Swarovski takes to the skies with an upscale lifestyle approach – WWD
PARIS – Swarovski, the ubiquitous crystal charm company, has refined its strategy in recent lockdown months and is expected to emerge with a new high-end lifestyle proposition early next year.
Under the direction of the general manager Robert Buchbauer, who was propelled to head all of the group’s cristalle activity in April, the 125-year-old company is streamlining collections and distribution channels, and retreating from the seasonal rhythm of product launches with an eye on longer lifecycles – organized around distinct families, or pillars.
Buchbauer spoke to WWD about this development.
“In all challenges are opportunities, and with the COVID-19 crisis, we have had the opportunity to further develop our strategy,” he said in a telephone interview.
The resumption of all of the crystal business this spring enabled it to seek a more unified approach.
“I am really working to make the company a Swarovski and abandon the divisional approach that we’ve had for many years and run everything with one team, a functional team that looks after all aspects of the business, ”he said.
Swarovski’s crystal business sells a wide assortment of products ranging from crystal components sold in bulk to figurines and even interior lighting, but finished jewelry has been a major driver of revenue. The crystals business is the core business of the largest Swarovski group, which also sells optical tools and industrial machinery and generated sales of around 3.5 billion euros last year.
About 6,000 employees were laid off over the summer as part of a major overhaul, and the company employs about 25,000 people worldwide.
The Crystal brand aims to reposition its products in the accessible luxury space, away from the more “stuck in the middle” premium positioning that had become a bit blurry in recent years, in Buchbauer’s description.
Fast fashion labels such as Zara, H&M and Mango have established themselves in the competitive and affordable space, and executives have found that it becomes increasingly difficult to stay competitive at lower price points given the time. it takes to produce crystals. Conversely, the high jewelry and hard luxury segments were also excluded.
The label decided to redouble its efforts while overhauling its portfolio, drawing on archives from over half a century ago to find designs to reinvent and reinterpret for contemporary consumers. Borrowing a page from the luxury industry, the idea is to rekindle the appetite for crystals by building an assortment of products around more classic and timeless designs with the potential to become iconic – the way luxury brands like Cartier have built products around the Love bracelet, or Bulgari with its Serpenti watches.
“We also have a clear goal of being more sustainable, so we are moving a bit away from that seasonal entry-and-exit approach that so many industries have taken over the past decades,” Buchbauer noted.
“We want our designs to be much more visible to follow a longer lifecycle than previous ones,” he said of the portfolio redesign.
Giovanna Battaglia, who joined the business-to-business components activity of the company in 2016, has taken over the creative direction of the company. Battaglia, who started out as a model before moving on to magazines, has extensive experience as an influencer and stylist, with over a million Instagram followers.
“My role is a natural evolution,” she said in an email. “I am delighted to lead the creative vision of a cultural powerhouse like Swarovski into the future.”
“We are about to enter a new era,” Battaglia added.
“She worked really hard during the lockdown months. Believe it or not, she and her teams were able to design 3,000 new products during this time, ”said Buchbauer. “We have our drawers full of new ideas, full of new designs, in an improved design language, which we will be bringing to market starting in the first half of next year, so very soon.”
The first collection is scheduled to release online in February, along with pop-up installations called ‘Instant Wonders’, in stores in major fashion capitals later this month, blending art, culture and marketing.
Unlike the constant stream of new products issued by the brand in the past, Swarovski intends to launch product families, each time starting with jewelry. First, a centerpiece, say a necklace, followed by other products, like mid-priced bracelets and, at a later stage, earrings. The necklaces will feature designs meant to showcase the crystals, while remaining classic and versatile, meant to be less trendy, to appeal to a larger audience, and at prices ranging from around $ 300 to $ 1,300.
With this lifestyle approach, themes will expand across categories – to include watches, writing instruments, home decor, figurines, and perhaps more – with the goal of attracting consumers into continually expanding a collection. Moving away from a seasonal, calendar-like style approach to more frequent product drops is also intended to encourage customers to visit stores or explore online more often.
The brand’s famous swan logo is also getting a facelift.
“It goes beyond the product, we’re working on the swan logo – it’s undergoing a major overhaul, it’s being rejuvenated,” Buchbauer said.
Moving away from its traditional blue, the company’s branding will take on more colors – a nod to the effect when crystals refract light.
As far as retail is concerned, the focus will be on streamlining the distribution network – by around 30%, with most of the reductions coming from independent multi-brand networks with the aim of raising the brand image by high-end, by pairing it with high-end retailers like Bergdorf Goodman or Saks Fifth Avenue, for example. As stores reorganize to provide a more upscale experience, the brand will also be looking for larger spaces. The same approach will be applied to digital channels, and the brand will turn to high-end players to forge partnerships in the field of e-commerce.
The bulk components business, which accounts for around 30% of annual sales, will likely decline to 15-20% over time as the brand focuses on finished products for consumers. Swarovski serves prestigious labels such as Dior, Chanel, Gucci and Saint Laurent and has collaborated with labels such as Supreme, Nike and Moncler, which have bolstered the brand’s profile. These partnerships are expected to continue, while others may be phased out.
By emphasizing craftsmanship and manufacturing capabilities (all of the brand’s crystals are produced in Austria), there will be a stronger fashion component, with more flair for corporate communications in order to promote specific styles that can be conveyed with its products.
Buchbauer said he has a long-term view in mind.
“If some things don’t work well in the first place, that shouldn’t be a reason to abandon the idea altogether, it should be a reason to work on it more, refine it and move forward so that the customer is able to appreciate it even more, ”said Buchbauer.
“Seizing this opportunity during the COVID-19 crisis will give us a good head start and some leeway once we move towards less choppy waters and a more normal situation at the end,” he said. he said, speaking of the current crisis.
The company expects its revenue to decline by a third this year compared to 2019, as it lays the foundation for its future strategy.
“It’s a tough time, but we really want to try to seize it as an opportunity and make the most of it, and I know everyone is working really hard on this project and in the end I know we’re going to be rewarded for all this hard work, ”said Buchbauer.