Twenty-five years ago, Maureen Chiquet had an epiphany in the middle of taking the LSATs that changed her life.
Halfway through the law school entrance exam, which Chiquet took because she didn't know what to do with her life, she decided to turn in the test after realizing that she belonged in Paris, not in court.
Chiquet, 43, is now president and chief operating officer of Chanel Inc., and in January will become global chief executive officer of Chanel.
She did not join Chanel from a luxury goods background. Chiquet was a 15-year veteran of Gap Inc., having served as president of Banana Republic, and before that, executive vice president, merchandising, planning and production of Old Navy, where she was instrumental in building the brand into a $5.5 billion force. She began her career as brand manager of L'Oréal Paris.
Chiquet brings an international perspective to her new role, as well as a fascination with French culture. She moved to Paris after joining Chanel in May 2003 and spent a year working with senior management to understand the brand and strengthen international communications, operations and strategic planning. In October 2004, she relocated to New York as president and chief operating officer, directing all U.S. operations for beauty and fragrance, fashion, watches and fine jewelry. Her new mandate as global ceo will be to guide Chanel — whose estimated volume is $3.3 billion — well into the 21st century.
Chiquet sat down with Ed Nardoza, editor in chief of WWD, to talk about her new post at Chanel, and how her experience at Gap Inc. and L'Oréal prepared her for it. WWD: You'll be running a French company based in New York, so you'll be on the road a lot. How do you manage professional and personal life when you're on the road so constantly?
Maureen Chiquet: It's a challenge, but I am really lucky. I have two people in my life who are my, I think, saviors in this respect: My husband, who is incredibly great with the kids, is able to work from home and do what he does and help support me at home, and my assistant, Kim Gold, who is incredible, keeps me organized and on track. But also I'm lucky because my family is multicultural. Antoine, my husband, is French, the kids are half-French, so when they have school vacations we can travel to France and they can come with us to different places around the world.WWD: People were a little surprised when you got the appointment at Chanel because you came from what is more of a moderate mass chain world to take over one of the great brands in luxury fashion. Was that a difficult transition and were you really prepared for that kind of shift?
M.C.: Certain parts of it were difficult, but I really think I was prepared. Because whether you're working in the mass market business or whether you're working in the luxury business, there are certain things that are the same. And I was fortunate because I worked at The Gap, which is an iconic brand; Old Navy was iconic and so was Banana Republic. So it really is about thinking about the brand, the details of the brand, how you communicate to customers, focusing on products, focusing on the image, and that was something I could take with me, albeit in a very different market with very different consumers.
Also, obviously being at Old Navy, which was a start-up, I had to hire a lot of people. So when I got to Old Navy I think there were 35 of us. It wasn't even called Old Navy, actually. So I really learned how to identify talent, hire great people and surround myself with really strong teams and then groom those teams.
And then, lastly, and I think this I learned maybe the hard way, when our business got very tough at Old Navy it was really [about] having a long-term vision and putting that vision out there and coming up with a strategy to help turn around the business.
WWD: What did you take away from working with Mickey Drexler [former ceo of Gap]? Was that something that really helped prepare you for this experience now?
M.C.: Mickey is and was an incredible mentor to me. Two big things I think about when I think about Mickey is the fact that he can walk into a room of garments, of clothes, and look at them and just whatever makes his heart beat fast he can see that, see it through the customer's eyes and figure out how to optimize those opportunities.And that's something I've learned and it's something that I'm able to use both as we look at our fashion collections at Chanel and really getting behind our items that make our hearts beat fast. But also in every type of business, whether it's fragrance, beauty or watches.
The other great thing about working with Mickey, this is another difficult lesson but a good one, is I was a young merchant and Mickey asked me to show him — I was in the denim department at the time — my denim product and my finishes. And I brought everything into a conference room, very arrogant as I was probably, and showed him. And I said, "This is the greatest new finish." He said, "That's great, so where are you going to put that finish?" I said, "Well, on this great new jean." He said, "Well, why don't you put it on the classic fit?" And I had a hundred reasons why and I wasn't listening to a word he said, and he got rather annoyed with me.
