BALLY Global CEO Fr E D Ric: How Should The Luxury Brand Be Younger?

The rules of the industry have been broken. Now, over 160 years of Swiss luxury brands.

It is also determined to become younger and embrace a new generation of young consumers.

According to the world clothing and shoe net, in June 29th, BALLY Global CEO Fr e d ric de Narp appeared at the Beijing conference and announced that Chinese actress Tang Yan was BALLY's first Asia Pacific region.

Spokesperson, and for the first time, released the 2017 autumn and winter series of new advertising blockbusters that Tang Yan shot in London in May this year.

Regarding the choice of Tang Yan as the brand's first Asia Pacific spokesperson, Fr e d ric de Narp said in an interview with reporters that Tang Yan, as a very successful actress, has a high popularity in China and even Asia. Her optimism is consistent with the idea of happiness and luxury now advocated by BALLY, and BALLY can better approach young Chinese consumers through cooperation with Tang Yan.

As of press release, BALLY official micro-blog announced that Tang Yan had posted more than 180 thousand of the posted message for the brand Asia Pacific spokesperson, which reached a record high and received over 5000 comments and commentaries.

The picture is BALLY global CEO Fr e d e ric de Narp, Tang Yan, Anita Yang and Brice Baudoin.

BALLY, founded in 1851 by Swiss gentry Carl Bally, is a Swiss luxury brand founded by shoemaking. With its rigorous manufacturing technology and exquisite design, it has grown into a highly creditworthy luxury brand and entered the Chinese market in 1986. It is the first luxury brand to enter China, and is currently holding by JAB Holdings, the European Investment Group.

In 2008, JAB Holdings acquired the full stake in BALLY from the Texas Pacific Group at a price of about 700 million Swiss francs, but under the influence of the global economic crisis, the growth of BALLY's performance was at a standstill. JAB

In order to bring BALLY back to normal as soon as possible, the group hired Harry Winston former chairman and chief executive Fr e d ric de Narp as the brand Global CEO in 2013 to identify the position of BALLY in the luxury market.

After a series of reform and reorganization measures, BALLY began to resume growth in 2014.

Before joining the Harry Winston, Fr e d ric de Narp worked for Cartire for 18 years, serving as a luxury retail executive in Japan and Europe.

In 2005, he was pferred to New York as chairman and chief executive officer of Cartire North America, and then joined Harry Winston in 2010.

Data show that the annual sales growth in the 2016 fiscal year is 4%, the profit before the depreciation and amortization is increased by 100%, and the wholesale channel sales have increased by 20%. Among them, the tourism retail department responsible for airport duty-free shops has the strongest growth. However, Fr e d ric de Narp declined to disclose further figures, but said that the brand annual sales will be the 1 billion euro club in 2021.

When asked whether the strategy of youth and BALLY would be inconsistent with the 166 year old history and the concept of luxury goods, Fr e d ric de Narp said that BALLY has been breaking the rules from the beginning, and is leading in many respects. It has achieved internationalization one hundred years earlier than other brands.

In 1870, BALLY's products had already spread to every continent in every country of the world, while other brands could only achieve such a level in 1970. The younger and digitalized pformation is just the expression of BALLY's keeping pace with the times. There is no conflict.

Fr e d ric de Narp also stressed that constantly creating surprises for consumers is what the younger generation of consumers expected. This invitation to Tang Yan as the brand's first Asia Pacific spokesperson is also one of the surprises brought by BALLY to consumers. It also reveals that there will be further cooperation between the following BALLY and Tang Yan.

It is noteworthy that Fr e d ric de Narp found that after the definition of brand positioning, the original consumer group of BALLY did not leave because of the brand younger changes. Instead, more and more new consumers were constantly joining. This is one of the reasons why BALLY has been growing steadily in recent years.

According to statistics, the proportion of post-90s and 00 in the luxury goods industry is 27%, which will expand to 40% in the next ten years.

In addition to being younger, digital pformation is also one of the key development strategies of BALLY at this stage.

It is reported that the brand BALLY.cn, fully owned by BALLY, has been officially launched in China last month.

