Coca-Cola did it again:
According to CPP Luxury, Italian house of Bottega Veneta (owned by Kering – former PPR) is expected to overtake the eight per cent growth forecast for the global luxury goods market this year. The brand saw profits boost of 46.7 per cent in 2012, as reported in February. “Bottega should grow faster than average considering the trend of the segment that we are in, which is absolute luxury,” said the label’s chairman and chief executive, Marco Bizzarri. “This customer is less hit by the [economic] crisis.” Bizzarri credits the exclusivity and craftsmanship of the brand’s products (some of which take up to 15 years to create), for its success.
“For us Made In Italy is so important, the quality of the artisans and the material is so important, that if we feel any kind of pressure on our profitability we will put prices up,” he told The Financial Times. “We’ve found that as long as our quality is maintained that the customers are willing to pay a premium.”
Staff.com sent me an email with this cool infographic of them.
Blame it on the media when people seem to think that their hot tech startup will make them a billionaire by their mid-20s.
Being a startup ourselves, we are very interested in the factors that contribute to a startup’s success, so we created this infographic on those factors, or chances that your startup will fail or succeed. This also includes some research on projections for the best sectors to start your new business.
A recent study conducted by CPP has revealed that Germany’s luxury market will grow by up to 20% in 2013, particularly the fashion, watches, jewellery sectors. As the the primary purpose of travelling to Germany is medical (treatments, surgeries etc), luxury retail and hospitality and indirect beneficiaries. Over 30% of the wealthy visitor to Germany come from the Middle East (UAE, Kuwait, Qatar, Oman and Bahrain).
Governments in most of these countries subsidize costs for treatment abroad of its nationals, from flights to accommodation and the hospital bills. The most ”generous” is the government of U.A.E., its embassies making all necessary arrangements. According to our survey, the length of such a ”medical” trip for a Gulf patient is on average 10 days – in many cases, flight arrangements being business class and hotels five star. Each patient is allowed to be accompanied by a relative or friend and in the case of women, by two such close people.
In Europe, Germany ranks as first choice, given the quality of medical services, especially for cardiology, ophtamology and cancer. Munich ranks first, followed by Hamburg and Dusseldorf (Essen).
In luxury hotels in Munich, these medical travellers now make up to a third of all guests, hence, personalized services such as literature in Arabic and Arabic cuisine menus in restaurants and in-room dining. This explains the high occupancy at luxury hotels in Munich, Hamburg and Dusseldorf in off-season as well as the high rates, despite a steep decline in corporate travel. Travel to Germany by Gulf nationals has also been helped by direct flight connections – Emirates fly non-stop from Dubai to Munich, Berlin and Hamburg while Qatar Airways flies from Munich and Hamburg, non stop to Doha. Lufthansa is also flying direct to several Gulf destinations. Etihad flies non-stop from Abu Dhabi to Frankfurt and Munich, and through its partnership with Air Berlin, to over 20 cities in Germany.
Russians and nationals from Eastern European countries are also incresingly travelling to Germany for medical reasons, however, unlike Gulf nationals, their expenses are covered by either private insurance or personal income. There are direct flights between many cities in Germany to Moscow and Sankt Petersburg. There has also been an increase from CIS states such as Kazakhstan and Azerbaijan, most of them for medical reasons too.
As for Asian travellers, most of them from China and South Korea, arrive in Germany mostly for leisure and they favour mainly Berlin, Munich and Frankfurt. The lower prices of most luxury branded goods, in many cases 20% cheaper than in China, have been the major incentive for Chinese to travel to Germany. By comparison to Paris or London, flights between China and Germany are cheaper due to an oversupply. On average an return economy class flight ticket from Beijing to Frankfurt is 30 to 40% cheaper than an economy return from Paris to Beijing.
Asian travellers also prefer German luxury shopping destinations such as Munich, Berlin and Frankfurt given that luxury hotel rates are up to 30% cheaper than those in Paris or Milan.
Major luxury brands such as Prada and Vuitton have grasped on the potential of foreign travellers and have placed Germany at the top of their expansion plans in Europe. They are also tackling an important shortcoming of Munich or Berlin, which have smaller stores than in Paris, London or Milan (hence a reduced variety of their collections), by enlarging existing stores or opening new, larger store.
