February 05 2013
Lucia van der Post
Asprey, that intimidatingly grand establishment store that has been right at the very smart end of Old Bond Street since 1847, that has seen as many family bust-ups, boardroom imbroglios and twists of fortune as the Ewings of Dallas, is turning a corner.
Those who have followed its history have watched with sadness as nothing has quite worked. Chief executives – most highly experienced, all well meaning, all desperate to get it right – have come and gone. Designers have been hired and fired, product ranges changed, the building glammed up by England’s finest (Norman Foster did the architecture, David Mlinaric waved his magic wand over the interiors), starry parties held, and yet, and yet… it’s no secret that customers have been few and profits elusive.
Now, however, Paddy Byng – Asprey’s managing director, brought in by New York-based financier John Rigas, whose Sciens group bought the brand seven years ago – is feeling quietly confident. “We won’t have made a profit in the 2012-2013 financial year because of all the investment that has gone into the company, but we are on track to declare one next year. Already, sales for the year ending March 2012 are up 11 per cent compared with March 2011, with sales of jewellery rising 36 per cent and silver 18 per cent. Sales from April to the end of September 2012 are up by 30 per cent compared with the same period in 2011. And in 2012-2013 the business is forecast to turn over $37m.” Meanwhile, the New York-based Luxury Institute (an independent research organisation that follows the high-end goods industry) declared Asprey to be one of the top two luxury jewellers in 2012, based on a survey of affluent US consumers. All this is good news for those who want to see a venerable and quintessential British brand flourish and be restored to its former glory.
Many FT readers will be familiar with some of Asprey’s historic convolutions, but it’s worth putting this new, heartening revival into context. Founded by William Asprey, the retailer began life as long ago as 1781 as a humble draper’s shop, although right from the start it always aimed high. Back then its stated ambition was to provide the finest of the fine for the cultivated Englishman of the day. And that Englishman was a sophisticated being, not easily pleased. Early on, Asprey identified the sort of treasures he needed to fill his houses. So throughout the heyday of the empire it trawled the world – the Middle East, China, Africa, Japan, the Himalayas – for all the appurtenances the good life required, and brought them home to sell to its select band of privileged customers.
By the early part of the 20th century, Asprey was a byword for a certain sort of English elegance and was the go-to destination for the newest and the best in porcelain, crystal, silver, jewellery, rare books and exotic wooden objects, and for sceptres and coronets, as well as quirky yet peculiarly appealing presents. It was known around the world and through its portals came maharajas, sultans and sheikhs, as well as landed British gentry and monarchs from the European royal houses that had managed to keep their crowns. And it’s salutary to remember that by the 1970s Asprey was in a similar league to Louis Vuitton and Hermès. But then the two French houses began to power ahead, while Asprey, as Rigas puts it, “missed the evolution of luxury and let the opportunity slip away”.
Then came years of endless boardroom drama and haemorrhaging profits until the Sultan of Brunei’s younger brother, Prince Jefri Bolkiah (mischievously rumoured to be Asprey’s chief – if not only – customer), bought the brand for £243m in 1995. It wasn’t long before Asprey became known primarily for selling pricey trinkets – a sorry fate for a once-glamorous brand.
Riding to the rescue in 2000 came a couple of white knights in the shape of entrepreneurs Silas Chou and Lawrence Stroll, who reputedly paid some £100m for the combined Asprey & Garrard brand (in 1998 the Brunei Investment Authority had yoked the two together). Chou and Stroll had made their fortunes by buying into Tommy Hilfiger in 1989, and by the time they took the company public in 1992 they had multiplied its profits several times over. This led most commentators to think they had the Midas touch. They also seemed to be willing to dip into their very deep pockets, and had huge ambitions. They made it clear that they wanted to turn Asprey into an über-luxe brand with a global reach and an international network of stores, a British Hermès or a Louis Vuitton. Stroll went so far as to say: “We intend to hold this forever – forever means I intend to pass it to my children.” Words that rang hollow when they abandoned the company to HSBC not long after, and Rigas (along with the now-defunct Plainfield hedge fund) purchased it from the bank for $44m – a sum that included quite a lot of debt. The very same day he sold on the Garrard part of the business for about $14.5m.
But the revival has taken a long time, and I suspect that Rigas, whose speciality is turning around struggling companies, has found it harder than he thought. “High luxury,” as he puts it, “isn’t simple. It takes a while. You have to get a lot of things right – product, quality, supply chain, aesthetics, tone and style, and pricing position.” As every other owner or chief executive before him has found, Asprey, in spite of all the commercial shenanigans, had never entirely lost its allure. The brand, as Stroll told me all those years ago, “may be a little faded, but it hasn’t been damaged, it hasn’t been debased or spoiled by licensing or fakes”. And it was after all, as Rigas points out, “one of the first luxury brands to be closely connected to royalty and the high aristocracy – Fabergé is the only other company that has a comparable history”. He also sees Asprey as occupying another niche in the luxury world: “Some do jewellery, others do accessories, but very few [although Hermès is clearly one other] can be called lifestyle brands.”
