Walpole: Why do you think London is still captivating for the international luxury visitor?
London is one of the truly international capitals of the world. And over the past 20 years in every category it has significantly upped its game – whether that is food, the arts or hospitality. Every aspect of London has improved to an extraordinary quality. It is the destination. Visitors come because we have the best opera in the world, we have the best restaurants, art galleries and exhibitions. This is the soft power that London offers to support Great Britain and our industry.
How important is the multicultural nature of London to international visitors?
You can hear seven different languages when you get on the tube in the morning. That is what the international visitor really loves. A meld of people. And it perfectly reflects where we are in the world geographically – where we sit between America, the Middle East, Africa and Asia. London is at the centre.
How do you serve the international luxury shopper?
We know from Walpole and Bain’s research that a luxury shopper is eight times more important to the economy than a normal shopper. We should be upfront about targeting them. And providing items in London they can’t get anywhere else. Why will they come to London? Because they get the most brilliant products of all the international brands in the world.
When we work with brands at Christmas – like Loro Piana last year – we agree a period of worldwide exclusivity on the product, which brings everybody to London. Last summer in the midst of the Middle East season, we had the worldwide exclusive for one month of the Francis Kurkdjian prestige Dior fragrances.
Another huge factor is curation. I look at what we have done for the summer to change the profile of our products for the international visitor, and it is enormous. We curate our products all the time, so it’s always relevant to that target customer, at that point in time, in that season.
How have you used tech and AI to serve the international luxury shopper?
We have invested heavily in the single view of the customer. We are also unique in the luxury world in having so many touchpoints with our customers. Chanel will know what they sell to a woman in perfume, apparel and accessories.
But I know their lives. I know whether they also buy childrenswear, homeware, beauty and whether they buy for their husband. And if they don’t buy from us, we can look at their signifiers of wealth. So, if you came in and spent £3,000 on Loro Piana children’s cashmere, we can analyse what other people who spent the same on the same product spend elsewhere.
We now have a strong AI programme across the business, which we started two seasons ago. One application was to optimise our sizing and product range. We don’t buy to normal distribution anymore. Nationalities differ by body shape and size and each nationality also favours different brands.
So, we looked at our historical buying and using AI looked at the ordering. Because we time stamp transactions, we could see the potential revenue difference if we had ordered correctly. We now do this by brand by category. Now, when the customer comes to the brand, the size they need is there ready for them. It has had an amazing effect on sell through. At the end of the season, we have reduced the stock we need to discount.
What advice would you give luxury brands in London now?
You have to be unique and distinctive in this market. That is what luxury shoppers expect. In retail, I think too many brands are still thinking of themselves as a shop. And if you sell the same product you sell in 20 different countries, you will fail.
If you walked into our new Schiaparelli rooms, it is a jaw-dropping experience. The ceiling and the walls of the room with jewellery are actually foiled gold.
And you have to be single minded. About ten years ago we decided we were going to own luxury perfumery in the UK. Now, of bottles sold for £150 and above, Harrods sells 50% of the UK volume. We managed to do this because we created the most beautiful unique boutiques for all the master perfumers. We created the Salon de Parfums. People thought we were mad putting it on the fifth floor. It is now one of our most successful categories.
How confident are you about London’s future as a leading global luxury hub?
I am confident London luxury is resilient to anything anyone throws at it. We should celebrate London, not give ourselves caveats. It is a diamond we need to show off. But while I think we could do more of that across the industry, I actually think we are in very good shape.
