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    Hermes: Customize Brand &Nbsp For Chinese Market; Take "China Road".

    2011/7/21 10:09:00 72

    Hermes Custom Brand "China Road"

    Recently,

    Hermes

    The sale of French fashion brand JeanPaulGaultie was finally settled.

    According to foreign media, Spain

    fashion

    Puig, the seventh largest perfume manufacturer in the world, finally purchased 45% of the market from Hermes by 16 million euros.


    At the same time, Puig will repay 14 million euros.

    debt

    The equity pfer and debt repayment brought about a total return of 30 million euros for Hermes.


    In addition, Puig bought 15% of the stake from Paul Gautiye, founder and designer of Charles tall, and eventually Puig owned 60% of the shares of the high tier, leaving Paul Gautiye to retain the remaining 40% stake.


    According to the news, the death of Hermes CEO Jean Louis Dumas has led to a breakup of cooperation between Hermes and Jean Paul Gautiye for more than a decade.

    As early as last year, Jean Paul Gautiye resigned from the position of creative director of Hermes and joined the L Or al group.


    In 1999, Hermes purchased a 35% stake in high tier and raised its stake to 45% in 2008.

    Sales in 2009 fell 19%.

    Although sales rebounded last year, it is still a net loss.

    Hermes announced its sale in April this year.


    Later, potential bidder including Japanese cosmetics company Shiseido and Puig eyed the tiger.

    Founded in 1982, Gago's revenue is mainly based on franchise fees. Perfume is the core and most profitable part of its brand. The perfume business accounts for 80% of the perfume business. This partly explains why the brands are eyeing them.


    In an interview with luxury industry analysts, he pointed out: "the sale of LVMH is more for the sake of earning a considerable income. Before being attacked by the foreign invasion of the LVMH group and being controlled by Bernard Arnott (BernardArnault) for more than 20% of Hermes, Hermes has begun to redeploy itself."


    Customize brand for Chinese market


    China's position in the global luxury market has become very important. The large number of coveted luxury brands has increased their capital and the Chinese market is a natural move.

    Honorable, such as Hermes, is specially tailored for the emerging market of China to brand new and top brands, so as to fully swallow the "fat meat".


    However, in the initial stage of China's luxury brand, it is entirely up to the Chinese designers team to design and advocate the "up and down" of the Chinese elements, whether it can be accepted by consumers. Whether the "up and down" brand can safely pass the "breeding period" remains to be tested by the market.

    What is more serious is that the launch of the sub card may also lead to the loss of the global customers of Hermes.

    Hermes's "reverse innovation" is still a huge question mark before consumers.


    For the entire luxury industry, the strategic significance of Hermes to launch a new brand "up and down" for China is that it has opened up a new way for the global luxury brand to fully occupy the Chinese market -- cultivating brand.


    And Hermes has set up high-end brands for China, which is the first step in the history of China's luxury market development.

    But the introduction of original brand products in China can bring luxury brands with huge sales results. Why should we invest a lot of money and energy to cultivate the brand in the market where China's local luxury brands are still in its infancy?


    Ouyang Kun, China's chief executive of the World Luxury Association, said in an interview: "now Chinese consumers are still blind to the choice of luxury brands, but there will always be a balance in the cultural foundation of luxury choice in the future. Many consumers will return to the Chinese elements and the spirit of China. By that time, luxury brands will be pferred in a rather late direction, while China is not able to create an international luxury brand.


    At present, 90% of China's luxury consumption comes from consumption of foreign luxury brands.

    China's luxury brand is still a vacancy, but in Ouyang Kun's view: "in the future, some consumers will return to local brands, which is a great opportunity for luxury companies. Moreover, the move of Hermes will lead more luxury merchants to follow suit, and it will also lead to the emergence and development of Chinese local luxury brands."


    "Half blood" takes China Road


    No matter how forward-looking the launch of Hermes is, it is difficult to avoid the possibility of losing customers.

    According to the psychology of consumers' luxury consumption, luxury brands are often just symbols, highlighting their noble status.

    Although the positioning of "up and down" in China is high-end, the average price of its clothing and capes is five thousand or six thousand yuan.

    Extravagance is not comparable to Hermes.

    Will the side card weaken the positioning of the main card?


    Nevertheless, Hermes chose to swallow more market share in China in the future.

    In order to better cultivate "up and down" and balance its relationship with Hermes, Hermes has adopted an independent operation system for "up and down" in order to make strategies and implementation more flexibly.


    At present, "upper and lower" and Hermes are divided into two companies in Shanghai, each with separate market and public relations departments.

    But Hermes has injected his spirit into the "up and down".

    As we all know, the noble lineage of Hermes is due to the preservation of tradition: tradition of handicraft and inheritance of history and culture.

    Hermes China's "up and down" will also uphold this essence, the product is made by the best craftsmen in China, and it can find the lost history and culture of China, which are all very scarce.


    The incubation period of a brand is not an easy journey. It is bound to face many challenges.

    The "up and down" brand of French and Chinese "mixed race" brands can continue steadily in the market, and sticking to the implementation of Chinese elements is crucial.

    "Otherwise, it is only a simple brand grafting, and its success is unlikely."

    Ouyang Kun said.

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