Tips for success from Mr. Biver, CEO of Hublot

I like Q&As that coax “lessons learned” or how-to advice from accomplished CEOs. Of course, it’s never that easy, but it’s nice to hear things boiled down to the essence vs. having to sift through a long book (for example).

In this vein, here’s a good snippet from Jean-Claude Biver (the man behind successful watch brands Blancpain and Hublot) on his criteria for success building a global, luxury brand:

“The most important are message of the brand, product, distribution, public relations, quality and finally pricing and charisma of the people representing the brand. All these factors need to be coherent in respect of the message of the brand. Everything starts with the message first and then all the other elements must be put into place with coherence to the message.”

Note: bulletin from David Report

I stumbled on a free white-paper today titled “I Shop therefore I am” from the folks at David Report. It’s worth sharing - here’s a snippet:

“Luxury brands are very good at selling us ‘parts’ of the luxury lifestyle: first class travel, bespoke fragrances, and atelier worthy chocolate creations. But by accumulating all the parts, we believe they’ll somehow fit into a perfect whole. But in reality, the whole is the beginning. It has to be the starting point. Otherwise you’re trapped in the vicious cycle of always needing the next ‘part’. You’re starting with incompleteness - so it always feels like there’s a piece missing. The whole must be - and is - the sense of self from whence the journey begins.”

Remember, we met online at Prada?

Here’s a nugget, buried deep in WWD this week, in an article titled ‘Luxe Brands Follow the Money – to the Internet’:

“The great opportunity that Web 2.0 has brought is the ability to interact with people in a whole new way,” said Salter [Guy Salter of Walpole of London]. “Some brands realize it’s good to bare their soul a little more and entertain comments from customers both positive and negative. I see a day when people will meet each other in the context of commercial brands,” he said. For example, a brand-related social networking site could be very useful for luxury customers who want recommendations from peers they trust. [my italics]

Seems to make sense. Something like this: “Let’s see. We both like Prada, APC and the Georges V in Paris… now what do you think about those Louboutin heels?”

Men loom large, and value brands too

The Journal ran an interesting article [sub. required] back in December (’Male Bonding’) about the increasing importance of men in the luxury goods market. Men, it seems, like nice stuff too - imagine that!

Here are some verbatims:

“Many luxury brands, known for their focus on women, are hoping to spur sales by luring male shoppers with new stores and product lines.

… One of their ultimate goals is to get men to shop more like women — making more impulse purchases and being open to items they didn’t intend to buy when they walked into the store.

… In the 12 months ended Oct. 31, U.S. sales of men’s apparel rose 2.6% to $56.3 billion — faster than the 1.9% growth to $103.5 billion in the women’s apparel market (NPD Group).

The story behind the stats

I read a lot and so come across a ton of data and market research. Occasionally a stat stands out and makes me wonder: what’s really driving these numbers?

Here’s an example from an article in today’s WSJ called ‘Does This Shirt Make Me Look Too American?’:

“Sales of men’s dress shirts costing $100 and up at [US] department stores rose 32.8% for the 12-month period ended June 30 2007, compared with a decline of 2% for shirts priced below $100, according to market researcher NPD Group. “

That’s a sharp increase in a mature corner of the US men’s wear market during what appears to be the tail-end of a protracted luxury boom.

Why are American men (and women) suddenly opening their wallets for expensive men’s dress shirts? Let’s see…

1. Widespread affluence which continues to feed the luxury boom (although I would be curious to see the data for July and Aug 2007 vs. the year-earlier period!)
2. Return to tailored and quality clothing (often with a twist)
3. Increasing experimentation in the fashion arena by American me
4. More offerings on the market, including a number of Brit brands, stoking demand
5. A possible luxury lag in men’s fashion (men are the first to purchase cars and watches in the luxury cycle, but probably lag females in fashion, at least in the US)

What else?

**

The issue with stats like the one above is that they reflect lagging data; even though they might portend the future, they are fundamentally backward-looking. (I guess that’s why eMap paid through the gills for WGSN.)

Still, it’s hard to ignore the cold hard numbers because they often point to the real story.

So I’m going to start posting curious stats as I come across them and maybe we’ll be able to connect some dots…

Photo credit: Seize sur Vingt web site.

I might buy one… if you let me feel it

This is a photo of an R 1200 GS motorcycle from BMW’s web site.