So I left the room, and he called me later and he said, "You know, Maureen, you're a great merchant but you need to learn to listen." And I have to tell you something, learning to listen was one of the greatest lessons that I had, because it wasn't just about listening to your boss, but listening to your consumers, listening to the world around you and really being aware and being able to be self-critical, being able to know that you're not always right — that you can entertain other people's points of view.
WWD: Do you have a mandate or a priority list in your new position in terms of what your emphasis will be? Will it be growth? Will it be product development? Will it be enhancing the service experience, or is that part of a total package?
M.C.: Yes. First of all, I'm not in the job yet, it's going to be in January. So I am looking at the different things that I'll be spending time on. Plus, at Chanel, it's really not about fast, rapid growth. We are very fortunate to be privately held and to be a family business. So for me, it's really about the longevity of the brand. We've been around for over 80 years, and I'd like to see us last for 80 more at least. So it's really about preserving and keeping the brand fresh and modern.And where I think I'll be spending a lot of time, because they are areas that I love, that I'm passionate about and that I think I have value to add, is with everything that has to do with our product, everything that has to do with the image that we communicate and, of course, the people who work at Chanel.
WWD: Are you concerned at all about brand maturity? I mean Chanel was reinvented once already by Karl Lagerfeld. Is that a concern?
M.C.: I don't believe in brand maturity. As a rule I don't. I think there are always things that you can do with a brand to make it exciting and fresh for consumers and reinvent it. And I think what Karl does, he does brilliantly. He takes the brand each and every time and he breaks it up and he puts it back together again and he makes it new and fresh, but it's always Chanel.
Great luxury brands have depth, meaning that they have a history, heritage and a story, and I think Chanel has that in spades. But they also have dynamism. And in order to keep the brand fresh you have to continue to create and innovate. And it's really about the balance between depth and dynamism that makes a brand last and keep growing.
WWD: Sometimes we see, in our travels in the industry, an adversarial shift emerge between a ceo and a designer. How do you deal with Karl Lagerfeld? Is he intimidating? How do you work with him? Is he fun? Is he wild?
M.C.: He is a lot of fun. I have to say the word that comes to mind most when I think about Karl is inspirational, quite frankly. And every time I see him or I go into the studio prior to the collections, I'm inspired and I remember why I got into this business and why I love the business so much.
To watch him start from a canvas while he's doing a couture gown and look at fabrics and watch the drape and know that he's so fast. He'll look at a fabric and say, "It's that one." Or do a sketch to explain to the head seamstress, for example, what his direction is. To me, that's completely inspirational.WWD: What about the business model in general? If you look at LVMH for example, one of your prime competitors, they have the multiple-brand model, which has worked very well for them, and it's often a hedge against brand maturity. Chanel has flirted a little bit with investing in other brands. Do you see that as a consideration for the future at all?
M.C.: I never say never, but the thing that's so interesting about Chanel and the house of Chanel is that we have so many different products already. I mean, think about it, we go from lipstick to fragrance to handbags to couture to watches to fine jewelry. So you don't need to make an acquisition. We've got an incredibly strong brand, and we have all these products that we can still develop.
WWD: Is there any particular market that you feel is really underdeveloped right now? For example, fine jewelry — is there a market you're anxious to get your hands on and think that there's a lot of potential that's untapped?
M.C.: Yes. I think there are. We have a number of businesses, and we look at our businesses almost like stand-alone businesses. So I can't sit here and tell you I'm going to prioritize fine jewelry and skin care or whatever. There are certainly businesses where we are newer in the market, or maybe not as developed as the other businesses.
But I think that because we manage each business as a separate entity, knowing that they're all part of the house of Chanel and have that spirit and essence of Chanel, it means that we have broken each and every segment. You know, everybody says the fragrance business is mature. Look what happened when we launched the No.5 campaign three years ago — sales of our fragrances went through the roof.
WWD: Was there one particular surprise or real challenge that hit you [when you joined Chanel]?
