On Why Chopard and Cartier are creating a new management wave in the luxury goods industry
Today the luxury goods industry is facing serious and continuing challenges...
The 21stcentury has forced upon management the need to focus on human resource capitalization so as to preserve competitiveness. This is particularly true in the luxury goods industry where high entry barriers can keep potential entrants away but cannot create a transforming lux experience in customers. Moreover, the internet with its ubiquitous presence; its powerful reach; its attractive interactivity and its portability has placed such a strong power in the hands of consumers that the century old recipe of tight vertical integration is being punctured.
This has placed the luxury goods industry in a situation that resembles that of the music industry in the 1990s. Then, the album based business model was pierced by music file-sharing kids using college laptops. Today the luxury goods industry is facing serious and continuing challenges that spring from the dilemma posed by the internet ubiquity versus the industry’s main attribute: exclusivity.
And while e-commerce has grown to represent between 20-25% of retailers’ sales, the luxury goods industry has been a latecomer to this distribution channel fearing the “lux experience” could not be transported through the net. As a result most millennials have taken it to Amazon and other retailers to satisfy their demand for clothing and accessories. As they do they have transported their tastes and ‘look and feel” to hereto forth unknown manufacturers who are now leading the “aspirational brands” market. Then along came social media to make matters worse for the luxury goods industry.
These are excellent channels to launch new products; to create product based communities and to tell the brand story in an appealing way. But to successfully navigate the cyber waters, one needs to have employees that think in terms of semantic networks building and not in terms of a brick and mortars brands aesthetics. Semantic network thinkers do not come by easily. Thus both Chopard and Cartier have resorted to best human capitalization vehicle there can be.
Both have enlisted Learner Nation the emerging human capital building company that creates online training courses tailor made for a particular industry and particular brands within the industry. Through attractive series; essays; quizzes and multiple options practical knowledge on value creation in this global world is put to bear in a revolutionary training method that continuingly extracts from consumers the keys towards successful product or service distribution. And the system also creates two kinds of constituencies. One of specialists on a particular value chain link and the other of testers of the virtues and flaws of particular goods and services so as for any brand manager to be able to correct course, withdraw or abort a product or service launch at minimal cost.
Learner Nation is a critical thinking and problem solving booster that triggers practical knowledge creation all the time, thereby making the venture where this revolutionary approach to employee training takes place farsighted and unique in terms of satisfying customer expectations. Cognitive skills are not only developed by Learner Nation but also are constantly upgraded through the establishment of networks with teams of people across cultural, geographic and language confines instilling global flavor to the brand while keeping local customs.
Production becomes targeted; inventories are something of the past and uniqueness comes from customization; quality and brand storytelling. The global marketplace will surely enthusiastically respond to this move by Cartier and Chopard rewarding them for creating a new approach to luxury experience that brings together exclusivity and 21stcentury savoir faire. Rivals begin to shiver!!!
Disclosure: The author is not responsible for the views expressed in the article. The text has been written freely expressing ideas, without receiving any compensation. The author has no business relationship with any of the companies whose shares are listed in this article.