In Munich, Prada is enlarging its existing flagship store by 30% (adding a adjacent building), while Louis Vuitton is opening an impressive Louis Vuitton Maison store at the prestigious Palais an der Oper on Residenzstrasse, covering 600 sqm – both stores due to open this Summer.
Leading jewellery and watches retailer Bucherer is opening in Munich its second flagship store in Munich near the new Vuitton Maison this Summer. Max Mara is also scheduled to open its new flagship store in Munich on Theatinerstrass this summer. The new developments in Munich come after the recent openings, at the end of 2012, of several new stores: Tom Ford, Belstaff, Michael Kors and Saint Laurent.
In Germany, Prada operates 6 mono-brand stores and 2 shop in shops; Louis Vuitton operates 8 stores; Gucci 7 mono-brand stores and 4 corners; Cartier operates 5 mono-brand boutiques, Ermenegildo Zegna 4 mono-brand stores and 4 corners; Burberry 4 mono-brand stores; Tiffany 4 mono-brand boutiques. Many of the luxury fashion and accessories brands blame the lack of infrastructure (few luxury department stores) and high leases for the slow retail development in Germany.
As for watches, most of the major luxury brands are represented through wholesale, the most important retailers being Wempe (15 stores in Germany) and Bucherer. Rolex (through local partners), Blancpain and Omega are among the brands with a large representation of mono-brand boutiques in Germany.
With the inauguration of the ZegnArt project in Mumbai - India, Gildo Zegna, CEO of Italian luxury menswear house Ermenegildo Zegna said that India will likely reach the levels of luxury consumption of China in 10 to 15 years. In India, Zegna operates 5 stores in joint venture with Reliance Group, while in China it operates directlty 100 stores nationwide.
The ZegnArt project features the works of Reena Kallat, curated by Anna Zegna, the exhibition being on display at the Dr Bhau Daji Lad Museum in Mumbai until 15 May. The ZegnArt project will be hosted in Turkey and Brazil in 2014, coinciding with the Art Biennale in each countries.
The 2013 World Watch Report shows that Fine Watches have lost none of their online appeal, as the 18 brands tracked by the report posted a 7% increase in online interest. Unsurprisingly, the BRIC countries, led by China, are the main driving forces behind this growth.
Now in its ninth year, the World Watch Report, which tracks the performance of luxury watch brands based on online searches, reveals in its 2013 edition a global rise of 7% for the 18 Fine Watch Maisons under review*. The report examines 20 markets and a billion queries. “Unsurprisingly, the emerging markets are fuelling this growth,” comments Florent Bondoux of Digital Luxury Group, the producer of the report which has the backing of the Fondation de la Haute Horlogerie. “Virtually half of global interest stems from the four BRIC countries [Brazil Russia, India, China] and the Asian markets. Chinese internet users clearly outrank others with 31% of searches relating to Fine Watchmaking compared with 20% in 2012.” This 27% increase is matched by growth in Brazil (+30%), Russia (+43%) and even India (+18%), whereas mature markets such as the United States (-11%) and Japan (-12%) have waned. Read the rest of this entry »
Swiss luxury watch brand Patek Philippe launched a website dedicated to ladies. The Ladies Microsite gives a behind the scenes look at how the brand approaches the design and production of women’s watches and includes an insightful video interview with Sandrine Stern, who heads up watch creation. There’s also a special section that describes the inspiration and production of Ref. 4968, the ‘Diamond Ribbon’ watch, a unique way of setting diamonds inspired by a gymnast’s ribbon.
The new microsite has a primary focus on education with the assumption that ladies need to be educated on watchmaking. The initiative could well be a retort to fashion houses like Dior or Chanel which have been producing watches with a predominantly aesthetic criteria, but the new Patek Philippe fails if compared to other established luxury watchmakers, some of which have taken a more sophisticated approach. Omega, Longines and Audemars Piguet have long had initiatives targeting ladies watches, through exclusive events, celebrity endorsements etc.
