LONDON — It’s 11:30 on a weekday morning and Yves Carcelle, chairman and chief executive officer of Louis Vuitton, is sipping Champagne. “It’s 12:30 Paris time, non?” he said, seated in a private room at the Royal Academy of Arts on Piccadilly.

This story first appeared in the May 25, 2010 issue of WWD. Subscribe Today.

Carcelle has just unveiled the Louis Vuitton Young Arts Project, which aims to educate local youths about the art world, and is preparing for the opening Wednesday of London’s first Louis Vuitton Maison.

Here, he talks about upcoming retail projects, his customer service philosophy and how Vuitton is dipping its toes into the movie business.

WWD: What is the company’s bigger priority this year, opening stores or optimizing business in the existing stores?

Yves Carcelle:
I would say both. It was clear there was a period when we needed to cover the planet as quickly as possible. I would say that in the last 10 years we really needed to conquer new countries where luxury was appearing. The desire for luxury design had become a worldwide desire. I think today we have already covered [the globe] quite well, but that doesn’t mean we don’t have new countries in our plan. This year, we opened our first stores in Lebanon, Poland and the Dominican Republic — that makes three new countries this year. We will open in three new cities in China — Nanning, Hohhot and Fuzhou — and some second stores in Chinese cities.

WWD: How much more potential for expansion do you see in Europe and why?

Y.C.: We are very interested in Europe, in the potential of developing new categories of products and offering better customer experience. We have a lot of cities in Europe, and you will see in the next three to four years that we will develop our network. We are expanding our Milan store over the next few months, and we’ll be moving our store in Rome in 2011.

WWD: Have you been able to take advantage of favorable real estate prices in each of those cities?

Y.C.: It’s not a function of real estate prices. Of course, sometimes you have good deals. In Rome, the new site is an old movie theater, and we will be re-creating a little movie theatre inside. You have to be imaginative.

WWD: What are some of your plans for your existing stores?

Y.C.: It is very important to make room for the new product categories in stores that were opened six to seven years ago. Our first global stores were in Paris, which opened in February 1998 and in London one week later. These were our first two stores to stock everything — shoes, luggage and clothing. What looked enormous at the time looks small today.

WWD: Is overall square footage increasing worldwide?

Y.C.: Year after year, the number of square meters we open is more or less the same. Today, the number of new square meters is balanced between brand-new stores and existing stores. We don’t feel that any market is mature, and we are working well everywhere, so we continue to expand and invest everywhere.

WWD: How is Louis Vuitton endeavoring to improve service?

Y.C.: The first service we can offer our clients is to give them more space. We want our stores to be more spacious — not to put more product out, but because we want to create areas for more comfortable seating, for example. Space is luxury.

WWD: Give me an example — aside from the London Bond Street Maison — where you are expanding an existing store.

Y.C.: In June, we will be enlarging Saint-Tropez. We have only a few resort stores, and Saint-Tropez is our cult resort store. We are lucky enough to have been able to buy the house behind the store, known as the Potter House, and it will connect with the store. The new store will be enlarged by about 200 square meters [2,152 square feet] — plus an incredible garden. People will be able to shop and sit in the garden. The store will completely change.

WWD: When Louis Vuitton has renovated older stores, what has been the end result in terms of productivity gain?

Y.C.: Productivity is a word that I hate. I want to improve the experience of the customer entering the store — that is what is important to me. I’m not interested in the financial figures. I prefer to look at customers’ happiness. What is important is to keep your ratios of profitability. I only care about the reaction of my customers entering the store.

WWD: What particular product categories are getting more focus in these new-look LV stores?

Y.C.: Really all of them — we are a multiproduct specialist. Each product category that we enter, we want one day to be the leader. And we need to consolidate our leadership in travel and leather goods.

WWD: What about the lines outside your stores — like on the Champs Elysées? Obviously, it’s a sign of healthy business, but is it troublesome for you in any way?

Y.C.: We love the idea that people are so in love with the brand that they are happy to wait. And it is better to wait a while so you can get better service once you’re inside. And thank God that our store on the Champs Elysées can open on a Sunday.”

WWD: With regard to service, what else are you focusing on?

Y.C.: More and more personalization. The company has always offered personalization services such as hand-painting or hot-stamping initials on leather goods and accessories. A year ago, we launched Mon Monogram, where you choose your bag style, your initial, your stripes and your colors. We have 200 million possible combinations per bag.

WWD: So the future is about increased specialization?

Y.C.: Yes, more and more people love real personalization, but not everybody — and not all the time. But that is the real essence of luxury — to make a special order and have your beloved item sent to you.

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