Editors’ Note

Born in Damascus, Syria, Safa Hummel received a BA in English Literature from Damascus University before committing two years of study to accounting, computer science, and economics at Solano College in California. Hummel’s career in luxury product sales began at Yves Saint Laurent where she was a Regional Sales Manager in northern California. She held the same position with Sanofl Baute after it bought YSL. Hummel then spent nearly a decade in luxury tabletop and gift sales and marketing. Most recently she was employed by Christofle, the French silver manufacturer, as Vice President of Sales and Marketing, before rising to serve as company President for two and a half years. Before coming to Christofle, she worked with Daum, the world-renowned French art crystal manufacturer. Hummel has been in her current position since November 2005.

Company Brief

In 1953, the Lladró brothers quit their work at a tiles factory and built a Moorish kiln in the courtyard of the family home. In Almàssera, a little town on the outskirts of the Spanish city of Valencia, they installed a rudimentary workshop that became the headquarters of their company, Lladró (www.lladro.com), which produces a diverse array of handcrafted porcelain objects and home decorations. Over 2,000 people now work for the company, and Lladró creations are exported to more than 100 countries and sold at almost 4,000 points of sale.

Many have said that 2007 was a challenging year for the luxury goods industry. Would you agree? Looking to 2008, do you see signs for growth in the segment?

While sales for our more classic collections have been declining for several years, our newer and more innovative collections of home decor pieces have shown tremendous growth, representing 30 percent of our retail boutique sales and about 13 percent of our sales to wholesale accounts. I believe we’ll see continued growth in this area in 2008, and this is where we want to focus.

Will that growth come from new products?

Yes, from both new products and new distribution channels. For instance, we now have a home fragrance line and we’re in Barneys in New York, Chicago, and San Francisco – that’s really big for us. We’re also now in Henri Bendel New York, where we launched our Re-Cyclos collection. We did very well there, because it exposed a new consumer to Lladró in a new environment.

Will the Re-Cyclos collection be a significant factor in the brand’s continued success?

Yes. In fact, we’re extending the collection by offering a breakfast place setting, as well as a sushi place setting. We’re not going to go into the dinnerware business, but we’re making table accessories that also serve a function. Of course, we’re not forgetting about the classic Lladró consumer who loves our flowers, children, and animals. We’re still going to cater to that type of customer, but we also understand that we have to attract a somewhat younger consumer who is looking for something relevant to his lifestyle.

Are these newer products available to consumers on a global basis or only in certain markets?

When we launch a new collection, we do so on a global basis, and so far, it has worked. The Re-Cyclos collection was well received everywhere – Japan, India, Russia, and Europe. That says a lot to us. Of course, we also like to touch on cultural and spiritual icons. So Lladró has recently been doing Indian, Japanese, and Chinese themes, such as Buddha motifs and so forth, and this has been successful as well. This made Lladró a bit more mainstream in emerging markets like India and China. We’re now reaching many ethnicities.

Are you pleased with the number of retail outlets Lladró currently operates?

Our U.S. retailing represents 60 percent of our global business in company-owned stores, so it’s the biggest part of our business. Our largest stores are in New York, Las Vegas, and Beverly Hills – those are our flagships, and our store in Moscow is close behind. In 2008, we will close a couple of stores that are not performing well and focus on the eight stores that present the biggest opportunities for us. In 2009, we may look at additional markets.

How do you train salespeople in your own boutiques and in other retail outlets to truly understand the Lladró brand?

Training and merchandising are the main pieces of our 2008 business plan. We have put in place a new merchandising concept that we feel will seduce the customer. The products will be presented in a certain way through each point of sale, and will carry the same message to the consumer. We’ll follow that merchandising plan up with training. Even the most trained sales associate sometimes fails to explain enough to the customer. They have to explain that, because of our manufacturing process, each piece is unique. I guarantee you that, if you pulled out three or four of the same pieces, no two would be identical. They’re handmade. Each painter has a different brush stroke. Some painters have deeper coloration, and others have a paler palette. If you buy a Lladró piece, you won’t find another like it. Each has unique characteristics. What separates a Lladró from other porcelain pieces is its details. Our pieces have a quality you won’t find in a machine-manufactured item. I think that’s important to the sale, and it’s something we need to make consumers aware of.

Along those lines, does the Internet drive sales for Lladró, or do people have to see the products in person to truly fall in love with them?

We started selling on our Web site last year, and it has been very successful for us. So it has become a flagship store in its own right in the U.S. and in Spain, as well.

Is that because Lladró’s loyal clients already know about the quality and feel of the pieces?

Absolutely. If you are already a consumer who loves Lladró, you know you’re getting the quality, even if you buy from the Web site. Your product will be shipped in perfect condition, and if it’s not, we’ll replace it for you. We expect to see a 25 percent increase in our Web site sales in 2008.

What new products can fans of Lladró expect from the brand?

I believe we could go further with our fragrances and actually use our figurative sculptures as perfume containers. We could make scents for the body, because our scents for the home are extremely beautiful. So you may see some of our floral pieces becoming perfume and home fragrance bottles.