Thursday, June 20, 2013

EXCLUSIVE INTERVIEW - FOCUS, ENTREPRENEURSHIP, INNOVATION & PASSION: THE ESSENCE BEHIND SWAROVSKI'S CEO ROBERT BUCHBAUER


Robert Buchbauer CEO Swarovski
I must admit when I went along to the meeting at the Swarovski stand at Baselworld to meet with team I was convinced of the fact that I would have encountered a traditional, highly hierarchical family business managed with an iron-fist.  I could not have been further from the truth.

As I roamed around the stunning new Swarovski stand at Baselworld I had the pleasure of chatting to various members of the Swarovski team and I discovered a young, vibrant and exciting company with a flat heirarchical structure where everyone is on first name basis, and each team member is in their own way highly driven and motivated.

Yet my greatest surprise was yet to come.  Despite having done my 'homework' I'd found very little information about Swarovski's CEO, Robert Buchbauer and had imagined I'd be interviewing a very reserved individual and find extracting information close to impossible.

Instead I was delighted to discover an individual who despite being born into a 5 generation family fortune and who could have quite happily rested on his ancestors' laurels, has the passion and vision that one only finds in a true entrepreneur.

Swarovski's Stand at Baselworld 2013

Despite the many changes Swarovski is still in many ways a family run business, you being a testament to this. Indeed Gernot Langes-Swarovski once attributed the success of Swarovski to this family structure which in his words made it “more alert, innovative, quick, flexible and systematic than other types of company”.  Would you agree with this statement?

"We are still today a 100% owned family business, of course this has its pros and cons.  One of the main constraints of not being a public company is that we are totally self-financed and cannot access external investment.  That said, this forces us to focus on maintaining a strong financial position, we are not distracted by stock market analysts who can often apply undue pressure and stress to deliver short-term revenues, and have the freedom to invest in R&D and work on longer term strategies that many quoted companies."
Swarovski's focus lies in Emerging Markets such as Mexico & Brazil

Swarovski opened its first boutique  in 1998 and today you have over 1200 Swarovski-operated boutiques and over 1000 partner-operated Swarovski.  What are your major markets today and where do you see future larger expansions in emerging markets to take place?

"As we seek to continue with the optimisation of existing stores our major focus at present lies in emerging markets such as Mexico and Brazil which have seen a 30-35% growth, as well as just as strong a focus in new emerging markets such as Malaysia, Indonesia and of course India where regulation has finally been relaxed allowing us to gain licences with greater ease."
China Inspired Jewellery from the Secret Treasures Collection

As we enter the realm of 'emerging markets' our discussion turns to China and I ask how important China is to Swarovski and if they had had to change the product mix etc to accomodate this strikingly different market.

"China is a very important market to us.  We entered at a very early stage, indeed we were one of the first companies to apply for a retail licence in 2004.  We had to change and adapt our collections particularly with regards to the resizing of our product.  Chinese consumers required smaller versions of the existing products."

As we discussed this further I was astounded to discover that Swarovski's relationship with the Chinese market is not 'unidirectional', indeed Robert Buchbauer explains that many trends have come out of Swarovski's 'creative lab' in China e.g. the cellphone accessories which saw a boom several years ago. 

This cross pollination became evident to me as I chatted with Swarovski's Creative Director Nathalie Colin later on in the day, who described their product development process which thanks to open channels of communication between departments and countries leads to a constant development and innovation of products.

Swarovski Autumn Winter 2013-14

As the interview developed into an informal chat about the world of luxury and entrepreneurship, the clearer it became to me that 'guts and faith' are crucial to this brand.  A fine example is their decision to launch their first Swiss Made Watch in 2009 in conjunction with the financial crisis and watch market slow-down I ask why they decided to go ahead with the launch, after all most brands would have probably post-poned (and indeed many did!)  and in hind-sight did he believe it was the right thing to do?

Robert Buchbauer smiled and sat back in his chair with an air of satisfaction....

