The lux­ury brand’s CEO ex­plains why Dubai is still such a vi­tal mar­ket

Gulf Business - - FRONT PAGE - By Neil King

For lux­ury brands across the globe, the bright lights of Dubai – and the dis­pos­able in­come of its res­i­dents – con­tinue to be a ma­jor draw. De­spite slow­ing eco­nomic con­di­tions across the GCC, the lux­ury mar­ket has con­tin­ued to grow and many brands see fur­ther op­por­tu­ni­ties in the UAE in par­tic­u­lar.

In­deed, fol­low­ing a study into the global lux­ury mar­ket, Herve Bal­lan­tyne – part­ner at Deloitte in the Mid­dle East – said: “The Mid­dle East rep­re­sents a big op­por­tu­nity for lux­ury brands. Lux­ury malls in Abu Dhabi and Dubai have helped put th­ese cities on the map for the in­dus­try, and the UAE as a whole con­tin­ues to en­joy strong growth.”

With such fer­tile ground for th­ese brands, Dubai re­mains the re­gion’s lux­ury epi­cen­tre, prompt­ing some well-es­tab­lished com­pa­nies to deepen their roots in the emi­rate.

This is cer­tainly the case for Ger­man man­u­fac­turer Montblanc, a brand renowned for its lux­ury writ­ing in­stru­ments, watches, jew­ellery and other high­end goods.

In Oc­to­ber the com­pany re­launched its flag­ship bou­tique at Dubai Mall, sig­nalling its con­fi­dence in the UAE’s lux­ury


mar­ket, and high­light­ing the value it places on the city’s com­mer­cial sta­tus.

“Dubai is def­i­nitely a very im­por­tant mar­ket for us,” con­firms Ni­co­las Baret­zki, Montblanc’s CEO, as we sit in the bou­tique’s ul­tra-com­fort­able VIP room.

“In fact, this par­tic­u­lar bou­tique is one of our top five bou­tiques in the world. We have 275 of our own bou­tiques and more than 500 with our fran­chise part­ners, and this one is in the top five. So it’s ex­tremely im­por­tant.”

The flag­ship store is now one of the few in the world that show­cases Montblanc’s most out­stand­ing and iconic items – some­thing Baret­zki says truly sets it apart from the ma­jor­ity of the brand’s other out­lets.

“What we are do­ing in Dubai is not just a bou­tique for us; we call it the High Artistry bou­tique,” he says.

“High Artistry be­cause th­ese are the few bou­tiques in the world where we re­ally show­case the high-end pieces of Montblanc. This is why you have here the ex­cep­tional Villeret watches, the ex­cep­tional lat­est High Artistry writ­ing col­lec­tion, and the limited edi­tion and very ex­clu­sive – and ex­pen­sive – pieces.

“Even this VIP room we have, we wanted peo­ple to be able to come, sit com­fort­ably, talk and look at dif­fer­ent items in peace. I think our cus­tomers re­ally ap­pre­ci­ate that – es­pe­cially cus­tomers from the re­gion.”

The launch of the flag­ship bou­tique comes af­ter dif­fi­cult times for the re­gion’s lux­ury mar­ket, which has slowed in re­cent years on the back of low oil prices, high gold prices and an in­creased cost of liv­ing. But re­cent per­for­mance has been en­cour­ag­ing, with Deloitte Global’s Global Pow­ers of Lux­ury Goods 2017 re­port show­ing that 70 per cent of con­sumers in emerg­ing mar­kets – the UAE in­cluded – have in­creased their spend­ing on lux­ury brand shop­ping.

And Baret­zki is pleased with Montblanc’s per­for­mance over the past year, de­spite the chal­lenges much of the in­dus­try has ex­pe­ri­enced.

“Last year was clearly a dif­fi­cult year for the lux­ury in­dus­try, but Montblanc was quite well pre­served from that,” he says, adding that it was iden­ti­fied as one of the top per­form­ing brands for par­ent hold­ing com­pany Richemont last year.

