Hermès: Culture & Customer Profile

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As you mentioned, due to Hermès' sales model, the recurring customer must be important to the brand because of how the sales process works. Hermès is one of the most exclusive brands at the top of the luxury pyramid. How does Hermès' exclusivity define its customer segment?

It became extremely complicated for the regions to interact and exchange information. The global perspective of who is a VIC was not present. It's more of a local approach because the VIC will be recognized in the country where they shop the most. There are good practices among the sales associate communities, but these are not mandatory and not always followed.

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As you mentioned, due to Hermès' sales model, the recurring customer must be important to the brand because of how the sales process works. Hermès is one of the most exclusive brands at the top of the luxury pyramid. How does Hermès' exclusivity define its customer segment?

At the store or country level, the history of purchases is crucial. They don't really care if you're a celebrity or not. That PR factor might have a slight impact in Paris, but that's an exception. Generally, it's about the longevity of your shopping with the brand and the diversity of your purchases. There are restrictions and quotas on typological products like bags, shoes, and belts. The more diversified your purchase history, the better recognized you will be as a VIC.

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I agree that this is a risk, especially for brands not at the top of the luxury pyramid. Do you think there's a way Hermès can mitigate this risk in China?

I think their obsession in recent years has been to control retail. As a result, they've drastically reduced the number of concessionaires. For example, when I joined in 2012, there were about 12 concessionaires across the US. Now, there's only one left. Italy was similar, once full of concessionaires, now there are none. I believe they're cleaning up their wholesale strategy to achieve a better and cleaner retail presence. Eventually, they might consider reshuffling a bit.

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