipstick or sunglasses. This is the reason why fashion and luxury brands keep haute couture— Because it's where they can really express the dream, the magic. Why are the dresses are so expensive? Because they are made-to-measure pieces, so they are done on the body measurement of the woman that is going to wear them. And there is a maximum level of craftsmanship. There is the use of most precious materials. So, as I said before, they’re pieces of art. So to summarize, haute couture is small business, but a very important image builder. A step below haute couture, we have the so-called, ready-to-wear. In French prêt-à-porter. This is a market segment that was invented by Italian companies, when in the 70s, they started combining the creativity of high fashion with the industrialization that was granted by our textile pipeline. So, in terms of price range, ready-to-wear is, from 3 to 5 times the mass market price. So the dresses are still expensive but you can take off a zero, so maybe you won't spend 20,000 euros for a dress, you’ll just spend 2,000. And they are industrialized, so they're not unique pieces. Yet, here you have a lot of creativity, most of the time you have “made in Italy,” or “made in France.” And, the ready to wear is where the designer expresses himself throughout the fashion show. Let me say that as sompared to haute couture, ready-to-wear is also more widely appropriate in terms of occasions of use. So while haute couture is especially suitable for evening occasions, ready-to-wear goes from daily, work wear occasions, to very important parties and other special events. But companies, we have to remember that fashion companies are companies, and need to grow. So, they need to expand their market range. So, what Italian and American brands did, especially in the 80s, was move from the top of the pyramid, the ready-to-wear, down to market ranges that were more affordable. So they introduced the so-called second young lines that occupy the segment that is named diffusion. For example, Versus for Versace, Marc for Marc Jacobs C for Chloe, DKNY for Donna Karen, and so on and and so forth. So, those levels are relatively more affordable, because the production is made in wider volumes, most of the time they are outsourced. So here, the country of origin, is not really a key success factor. The distribution is more wholesale. So it is even wider than the ready-to-wear lines, and they're also sportier in terms of occasion of use. Within this segment you will find more sneakers, denim, and t-shirts, because their aiming at targeting a younger audience. So far we spoke about the high end of the market, which is mainly occupied by luxury brands, and fashion designers with very few premium brands, and where companies mainly have global exposure, also because it is a niche. Very few customer can afford those dresses, and therefore the companies need to be present all over the world. A very interesting market segment is the one that is connecting the high end of the market with the mass market, and indeed this market segment is called the bridge. This mid-range was born in the US within American department stores. Where it was key to offer the customer a product with the right level of creativity but the meantime, also the right value for money, the right delivery in the store, in a word the right marketing mix. So companies competing in the bridge market segment are more expensive, than companies competing in the mass market, but they're definitely more affordable than companies and brands, to be more precise, in the high end of the market. And basically the set of products that are updated, that are trendy. Are not as avant-garde or fashionable as the ones of ready-to-wear. But because of this, also offer the customers better fit and better delivery, and therefore they’ve satisfied the needs of all those who want to have, a product that is very suitable for daily occasional use. Here, we have many brands that can be through the line of the designer brands. A good example is Emporio Armani or Max & Co but it can also be brands as the premium brands that immediately position themselves into this mid-range. Many American designer brands are positioned in the bridge segment. Something that you may notice is that, in this market segment, we have a lot of fantasy names. So while in the top of the pyramid the sponsorship, the endorsement of the designer is key. So, you will find most of the brands carrying, the name of the founder. In the bridge segment we have brands such as Coach, Diesel. We have brands such as North Face. Brands that convey values that are more associated with a lifestyle, rather than the personality of the couture. And because of that, here companies tend to be a mix in terms of distribution between wholesale and retail and to outsource their product in order have the right value for money. Different than the top of the pyramid, the bridge segment is very local, so we have some global brands, specifically the American designers, but in each country, we still have very interesting local concept. Also because, these market segments particularly appeal to the local customers. Then, we get into the mass market. The mass market used to be a very homogeneous market segment. Just based on the lowest price for the customer, and therefore the lowest cost for the company. So efficiency was, and still is, one major key success factor. But what happened in recent years is that groups such as the Inditex but also H&M, started segmenting the mass market. Offering different brands, targeting different customers, different occasional views, as well with different price ranges. For example, within Inditex, we have Bershka, that is more suitable for teenagers. We have Zara that is more sophisticated women, formal wear and we have Massimo Dutti that is definitely a bridge brand. An effective management of the supply chain, is still fundamental to be successful. But today, is also key to offer the customer a glamorous communication, an entertaining shopping experience, somehow to combining the affordable price with the fashion content, which is typical, of the high end of the market.