Unlike other luxury goods chosen to enter the third party e-commerce platform, Fr e d ric de Narp, in an interview with reporters, said that it would not choose to cooperate with local businesses such as Alibaba. BALLY hopes to control the channel of its business by itself, so that consumers can buy quality assured BALLY products with ease.

BALLY's China official website began operation last month.

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At present, BALLY official website has already opened Alipay payment channels, and will also connect WeChat payment in the future, and there will be new initiatives in WeChat stores.

Fr e d ric de Narp points out that the goal of the next stage of BALLY is to achieve full channel retailing, that is, to provide consumers with a seamless experience from offline to online, and to flexibly mobilize global retail stores to satisfy consumers' needs as much as possible.

In addition to China, the official website of BALLY has landed in countries such as Britain, France, Germany, Italy, Switzerland, the United States and Japan.

When it comes to how BALLY will achieve its goal of entering the 1 billion euro club in 5 years, Fr e d ric de Narp says BALLY has three important points to achieve this goal:

First, on the market side, BALLY hopes to achieve balanced development in China, the United States, Europe, Japan and the Asia Pacific region.

Fr e d ric de Narp compares these areas to the 5 engines of BALLY. Keeping balance is conducive to the better expansion of BALLY, but at present, the Asian market, including China and Japan, remains the first home of BALLY.

Fr e d ric de Narp believes that the number of Chinese middle class, including the high salary class, will maintain a high growth rate before 2030, and China will be the center of the future luxury market.

BALLY currently has about 60 stores in China, all of which are directly owned by the brand.

Chinese consumers accounted for 54% of brand sales last year, and nearly half of BALLY products were bought by Chinese consumers each year.

Second, in terms of customer groups, BALLY is trying to balance the number of male and female consumers.

It is reported that Chinese male consumers rank the top five among all luxury brands, while female consumers rank the top ten in the BALLY brand, but BALLY is still predominantly male in China.

In this regard, Fr e d ric de Narp indicates that most Chinese male consumers expect to build a reliable and trustworthy image through BALLY's clothing, which is related to the brand culture that BALLY has always molded, so male consumers have higher loyalty to BALLY.

As for China's female consumers, Fr e d ric de Narp said that although their brand loyalty to BALLY is not too high, they always change in different brands, but this also means BALLY has great potential and opportunity in the female consumer market. After all, most of the luxury consumers are women, and BALLY is originally made up of women's shoes, but later it has deviated. But in the past two years, the focus of development has gradually returned to women's products.

At present, BALLY sales of women's clothing account for 37% of the total business. Fr e d ric de Narp hopes that this proportion will increase to 50% to 55% by 2020.

The third is the product category. Fr e d ric de Narp indicates that the current source of income of BALLY is mainly accessories such as handbags and so on, accounting for 50%, while footwear sales account for 45% of the total sales, and only 5% of the revenue comes from ready-made garments.

In the interview, Fr e d ric de Narp also admitted that the price of the clothing series of BALLY is on the high side, and the brand will also be dominated by footwear products in the future.

According to the latest data, BALLY's sales of women's wear products in China have achieved double-digit growth, especially handbags and accessories. This is mainly due to the fashionable and modern design of BALLY products and the price advantage compared with other luxury brands.

It is worth noting that at the beginning of this year, foreign media reported that JAB group would withdraw from the luxury market and plan to sell JIMMY CHOO and BALLY.

In response to this news, Fr e d ric de Narp responded that with the gradual achievement of BALLY performance, JAB group and BALLY have reached a consensus that it is the best time to sell, and that it is time to pfer BALLY to those investors who are willing to invest more energy and enthusiasm for the brand.

Some analysts expect that the sale of BALLY will take place in the second half of this year, with potential buyers or Italian company coming from Chinese investors.

At the same time, BALLY is constantly adjusting its corporate structure. Its sales, creative, public relations and marketing departments in London will move to the Swiss headquarters Caslano near Milan, so that the company can centrally manage, improve operational efficiency and save operating costs.

The brand designer Pablo Coppola, appointed by Fr e d ric de Narp, has resigned at the end of last year. Its original design team is temporarily responsible for BALLY product design. In the interview, Fr D ric ric did not reveal the intention of the new creative director.