M.C.: There were a lot of surprises. I'm just thinking back to three years ago, but the first was how incredibly devoted people are to the brand who work there. I have never encountered that in my career. You know, I'm fortunate inasmuch as I haven't worked in a lot of companies. I worked at L'Oréal; I worked at Gap. But I've never seen people who care as much about the [Chanel] brand. There's very low turnover and incredible experts.What was interesting to me was the insistence on keeping up this artisanal tradition that we have with the houses like Le Mariér. I wouldn't have expected that. That contrasted with the modernity. For example, we have a warehouse in France that actually distributes our products with robots. I was surprised by that, I thought, "Well it's Chanel, shouldn't it be old and dusty?" But it really is quite modern.
I was surprised by how coherent the brand was. I mean, here you have all these different products and lots of different geographies, but the brand [gets the same reaction]. I can go to China today and ask a consumer what she thinks of Chanel, to Germany and the U.S. and really the words that come out are the same.
WWD: How much does a company's culture have to adapt to a ceo and how much does the ceo have to adapt to a culture, particularly a very rich culture, like Chanel?
M.C.: I suppose it depends on the ceo and the company, obviously, and the state that the business is in and the brand is in. But for me at Chanel, it was really about 50/50 to be quite frank. I came into this brand that was so strong and that had such deep meaning for consumers. I mean to the extent that I would go into a boutique and see somebody with an editorial of a jacket that they wanted. And when that sales associate came out and said "I've got it," the sense of joy, I mean, my God, this is such an emotional brand for consumers. So I think that's something you can't throw away.
The business had been very strong when I got there, so obviously something was working. And there's a great team of experts, I mean really strong players who understand fundamentally the luxury business, and I'd say most important, had this kind of reverence for a brand.
On the flip side, Chanel is ultimately, and always has been, a very modern brand. Coco Chanel broke every rule in the book. She put women in pants when they were in corsets and long gowns. So I thought maybe we should start reinvestigating the spirit of rule-breaking and doing some things and taking some risks within the context of the brand, but really pushing sort of on the edges a bit, bringing out and revealing the modernity that the brand has.In addition, I think from an internal standpoint, bringing in some new perspective, hiring a couple of new people so that we could get a transfer of knowledge from the great experts that we had.
And then, lastly, from a cultural standpoint, one thing I did when I got there was I asked everybody what they wanted and what they expected of me. And basically I heard two things. The first was, "We're really great experts, we know our fields very well but we'd love to work in a new way together. We'd love to sort of learn from each other, so fragrance and beauty learning from fashion, etc." And they also said they wanted a vision, they wanted me to give them a vision. So, at that point, what I did, and what was somewhat of a cultural shift, was pull people together in teams to work out a long-term strategy and to develop a vision together. So I stuck IT people with fashion people, with finance people, to really develop where we wanted to go for the next several years.
WWD: Do you study the mass market at all? Is there anything you can learn from the mass market? When we look at it, we define it very broadly now, it's not just Wal-Mart and Target but look at the H&Ms and the Zaras, which are a trend a minute. And we even saw Karl doing that one-season experimentation with H&M that led to mob scenes around the world. I mean, he was treated like a rock star wherever he went, but the lines, we hadn't seen lines like that waiting to get into a store. Is there something a true luxury brand can learn and take away from that sort of fashion democracy movement and that mass customer?
M.C.: I do study all ends of the fashion spectrum because I think it's interesting intellectually. Target is a great example of a fashion company. You can have fashion and it's not really about price. Fashion doesn't have to be about price.
I think Target is really hooked into that. I also think Target is into this whole design or style movement that we see going on. It's almost like I feel like Target has done sort of what Andy Warhol did and become a pop culture. They've taken things that are quite ordinary and made them look extraordinary.In terms of H&M, people ask me all the time, "Do you think it was a good thing that Karl did?" I think it was a terrific thing. First of all, because our designer, who is known for incredibly elegant couture gowns and beautiful ready-to-wear and everything else, has that incredible breadth to be able to do a great-looking collection for H&M. That's pretty extraordinary. It also communicates to a different generation, to your point, of consumers in a new way. It was very exciting, very buzz-worthy, even for us.
So that being said, you know, to say do we want to do a secondary line, is that something that we should learn from? I think Chanel is really the ultimate house of luxury, so I don't see us going into sort of a lower-end line ourselves.
WWD: Let's just talk about some of your approaches to people and your hiring techniques. What do you look for when you're looking to hire an executive and what turns you off?
