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The global fashion business journal

18 Jul 201913:24

P. Paolo Righi (Karl Lagerfeld): “It’s good to listen to the consumer, but you have to anticipate him”

Pier Paolo Righi is chief executive officer at Karl Lagerfeld, the brand that the German designer, who also leads Chanel’s creative direction, prompted in 2011.

28 May 2018 — 10:00
Iria P. Gestal/ L. Molina
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Pier Paolo Righi (Karl Lagerfeld): “It’s good to listen to the consumer, but you have to anticipate him”

 

 

Although his name and accent reveal that his DNA is Italian, Pier Paolo Righi was born in a small town in Germany. He says that with Karl Lagerfeld he has found a company to put to work the sensibility he inherited from Italy with German efficiency in management. Righi joined the designer’s project in 2011 to launch his independent brand, after working for more than a decade in international groups such as Nike and PVH Corporation. From his time in the sportswear juggernaut he learned the importance of thinking out of the box and going one step ahead of the client to “take him to places he didn’t even know he wanted to go to”.

 

MDS: With fashion retail sales falling down, is it a good time to enter Spain?

Pier Paolo Righi: Probably the best. When the client doesn’t know well where things are going, a new brand, with a good history, can stimulate the consumer and the market. The response that we’ve seen for now of the retailers has been very good precisely because it’s a novelty.

 

MDS: The mid-market suffered the most during the economic crisis and now premium brands are among those that grow the most. What has changed?

P. P. R.: The market as a whole went through crises in several countries, like in Russia, conflicts in the Middle East, China’s growth slowed down... But the good thing about global brands is that after such a context there’s always a new peak that makes up for it.

 

MDS: What is more important for being successful in mid-market fashion: brand, product or price?

P. P. R.: Product quality and brand are important, as well as the way it interacts with the customer. But perhaps the most important thing is to tell a story and create a conversation with the client. It’s not the product or the price but a mixture of everything: a strong brand, translated into a quality product, a conversation with the customer and all at a reasonable price.

 

 

 

 

MDS: In many of your interviews, you talk about conquering the millennial consumer. How come?

P. P. R.: Karl connects with a very broad audience, and is very relevant, in particular, to people in their twenties or even younger. He never stops, is self-assured and always one step ahead... In that sense he’s a role model for young people and it’s very relevant for them, who always look for the newest. For us it’s a key asset because we can translate all these values ​​into the brand.

 

MDS: Could it become a burden the fact that the brand is so linked to a public figure?

P. P. R.: It’s not a burden but a blessing. In fact, our biggest advantage is that we don’t have to invent anything. When Karl works for Chanel, he’s to interpret everything though the brand’s point of view, while in his brand it’s just his own DNA. It's just about translating the person values to the firm, and that creates great opportunities.

 

MDS: Michael Kors buys Jimmy Choo, Coach acquires Kate Spade ... Tends the premium market to concentrate on fewer hands?

P. P. R.: When companies reach a certain size, they start thinking on how to face the next growth stage. It can be organic, but when you’re as big as Michael Kors, the options to grow organically are reduced. So I think there will always be a desire to buy but, at the same time, this kind of independent, emerging brands that aren’t controlled by a large group and have their own vision will always exist. It would be a shame if it wasn’t like that.

 

 

 

 

MDS: What is the difference between working for a large group listed as PVH and for a designer brand?

P. P. R.: A key reason in my decision to choose a different path is that I wanted to work for an individual designer with a personality and an almost-entrepreneurial approach. In this type of company, it’s all about understanding the creative sensitivity and combining it with a professional brand management. Create something in an emotional way and then structure it. I’m half German, half Italian, and in some way this business model is the last of my shoe.

 

MDS: Who puts more pressure, the stock market or a creative individual as an owner?

P. P. R.: The greatest pressure is always to succeed, regardless of where it comes from: the market, the blessing or appreciation of Karl, the employees ... I feel a positive pressure to be successful for all stakeholders, it’s the essence for which I do what I do.

 

MDS: What did you learn during your time at Nike?

P. P. R.: That good is not enough, you’ve to think out of the box and take the client to a place where he didn’t even know he wanted to be. This mentality is what I loved about Nike. It’s great to listen to the client but you’ve also to address him in some way, otherwise you will end up at the same point. And this is Karl too: he looks at what is around him, but not only listens passively but leads and pushes him.

 

MDS: Big data then does not work at all?

P. P. R.: The use of big data is always in retrospect, but it doesn’t give you a clue on how these analytics will be in one or two years. You need to be creative to think about where you want to take people based on data. Big data is extremely important, but creativity is also important. People would die of boredom if we always gave them the same thing or what they already know.

 

 

 

 

MDS: What does an industrial partner like G-III Apparel Group bring?

P. P. R.: It’s been a blessing. We have partners who, in addition to equity, provide knowledge, sourcing contacts ... They are business facilitators, and that was particularly important during the company’s early years.

 

MDS: Since G-III came on board as shareholder, it already showed its intention to get a majority stake. Is it something planned in the short term?

P. P. R.: The group sees that the business is growing, so of course they’re interested in acquiring a larger share, but the terms aren’t defined.

 

MDS: While luxury companies are taking more and more control of their business, Karl Lagerfeld continues to opt for external partners, why?

P. P. R.: It depends on what level you are in the market and how good the potential partners are. With Via Emilia, for example, they are experts. If we entered directly into Spain, we would have to set up a subsidiary in the country and it would take us years to reach the level of knowledge they have.

 

 

 

 

MDS: Karl Lagerfeld has 100 stores around the world. How much growth potential with retail is left?

P. P. R.: I think it’s very difficult to give quantitative objectives when it comes to stores because it puts pressure on me and my team. Besides, it’s a goal that is led by the number and not the quality. I prefer to grow gradually but with the right stores.

 

MDS: What role does ecommerce play?

P. P. R.: In general, digital is becoming a retail part. In terms of communication and interaction with the consumer, for instance, or to explain the brand to the customer. But it can’t be isolated as an independent channel. The consumer connects with the brand on the Internet, but also in stores, through wholesale distribution, magazines ... It’s all intertwined. It’s clear that digital will grow, but together with the store, because customers need to touch the brand at the end of the day. There’s study revealing that 70% of luxury store purchases originated online. Buying online-only is like always ordering at Deliveroo and never going to a restaurant”. The key is having both options and get some food whenever you want, but that doesn’t mean you don’t want to go to a restaurant and have a social experience that isn’t digital.

 

MDS: In the United States people talk about the Apocalypse Retail, but restaurants continue to open.

P. P. R.: That’s what fashion brands must rethink. How can we connect with the customer in stores so that they think that brick-and-mortar offers more than just the opportunity to see the product? That also implies staff changes, because the store is less transactional and more interactional. Probably we’ll see a return to basics because the store is becoming more personal, more emotional. I come from a small city and there the baker knew you by name, knew your parents, remembered what you usually ask for and what time you went.

 

MDS: What role plays technology then?

P. P. R.: Technology has to be in stores. The client uses it all the time; it wouldn’t make sense to use your iPhone in the car or in the subway, but not inside a point of sale. It’s about mixing the online experience with the offline one.

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