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BERLIN — Hermès reshuffled its retail deck earlier this month, opening a 1,600-square-foot, company-owned shop in the KaDeWe department store and reopening its renovated and expanded 2,700-square-foot store on Kurfürstendamm.
The KaDeWe boutique replaces the brand’s two-floor store in Friedrichstrasse store, which was closed last February. This is the first time in Germany Hermès has opened its own retail space in a department store. Especially in Europe, shop-in-shops are the Hermès exception rather than the rule, and tend to serve as a city’s second or third door.
“With all these beautiful old towns and old buildings in Europe, we want to live in those buildings,” said Christina Rosenberg, director of Hermès Germany. Yet sometimes the most attractive architecture is not enough. “Friedrichstrasse was a beautiful location, and it’s a pity the eastern part of the city didn’t develop in a direction suitable for a luxury brand.”
Ten years ago, Hermès sat out the opening of KaDeWe’s luxury boulevard, which houses shops for Dior, Gucci, Chanel, Louis Vuitton, Prada and Bulgari, among others. Rosenberg said “the waiting was worth it. We don’t only have a shoe box of a space but a full boutique, as well as the great opportunity to use the atrium [in the lobby] for six weeks for Hilton McConnico’s ‘The Tale of Silk’ exhibition.”
Selections from all 16 Hermès product categories can be found at the KaDeWe boutique, as well as the remodeled Ku’damm store some 12 blocks away, which now suggests a variety of mise-en-scènes. One example is the intimate jewelry and watch department set three steps up at the back of the store. “We broke through a wall, and you feel like you’ve left the store behind,” Rosenberg remarked.
Hermès has 10 company-owned stores and four concessions in Germany. Besides the two simultaneous Berlin openings, a new jewelry, watch and Art de Vivre space will be launched in the enlarged Munich store in November, followed by a Maison furniture and carpet/tapestry showroom in the Munich shop’s arched cellar in January.
While Wilfried Guerrand, Hermès managing director, Europe, declined to discuss numbers, he said all German doors were posting double-digit growth, and “that with one less store at the moment. In Europe, and for the group, Germany has a special place as champion in terms of organic growth. [Germany] is the second market for us in Europe after France,” he pointed out.
Further openings in Germany are not planned at present, but on the continent, 2011 will see new doors in Geneva, a renovation of the Lisbon boutique, a second door in Rome and Istanbul, and “hopefully the first Hermès in Kazakhstan,” he said.
Asked about the effects of the current euro crisis on the house’s business, Guerrand responded “that’s always difficult to answer when you see our results. Our turnover is growing, even in Europe, including Greece.” As reported, Hermès posted a 49.5 percent gain in net profits in the first half, with sales gaining 22 percent in the six month period.
“Of course [the crisis] affects us in that we manufacture only in Europe, and on a euro basis. But selling on a euro basis is not a problem, though there are currently currency discrepancies, as in Switzerland,” he noted.
Both he and Rosenberg said such a crisis, as in 2008-2009, has been more of a help than a hindrance. “All those ‘it’ bags represented no value. You couldn’t wear them next year, they were out of fashion,” commented Rosenberg. “Our customers say they’d rather save their money for one or two years and then come to us.”
Guerrand added, “Globally there’s clearly an increasingly an appetite for high quality, which is a huge potential for us.”
He sees particular promise for Hermès in Russia and Scandinavia. “We’re noticing a change in consumption in Scandinavia, where people were reluctant to shop and enjoy spending their money. But now there’s a new generation of entrepreneurs, in Sweden, for example, who do indeed enjoy spending.”