00:00Swarovski Crystal is one of the best known names in luxury jewelry is in the midst of a major brand
00:04overhaul, hoping to modernize its image.
00:07That's right. They're partnering with famous faces like Ariana Grande and Venus Williams, along with iconic Disney characters and even
00:14some Marvel figures.
00:15The Austrian company is turning a profit once again by focusing on what it calls pop luxury.
00:20We spoke with the CEO, Alexei Nassar, at their Fifth Avenue flagship store for this weekend's C-Suite Saturdays.
00:30So explain to me what a Swarovski Crystal is and why it is different or special from other products.
00:37Swarovski is a pop luxury icon.
00:39What do you mean by pop luxury?
00:40We don't subscribe to some stale theories about what luxury is.
00:46And I think the world needs to think about luxury in a much more modern way.
00:50Those who have are winning. Those who haven't aren't.
00:53This is not what Swarovski stores looked like when I was growing up.
00:57This is the Wonder Luxe concept.
00:59It's very different from what you'd think of a conventional retail experience.
01:03It's packaged as a big jewelry box.
01:06I mean, it feels like that. Or like shadow boxes.
01:09Yes.
01:09Like you're discovering things.
01:10Exactly. That's the whole point.
01:12A treasure hunt.
01:13It's not that I'm coming purposefully to buy something specific.
01:17Yeah.
01:17I'm going to see what's out there. I'm curious. I touch things. I try stuff.
01:21See, I didn't know I needed sparkly sunglasses and now I feel like I do.
01:25It's a necessity now.
01:26Are you seeing a return on that investment? I mean, you guys were profitable for the first time in a
01:31couple of years.
01:31How is the company doing? The company is doing very well.
01:34Over the last four years, we added 24 points of organic growth.
01:382025 was equally successful, up 6% organic.
01:43And we're growing at three times the rate of the jewelry market.
01:46I mean, that's pretty good, especially when a lot of your competitors are seeing pretty flat growth right now.
01:50Yeah. No, we're very happy with the results. I mean, we're proud. We're happy. But we should stay vigilant. The
01:56market is tough.
01:57Yeah.
01:58Consumer sentiment, as you've seen, the latest data from the U.S. is at all-time low.
02:02It is.
02:02And it's still a discretionary category. So I told my guys, we keep the confidence, but we stay vigilant and
02:09we navigate on site.
02:10I mean, I don't have to have sparkly sunglasses, but I do kind of want them now.
02:18What were the main changes that you made?
02:20Any transformation starts with respect. Respect the legacy. Respect the brand. Respect the company.
02:27Otherwise, you wouldn't even be here to turn it around.
02:29Because you're the first non-family member to run this company in its history, right?
02:33Correct.
02:33That's got to be kind of scary.
02:35Yes. It has its share of challenges, but also of opportunities.
02:39Okay.
02:40Because when you come and you're not part of the family, you don't carry baggage. Your agenda is clear. You
02:46just want to create value.
02:48I'm a brand man. I've been a CEO for more than 10 years, but at heart, I'm a brand man.
02:52But not necessarily jewelry. You were at Procter & Gamble.
02:54Exactly.
02:54You were at...
02:54Exactly.
02:55Yeah.
02:55And I've always been that, and I believe that is fundamental for a brand like Swarovski. I think you can
03:00be superbly creative and be super disciplined.
03:02What does the discipline do? What is... Like, why can't you just be extremely creative?
03:08I was in the process of turning the company's profitability around, and I could not afford the luxury of having
03:13disorder in that sense.
03:15But you need to manage it in a way and through a managerial philosophy.
03:19And that philosophy is called tight, loose, tight, which is being very tight on the values of the company, of
03:25the strategy, and be very tight on results.
03:27But in the middle, you have to have the courage to let people meander a little bit.
03:33A little bit of freedom.
03:34A little bit of serendipity.
03:35A little bit, you know, I tried that. What do you think?
03:38I said, yeah, let's try it. It doesn't work.
03:40But then I make sure we do. Don't do 15. Let's try it to see if it works.
03:44We limit them, and we spread them over time.
03:46Yeah.
03:46To make sure the risk profile is managed and is reasonable.
03:49When I was growing up, my mom had the Swarovski crystal figures, like doves and swans and very elegant animals.
03:57You've got a baby Yoda figure over here.
04:00Yeah, yeah.
04:01You've got Shrek. You've got Wicked. You've got Disney.
04:04Is this still a big part of the business?
04:06What we try to do with figurines is really showcase and display what we call our savoir-faire, because our
04:13ability to design and cut crystal with precision is even more enhanced in the home figurines category.