M.C.: First thing, I really have to hire people who are passionate. Pretty much within the first five minutes, if I don't see someone that's incredibly passionate about the business, about whatever I'm hiring for, that is not good for me. Eyeballs. I think in the fashion business a certain intuition, eyeballs, are important but you also need eyeballs with analytical skills. I don't think it's one or the other. I like to look for a balance of that.
I like to look for people who think outside the box, who are risk-takers, who have tried some things and failed, who know how to talk about failure, who have learned from their failures, who can look in the mirror and say "You know that I did this, but it didn't work out." I think that's incredibly important.
I think what turns me off is arrogance. Somebody who is completely arrogant and, as I said, lacks of any kind of passion are things that I don't gravitate toward.
WWD: How important is the Japanese market to you? Is that a huge chunk of your business? And why do you think the Japanese customer maybe is a little bit more passionate toward Chanel and Vuitton than maybe other customers?M.C.: It is a large portion of our business. The Japanese inherently value quality and great design and wonderful products. And I think that, with Chanel, you have the best of everything. You really are the ultimate, so you're offering the best quality. From a design perspective, it's incredibly unique design with traditional artisanal touches.
WWD: You came from a public company, very, very visible, huge volume and now you work for a private company. Looking at them both as fashion companies, which would you prefer? And is your strategy very different in working in a private company?
M.C.: That's hard to say right now. I have to say I love being in a private company. It is hugely, hugely advantageous in so many ways. It's really different, though. I have to say it's night and day. I think about it all the time because people ask me, they say, "What's different?"
There are really four things that are different for me, and this is comparing and contrasting Gap to Chanel. Obviously, if you look at different companies, that's going to be a different question. But the first is, at a company like Chanel, you're letting creativity lead. So it's all about creating a desire, creating a dream and not necessarily about fulfilling a customer need. That's tremendously different, that means everything you do and the way that you organize yourself is different.
The second thing, and this is like sort of a no-brainer, everybody talks about it, but in a publicly held mass market company it's about maximizing. I want to maximize my sales. I want to maximize my store count. I want to maximize my advertising. It's more, more, more and more is better, which I think has probably gotten some companies in trouble. But that's really the game.
In a private company, and particularly in a luxury house, it's really about rarefying. You still want to grow your sales, but your customer wants something exclusive. They don't always want to see the jacket that they have on the customer next to them. So it's really about how you deal with rarity and how you make sure that your product stays unique and exclusive.Obviously in a public company, you're subject to the market, so you're very often talking about your sales. And therefore I think that there's very much more an emphasis on a short-term perspective. Obviously, even at Gap, we did long-term strategic plans, and you always have that in mind, but you manage through a short term every day.
In a company like Chanel, we really manage to the long term. It's really about a perspective that allows you to make some decisions. Sometimes it's about saying no. I feel like I spend a lot of time saying no to things because they're not good for the brand. Or sometimes the converse, about investing enormous amounts of money in things where you're not going to see an immediate payoff.
The last one is actually not really public or private, but I think I went from a very hierarchical company — Gap is organized very much as a hierarchy, which is one model — to more of a matrix organization where there's really sort of a balance of power between the regions and the activities, and that is quite different and a bit of a change.
AUDIENCE QUESTION: How important do you see couture at this point? Is it really the icing on the cake and the house really doesn't need it? Or do you think that it does serve a purpose?
M.C.: It's absolutely critical. It does serve a purpose for a lot of reasons. One, it's aspirational and it has a halo effect on the brand. But it's also a place for our creative teams and Karl, in particular, it's his playground. He can do whatever he wants, and it allows a lot of new ideas to bubble up and a lot of things that he may think about using in ready-to-wear later, so I think it's critical to the brand, actually.
AUDIENCE QUESTION: Have you thought about succession planning, and what will life be like after Karl?
M.C.: Yes, I get asked that question a lot. People say, "What do you do, what's life after Karl?" To be quite frank, I don't think about it, because we have an incredible creative team in place. Karl is unbelievable. He has been putting out better and better collections every time that we see him. To be quite frank, I don't think about that. It's not something on the radar screen.
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