One such recent initiative is Longines’ 20 year multi-million dollar sponsorship of Fédération Equestre Internationale (FEI), an agreement signed between FEI President HRH Princess Haya and Mrs Nayla Hayek, Chair of the Board of Directors of the Swatch Group, which owns Longines. The new collaboration establishes Longines’ consistent and coherent focus on equestrian, being already the official sponsor of Prix de Diane, one of the most prestigious equestrian competitions worldwide.
According to the fashion related website, CPP-LUXURY, at times, overshadowed by the excessive coverage on China, several important international luxury markets have shown solid growth in 2012, defying worldwide volatile economic conditions. These markets have been showing great potential not only for the retail sector but also for hospitality, yachting and travel, with an increased appetite for luxury and with a strong motivation to buy locally rather than abroad. Read the rest of this entry »
For all those who like investigative literature, Agatha Christie, the best-selling novelist of all time according to the Guinness Book of World Records, will be re-branded.
As PR Week says,
The company behind the Agatha Christie brand is looking to drive the 125th anniversary of the writer through new comms help and a range of partnerships.
The PR company which will commemorate 125 years of Agatha Christie is Four Colman Getty.
Along with corporate comms, Four Colman Getty’s brief is to co-ordinate PR activity across all programme strands, including books, film, online games and television.
The agency will be looking to pair up with companies in the cultural, travel, luxury lifestyle and food and beverage sectors in an effort to bring the brand to wider audiences, both nationally and internationally.
1. Chasing after someone who never did, and never will, care about you in the same way.
2. Choosing to stay home on a night that ended up being an incredibly sweet adventure that everyone is going to talk about around you for the next 23409823409 years.
3. Going out when the evening ended up being a total bust and you spent the entire time sitting in the corner wishing you could be at home with your smart, sexy, loving laptop.
1. Communication should start with humble listening, not boastful talking
Especially at a time when communication is becoming more and more about conversation on social networks, succeeding in this new Asian age demands listening and thinking with an open mind attuned to modern Asian sensibilities, not just talking and bulldozing ahead with traditional Western approaches.
2. What works in America or Europe doesn’t necessarily work in Asia
It’s a common sense point, isn’t it? But time after time, I see public relations effectiveness in Asia needlessly compromised by presuming that the way PR is done in New York or London will be effective in Tokyo or Hong Kong. Whether it’s how media relations is conducted or the way that communities form on social networks or even how people use language to communicate, the Asian experience can be markedly different than Western ways.
3. Asia is not a country
Indeed, as far as PR campaigns are concerned, there really is no such thing as a market called ‘Asia.’ It’s amazing to me the cookie-cutter assumptions I sometimes encounter about doing PR here; as if what works in China will work in India even though within each, there is an incredible degree of demographic, cultural, and linguistic variation.
4. Asian PR merits serious investment
Communicating with such diverse constituencies can command considerable PR resources, because operating in multiple languages takes much more staff time, which costs more money. When you consider the economic pressures of rising salary expectations in countries where the GDP is growing (not to mention high inflation levels in many markets), then higher prices than one has historically expected of Asia can be anticipated.
Stereotypes should not set PR budgets; Asian PR can already seem expensive compared to what many have assumed in the past. I’ve seen no shortage of situations where someone thinks that if PR costs a certain level in the West, then it should surely cost much less in the East, where ‘there’s much more cheap labour to go around.’ The problem is, in many Asian countries, PR is a relatively new or emerging field of endeavour, meaning that there’s a large demand for a much smaller supply of experienced PR people, driving prices up. Then there’s the expectation that all PR staff must be fluently bilingual in an international firm, in markets where often huge majorities of the population do not speak English, meaning all the recruitment demand fishes in a tiny bilingual talent pond that further steepens the cost spiral.
5. Quality is the thing
There is a lot of restless multinational PR money roaming around Asia, switching from one agency to the next, fed-up with mediocrity and looking for certainty of positive outcome across borders. In some Asian markets, there are few or not enough post-secondary institutions offering PR education, so the smart firms are taking matters into their own hands and building their own training capability. Education must be at the heart of building a premium PR brand in Asia. As especially friends in North Asia will remember, setting the PR standard for quality is my #1 priority. I often remind myself of what one of my Korean clients once told me: “Aim for the money, and quality suffers; aim for the quality, and the money will always come.”
