MontBlanc CEO Charts Middle East Growth

On a mission to visit every single one of Montblanc’s 400 boutiques, CEO Jérôme Lambert, has paused his tour for a whistle-stop trip to New York to mark the 90th anniversary of Meisterstück, the iconic writing instrument.

The event marks a transformational year for the luxury accessory maker, which is undergoing a restructuring exercise in light of falling sales.

Among Lambert’s first initiatives at the helm of the German luxury good maker was the Meisterstück Heritage collection released in January, which was taken from concept to delivery in less than six months, and features pieces designed and priced to appeal to a wider audience.

“It’s important to be value-oriented for our clients,” he explains, looking remarkably fresh faced after the star studded cocktail and dinner party the night before.

“We’re moving forward and expressing what we can do in terms of expertise with these new lines. It will definitely bring new clients to Montblanc.”

Despite the challenge he faces, the CEO paints a confident picture, explaining in his thick German accent, dotted with French phrases, how he has enjoyed “readdressing new priorities and a new vision” since taking the top job in July last year.

Lambert is no newcomer to the luxury accessory industry, having joined Montblanc from Swiss watch and clock maker Jaeger-LeCoultre, where he became CEO aged just 33.

In his 15 years at the helm of the Le Sentier, France-based firm, which is also owned by Montblanc parent Richemont, the business tripled in size and joined the premier league of watchmakers.

WRITING ON THE WALL

The Montblanc chief says he has carried with him several important lessons from his previous role, including the need for charisma in leadership and maintaining constant contact with his team, all rounded off with a sense of fun and positivity.

“Even the most rational messages cannot go through if they are not carried by charisma,” he says.

These lessons could prove valuable in improving Montblanc’s performance, which has been impacted by lower sales and reorganisation costs. The company’s sales fell five per cent to 730 million euros in its FY2014 from 766 million euros in FY2013.

“Strength in the jeweler and specialist watch segments offset the softness of certain fashion maisons and Montblanc,” noted Yves- André Istel, chairman of Montblanc’s parent company Richemont, in announcing its FY2014 financial results.

Montblanc is an altogether bigger beast than Jaeger-LeCoultre, spread across four sites in three countries including extremely bespoke operations like Velleret, which produces around 50 handmade watches each year.

Lambert’s task includes overseeing changes in the way Montblanc has done business till now. Among them, a reduction of wholesale points of sale to upgrade the company’s positioning and a global restructuring to integrate Richemont distribution platforms and shared services, states the FY2014 report.

The global tour, which saw him stop off at Montblanc’s new Abu Dhabi store earlier this year, has helped him get better reacquainted with the company’s operations as he helps undertake this shift.

“It’s a maison that is more than 100 years old with different product categories. It takes time to try to understand and feel it the right way,” Lambert asserts.

But the Montblanc chief admits that keeping such a classic brand moving forward is not without its hurdles. “One of the biggest challenges is to create a good consistency between the different activities and ensure they reinforce one another,” he says.

Turning around Montblanc’s fortunes could mean turning, at least to some extent, away from its legacy.

It was in 1906 when German businessmen Alfred Nehemias and August Eberstein returned from a trip to the US fascinated by the invention of the fountain pen and decided to make one of their own – beginning a chain of events that would see Montblanc rise to the pinnacle of writing instruments.

Now, some 108 years later, the world is a different place, with the fountain pen becoming less relevant in a digital age of PCs, laptops, tablets and smartphones.

When Lambert’s appointment was announced, some in the industry feared the watch veteran would shift the company’s emphasis away from writing instruments, which still make up around 45 per cent of Montblanc sales. And it was acknowledged that more sustainable long-term growth would come from developing Montblanc’s capabilities in watches and leather accessories.

But Lambert stresses that the greater role other product categories are set to play would not reduce the importance of writing instruments to Montblanc’s identity.

“The writing instrument is the DNA of the maison, in terms of creativity, time and recognition,” he says.

That the Meisterstück collection features no less than five models, from the 149,Classique and LeGrand Fountain pens to a Rollarball and Ballpoint, should also go some way in quelling any doubts. Clearly, the success of this line will be watched closely in the months ahead.

“We are focused on Meisterstück, from the writing instrument to watches and leather. On the other end, we are looking at introducing these lines into the different markets in a global approach,” says Lambert.

CHINA SLOWING, MIDDLE EAST RISING

Among the factors impacting Montblanc’s sales has been a slowing down of the luxury market in China where, in addition to Europe, the company has a strong reliance on domestic clientele. It comes as little surprise therefore that that Lambert is looking to boost Montblanc’s position in other markets including the Middle East.

“The whole region is very profitable and successful,” he says. “The leadership of the region, in terms of trade and activities, is reinforcing itself and we intend to strengthen our presence and create an original hub.”

The more personal shopping style preferred by wealthy locals in the region also fits in well with the emotional connection Montblanc likes to create with customers. “It’s not about selling, it’s about the long relationship, positive reputation and impact,” Lambert argues.

This approach has already netted Montblanc very high-end clients and collectors in the region, he says, and there could be more potential for the company.

Montblanc has historically made fewer sales from tourists, relying on local customers in both established and new markets. However, luxury-focused international shopping options now available in the likes of Dubai and Abu Dhabi could help change this.

“We see the dynamism of the region, in terms of tourism; it brings us a lot of new clients,” explains Lambert, highlighting the role Middle East will have to play in helping the Montblanc chief bring the company back to form.