LONDON — Like miners panning for gold, luxury goods chiefs are learning it takes time and patience — not to mention money — to strike it rich.
The hours, financial investment and sensitivity to heritage involved in turning around or launching a jewelry brand could not be more different from what goes into creating or revamping a fashion brand.
“Both need the same ingredients: a clear strategy, excellent execution, time and investment. But the results in fashion are more immediate,” said Domenico De Sole, Gucci Group’s president and chief executive officer, who made his name in the fashion business turning around Gucci, together with Tom Ford, the group’s creative director.
Today, the duo is relaunching a portfolio of brands, including Yves Saint Laurent, Bottega Veneta and the French jewelry house Boucheron.
“In fashion, everything is more immediate: There are shows four times a year, and they focus the attention of the press and buyers,” De Sole said. “If you get a good fashion show or review, then everything accelerates. Jewelry doesn’t have that opportunity or exposure. Also, developing and producing jewelry takes much longer than in fashion.”
Patience is a necessary virtue in the business, according to De Sole, who has put the rollout of Boucheron stores on ice, starting with the planned Manhattan unit on Fifth Avenue, which will now become a Bottega Veneta store.
“Bottega Veneta is doing unbelievably well, so we decided to put it there,” he said. “It was simply a rational, pragmatic business decision.”
There are currently 27 Boucheron stores and shop-in-shops worldwide, and about a third of those are new-generation, Gucci Group-designed units. Those stores are in major cities, including London, Paris, Milan and San Francisco.
“In the beginning with Boucheron, we started moving very quickly,” De Sole said. “Now, we’re taking our time. Before we started working on Gucci, it already had worldwide name recognition and global store network. And the economic circumstances when we were doing the turnaround were wonderful.
“Today, the economy is what it is, and we’re being quite prudent. Our number one priority right now at Boucheron is product development. As soon as we feel comfortable with the economy, and when we think the time is right, we’ll resume our Boucheron store rollout.”Gianluca Brozzetti, ceo of A&G Group, parent of the Asprey and Garrard brands, has faced an additional challenge in relaunching Garrard, the 258-year-old English brand that is still home to the Crown Jeweler.
The brand that supplies royals with their engagement and wedding rings, and where England’s aristocracy still stores the family jewels has taken on a whole new dimension with the arrival of creative director Jade Jagger, who has introduced fresh collections with a lot of glamour.
“We wanted to create a brand that would reinvent the heritage of Garrard and offer something unexpected,” Brozzetti said. “At the same time, we knew we needed to be consistent with and respectful of the past, and be acceptable to Garrard’s customers. We have encountered prejudice from more conservative people who say it’s impossible to change and evolve the brand. But you just carry on, and the challenge is to have the time and resources to materialize your vision.”
Garrard ran into some trouble last year when its launch ads raised the ire of the watchdog group Royal Warrant Holders Association. The group thought Garrard’s tag line, “By special appointment to…” written under the newly created coats of arms for celebrities like Missy Elliott, Liberty Ross and Rupert Everett, was not in great taste.
The company also raised a few eyebrows around London last month when it hired the burlesque dancer Dita Von Teese to stand inside a giant martini glass and strip down to nipple tassels and a thong. Von Teese was performing at a party to celebrate the opening of Garrard’s London store on Albemarle Street and Jagger’s first year with the brand.
With one year already under its glittering belt, Garrard is forging ahead. Earlier this year, the company opened in-store units at Harvey Nichols in Manchester and London, and the brand plans to open a by-appointment-only sales office on Spring Street in New York.
Another challenge that Garrard, like Boucheron, is facing is how to build brand awareness outside the core market.
“We know we need to do this slowly, so we didn’t plan to roll out stores immediately,” Brozzetti said. “We want to incubate the new concept before we do anything else.”He added: “It’s been a very difficult 12 months for the luxury business. The market has not been at its best and, yes, growth and development could have been faster. So in the meantime, you invest in and support the brand.”
While De Beers LV, a new jewelry brand, may not be wrestling with Garrard’s legacy issues, it is experiencing similar challenges to both its rival brands. Launched last year as a joint venture between De Beers and LVMH Moët Hennessy Louis Vuitton, De Beers LV is taking the slow-growth approach.
“I thought Boucheron was very gutsy to open stores right away, at the same time. But that’s a very costly exercise,” said Alain Lorenzo, ceo of De Beers LV. “We chose the more conservative option.”
De Beers opened its first store in London, on the corner of Bond Street and Piccadilly, last November, followed by three Tokyo units last month.
“I’m glad we didn’t open the Japanese stores right away because there were so many operational things we had to iron out, [such as] security features, store lighting — which was bad at first in the Piccadilly store — and holes in our merchandising strategy,” Lorenzo said. “You never get these things right the first time.”
In the second half of 2004, a De Beers LV unit will open in Manhattan on the corner of Fifth Avenue and 55th Street.
Like De Sole, Lorenzo agreed that jewelry and fashion are two different animals.
“From manufacturing to inventory controls to lead times, the whole process is different,” Lorenzo said. “You know, there is no such thing as an industrial jewelry maker in this business. We work with tiny, specialized workshops. The cost of inventory, too, is very high because of the value of the raw material. We’re not talking cotton, but diamonds. If you make the wrong forecasts for your in-store merchandise assortment, you potentially have a very big problem on your hands.”
Lorenzo also is taking the long view.
“We expect to have a worldwide chain of De Beers LV stores in 10 to 15 years’ time….That’s the time frame we’re working on,” Lorenzo added. “In this business, it’s so easy to get carried away with your own ideas and ambitions. You have to be careful not to be too optimistic, and you can’t spend too much money too quickly. But when you live and breathe a project like this, it’s not easy to hold back.”
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