A little over a year ago, Fashion Group International checked in with luxury retailers on Madison Avenue to see how they were faring during the Covid-19 pandemic we now known as Alpha. As we move along the Greek alphabet to the Delta variant, it is time to check back in for a progress report. I guess it’s safe to say that while we await the return of the red carpet, at least the welcome mat is out.
Thursday’s Zoom event dealt with one ultra-exclusive block between 63rd and 64th Streets as Marc Hruschka, CEO & President of Graff USA; Paul Lorraine, President/CEO of Longchamp and Andrew Wright, president/CEO President, Americas & CCO of Manolo Blahnik, shared their lived high-end retail experiences.
Moderator Mickey Alam Khan, Chairman/CEO/Editor-in-Chief of Luxury Daily, kicked off the event (sponsored by the Madison Avenue Business Improvement District) by professing his “tremendous affection for this street,” which he both works and lives (albeit lives in the less chic low 80s.)
Graff was founded 60 years ago by Laurence Graff and is run by his son Francois. The first Graff store in New York was also a “tiny little jewel box” on Madison Avenue. About ten years ago, they moved to the corner of 63rd Street, where it remains one of three or four global flagships. “There is some serious wealth in that store,” remarked Khan.
French luxury leather goods company Longchamp was founded in Paris in 1948 by Jean Cassegrain. Lorraine, who is in charge of developing business for the US, said it is a pleasure working to serve the brand – “I’m looking forward to the next 73 years.” “If you want to feel cheerful, walk into this colorful store,” said Khan.
For those who remember the relatively tiny Manolo Blahnik store on 54th St west of Fifth Avenue made uber famous by Carrie aka Sarah Jessica Parker in “Sex and The City,” the recent move to a 1923 landmarked Madison location featuring two adjacent stores for men and women, is an exciting upgrade. Wright, who joined the brand in London four years ago, moved to NY two years ago to open the benchmark. “Two months in, so far so good,” he said.
How are these brands adapting to the changes of the last 16 to 18 months? “Let’s not forget the lessons of 2020,” said Hruschka. “We’ve had to find new ways to engage our customers when we’re usually careful about change. Here we’ve compressed six years of change into six months while trying to keep things that were the best of 2020 with what came before.”
Luckily, he reports the ultraluxe category of fine jewels is “experiencing growth and roaring back. Supply couldn’t keep up with demand for high-quality gemstones since the mines and the cutting and polishing houses were all closed for a year.” Although the jewelry business is “high touch,” they have been able to reach out to their global clients through pictures and videos using models to “put it on the body.” When all else fails, they make house calls, even if that house is in Jackson Hole or Palm Beach.
Lorraine of Longchamp also shares similar challenges with customer engagement. During this time, he explained the focus is more on “business on your doorstep than international. We’ve positioned ourselves for the local business since tourism probably won’t return until 2023. We’re more bespoke now – there’s more ‘theater’ to make people come in rather than go online.”
Arriving in New York in the throes of the first wave of the pandemic, he said it felt “surreal it was so quiet. Now the confidence is coming back. Retailers are the most resilient people on God’s green earth – we cannot stand still, or we’ll disappear. We must focus on the customer and on being better.”
Manolo Blahnik is a family-run business celebrating its 50th year, but what of the decision to open such a big store at such an inopportune time? “We’re into it for the long term,” explained Wright. “It was very different during the pandemic since 100% of our shoes are made in Italy – we work with the same artisans and try to protect them. As E.M. Forster said, if you don’t connect with your clients, you are dead in the water.” Taking inspiration from Mr. Blahnik and his niece, CEO Kristina in the tiny Chelsea (London) store, customers are offered coffee, smoothies, or fruit juice to make the experience more relaxed. “It’s less about selling and more about socializing,” Wright said.
How do you succeed in reaching your customer base through omnichannel, and what retailer does it best? Hruschka of Graff looks to other brands for inspiration on making things special — something they could appropriate to add value to their client experience. “We never rush anyone out of the store. Someone has to fall in love with the product to want it. We used to feature a publication (“Graffiti”) twice a year, but we have pivoted to smaller print catalogs of product lines. People will walk in with the catalog and say ‘I’m interested in this.’”
“Any company who got through the last twenty months deserves credit,” said Lorraine. “It’s been incredibly rough on mom and pop stores, restaurants, hotels. Some are very proactive in trying to grow their business.”
What of the digital experience? “People are desperate to get back to face-to-face meetings,” said Wright mentioning that MB used a “gallery experience for digital.” “We’ve focused on mental health by taking some of Mr. Blahnik’s favorite drawings to be printed and colored by kids.”
David Moin of WWD asked the $64,000 question regarding the high degree of vacancies on Madison Avenue. Can landlords be “more understanding” about rents while they have to meet their mortgages? What about offering short-term leases to tempt others to come in rather than have empty storefronts? Lorraine mentions that this is a problem in the UK as well. Hruschka adds that “our block is critical and sets the tone for the whole street. I’d like to see the Roberto Cavalli space filled on the corner,” he added.
Marc Hruschka was asked if Graff has tried appealing to a younger customer. By beginning to offer smaller stones of 1.5 to 2 carats in addition to their usual five to seven-carat diamonds and some items with lower price points — $7,500 to $75,000 — they include more “starter pieces.” They are also trying to grow their customer base by enticing some clients from going to other retailers for gifts with more affordable options.
Of course, someone brought up that dreaded word—sustainability. Lorraine mentioned that the famous Le Pliage bag is transforming into fully sustainable nylon for 2023. “How can we improve and do better? Already as high craftsmen, we have no waste,” he said. Wright referred to sustainability discussions as “opening Pandora’s Box” since leather is a by-product of the food chain; however, people are eating a lot less meat. “We are looking into non-leather leathers, satins…we have a few things in the works but a long way to go,” he said.
Lastly, how does the future look from the view on Madison Avenue? Lorraine sees “blue skies – people are coming back. Given what we went through, nothing really frightens me now.” Hruschka is feeling “bullish for the remainder of 2021. We’ve got our foot to the floor, pouring gasoline on the fire. Knock on wood; it’s paying off. We’ve been through a lot, like Paul said. Nothing scares me anymore.” Wright agrees – “It’s made us stronger, I hope. Great things are happening for our 50th anniversary.” (He couldn’t say much, but I would think it’s safe to say we’ll see some SATC tie-in for the movie release of “And Just Like That”).
Khan’s advice? “Invest in your neighbors, not tourists. Get to know your neighbors very well.” And his key to weathering the ups and downs? “Accept that there are some days when you’re the pigeon and some days when you’re the statue.”