INNOVATION DRIVES FASHION FORWARD

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EXCLUSIVE INTERVIEW With WEI-KUNG LIN, GM OF RIMOWA China | How Has RIMOWA Changed Since LVMH Group Bought It Over?

September 2,2019

When people speak of RIMOWA, people immediately think of its classic aluminum-magnesium suitcase. Its unique design and solid, durable features have been deeply rooted in people's hearts since 1937. 

However, it is not difficult to see that RIMOWA's marketing activities and brand image have become younger and more dynamic recently -- all of which happened after French luxury giant LVMH group bought an 80% stake in RIMOWA for 640M euros in 2016. Alexandre Arnault, the youngest son of LVMH chairman and CEO Bernard Arnault, was named the co-CEO of RIMOWA.

To learn more about RIMOWA's latest strategies, Luxe.co conducted an exclusive interview with Wei-Kung Lin, GM of RIMOWA China. “In addition to creating a brand new visual image,” he said in the interview, “The brand is also trying to get consumers to perceive RIMOWA in a younger, fashionable and more diverse way, through more innovative product languages and marketing channels.

Witness Rebranding

New Vision System|Fashion and Art Crossover| Younger and Enrichment

The global luggage market is expected to grow at a compound annual growth rate of 6.28% from 2018-2022, according to the latest research report from the market research firm ResearchAndMarkets. With the rise of the digital era, many innovative technological brands have entered markets such as smart luggage, with frequent collaborations between classic brands and artists, together indicating that the global luggage and travel accessories industry is waking up.

Speaking of booming travel spending of Chinese consumers, Wei-Kung Lin revealed several figures: "The number of travelers worldwide grew about 3%, while China experienced 7% to 8%, much higher than global growth. During May Day Golden Week this year, 70% of domestic trips were made independently in China, and the number of first-class passengers increased by 30%. This is a significant uptick."

"Luggage has become a fashion accessory for young people," Lin said. “In the past, luggage was simple, just a tool that could take things from point A to point B. However, with changing times, the way people travel has also changed -- luggage has become a part of young people's lifestyle, which can show their personality and characteristics."

"What consumers want from a suitcase is not just functionality, but an expression of personal style and a different experience. For many business people, travel is a part of life. The core and goal of RIMOWA is to make their travel experience more complete and unique through luggage.” Lin said.

For example, last year, RIMOWA teamed up with Off-White to launch a "transparent" series of luggage, which now appears frequently in celebrities' travel collections on social media. Lin describes: "The transparent suitcase makes you think about what kind of image you want to present, how to package your luggage, what things to put where, what things to show, what personalized stickers to add and so on. It's a very different experience and it is cool."

In addition to its cooperation with Off-White, RIMOWA launched co-branded luggage with street brand Supreme and luxury brand Fendi last year. RIMOWA has also teamed up with luxury Danish audio brand Bang&Olufsen to launch a limited edition headset. Other than this, RIMOWA is also launching the brand's first gradient luggage collection in collaboration with California-based visual artist Alex Israel. 

This time in JINGART, Rimowa will team up with creative studio @kaleidoscopemagazine featuring Spanish designer Guillermo Santomá's installation "GAS". Inspired by the idea of a conceptual gas station, Guillermo created a fully functioning car customized with RIMOWA aluminum into a light and sound sculpture.

Lin told Luxe.co that the brand hopes to highlight diversity through crossover collaborations, so that different designers and artists can express their different views on travel, and more people can understand the meaning of travel from different perspectives. Showing people different aspects of RIMOWA can further deepen their understanding of RIMOWA.

Speaking of artistic crossover, Lin believes that it not only enriches the brand image, but also improves the technical level of products:

"Luggage is a very figurative object, but art is not. Art can open people's eyes and in this way, the different aspects of RIMOWA can be better transmitted to people. In addition, to produce a product that looks like a work of art, it has very high technological requirements."

According to the brand, this year RIMOWA will launch the "Seasonal Color" collection which will be in line with the trend of this season. The four colors of this year are: Sage, Saffron, Coral and Slate, unlike the traditional metallic impression of the case, so these bold colors can break and refresh RIMOWA’s stereotype image.