04:20Wait, am I allowed?
04:21Yeah, yeah, you are.
04:22I'm not going to lie. I do kind of want a baby Yoda.
04:26Yeah, it's called brand desirability.
04:27We have a group of collectors that buys what you mentioned, which is, you know, the animals, the still-fictors,
04:34the flowers.
04:35But you also increasingly have a group of franchise aficionados, the lovers, the fans of Star Wars.
04:43They want everything from Star Wars.
04:45Disney, Star Wars, Marvel. Yeah.
04:45And that's a different demographic. They're younger in general. They're more skewed male.
04:50Do you get dudes in here buying these?
04:51Yes, yes, of course.
04:53Oh, this is Ariana Grande. So this is the new collection?
04:56Exactly. That's the new capsule, the dragonfly of Ariana Grande.
05:00The collaborations with ambassadors like Ariana Grande give a lot of texture and dimensions to the cultural capital of the
05:06brand.
05:07We select people who are in tune with our pop luxury positioning that can nurture it, and we can nurture
05:11it back.
05:12The collection has been very successful.
05:14I mean, this is the second year, so obviously you went back for more.
05:17It renews the storytelling around the brand, and we use some also design codes, which are unmistakably Swarovski,
05:24but with a little bit touch of originality, so people can be tempted to layer this on top of what
05:31they already have with us.
05:32And let's be real. Layering means they're purchasing more products.
05:35Exactly.
05:36I also feel like you guys are positioned at an interesting time because study after study is showing the younger
05:41generation,
05:41even people my age, don't really care about diamonds, precious gems, in a way that previous generations did.
05:49I know that we're in a room that you guys now have diamonds here, lab-grown, I'm assuming.
05:53Correct.
05:54Are you taking advantage of that? Have you seen that growth in your customer base?
05:57No, you're absolutely right.
05:58Right. The train left the station for lab-grown diamonds.
06:03Yeah.
06:03And it's growing rapidly.
06:05This is the trend of the market, and we've been playing it unapologetically.
06:08We've been one of the first.
06:10We're determined to do it because we think it's a triple win.
06:12It's a win for the customer.
06:14In the end, you know, for your buck, you get a much bigger carrot.
06:17The psyche of younger customers is a different one in terms of, oh, and what would the value remaining,
06:23and who could I sell it for, are passing on to my daughter.
06:26People are more in the here and now.
06:28I love it. It seats me. It gives me joy. Give it to me.
06:31Life is hard, man. I just want some pretty stuff.
06:33Exactly.
06:34When you walk around the store, it's not cheap, but it is achievable.
06:39Are you at a price point that you think is very beneficial for this time, given the pullback on luxury
06:44spending?
06:44We're one of very few companies that offer products in one store ranging between $150 to $250,000.
06:53So with us, most people can find something that they like and that is suitable to them.
06:59And you want customers that range those income brackets?
07:02We want to have a combination of consumers who are young, who are in the zeitgeist, and who determine the
07:09zeitgeist.
07:10But Gen Z has its limitations, particularly monetary.
07:12And that is why our target group is a little bit broader.
07:15The post-90s, that is our core target, used to represent 21% of our sales back in 2021.
07:21Today, they're 45%.
07:22And in the U.S., 50%.
07:24When did that transition start to happen, and how successful has that rebranding been?
07:28What we call pop luxury is having the credentials of what I call conventional luxury.
07:34Heritage, 1895, Austrian, Tirol, Daniel Swarovski, savoir-faire, we call it in French, which is craftsmanship, creativity and quality.
07:44We have it all.
07:45But in addition to that, at what makes our luxury pop luxury, we are always in the zeitgeist.
07:52We are unapologetically modern.
07:55We will never be a dusty brand.
07:57We're fun.
07:57We don't think to be luxury, you have to be stiff.
08:01We don't believe that.
08:02You can have fun in luxury.
08:04Many people who buy our products are not always people with limited means.
08:08There are many people, many, many customers, ladies, who just say, you know what?
08:13I love that extravagant millennium.
08:15Give me the pink one as well.
08:17And last thing is what we call the human touch.
08:19We don't make people wait in line under the rain.
08:21We don't treat customers in a haughty way.
08:24We don't do stuff like that.
08:25Ultimately, the value for money matters.
08:28Walking away from it or ignoring it, just thinking because I'm luxury doesn't matter, I think is short-sighted.
08:34What should luxury give the consumer at the final end?
08:37It's a feeling of joy and a feeling of self-worth.
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