Europa Star 333 - 5/2015

Page 50

WHEN THE BRANDS WANT A PIECE OF THE PIE Nevertheless, given the consolidation of the industry and its growing global reach, the landscape has changed significantly over the decades, as Christian Hübner points out: “Before, we had a more direct relationship with brands. We might decide to take a trip to Switzerland, turn up at the door and ask for a meeting with the CEO. Today the doors are less likely to be open. With the big multinationals, which is what the watchmaking groups have become, their organisation is also more complex.” Bearing testimony to the watchmaking companies’ desire to exercise greater control over distribution, the number of own-brand boutiques in the Austrian capital has soared. Some of the brands represented by Christian Hübner now have their own shopfronts, just a few doors down the street. How is he dealing with this new situation? “We can’t change things; we just have to live with this new competition. We have also embraced the change. In fact, for the last two years we have run JaegerLeCoultre’s Vienna boutique.” The retailer and the brand have found a way to make the relationship work for

50 | RETAILERS & DISTRIBUTORS CORNER | europa star

both parties. The boutique, for example, can take advantage of the back-office setup and watch sales experience of the multi-brand store. “It was difficult in the beginning, as we had to learn how to work in a mono-brand situation, but we are happy with it now. Running this boutique has also brought us closer to the brand. We have more meaningful dialogue, access to better information and quicker deliveries for our clients. The project has nevertheless meant a huge investment on our part.”

BREAKING DEPENDENCY ON FOREIGN VISITORS Who are the retailer’s clients? “Some of our customers have been coming to us for 30 years. I have an excellent relationship with these collectors. We make a great effort to ensure that at least two-thirds of our business comes from Austrian clients. In that way we can cover our costs with local trade, since they are more reliable clients. All it takes is an outbreak of bird flu and we won’t be seeing any more Asians for a while...” Other retailers in the vicinity, who rely heavily on foreign tourists for their custom, find they are vulnerable to geopolitical pressures, as Christian Hübner notes:

“At the moment, for example, we don’t see any Russians or Ukrainians, and they used to be good customers. Thankfully, there are more and more Asian visitors, particularly in the summer. They make up for the absence of Austrians during the summer holiday period.” He has nevertheless observed a difference in buyer behaviour depending on their geographical origin. While Austrians are more likely to shop at a multi-brand retailer, the Chinese prefer mono-brand boutiques.

2015: A GOOD VINTAGE As a consequence of this cautious approach to volatile foreign clientele, the retailer is less affected by a slowdown in sales from that quarter, and expects profits to continue to grow this year. The strong Swiss franc has also not had a significant impact: “I think that the Swiss watch industry had a panic reaction. In the space of a few days, watch prices skyrocketed. And yet these brands already have comfortable margins, of around 30%, which is not something you find in any other industry. I’d be happy with a profit margin of 10%!” In Christian Hübner’s view, customer service is what makes the difference these days. “In our shop it is possible to compare brands, and we advise clients on the models that suit them best. They demand reasonable value in return for the money they are intending to invest, and we are honest with them.” Another key element is regular communication. “We organise special events for our clients, and we publish our own newspaper, for instance.” p


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