Taking the magic of denim international - Emirates24|7

Taking the magic of denim international

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English denim company Lee Cooper is gearing up to cement its customer base in the region and to expand as a global brand under the leadership of new Chief Executive Stefaan Le Clair.


Celebrating the company’s 100th anniversary and six years in the Middle East with a tour of the global stores, Le Clair stopped in Dubai last week to meet the team responsible for distributing Lee Cooper products through 75 shops across the region. He sat down to talk to Emirates Business about the company’s relationship with Middle East distributor Splash, and his plans to capitalise on Dubai’s growing mid-market retail segment. Le Clair revealed his key strategies for Lee Cooper in 2008 – including celebrity tie-ups and a more “top of the line” collection. He also spoke about the elements missing from Dubai’s booming retail sector and the future of the retail sector.

Why is Dubai a key market for Lee Cooper in 2008 and what is your business strategy this year?

Not only is Dubai very important to us, but so is the Middle East market. We decided a few years back to bring the brand to global markets. The key strategy is to work with strong local groups who know the market well and who have more experience in those markets than we could ever have and to forge a partnership with them through a distribution licence. Getting out of our base in Europe, where the brand is very strong, [was important], as was taking a position in Asia Pacific and the Middle East. The strategy is to bring the brand to the global marketplace and to work on international collections to make this happen.

Which consumer segment does Lee Cooper target in Dubai?

In Dubai, we target the mid to mid-high segment and it is basically the same in the rest of the Middle East. In Dubai, our core target market is the 18 to 22 [age group]. In Europe, we have a history of 100 years so we’re more targeted towards the older customers, the 30-plus group. But in Asia Pacific and the Middle East, from a fashion point of view, we are targeting a much younger customer. In Europe, we are learning from this experience and it is helping us to target younger customers in the European market. It’s an interaction that helps us to position ourselves differently in the global market.

How big do you think that segment is as part of the whole retail industry?

I think this is quite a big group. In the past, it was targeted only by vertical retailers, such as H&M and Zara, who create their own brands and are not working with external brands. They really dominated the marketplace in different parts of the world. I think looking now at different denim brands, and our own denim lifestyle brands, it is a growing market for us. What is more important is that working with this age group you can bring them with you. Customers today, if they are loyal to your brand, will also be your customers tomorrow, when they are much older. So you can have them throughout the scale of age groups and that’s the strategy we’re working on.

What percentage of retail spend do you think this segment of consumers accounts for?

I think the mid to mid-high segment has always been the biggest part of the market – maybe more than 50 per cent. More “discount” types of customers also exist, which is not our target group, but I think generally and globally speaking, these probably account for about 20 per cent. And then you have the high to extreme-high luxury segment, which is also going to be about 10 to 15 per cent. The luxury part is probably bigger in the Middle East and it’s also growing in Asia Pacific. You cannot count the Gucci stores anymore because they are so numerous. But I would say the mid segment is the most commercial part of the retail environment.

Where do you see a gap in the retail market in Dubai?

From my point of view today, looking at different store concepts, I don’t really see big gaps. I think in the Dubai market you have coverage of the low-end side of the market, the high-end and everything in between. So from my perspective, I think it’s very well balanced.

How does Lee Cooper fit in with the image of Dubai as a “super-luxury” hot spot?

From the fashion point of view, we’re not only transforming but also creating trends. Secondly, Lee Cooper will be introducing celebrity line-ups, which we are working on with two French celebrities, including [French model] Lou Doillon. We’re working together to set up a collection that will be launched in March. We have decided to work with these celebrities, not from a one-shot perspective, but to create the next six seasons’ collections.
 
We have decided to enter a long-term relationship, build up the collection and to bring it worldwide in our distribution network. This is the top line of the collection, with prices between €100 to €500 (Dh544 to Dh2,724).
 