Reporter: what factors did BALLY consider when choosing the first speaker in the Asia Pacific region? Do you feel the pressure brought by younger luxury?

Fr e d ric de Narp: Yes, BALLY has long known that luxury goods are gradually becoming younger. This is also one reason why we decided to announce the brand spokesperson in the Asia Pacific region.

As far as I know, BALLY, founded in 1851, is the largest brand market since it entered the Chinese market in 1986.

As the first luxury brand to enter the Chinese market, BALLY has a relatively stable consumer group in China and even in Asia.

When we first decided to choose Asian spokesmen, we considered many factors. For example, our spokesperson should be very beautiful, elegant and very real.

In fact, we have no doubt about choosing Tang Yan. She is our only choice, because she can represent the value of our brand.

China is our first largest market, and BALLY is also the first luxury brand to enter China.

We also hope that we can choose the best Chinese women to endorse our brand.

In addition, Chinese consumers are also very confident in the BALLY brand. As the only luxury brand from Switzerland, the BALLY handmade quality, including the authenticity of the products, can withstand the test. There are very few fake commodities on the market.

Fr e d ric de Narp: in fact, since its establishment in 1851, BALLY brand has been constantly breaking the rules and is a leader in many aspects.

Creativity and innovation are very important in the development of BALLY.

Compared with other international luxury brands that we now know, BALLY has achieved internationalization one hundred years ahead of schedule.

In 1870, BALLY's products had already spread to every continent in every country in the world, while other brands could not achieve such a level until 1970.

In addition, we are also very advanced in cooperation with artists. BALLY had a sense of cross-border cooperation long ago, and invited many artists to design posters for brands, much earlier than today's luxury brands.

At present, the design of the flagship store is built by DAVID CHIPPERFIELD (DCA), which continues the logo design aesthetics of the brand global stores.

In addition, the young consumers have been pursuing the freshness and have high expectations for the creativity and innovation of the brand. This is what BALLY is trying to achieve.

The concept of happiness and luxury that BALLY is now advocating is very compatible with the concept of a new generation of young people.

The idea of happy luxury is that consumers can feel happy and satisfied while buying BALLY products.

In order to attract more millennial consumers, BALLY is trying to create a kind image.

Although the main young consumer group in China is male dominated, BALLY has started to focus on creating new products for women in China, hoping to sell more products to the female market. Tang Yan's high influence in Chinese female consumers is in line with our aspirations.

The era is progressing. The long history represents the stability of the BALLY brand foundation. It does not mean that BALLY has to stop. It is very important to keep pace with the times.

Most of the main audiences of Fr e d ric de Narp:BALLY are more avant-garde. As far as I know, the post-90s and 00 consumers account for 27% of the luxury goods industry, and the proportion will expand to 40% in the next ten years. Obviously, younger age is a luxury that must be experienced at this stage.

BALLY's loyalty to the brand is very high, because BALLY itself is a reliable luxury brand.

As far as I know, in the process of BALLY pformation, loyal consumers have not left, and new consumers are constantly joining, so there is no worry about the conflict between younger and innate audiences.

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Fr e d ric de Narp: in addition to being younger, digital pformation is also a step taken by BALLY at this stage. At present, our fully automated business platform has been formally launched last month, including in China.

We hope that through our own control of e-commerce channels, so that Chinese consumers can rest assured.

As long as customers login to our BALLY.CN website, we can ensure that we can buy quality guaranteed BALLY products. At the same time, we have opened Alipay on our e-commerce platform, then will access WeChat payment, and there will be new moves on WeChat stores.

In the next stage, we hope to achieve full channel retail, that is, the experience of consumers from offline to online is complete and seamless. It will flexibly mobilize global retail stores to satisfy consumers' needs as much as possible.

Fr e d ric de Narp: the Chinese market now accounts for more than 20% of our global sales, but in fact, more than half of our products are sold to Chinese people.

I am also very interested in Asia. When I was 17 years old, I began to understand the culture of China and Japan.

I think Asia represents the future.