He con­tin­ues: “We still had a nice growth even in that dif­fi­cult con­text, which is very en­cour­ag­ing. And I don’t see a de­crease of busi­ness in Dubai – in fact I see a nice devel­op­ment of busi­ness here. Not only with Mid­dle Eastern cus­tomers, but In­dian cus­tomers, Euro­pean cus­tomers, Chi­nese cus­tomers and many more. It’s still a very vi­brant city – a city where busi­ness is do­ing well. Be­ing a tourism hub is very im­por­tant and the weak­en­ing of the US dol­lar has also made it a very at­trac­tive place to shop today.”

Speak­ing with con­fi­dence about the com­pany’s strat­egy in Dubai, the CEO adds that there is a pos­i­tive at­mos­phere within Montblanc re­gard­ing fu­ture growth in other mar­kets – largely borne out of its suc­cess­ful en­try into coun­tries such as India and China.

“We have al­ways been a lux­ury mai­son to en­ter new mar­kets or growth mar­kets at a very early stage,” he says. “For ex­am­ple, Montblanc was the first of­fi­cial lux­ury mai­son to im­port goods into India – 24 years ago. We were the first ones to ob­tain the li­cense to do that. And that story has cre­ated that no­tion of reach at Montblanc – we be­lieve we have to be where the cus­tomers are. It’s im­por­tant for us to be in all the key cities.”

With a pres­ence in 68 cities in China, six cities in India, and many more cities across emerg­ing and ma­ture mar­kets, Baret­zki aims to con­tinue this hith­erto


suc­cess­ful ap­proach in the months ahead.

“Strate­gi­cally in the re­gion we are very much fo­cus­ing on India, which is an im­por­tant mar­ket for us,” he adds.

“We are also fo­cus­ing on Saudi Ara­bia, and we have quite a few pro­jects com­ing up in the next six months.

“And then there is Africa. This mar­ket is re­ally open­ing up and now is the right time to en­ter. And we will do that in our way – en­ter­ing and creat­ing bou­tiques, show­ing who we are, and ed­u­cat­ing so that in 10 to 15 years we will re­ally see the ben­e­fit.

“The last part is Iran, which is also a big mar­ket – a big pop­u­la­tion. The mid­dle class is com­ing up there and I think it will be a big mar­ket in the fu­ture.”

It’s not just new mar­kets the com­pany is look­ing into. There has also been a sig­nif­i­cant move into a dif­fer­ent prod­uct seg­ment of late, with the brand’s first smart­watch – the Sum­mit – be­ing launched ear­lier this year.

And while much has been made of the ri­valry be­tween dig­i­tal and analogue time­pieces, Baret­zki be­lieves there is not only room to co­ex­ist, but lots of in­no­va­tive ways to ex­plore hy­brid watches in the fu­ture.

“Per­haps it’s a bit of my mil­len­nial think­ing – even though I’m not ac­tu­ally a mil­len­nial – but I bridge analogue and dig­i­tal very eas­ily. I don’t think they op­pose. I just think they fit dif­fer­ent parts of your life. A dig­i­tal watch is ex­tremely use­ful and fun, and at the same time I come from the watch in­dus­try and am a big lover of watches.

“We don’t fore­see the end of tra­di­tional watches – we ac­tu­ally want to de­velop fur­ther th­ese kinds of watches. But Montblanc is a lot about in­no­va­tion and is some­times about be­ing dis­rup­tive. So it was im­por­tant that we could have our say in this area, and that we did it in our own way.

“What we did with the Sum­mit watch is that we came up with a real watch case. We were the only ones to have this Bom­bay sap­phire glass, and to use all the codes of watch­mak­ing. We then bridged it with the func­tion­al­i­ties of the dig­i­tal move­ment. While ev­ery­body else was more into sport, we used a vin­tage dial from the 1858 col­lec­tion; we were the only ones to have this kind of ap­proach. And the re­sponse was ex­tremely good.”

De­spite be­ing some­what coy about

fu­ture smart­watch plans, the CEO em­pha­sises his be­lie that there is a lot of po­ten­tial in the dig­i­tal-analogue cross­over, es­pe­cially when bring­ing in new cus­tomers.

“I hope we have brought some more mil­len­ni­als and younger cus­tomers to the mai­son, and that even­tu­ally we will be able to con­vert them to a tra­di­tional watch,” he says.