(My green friends will cringe because this guy’s scarring up the desert and emitting noxious fumes.)

Still, I have to admit, I like the silver F 650 GS. It looks sharp and the thought of tearing down the back-roads of the Northeast Kingdom this summer is tempting.

But I don’t think I’ll buy one any time soon.

Crafty creative

Straight from the horse’s mouth (Group Chairman Patrick Thomas of Hermes), via WWD:

“We are by origin craftsmen of harnesses and saddles,” said Thomas. “What we are trying to pursue in each of our métiers is authentic product, products that have a real meaning and real usage for the customer. Hermès is not a luxury house or a fashion house. We make creative products.”

Refer to yesterday’s WWD for the full article.

Studying the master of multi-brand, multi-channel

I enjoy studying Ralph Lauren’s big strategic moves. The man’s a master of sound brand management.

(I revealed this habit in an earlier post called ‘Should You Launch a Diffusion Brand in the Mass Market?‘, one of the more popular posts on this blog.)

So I read last week’s article in the Journal, ‘Polo’s High-Stakes Balancing Act’, with interest. Here’s a highlight:

“Mr. Lauren’s ability to juggle so many brands in so many price categories and retail channels without tainting his luxury image is increasingly a model the rest of the fashion industry is seeking to emulate. Other brands, from Calvin Klein to Tiffany, have seen their cachet erode when they expanded too far into lower-price goods. But Mr. Lauren has defied conventional wisdom, building a luxury-goods empire with a major portion of sales from moderately priced brands.”

How has he done it? He’s hired some smart people!

Well, actually, there’s more… some snippets from the rest of the Journal article:

1. “A meticulous focus on his high-end image”, with all labels basking “in the halo of Polo’s vaunted “Black Label” collections”, shown in NYC twice a year
2. Carefully matching styles, pricing and quality to specific channels, while remaining true to the brand’s Ivy League and British sensibilities
3. “Deftly interpreting its look at popular prices” - e.g. Chaps at Kohl’s, American Living with J.C. Penney
4. Keeping the “Polo” and “Ralph Lauren” names out of the mass market

(That last one’s especially important.)

Ralph Lauren’s master brands have also had enough time to mature and gain a widespread, diverse and loyal following, providing enough platform vitality to enable a new generation of sub-brands.

So there you have it.

Now let’s sit back and see how American Living does at J.C. Penney (my guess is that it will exceed expectations, which are high).

Should luxury and designer brands be getting into the hotel biz?

I often think about how product-centric brands can become more experience-driven to increase brand resonance, consumer loyalty and create growth opportunities in new categories.

So I’ve been watching with interest as luxury and designer brands jump headlong into the hospitality business. All this activity, just in the past few months:

“Swatch Group is getting into the hotel game. The company has formed a venture with China’s Jin Jiang International Hotel Management Co. to purchase the 78-year-old Peace Hotel in Shanghai.” (WWD)

“In the next several years, Bulgari hopes to open three to four more hotels, and is looking at properties in Paris, London, New York, Tokyo and Shanghai, among others.” (IHT)

Repurposing vintage luxury goods

I recently stumbled on a little company called Bellum, consisting of two guys from NYC, calling itself a “a design collective catering to designing, manufacturing and customizing one-off luxury goods”.

Their reason to be is “the lack of originality and individuality in the marketplace today” and Bellum (meaning war in Latin) is a vehicle to fight their “war for creative freedom”.

Bellum’s products are vintage watches that they trick-out with their own designs - e.g. a Rolex with a skull engraved on the back. They have ambitions to customize vintage cars, etc.

Marketing hyperbole aside, they basically re-purpose stuff by appropriating mainstream status symbols, putting their own spin on them, and then selling them for a profit.

Funk-free distribution

I’m always intrigued when I see a brand cut distribution. It’s often a sign that someone’s trying to claw back some brand integrity and improve a brand’s financial health.

Serge Lutens, a niche beauty brand owned by Shiseido, has been on a growth tear in recent years, doing about $20 million at retail in 2006 (up 45% over 2005), according to WWD.

I’ve never met the brand’s director, Hassan Saad, but he seems to understand the importance of maintaining scarcity of distribution. Here’s a recent quote (WWD):

“We have some cleaning up to do; we will certainly close some points of sale. We are going to concentrate our efforts on the sales force, quality merchandising and animations at points of sale.”