"It was a tough decision, and we all sat around a table to discuss the best way forward - but we came to the conclusion that for us there was only one way to go - after all we had spent 3 years developing the watch we could not possibly back down"

Was it worth it? - I ask

"Absolutely! The industry recognised it as a gutsy move and the watch benefitted from extensive coverage particularly as other major brands had avoided releasing new watches, this inadvertently leaving plenty of media space for Swarovski"

The success of the watches has resulted in the watch becoming an integral part of the brand, sold in most of the Swarovski operated stores and as Robert Buchbauer was clearly proud to announce 

"We are currently expanding our distribution of the watch further by striking agreements with independent watch dealers"
Swarovski Octa Men's Watch

All Swarovski watches are 100% Made in Switzerland so it was natural to ask Robert Buchbauer whether Swatch's decision to stop supplying fellow watch makers with components would affect Swarovski and the watch market in general (Swatch is one of the world's largest suppliers of watch components)

"We have not been affected by Swatch's change in strategy, we have been using ETA movements which we have no problem accessing".

Swarovski is a well-oiled machine which strikes me as thoroughly satisfied in its strong independent status, never dependent on others in its pursuit of success, and its focus and resolve is nowhere clearer to me than in Robert Buchbauer's answer to my next question:

As many luxury brands try to bridge the gap between mass-market affluent consumers and the super-rich or as the Wall Street Journal put it “walk the fine luxury line” – a clear example at the moment being Louis Vuitton – how do you think Swarovski fits into this picture and what are your plans for the future?

"Walking the luxury line is an art.  It requires total focus and no compromise.  You have to start at the aspirational top end of the lines and then you can cascade down to more accessible items.  It is paramount to apply the same attention to detail no matter what the price point.  Testament to this is that we have never given up our hand made craftsmanship which is the soul of the company.
If you lose sight of the higher end of the brand, focusing on the mid to low price point that careful balance allowing you to walk that fine luxury line will be gone forever."
Swarovski Autumn Winter 2013-14

This focus has guaranteed that Swarovski finds itself perfectly positioned to fit the 3 core values required of a luxury brand today: exclusivity, craftsmanship and heritage.

As Swarovski keeps tabs on its heritage and craftsmanship, it also faces the future full on, showing no fear in embracing an ever changing technology which many brands have found challenging, threatening and down-right fastidious!  With digital advertising has become core to the industry I was keen to discover Robert Buchbauer's view on it:

"We love digital advertising!" he replied gleefully "We were one of the first companies to launch a branded webstore in 2001  and we are constantly looking to improve our clients' online experience through new tools and channels of digital media."


Swarovski Autumn Winter 2013-14

As digital technology (and non-digital technology for that matter) impacts their decisions I ask Robert Buchbauer what he believes the challenges for the luxury market will be in the future and for Swarovski in particular.  With his answer I believe Robert Buchbauer demonstrates how close his finger is on the pulse of the market.

"As we continue to offer more and more innovative products I ask myself - "How much more can we possibly accumulate and hoard?"  The answer is simple, there will be a time when we can't any longer and the solution will have to be 'recycling'.  But not in the traditional sense where pieces are broken up to create other pieces, but rather keeping the 'old' and using it as a whole to create the 'new".


For those like me, who work very closely with emerging brands and designers, this is not a novel concept as the last year or so has seen an increase in this genre of 'recycling' what is completely novel is that the CEO of a company such as Swarovski is on the same 'creative' wave-length of these young creative minds - however what sets him apart from the rest is his ability to take it to the next level....

"You see what I envision is a change in the way people approach the products, the concept of 'sharing' will in my opinion evolve and this is very exciting for me.  I believe our retail stores are perfectly positioned and suited to develop into 'sharing centres' where clients could walk in with their 'old' and walk out with their 'new' (which could have been someone else's old - or a piece developed from an old thus creating unique one of a kind pieces).  
Definitely a concept we should develop further particularly in an age where sustainability becomes of paramount importance".
Swarovski Autumn Winter 2013-14

As I sit and listen to Robert Buchbauer's answers and how enthusiastically he speaks of his company and its future I wonder what a man, who is surrounded by luxury and produces luxury, believes is luxury, so I ask what some have deemed to be the hardest question to answer, and this time it is no different:

So, Mr. Buchbauer - what is luxury for you?

Swarovski's CEO sits back in his chair and after a few moments reflecting in silence he answers:


"That is a hard question.  In my mind money can buy you a lot - but - if you don't have the time to enjoy what you buy you are still poor."


Natalia Dodi Migliorini



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