Lutz Bethge, 59, is the president of Montblanc International, based in Hamburg. Founded in 1906, the company today operates in more than 70 countries and is part of the Richemont group. Bethge joined Montblanc in 1990 and is key to the company’s brand strategy of diversifying from writing instruments into other luxury goods. How’s business?
We’re living in interesting times, but the business is definitely still out there. In the early days, luxury was just something that people had to have and to chase. I think that these days people are more careful. They want something authentic, creative and with sustainable value. Tell me about the Montblanc logo
It’s Mont Blanc’s snow-covered peak. The company’s founders chose it in 1913 as it was the highest mountain in Europe and symbolised their own commitment to the highest craftsmanship. What’s the Montblanc philosophy?
People are always prepared to pay for something that is different and has a substantial value. We believe that a product should be of the highest quality and have a timeless design. We’ve never run after the latest trend. We want to create pieces that the customer will still love decades from now. Which is your most iconic product?
The Meisterstück is the classic pen for life. You get it for graduation or your first job or when you meet your significant someone. My girlfriend (now wife) gave mine to me for my birthday 20 years ago, a year before I came to Montblanc. It’s my lucky pen. I’m never without it. Montblanc has always been associated with success. In the old days of Wall Street, the Meisterstück was called the “power pen” because it was used to sign acquisitions and mergers. And kings and presidents have used it to sign papers that have changed the fate of whole nations. I wanted to send Barack Obama a pen for his inauguration, but I was told he wouldn’t be allowed to accept it. Then I saw a picture in Time of him in the Oval Office using a Montblanc pen. So that’s nice. How important is the creative process?
It’s very much part of the company culture. For example, we support the Philharmonie of the Nations orchestra, and it’s played here for our staff. We also have the Montblanc de la Culture Awards and a vast art collection and gallery here for our staff and visitors to enjoy. We also raise a lot of money for UNICEF to promote child literacy. When did the company start diversifying?
In the early 1990s. The writing instruments now represent about 50 per cent of our revenue. That doesn’t mean we’re selling fewer of them. It’s just that the market for them is smaller than for watches, jewellery and leather goods. When I joined 19 years ago, Montblanc only manufactured in Hamburg. Things have changed dramatically. We have acquired companies all over the world and make watches in Switzerland and leather goods in Italy. I’ve been president for five years and have tried to increase brand appreciation. We introduced fine jewellery in 2007 and took over a 250-year-old watchmaking workshop in Villeret in Switzerland. Diversification is a big success — our customers believe in the brand. Would you make less expensive lines?
No. Definitely not. I don’t think it would be right to come up with something much cheaper because it means that we would need a different kind of craftsmanship. When I speak to the people who work in the factory, sometimes they show me a product and say it has to be scrapped as it has scratches. And I say I can’t see them, so they tell me to use a magnifying glass. Should I tell them not to look so closely any more because our products must be produced more cheaply? I don’t think our customers would like that. People would probably love to have Montblanc items for half the price, but that’s not possible because of the work that goes into them. Our customers want the quality and for them the price is only secondary, What’s your largest growing market?
In 2008 China became the number one market for Montblanc. In 2005 it wasn’t even in the top ten. It’s been a huge success for us. We have 100 stores there in about 38 cities. The diversification is even stronger in China, but the writing instruments have been a huge success and sales have been growing significantly. I think the Chinese like the sense of status and success that comes from the brand. In the end, writing is power. Where else does Montblanc sell well?
There are 360 stores around the world. The US is the number two market in the world. The third is Italy. India is a market that’s becoming more and more important to us. Do you spend a lot of time travelling?
Absolutely. Meetings really matter
. If you don’t talk to people personally, you cannot do good business. I was in Bombay last week, then Paris, then LA, then back here in Hamburg. To me it is vital to talk to the customers, to see what their requests are and how they react to new products. It’s all about communication. What are your plans for next year?
It’s too early to say how long the recovery will take, but I believe that the luxury business will always be in a strong position because luxury is about love. If you buy a luxury product it’s either to give it to yourself or an appreciated business or life partner in order to say, you’re important to me. That’s why Montblanc will never stop. The world will suffer many crises to come, but there will always be people who want to show somebody their respect and appreciation. Do you have advice for anyone wanting to launch a business?
You have to know your business and be an expert in what you want to do. Even more than that, you have to know who your customers are. If you know what they like and you’re passionate enough to see it through, then you’ll be successful at any time, whether in a recession, in a crisis or in a boom period. But it’s not as easy as it sounds.
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