ID :
84646
Thu, 10/15/2009 - 14:31
Auther :
Shortlink :
https://www.oananews.org//node/84646
The shortlink copeid
(Yonhap Interview) Crisis becomes opportunity for Asian luxury brand
By Lee Youkyung
SEOUL, Oct. 15 (Yonhap) -- The ongoing financial crisis that erupted last year
created an opportunity for an emerging South Korean luxury brand to make headway
in the global fashion market, the head of the company said Thursday.
"The general perception is that the more expensive the product, the more
consumers will buy it. But with the economic downturn, consumer trends are
changing -- they have become value-driven," said Kim Sung-joo, chief executive
officer of MCM Group, in an interview with Yonhap News Agency. "If you think
outrageous prices will still lure consumers, you'll find yourself on the losing
end."
Kim took over the helm of the troubled German luxury brand MCM Group from its
Swiss owners in 2005, when catching up with established brands like Louis Vuitton
seemed a far off goal. The company has since seen its annual sales top US$200
million, with over 100 stores in 30 countries including the Middle East and
Europe.
The watershed moment that marked MCM's entry into the highly competitive luxury
goods sector was the simultaneous launch of 15 boutiques in Saks Fifth Avenue
stores in the U.S. in September, she said, while around 40 other luxury brands
closed down as part of Saks' restructuring efforts. MCM was the only new brand
brought into Saks since the economic downturn began last year with the collapse
of U.S. investment giant Lehman Bros.
MCM's first month performance with Saks saw robust sales in both the on and
off-line markets operated by the high-end U.S. retail giant. It was the top
selling brand during its first two weeks at Saks Fifth.
MCM is scheduled to open another boutique in Shanghai this year, right next to
Italian brand Giorgio Armani.
"Before the financial crisis, we had to beg to get that space, but now so many
spaces have opened up for us in fashion capitals," Kim, a fluent English speaker,
said. "We have also worried a lot because big brands are losing ground. But it
turned out to be opportunities for us."
Aside from aggressive spending on marketing and business expansion, which bucked
the trend of other competitors during the economic downturn, Kim said meeting the
needs of female consumers was the key to her brand's success.
"Our primary customers are not passive, rich women. They are independent,
well-informed, globe-trotting professionals," she said.
That sentiment informs many of MCM's business practices, ranging from bags that
are "functional, durable, helpful for time-management, multi-occasional and
elegant" to avoiding commercials that use sex or female nudity to lure consumers.
Born into the family-owned South Korean conglomerate Daesung Group, Kim shunned
her title as heiress and instead took on a job at Bloomingdale's that paid her
less than 180,000 won per month, the equivalent at today's rate of US$154. The
experience, she said, taught her fashion retail, U.S. consumers' taste, as well
as courage and confidence.
Once she became the owner and chief executive officer of MCM, Kim again went
against the tide of the fashion industry as the sole Asian female business leader
operating an European luxury line.
She resists all attempts to lump her company alongside other successful South
Korean conglomerates, or chaebols, like memory chip maker Samsung Electronics Co.
or automaker Hyundai Motor Co., which also consolidated their positions during
the financial crisis.
Kim is adamant about differentiating her fledgling firm.
"In Korean history, none of these chaebols ever did what we did even though they
have far more money and far more infrastructure," said Kim, hinting at the
lackluster level of social responsibility that chaebols have drawn fire for over
the decades.
While the dominance of chaebols within South Korea's social and economic
landscape has diminished, the chance for small and mid-sized firms to grow
remains slim. Kim said she hopes that MCM will set a model for more local firms
and female leaders to become globally competitive.
"In five years, we'll become a major Asian fashion house," she predicted. Asia
takes more than 70 percent of the global consumer market, she said, and therefore
"if we win Asia, we will win the global market."
ylee@yna.co.kr
(END)
SEOUL, Oct. 15 (Yonhap) -- The ongoing financial crisis that erupted last year
created an opportunity for an emerging South Korean luxury brand to make headway
in the global fashion market, the head of the company said Thursday.
"The general perception is that the more expensive the product, the more
consumers will buy it. But with the economic downturn, consumer trends are
changing -- they have become value-driven," said Kim Sung-joo, chief executive
officer of MCM Group, in an interview with Yonhap News Agency. "If you think
outrageous prices will still lure consumers, you'll find yourself on the losing
end."
Kim took over the helm of the troubled German luxury brand MCM Group from its
Swiss owners in 2005, when catching up with established brands like Louis Vuitton
seemed a far off goal. The company has since seen its annual sales top US$200
million, with over 100 stores in 30 countries including the Middle East and
Europe.
The watershed moment that marked MCM's entry into the highly competitive luxury
goods sector was the simultaneous launch of 15 boutiques in Saks Fifth Avenue
stores in the U.S. in September, she said, while around 40 other luxury brands
closed down as part of Saks' restructuring efforts. MCM was the only new brand
brought into Saks since the economic downturn began last year with the collapse
of U.S. investment giant Lehman Bros.
MCM's first month performance with Saks saw robust sales in both the on and
off-line markets operated by the high-end U.S. retail giant. It was the top
selling brand during its first two weeks at Saks Fifth.
MCM is scheduled to open another boutique in Shanghai this year, right next to
Italian brand Giorgio Armani.
"Before the financial crisis, we had to beg to get that space, but now so many
spaces have opened up for us in fashion capitals," Kim, a fluent English speaker,
said. "We have also worried a lot because big brands are losing ground. But it
turned out to be opportunities for us."
Aside from aggressive spending on marketing and business expansion, which bucked
the trend of other competitors during the economic downturn, Kim said meeting the
needs of female consumers was the key to her brand's success.
"Our primary customers are not passive, rich women. They are independent,
well-informed, globe-trotting professionals," she said.
That sentiment informs many of MCM's business practices, ranging from bags that
are "functional, durable, helpful for time-management, multi-occasional and
elegant" to avoiding commercials that use sex or female nudity to lure consumers.
Born into the family-owned South Korean conglomerate Daesung Group, Kim shunned
her title as heiress and instead took on a job at Bloomingdale's that paid her
less than 180,000 won per month, the equivalent at today's rate of US$154. The
experience, she said, taught her fashion retail, U.S. consumers' taste, as well
as courage and confidence.
Once she became the owner and chief executive officer of MCM, Kim again went
against the tide of the fashion industry as the sole Asian female business leader
operating an European luxury line.
She resists all attempts to lump her company alongside other successful South
Korean conglomerates, or chaebols, like memory chip maker Samsung Electronics Co.
or automaker Hyundai Motor Co., which also consolidated their positions during
the financial crisis.
Kim is adamant about differentiating her fledgling firm.
"In Korean history, none of these chaebols ever did what we did even though they
have far more money and far more infrastructure," said Kim, hinting at the
lackluster level of social responsibility that chaebols have drawn fire for over
the decades.
While the dominance of chaebols within South Korea's social and economic
landscape has diminished, the chance for small and mid-sized firms to grow
remains slim. Kim said she hopes that MCM will set a model for more local firms
and female leaders to become globally competitive.
"In five years, we'll become a major Asian fashion house," she predicted. Asia
takes more than 70 percent of the global consumer market, she said, and therefore
"if we win Asia, we will win the global market."
ylee@yna.co.kr
(END)