"This is actually RIMOWA's first attempt," Lin said, “With Seasonal Color Collection, we can try a totally different color scheme or a more daring design style from traditional luggage."

RIMOWA is steadily rebranding itself in a contemporary language under the leadership of LVMH group.

RIMOWA launched its first global promotion in the brand's history last September to celebrate its 120th anniversary: "No One Builds a Legacy by Standing Still". For this German luxury luggage brand with a history of more than 100 years, quality and innovation have always been the core concept of the brand. After entering LVMH group in 2016, RIMOWA underwent changes that exactly echo this slogan.

Sales Strategy Analysis

Retrieve Retail Distributor and Operate Directly | Launch Customized Services | Detailed Operating Online Channels

When LVMH acquired RIMOWA in 2016, the overall valuation of RIMOWA (800M euros) was about double the total expected sales of 2016. This was LVMH's first acquisition in Germany.

According to the previous disclosures by Alexandre Arnault, RIMOWA's annual sales in 2016 was about 440M euros. Their target was to achieve a significant increase in profitability, direct stores and online sales within three years, with an ultimate target of 1 billion euros in annual sales.

Behind the sales target of 1 billion euros, the brand not only needed to make a long-term investment in brand remodeling, but look deeply into online and offline sales channels.

The following is a partial interview between Luxe.co and Wei-Kung Lin, GM of RIMOWA China:

Luxe.co: A physical store is an important link to convey the brand story. What changes does RIMOWA's physical store have?

Lin: In the past year, there has been a big change in our stores in the China market. We took back 55 stores from retail distributors and only retained about 20 of them. The main consideration is whether the development and positioning of stores and brands are consistent. RIMOWA is a luxury brand -- our stores must convey the same message.

Luxe.co: According to the "China's New Generation Of Fashion Consumption White Paper 2018" released last year by Luxe.co, 20% of consumers want brands to add customized services to their stores, an ask that ranked first among all the demands. What does a physical store mean for a luggage brand like RIMOWA?

Lin: Physical stores are a great way for the brand to connect with consumers. RIMOWA recently opened two new stores in China, which are quite different from the traditional RIMOWA stores in terms of design, incorporating many new elements.

For example, the newly opened store in Plaza 66 Shanghai has 116 square meters of customized service area, and many new accessories. 

The stores in TaiKoo Hui Guangzhou mimic the look of the baggage carousel, so people can think of travel immediately when they enter the store. In addition, there is a display rack in the shape of a ferris wheel, making the store atmosphere very young and interesting. These are a couple of examples of the new ways that RIMOWA is developing new store concepts.

In the future, we will introduce more technological services and more customized choices in stores, such as handles with different colors and even wheels. Many of these services are already in the stores in One Central Macau and Ginza in Tokyo.

In addition, we will launch different categories other than suitcases to meet different needs of consumers during their travel. It is expected to be launched by the end of this year.

Luxe.co:  What are the plans for online sales channels? What does an online consumer profile look like?

Lin: Luggage is a very standardized product, so it is easy to choose online, but we think online channels are more than simply sales channels. Each of the different channels has different features and can provide consumers with different content.

For example, in WeChat Mini Program, we will focus more on functional aspects. A luggage binding service was launched on WeChat last month, allowing consumers to better manage their luggage. In addition, consumers can also communicate with us through WeChat and ask questions. After that, we will provide the Mini Program with after-sales service, allowing customer service staff to help them solve problems directly, so as to provide customers with a simpler and more complete experience.

Tmall flagship store is an important sales channel for RIMOWA. One interesting figure: Tmall's main consumer group is between 25 and 28 years old, about 10 years younger than the average age in physical stores. In addition, 35% of our Tmall's consumers come from cities where we don't have physical stores. They do not normally have access to RIMOWA via physical channels, but only via online channels.

By contrast, WeChat is a platform with different positioning. Consumers on Wechat  have certain perception of our brand, and most of them are loyal users of RIMOWA. Therefore, we mainly provide functional services to consumers. Tmall has larger traffic, which can attract more people to RIMOWA and increase the brand popularity.

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