NEW GUERLAIN HEAD IS READY TO ROCK
Byline: Sarah Raper
PARIS — In his first appearance in front of the press since taking over as president of Guerlain Sept. 1, Christian Lanis promised a torrent of product launches and vowed to bring the “spirit of combat” that pervades the mass market to the 166-year-old prestige fragrance house.
The first new product — a younger, fresher version of Guerlain’s 1989 women’s entry, Samsara — is called Air de Samsara and will be launched worldwide next spring.
“There will be more launches and they will come more rapidly than in the past,” Lanis said. He declined to be specific about future projects, but said another new women’s scent was in the works.
At 46, Lanis appears to have the energy to match his rhetoric. He spent 21 years at Unilever, where his last position was chairman of personal products for Italy from 1991 to 1994.
He was handpicked for the top post at Guerlain by Bernard Arnault, chairman of LVMH Möet Hennessy Louis Vuitton, which acquired financial control of the family-owned company in late April. LVMH now owns 58 percent, but the Guerlain family still retains narrow voting control.
Last year Guerlain earned $32 million (162 million francs) on consolidated sales of $392 million (2 billion francs), 70 percent of which was rung up outside France. At the time of the acquisition, LVMH projected 1994 profits at the house would increase by 18 percent.
Lanis made his remarks during a tour this week of Guerlain’s new fragrance factory in Orphin, south of Paris. The plant opened in January and replaced Guerlain’s factories in the Paris suburb of Courbevoie, as well as a U.S. plant in Sommer, N.J., which closed in April.
Master perfumer Jean-Paul Guerlain and Philippe Guerlain, director general, joined Lanis for the tour. Watching the trio interact was more instructive than any table of organization.
While Lanis outlined his strategy for the company and described the benefits Guerlain would reap as a member of the LVMH luxury galaxy, he often had to call on one of the Guerlain cousins to answer questions about the company.
Neither did the Guerlains hesitate to break in on him to put the family spin on an issue or to provide colorful tales about their ancestors.
Jean-Paul wandered about clutching the leather-bound family “recipe book,” which contains handwritten formulas of the house’s best-selling scents, as if to stress that one can buy a company but not 166 years of know-how. It is said that only Jean-Paul and his assistant have access to these formulas.
All the theatrics seemed to support Philippe’s claim that “the association with LVMH has not really changed anything.”
Lanis said he had spent most of his first two months on the job touring Guerlain doors in France and had traveled to Germany and the U.S. for meetings with subsidiaries there. He has focused so far on Guerlain’s marketing strategy, he said, and has already identified some strengths and weaknesses.
For example, he praised Guerlain’s Kiss Kiss, a longlasting lipstick whose September launch was mapped out before Lanis arrived. “It’s superb packaging, a new, very modern product, a color range that’s on target and an extraordinary name,” he said.
On the other hand, Lanis conceded that Héritage, the men’s scent that was launched worldwide rolled out to the U.S. 1993, has been disappointing.
“It’s a success in some markets but it is not as complete a success as Samsara,” Lanis said. “The juice is good. The problem, we think, is in the marketing mix.”
Lanis said the brown accent in packaging was too dull for some markets. Also, Guerlain and other luxury companies have not exploited their competitive advantages and were sometimes not direct enough in pointing out their innovations, particularly in skin care, he said. “In the mass market, we don’t sit around and wait with something new,” Lanis noted. “We move, and when we do, we tell the consumer about it. When P&G came up with two-in-one [hair products] you heard about it.”
Lanis said that his biggest hole in management terms is the international marketing position left vacant when Bernard Fornas departed for Cartier last spring.
As for the U.S., Lanis acknowledged that there’s been problems. “In the U.S. we must make progress,” he said. “That market demands new products and we have not invested enough there,” he said.
The LVMH link provides Guerlain with advantages, such as a stronger draw for executive talent. There will also be synergies in basic research and increased clout in negotiating commercial space, he said, pointing to Asia, where the group may find itself opening several boutiques in the same shopping center. However, Lanis said he did not think LVMH’s interest in Guerlain would make it easier to negotiate for space in department stores.
The new factory, with its computerized systems for storing raw materials and for processing fragrances, employs between 160 and 200 people, depending on the season. That is the same number as previously worked at Courbevoie, but productivity has been increased by 20 percent. In 1994, Orphin will turn out 10 million fragrance pieces and between 10 and 12 million samples and gift sets, executives said.
The real challenge, however, in designing the Orphin factory was to keep the production flexible in order to accommodate high-volume products like Samsara and Shalimar, each of which have sales of about $80 million worldwide, as well as products produced in smaller quantities.
On the day of the visit, five women were polishing, labeling and carrying out finishing details by hand for a 1,200-bottle limited edition for Christmas in France and Belgium of Liu, a women’s fragrance created in 1927.