Protecting the brand for genuine consumers


Diversification of the economy is being hampered by restrictive labour and consumer practices and a lack of “can do” attitude to removing the grinding bureaucracy, observes David Crickmore, CEO of Amouage

What is your industry outlook for 2019?

Like all luxury brands, this year has been very tough, as the high streets around the world see less footfall and consumers switch to shopping online. This is a challenge for all brands and this includes luxury marques.

We have also, like many perfume brands, been actively stemming the flow of products into the grey, or parallel markets, by closing business with unscrupulous distributors and retailers. We expect this to continue, as we seek to protect the brand for the genuine consumers, not those who are prepared to take the risk of buying cheap fakes and seconds in cheaper shops.

If something seems too good to be true, then it usually is and we recommend that everyone only buys from approved retailers and Amouage shops. If you do not, then you are not protected and we will not stand by the product, should you have any issue with it.

What are the challenges for the luxury industry in the years ahead? What are your recommendations/suggestions to address these challenges?

Internet shopping has to be the biggest challenge, as well as the grey market. We are totally upgrading our website in 2019 to meet this challenge and to make it more informational and cross conversational, as well as an enhanced shopping experience.

The grey market will always be with us to a point, but we are now ruthless with distributors who turn out to be unscrupulous traders and we have closed with so many as a result. In 2018, I walked away from around RO12mn worth (at retail price) of business to protect the brand. Gradually the availability in these cheap, low grade shops will reduce to the point that they have no more of our product to sell. Remember however that much of the products they sell are out of date, seconds, or fakes and you are not getting a good deal if you shop with them, whatever they claim. They are not registered, authorised Amouage retailers and you are taking a risk in buying their products.

What are the new areas that Amouage plans to foray into in 2019?

We will have four launches next year and we are seeking to broaden our reach in key stores around the world, through a continued programme of personalisation, so that the Amouage brand is sold in its own environment and gives the purest message of the brand’s DNA.

China is a new market for us, as is Korea. We have only recently signed agreements to supply these markets and so we have high hopes for success there in 2019. Japan is also on our horizon for 2019.

How was the year 2018 for the Luxury brands in general and Amouage in particular?

In the perfume world, many previously niche luxury brands have been sold to the huge conglomerates and we are already seeing a downgrade in their luxury status. Some say that in the fine fragrance world, “luxury is no longer luxury”, but this is something Amouage is adamant about keeping alive. We continue to source only the finest fragrances for our consumers around the world.

The main challenge for a family owned business like Amouage however is that we do not have the clout or the spending power of these huge groups like Estee Lauder, L’Oreal or the Puig Group. So, we are expecting to have to fight harder to maintain our position in many of the key stores around the world, as well as to continue to be top of mind of the luxury fragrance consumer.

How do you foresee Oman’s economic growth in 2019?

I can’t speak for the Omani economy, as so much is dependent upon the price of oil. I leave this to the experts. Diversification of the economy however is being hampered by restrictive labour and consumer practices and a lack of “can do” attitude to removing the grinding bureaucracy, which holds new business back.

Oman is not an easy country in which to run a business that isn’t involved in oil or gas. The country needs to take the need for diversification seriously and accept that these restrictions need to be removed.

In retail terms, I am concerned that Muscat in particular is becoming “over shopped” and the new Malls being built need to start finding their own points of differentiation, rather than merely repeating the same tenants. It’s a relatively boring retail landscape at present, with little uniqueness and I sense consumer fatigue. This is down to the leasing departments not broadening their horizons and travelling to bring in new brands. Of course, there are still the problems of restrictive labour practices that hold potential new entrants back however.