A lifestyle statement

David Crickmore, CEO, Amouage speaks to Mayank Singh about the brand’s foray into leather goods, its retail strategy and his aspirations about being on the same table with internationally reputed luxury brands like Gucci, Prada and Louis Vuitton

When you took over as the CEO of the company, you embarked on a complete makeover of brand Amouage. How much progress have you made in that direction?
Every product in the collection has been rebottled, repackaged and rebranded. The new image has completely been established. In addition, we have launched some new fragrances like Jubilation, Lyric and Epic. We have increased our product category groupings, so now we have a full body and bath collection and an extensive home selection which takes the form of fragrance candles to room sprays. We have phased out some of our old fragrances but we have retained Gold, one of our best sellers and which is kind of our Chanel No 5. Amouage has also retained Deer and Reflection. In the men’s range we have kept Silver Cologne and for customers who like wearing lighter fragrances, we have kept Ciel for men and women. As we were going ahead on this journey we heard about fragrances like Ubar from the past that had been discontinued, but since there was a demand from customers, we relaunched them.

Amouage has forayed into various brand extensions. What are the reason for doing so and how have these been faring?
The bath and home products are extremely successful. They are getting greater acceptance in the Gulf markets as this is a new concept in the market. We recently launched our range of leather goods. All our leather goods are stamped with our Jackard designs. These are cut and created in Florence in Italy. Florence incidentally is the place where Gucci and Prada began. We import all our leather goods from them tailored to our designs. We take the top cut of a hide, which is the best quality. For a perfume house to launch a leather collection is quite strange, but perfume is a form of accessory and so adding other accessories fits in with the overall positioning of the brand. In a way we are also testing our consumers and our markets, as to whether they will accept us as a leather goods producer. The initial reactions have been better than I thought. This has given me the confidence to have further extensions to the line for the spring-summer next year.

When was the leather goods collection launched and what does the line include ?
We launched around three months back and the collection includes small leather goods such as wallets, purses, key case holders, business card holders, photo frames, cosmetic bags for ladies and men’s toiletries bags. We are extending the brand in product categories where it can grow organically step-by-step. It would be wrong for us to create a clothing collection because it would not be accepted. I am not saying that two or three years down we would not come up with a beautiful ladies scarves collection or silk ties or men’s cuff links. Brands have a stretchability factor and we need to see as to how far a brand can be stretched. Since we now have so many of our own retail shops and shop-in-shops, we can now test them out inhouse.

You are positioned as the king of perfumes. Can that brand promise be extended to the leather goods line where you compete with the likes of Louis Vuitton or Gucci?
We are nowhere near competing with Prada, Gucci and Louis Vuitton. We aspire to be like them and to give us inspiration for future development. These brands have been around from the turn of the last century and Vuitton has been around since the 19th century. Things do not happen overnight. Despite having a century old heritage, Louis Vuitton only started doing a clothesline in the last ten years. Our objective is to aim high and to sit on the same table as them, but not immediately. We are starting from a zero base; before we repositioned Amouage, it had very little consumer recognition outside the Gulf.

How much investment has gone into your foray into leather goods and how long will it take Amouage to start making a return on investment?
Our main investments have been on knives as leather requires steel knives, raw materials and the leather. When one enters a new category or product, one needs to have a longer time frame. Since big brands like Prada, Gucci etc are not available in Oman and if someone wants to gift a good leather product and does not have the time to nip up to Dubai, then we are the natural port of call.

Will such brand extensions eat into your profitability in the short term?
From the beginning we negotiated bare minimum rates with our manufacturers, so the leather goods collection was profitable from the day we started selling it, thus it has not eaten into our profits. I would not develop something that would take huge profits out of the business. I am proud to say that all these developments, including building a new factory, the planned new shop in Dubai Mall have all been done in-house without us having to seek further capital funding. So we are making our money work for ourselves and not just sitting and counting it as in the past.

How much are you investing in your new factory and when will it be up and running?
We are investing 2mn rials. It should be up and running in a year’s time. The new factory will enable us to reach our full forecast capacity till 2020. We currently produce 4500 bottles a month. The new factory will enable us to produce 20,000 bottles a month.

How have you strengthened your marketing and retailing presence in the GCC and beyond?
Our presence in the GCC was very shaky when I took over and the brand had begun to decline due to poor brand management and lack of investments. So we had to arrest that decline and protect our markets. We had to convince retailers and distributors to work with us while we went through the transition process. They also needed to believe that we would come out with a very saleable and desirable product at the other side of it. We are moving with our distributors in all the locations that we are placed. Paris Gallery in Dubai and Abu Dhabi; Modern Home in Qatar; Bedouin in Kuwait; and Al Felaij in Bahrain. We have either shops or shop-in-shops so we have an Amouage identified retail presence. In places where there is less space to build shop-in-shops there we have built moor bays.

So we have personalised our space in the region and we have one more year of work to do in the smaller spaces. Having a dedicated space helps us to tie in the retailer to buy our products to fill up the space and gives us a chance to put an Amouage expert to
sell the product.

What are your plans for 2010?
In 2010 we will be looking for a store in London to launch a fragrance and increase our leather goods line. We are working on an exclusive range called the Library collection and those will be marked as Opus 1, Opus 2 and Opus 3 and not given names. These are very unusual and complex fragrances. These will be limited and will appeal to a highly sophisticated audience in the way Chanel’s limited edition or Tom Ford’s special blend does. The edition will be available only in the highest prestige outlet or in our stores. It will be 30 per cent above our current range. Our current range costs 60 rials for a 50ml fragrance and for a 100ml it goes upto 135 rials. The Library collection will be priced 30 per cent higher but for a 120-ml bottle.

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