The strategy he has devised with managing director Byng, who runs the company day to day, has involved a lot of brow furrowing. “John’s vision,” says Byng, “was to take the company back to the good old days when it was the apex of the luxury world.” But then they had to decide, “What is luxury today?” Rigas is very clear: “It isn’t merely a matter of exclusivity. Luxury has become more democratic, so the companies providing it have made their products more available, and that has watered down one of the basic elements of the luxury experience – the sense of discovery. We have to reintroduce that today; buying something from Asprey has to involve a sense of discovery. When people used to go to Paris’s or Florence’s little craft-based ateliers, it was this that made what they bought seem special. Many people confuse things that are expensive with luxury – it has little to do with price. You can have a very simple object, like my silver pencil sharpener, which didn’t cost a lot but to me is a luxury because it does what it has to do beautifully and perfectly.
“My vision,” continues Rigas, “is to do the opposite of what many companies do now. They want you to buy something new in three years’ time, whereas we want you to love whatever it is you buy for 30 years and pass it on to your children. Mass market has an appeal – the siren call of money – but if you give in to it you lose your soul, you lose everything precious and you’re gone.” He also thinks that “there has to be one vision – and only one. Aside from the product categories, we asked ourselves, ‘What does the brand stand for?’”
They see Asprey, it turns out, as the place for the ultimate gift, which means that if it is to be at the summit of luxury anything bought there has to seem like the utmost expression of gratitude and love. There needs to be “innovation, and real quality and refinement”. Then they both always come back to craftsmanship: “We have to hold on to that in the face of China,” says Byng, “and so we are pushing our artisans to do work that they haven’t done before. Our silver isn’t pressed out and stamped the way it usually is in east Asia; ours is all handmade.” While much of what Asprey sells is designed and made in the UK, it has also gone to Murano to find craftsmen to create things specially for it: champagne flutes, wine glasses, decanters and candelabra. “We’re keeping the craft alive,” says Byng, “which is something Asprey has historically always done.”
Furthermore, both Rigas and Byng believe luxury has to revolve around a small-scale, intimate experience, so that customers have a real involvement in the product they’re buying, which is why for the moment they’re concentrating on reviving the London and New York stores. But they draw their brand identity from only one side of the Atlantic. As Byng puts it: “We’re trying very hard to root our product in a British aesthetic. We do that by getting people such as Shaun Leane, the quirky, edgy jeweller, involved. His Woodland collection [from £1,600], featuring the quintessential symbols of British woodlands – acorns, blackberries, oak leaves and the like – has been a sellout. Of course, you can do Britishness in several ways. You can introduce irreverence and wit – something we also try to bring to the products.”
The 44,000 products Asprey stocked when Rigas and Byng came in has been cut back by half. They asked themselves, “What is the core of the brand?” They decided it should be jewellery (which makes up some 50 per cent of sales), china, leather, silver and books. They stopped doing clothes. “Even though they were among the best in the world,” says Rigas, “nobody thought of going to Asprey for clothes, so there was no point in them. It isn’t ‘us’. What is ‘us’ is handbags.”
When they first produced a few bag designs in exotic skins, some embellished with jewels, and invited a select group of customers to see them, they were astonished to find that the four most expensive sold first. “It told us,” says Rigas, “what our customers want from the brand.” And when Rigas’s wife Darcy came up with a reworked version of an old Asprey steamer bag that she loved (now known as the Darcy), with the exotic-skin versions priced at £12,000, they found that it began to sell by word of mouth – again showing they were right to suspect that their customers were looking for things that were special and different. They’ve now brought in handbag designer Katie Hillier, who didn’t want, as she puts it, “to reinvent the wheel, but just to bring a little new energy to it. When things cost this much money, you have to be quite careful. At Asprey we use the best skins, the best fittings, and so I wanted to keep the designs quite simple, so that the craftsmanship could be seen.” One example, the Morgan day bag (£15,000 in crocodile, £4,800 in python and £2,000 in nubuck), inspired by a briefcase a stylist was carrying, has become a bestseller – what Hillier calls “an iconic, forever piece”.
The very specialist areas, such as the rare and limited-edition books, the book rebinding and the bespoke jewellery services, are all to be kept – as are the workshops at the top of the store. Artists have been recruited to hand-paint china and to engrave glass. Everything has to be special and not found anywhere else. “This is arguably,” says Byng, “what luxury used to be all about.” And then he reiterates: “We are not in the fashion business – we are in the heirloom business.”
But what is interesting about the new regime is that they think very differently from Stroll and Chou. Global domination is not on the agenda. “We believe,” says Byng, “that we can create a meaningful business on a smaller footprint.” Both Rigas and Byng feel that the sort of customers they are interested in, those who are really discerning and sophisticated, are “tired of the ubiquity of luxury” and find brands that aren’t so visible infinitely more exciting. It is not about aiming to have 200 stores but more like (eventually) 20, coupled with what Byng calls “an engaging and content-rich e-commerce site”.
The company has now been independently valued by Brand Finance (an internationally known brand evaluation and strategy consultancy) as being worth between $200m and $250m, so it looks as if Rigas is on to a very good thing. “It is wonderful how resilient the brand has proved to be,” says Byng. “It’s been around for over 230 years, and although it has had a rough patch, in the context of its long history that’s a very small part of the overall picture.” Rigas has made it clear that he’s in it for the long term (“He’s very emotionally connected to Asprey,” is how Byng puts it) – and it looks as if, unlike Stroll and Chou, he really means it.