6. English fluency is no guarantee of success
In many Asian PR offices, the best writer in the language that matters in the market may not communicate in English so well. When I ran offices in Seoul and Tokyo, some of our best media relations people couldn’t speak much English but the clients sure loved the publicity results. English fluency is no guarantee of a great strategic mind, and there can be these apple-polishing bilingual poseurs who manage overseas audiences well in the language of convenience for head office.
7. Forget the cultural condescension
Partly because English is a second language in Asia (meaning many PR people may not be so keen to challenge and engage in fast-moving debate in English at meetings and on conference calls), there is still this widespread sense that Western PR is somehow superior to or more advanced than Asian PR, but in my experience that’s not objectively valid nor relevant in most circumstances. I don’t know how many times I’ve seen loquacious foreigners come to Asia with the attitude that the Asian PR people are a relatively ignorant audience whereas they are like oracles. A more peer-to-peer approach always earns the most goodwill. Let’s also note that Asia is now teaching PR lessons of its own, as we see with the worldwide rise of ‘apology communications.’
8. Asian PR citizens of the world
A few years ago when I was running the Korean operation of another agency, I attended one of its meetings in Washington, DC when I made what I regarded as a statement of the obvious: “The global PR firm that attracts and champions the Asian talent will be the PR firm that wins in Asia.” I was challenged on that point by someone there, and was told that “the Asians look to the expatriate for leadership.” It was ironic to hear that kind of outdated talk, because my Korean successor was sitting in the room with me, and I think a key reason our office was the fastest-growing at that time in our company was the fact that the Korean staff knew he would be taking over after my two-year term and felt highly motivated by that eventuality (he and they went on to grow the business bigger than it was during my tenure).
There have been some stories lately about how because of ailing Western economies, job-seekers are heading East to Asia looking for opportunities. I don’t doubt it, but actually there have always been plenty of people heading to Asia; in the PR world, the flow in the other direction has been more like a trickle.
The Asian going West in an international PR firm — more so than vice-versa in my experience — can face many obstacles: stereotypes about whether people from their country can do well in the target country, assumptions about their ‘quality level’ (see above), questions about their language capability, whether they will find ample client business to fund their relocation, how adaptable they will be to a new cultural context, etc.
The priority must be on achieving diversity, not conforming to be the same. That’s why cross-border transfers in our consultancy aren’t rare; they are routine – and sincere (i.e. not primarily designed to prevent people being poached by a rival firm).
9. Asia as a global platform
For many years, the dominant trend in Asian PR for multinationals was the import of Western money, ideas and people into the region, but now we we’re starting to see significant export of all these things from Asia by all kinds of exciting emerging multinationals (who will become globally famous from Asia for the first time on a digital marketing platform).
Just about every other week we see major Western multinationals anchoring important international headquarters and global functions into Asian centres like Singapore, Hong Kong or Shanghai. Some PR firms are seizing this opportunity and putting global functions into the region – such as the leadership of our energy practice based in Beijing – but alas others still have the attitude that anything ‘worldwide’ must of course be based in a Western centre like New York or London.
10. ‘Face’ is just as important as Facebook
Probably the most important perspective you gain by actually living in Asia over several years is an innate feeling for the all-important ‘face‘ dynamic. Time and again, I’ve seen Westerners make costly mistakes in Asian commercial situations because they just don’t get it. In my opinion, grasping and mastering ‘face communications’ is the most important thing to know about doing PR in Asia.
I can’t write any blog on this topic without mentioning the value of relationships, which I think tend to have a different and often a more durable dynamic in Asia. During an era when a world with a shrinking attention span is embracing the transactional ways of fast-moving cool ‘digital’ technology, there is a special significance to the warmth of face-to-face ‘analogue’ relationships that stand the test of time.
Generally when doing business in Asia, I think the feeling is more ‘relationship first, contract second’ rather than ‘contract first, then relationship.’
Compared to what I knew working on the other side of the Pacific where needlessly aggressive and often angry e-mail communication is certainly not uncommon, here I find relatively friendly – if often spirited – face-to-face encounters are more the norm when it comes to solving disputes and finding common ground.