Another po­ten­tial shift in the com­pany’s tar­get cus­tomer could see women given more op­tions at the tra­di­tion­ally male bou­tique – a pos­si­ble move driven by the fact that 40 per cent of traf­fic through the brand’s doors is fe­male.

“The ladies who come to our bou­tique are mainly buy­ing for their hus­bands and sons, but I do be­lieve that if we have the right of­fer for ladies it could be ex­tremely suc­cess­ful,” says Baret­zki.

“We just started the launch of the Mar­i­lyn Mon­roe edi­tion writ­ing in­stru­ment, which is a very strong pres­ence in­spired by the fa­mous red dress of Mar­i­lyn. I think it would be a shame to have such a large crowd of women in our bou­tiques and not of­fer any op­por­tu­nity to look at some­thing for them­selves.”

But while it might ap­pear that Montblanc could be on the verge of a new era, don’t be fooled into think­ing that the com­pany isn’t used to mak­ing bold steps in new direc­tions.

In­no­va­tion is clearly an im­por­tant part of Montblanc’s DNA, and while change is in­evitable in this re­spect and many oth­ers, the key to en­sur­ing its suc­cess is in con­ti­nu­ity. A point well il­lus­trated by the CEO him­self, who was el­e­vated to the top job in April, hav­ing served three and a half years un­der his pre­de­ces­sor, Jérôme Lam­bert.

“I’m quite lucky be­cause I’ve been with the com­pany for four years, so I feel like a had a lot of op­por­tu­ni­ties to work closely with the former CEO, and in that re­spect there’s a lot of ex­cite­ment to be able to con­tinue the past,” Baret­zki ex­plains.

“I’ve been part of the de­ci­sions in the past for years, so it’s not like I want to change ev­ery­thing. But at the same time, Montblanc is about con­stantly in­no­vat­ing, con­quer­ing the seg­ment, en­ter­ing into new mar­kets.

“I want to con­tinue to in­no­vate and I want to con­tinue to change and bring new sur­prises to the mar­ket. That’s my goal and that is what I will be fo­cus­ing on in the com­ing years.”

The ex­act na­ture of th­ese sur­prises re­mains a closely guarded se­cret, but Baret­zki does re­veal a few hints as to their di­rec­tion.

“Def­i­nitely the High Artistry is some­thing very im­por­tant,” he states.

“I be­lieve that it’s an im­age driver and a great demon­stra­tion of our ca­pa­bil­i­ties when it comes to crafts­man­ship. I want to de­velop that high-end seg­ment – I think it’s ex­tremely im­por­tant.

“I also be­lieve that the mai­son is trans­form­ing and that leather is be­com­ing more and more im­por­tant – bring­ing that touch of lux­ury life­style that will be im­por­tant to the fu­ture of Montblanc. It will be im­por­tant in re­cruit­ing mil­len­ni­als and build­ing that re­la­tion­ship."

One other ma­jor fo­cus for the CEO and his com­pany will be the re­centlyan­nounced Montblanc mu­seum – due to open in Ham­burg, Ger­many, in 2020 – a project that Baret­zki says will cham­pion the art of writ­ing ap­pa­ra­tus.

“The Montblanc Mu­seum – what we call the Montblanc House – will bring a link to art, to ed­u­ca­tion and to the his­tory of writ­ing, and will ex­press why writ­ing in­stru­ments are mean­ing­ful, and why mil­len­ni­als should con­sider us­ing a writ­ing in­stru­ment for more than just its func­tion.”

In­deed, as we part com­pany, Baret­zki is con­fi­dent about the fu­ture of high-end writ­ing tools, even as we sink deeper and deeper into the world of smart tech­nol­ogy.

“I hope and I be­lieve that writ­ing in­stru­ments will be­come more and more im­por­tant – even though we are all on our dig­i­tal tablets and phones,” he says.

“If you want to have sin­gu­lar­ity, if you want to show that you are maybe a bit more el­e­vated, a bit more cul­ti­vated, writ­ing can be a very im­por­tant way to dif­fer­en­ti­ate your­self.”

There’s no ques­tion that Montblanc has con­tin­u­ally found ways to dif­fer­en­ti­ate it­self over the years, and with Dubai’s new flag­ship store al­ready un­der his belt, Baret­zki clearly in­tends to take the com­pany to ever higher peaks.

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