By  on October 10, 2011

MUMBAI — Hermès last week held the formal launch for its first stand-alone store in India — and the first street-level store by any luxury brand in the entire country.

Most brands open in five-star hotels as well as the two luxury malls, Emporio in New Delhi and UB City in Bengaluru, and have long complained that the retail ambience in India is not ready for luxury.

“This is the perfect way for Hermès to make its presence in India,” said Patrick Thomas, the company’s chief executive officer. “It is symbolic of the relationship of the brand to India, to be Indian in India and to share some activities with our customers.”

The 5,000-square-foot store, which had a soft opening in July in the midst of the monsoon season in Mumbai, was designed by RDAI, the Parisian architectural agency. Its stone exterior is embellished with arches and six windows positioned atop the Greek meander frieze patterns characteristic of Hermès. Spread over two floors, the store has a series of large connecting rooms with the first devoted to accessories, a room at the back housing ready-to-wear for men and women and an imposing stone staircase that leads to an art gallery on the second floor.

To mark the launch, Hermès created 27 special edition saris made in special silks and inspired by the firm’s scarf patterns.

“It is the first time printing has been done over fabric measuring 5.5 meters [18 feet] long by our ateliers of Lyon. The sari is a very sensual object, particularly in twill silk or mousseline changeante, when it reflects the light. It is very feminine and elegant,” said Bertrand Michaud, regional managing director, for India, Middle East and Southeast Asia.

The saris will also be sold with a meter of extra twill silk so that Indian clients can have tops tailored to their own specifications, as is their custom, or to order a custom-made choli (blouse) at the Hermès store.

With emerging markets becoming strong players for luxury, Thomas has been paying extra attention to China and now India, for both of which, he said, corporate strategy has to be tailor made.

“From a product point of view, Hermès is Parisian — therefore the product range you see here is exactly the same as in Paris, or Shanghai or Tokyo. But corporate strategy? Of course we have to adapt. First of all, you cannot talk about Asia in one breath — every country is so different. You have to adapt your distribution pattern and also the way to explain Hermès to the customer is different in every country. If you want to surprise and seduce a customer in the luxury business you have to do it one to one,” he said.

The brand has kept in mind the cultural differences for its growth in a country. While Hermès launched the Shang Xia brand in China, its first experiment with launching a separate brand for a country, the company has made a bow to India with the limited edition saris.

“Today, India is a big challenge for a company like Hermès because of its strength in textiles, ready-to-wear, jewelry — we are here to learn from this country, which is extremely knowledgeable in these areas and we have to be extremely modest,” said Thomas. “In China it was easier in a way — it was a totally different environment, because it was starting anew. That’s why the luxury goods industry is growing so fast in China and so slowly in India. Plus you have the tariffs here, we have to cater to that,” he said.

Hermès has 22 stores in China but only three in India.

Could the Shang Xia model be replicated in India? Perhaps in the long run it could work very well, Thomas said. But after considering another moment, he added, “But, you know, in life one should never repeat what you have done somewhere else. For example, we never repeat public relations operations that have worked in one country, but rather always develop a new one.”

But luxury itself can be defined in many ways, and Thomas described the two main categories as ostentatious luxury and quality luxury. “There is a great segregation,” he said, “but people are gearing up to get more of high-quality luxury. They are putting aside the ostentatious, fake luxury which is a name on a label of a disappointing product.”

He is certain that the quality of Hermès will pay off in the end, along with the style it has developed globally. But while style is the focus, business is not completely ignored. “It is hard to talk about exact time frames for India, but I believe that in the next five to 10 years this store [the newly opened Mumbai unit] will make more than 5 to 10 million euros [$6.7 to $13.9 million at current exchange]. But the figure is totally irrelevant. I want this store to be a real showcase for Hermès, he said.

Michaud believes the Indian market will not begin to mature for at least another 10 years and that the investment now will be worth the wait. “It is not that you put your toes in the Indian market and then leave in confusion like some brands have. It must be a long-term commitment,” he said.

Learning about Indian markets has been a unique experience. “In the first month when you come to India, it is as if you can write a book about it. Two months later, you feel you can write an article. Two years later, one cannot write a word. It is as if you don’t know anything. But I haven’t been about to give up, and the sense of achievement is that much more,” Michaud observed wryly.

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