The haute couture line, which we will do with Lou Doillon, is priced around €500 to €600 and is going to be placed in very selective stores, such as Harrods, in March this year. We are trying to reinforce the top of our pyramid and for us it’s not just a marketing gimmick, we take it very seriously and are working very closely with the celebrities.

Who are your main competitors in the region?

We mostly have to look at (retailers) companies such as H&M, and the Inditex Group – one of the world’s largest fashion distributors – as our major competitors here. They are global competitors because these brands are globally active. However, we don’t look to our fellow retailers dealing with American brands such as Levi’s and Lee – this area is not competitive at all.
 

What’s your opinion of the growth of the retail sector in Dubai?


Looking at what a major retailer like Splash is doing, I think this is where the growth will come from. It’s a one-stop shopping place where you have a combination of international brands as well as house brands, and targeting almost every customer’s wish within the four walls. I think that’s the future and I believe 100 per cent in this concept. I do not believe in single approaches anymore. In Dubai and the Middle East, where the business is concentrated mainly in shopping malls and department stores, there is a need to capitalise on the force of the traffic and on the diversity of the customers coming into stores. [You must] try to keep them within your walls and offer everything that is on their wish list. From an objective point of view, this formula is one of the best I’ve ever seen and it’s the future of what retail will be in the coming years.

Where do you think the retail sector falls down in Dubai?

What I would expect to see is a higher impact of some European vertical retail formulas – I think they’re still not very strong here.
 
Vertical retailers create everything from a vertical point of view and have their own label, or they don’t have a label and just use their front brand, such as Esprit and Mexx. They are not as powerful as I would imagine here [in comparison] to Europe.

What are some of the challenges you have faced in terms of expanding or penetrating this region?

I think finding the right location is always the most important. Following the growth of what the real estate business is doing to develop determines your expansion. If you talk about growth and having a stronger impact in the market, it is not only about optimising the square metre performance of your store, but also going further, investing, and I think this is going to be a never-ending process.

What else can we expect from Lee Cooper this year? Any other expansion plans?

Yes, I think the Splash group has a very aggressive expansion plan in the region. One of the major steps in connection with Lee Cooper is the introduction of the celebrity brand, which both partners very strongly believe in as an element of growth for the future.

What revenues did the company see last year?

The fiscal year for us hasn’t ended yet so I can’t really answer that. However, in 2006 Lee Cooper’s retail value worldwide was about €500 million, and, of course, we expect that to increase. 

What percentage of Lee Cooper’s overall revenues comes directly from this region?

We’ve only recently started in this region but combining Asia Pacific and the Middle East together it takes roughly about 30 per cent of our turnover – the rest is coming out of Europe. However, the figures from this region are increasing in the double digits every year.

Looking forward, what are your personal plans for the company?

I’m going to bring the company from merely a denim-based brand into a denim lifestyle brand. Customers today are looking for total concepts rather than just denim products. We’re working with Splash to bring this to life but we also have to build it up. I don’t believe in a denim-only company – we’re going to put a lot of emphasis on combinations, silhouettes and stories. In Europe, we’re developing a women’s business, which is only taking about 20 per cent of our turnover in Europe right now – in my opinion far too low. We’re going to push a very strong women’s line in the next couple of seasons, starting with spring-summer, and our target is to increase this to 40 per cent of our turnover.

Stefaan Le Clair

CEO

Stefaan Le Clair has been the Chief Executive of Lee Cooper since June, when he was called on by shareholders to lead the company.
 
The Belgian national hopes to take Lee Cooper from a denim-based brand into what he calls a “denim lifestyle” brand. He hopes to lead the global name into a stage of profitable expansion.

The company is a designer, distributor and marketer of branded jeans, clothing, accessories and footwear and has a worldwide presence through its extensive licensee network.

Le Clair comes from a retail background and has 20 years of experience in product and retail management in home decoration and fashion. Prior to his latest position, he was retail director (Europe) at the leading brand Esprit. He has also worked internationally in retail and clothing sector, including at WE International in the Netherlands and Etam China in Shanghai.
 
 
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