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Hermès started looking for a location in metropolitan San Diego about three years ago, and the recession didn’t change the luxury retailer’s game plan.
This story first appeared in the December 24, 2008 issue of WWD. Subscribe Today.
“We’re really long-term thinkers, so [the economy] is not as much of a factor in our current expansion plans,” said Robert Chavez, president and chief executive officer of Hermès USA. “We plan 10 or 15 years out, so this was one of those decisions that’s part of that, and we’re here for the long term.”
The company focused on San Diego because Internet sales in the region “lit up our screen….The city has continued to grow in terms of population and economic importance,” Chavez said.
Those elements led to the opening of a 2,500-square-foot Hermès store this month at Simon Property Group’s Fashion Valley Mall in La Jolla. Construction took about a year.
The store offers all 14 product categories of Les Metiers Hermès, consisting of leather goods, silk scarves and ties, perfumes, men and women’s ready-to-wear collections, watches, fine jewelry, shoes, equestrian, Art de Vivre and Art de Table.
The store features modern upgrades to the traditional Hermès boutique decor, such as a glass display wall for scarves, floor-to-ceiling windows and lots of mirrors. One item exclusive to the San Diego boutique is a bright pink beach towel with zebras — an homage to the famed San Diego Zoo.
Hermès already has locations in Beverly Hills and at South Coast Plaza in Costa Mesa, Calif. The Beverly Hills store ranks second in U.S. sales for the brand behind Manhattan’s Madison Avenue flagship. South Coast Plaza is also in the top five stores in terms of sales.
The San Diego location is the brand’s 20th retail unit in the U.S. A second Las Vegas boutique will open in January in Steve Wynn’s Encore resort, to be followed by a Denver store slated to open in spring 2009 and a men’s store on Madison Avenue to debut in November.
Chavez said San Diego should rank in the company’s upper half of boutique performers.
“Southern California is a very strong market for us,” he said. “With the number of people and geographic expanse of California, we’re not anywhere near the point of cannibalization.”
Despite the economic climate, “our client base does continue to shop,” he said. “They’ve just altered their patterns.”