We believe that by 2030 China's middle class, including the high wage class, will grow very fast every year, so we think China is the main force in the future luxury market.

I think BALLY has great advantages in China.

Accessories in our products account for half of the products, while Chinese consumers have great demand for high quality accessories from Switzerland.

Fr e d ric de Narp: since BALLY entered China, male consumers are the main audience of our brand.

Because men generally want to build a reliable image through clothing. BALLY's reliable brand image is exactly what they need, so Chinese male consumers are loyal customers of brands.

Although Chinese female consumers are not very loyal to BALLY brand loyalty, they always change in different brands, but this also means that we have great potential and opportunities in the female consumer market. After all, most of the luxury consumers are women.

Historically speaking, BALLY started out as women's shoes. In the past two years, BALLY has gradually shifted its focus of development to women's products.

During this period, BALLY's sales of women's wear products in China have achieved double-digit growth.

Last week, I learned from the brand stores in Chongqing, Shanghai and Beijing that the sales of BALLY women's clothing in China are also increasing, especially handbags and accessories, because the design of BALLY products is very fashionable and modern, compared with other luxury brands, it also has a great price advantage.

A few days ago, I just saw a report that male consumers in China knew the BALLY brand in the top five among all luxury brands, and women could reach the top ten, so this is also very good news.

At present, we are adjusting the proportion of men's and women's wear in each store. The proportion of women's clothing display in the shop has been raised to 45%. In the future, the sale of men's and women's clothing in BALLY can be balanced in China.

Fr e d ric de Narp: Yes, BALLY's wholesale business indeed increased by 20% over the past year, which is also very representative for us. Especially, the quantity and sales performance of the new products in the year of brand 17/18 are positive, representing the trust and confidence of our customers.

Because our wholesale channel customers need to buy BALLY products one or two quarters in advance, that is, the first half of the product's formal debut, for example, now the wholesale channel customers are buying our 2018 spring summer series products.

Therefore, the order can reflect the customers' confidence in this season, because they are not only the brand of BALLY, they have been exposed to all kinds of brands, and their fashion sense is very sensitive.

Therefore, it is very meaningful for BALLY to get their approval. It is also an indicator of the brand's next year's performance.

But at present, we only have direct outlets in China, and there is no wholesale business.

The wholesale business of BALLY is generally concentrated in South Korea, Macao and Australia.

In Europe and the United States, BALLY has entered many fashionable comprehensive stores and buyer shops. But 10 years ago, these stores were not willing to sell BALLY products for a variety of reasons. But in recent years, the attitude of these stores has begun to change, and they have begun to actively seek cooperation with us. This proves that BALLY has begun to regain the identity of consumers of fashion stores and buyers.

In addition, BALLY also has a tourism retail department specializing in the duty free business of BALLY airport. However, there is a certain difference between the products of the duty free shops at the airport and the products of the retail stores.

Fr e d ric de Narp: nine years ago, JAB acquired the brand of BALLY, and four years ago, they hired me as the latest CEO. So far, nine years ago, we have been the first time so far. JAB thinks that BALLY now has a very clear brand strategy, that is, happy luxury, including modern, inclusive and modern brand concept.

So we agreed with JAB that it is a good time to sell BALLY to the investors who are willing to devote more energy and love to BALLY brand.

Over the past four years, the overall size of JAB has also expanded four times, but now much of its focus is on consumer goods.

After four years of reform and reorganization, BALLY is ready for the next chapter.

Fr e d ric de Narp: to achieve this goal, we must achieve three points, one is in the market, China, the United States, Europe, Japan and the Asia Pacific region are the five growth engines of BALLY, our goal is to achieve balanced development in these areas; and another is in the customer community, we are trying to keep the number of male and female consumers in line.

At the same time, in terms of product category, BALLY's current income sources are mainly handbags and accessories, accounting for 50%, while footwear sales account for 45%, while only 5% come from ready-made garments.

We are actually a luxury shoe brand with a long history, but now more than 50% of the products are accessories. In the future, we will gradually shift our focus to footwear products, so as to maintain the balance between handbag accessories and footwear products.

Generally speaking, we are confident that the annual sales of 1 billion euros will be achieved.

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