French leather goods brand Longchamp has been a presence in China for 20 years. But now, as the company tries to bring China into its top three markets within the next few years, big changes in strategy are underway.
“We are still in the process of building up the brand so we need to gain more visibility in the market,” said Longchamp chief executive officer Jean Cassegrain. “Frankly, the issue is the brand awareness. We need to work to be more physically visible, that is the main goal. We are a medium-sized independent company, so we can’t do everything at once, so we have been working on some other markets a little bit more intensively and actively in the past 10 years.”
Longchamp currently has 14 stores on the Mainland and hopes to grow that number to 20 by the end of 2012. Its new flagship in Hong Kong will be the largest in Asia. There’s even talk of a Chinese e-commerce site. Last week, the brand hosted an event at the Bund waterfront to celebrate its partnership with actress Gao Yuanyuan, who serves as Longchamp’s Chinese brand ambassador. It is the brand’s first venture with a Chinese celebrity.
While Cassegrain would not divulge specific numbers, he offered that Longchamp sales in China have doubled over the past two years. The company’s global revenue rose 22 percent in 2011, to about $ 542.1 million, from the previous year.
“We feel that now the timing for us is right in China because we are getting the next generation of Chinese consumers,” he said. “They are beyond the discovery stage now, and they are ready to be interested in a brand like us that is maybe a little more discreet and subtle, not too logo oriented.”
With such careful planning underway, Longchamp’s difficulties are more likely to come from that area it can’t control: the fake bag market. Longchamp bags, nicknamed “dumpling bags” on the street, are quite often and easily reproduced illegally. But even this can’t damper Cassegrain’s confidence.
“We see Chinese shoppers in our stores in Europe and across Asia, so we see that the ball is starting to roll, and this is why we are also starting to invest more in all of these projects,” he said. “We feel that now is the time that things are starting to take shape. Chinese customers are all interested in the brand. They want to know more about us, so we are at this crucial time where we feel if we do things well, the upside is enormous.”
photo credit: longchamp