China is set to be upmarket jeweler Cartier's largest market in the world within three years, according to the company's president and chief executive officer.
Bernard Fornas - in Beijing to launch a Cartier exhibition at the Forbidden City - said there was now huge demand for the company's ranges from China's new rich.
"I think China will be the number one market for Cartier in three to four years and that is our aim," he said.
Cartier currently has 32 boutiques in 18 cities across China, its fourth largest market.
"I think cruising speed for Cartier over the next three, four or five years will be about 55 boutiques to cover the country properly. In five years, the country can change further and maybe what I am saying now will be wrong and it could be 75," he said.
Cartier was founded in 1847 and is now part of Richemont, the Swiss luxury goods group.
The group reported a 31 percent fall in net profit to 1.075 billion euros in the year to end of March this year, hit by weak sales in the United States.
Fornas says the focus on China is part of a strategy to make the company less reliant on Western markets and to tap into the growing wealth in the East.
He said it is also one of the company's key approaches in combating the economic downturn.
"Our strategy was to prepare Cartier for the worst when everything was going well. In 2006 and 2007 the sky was blue and everyone was bullish but you could be sure one day there would be a bearish trend," he said.
Cartier first came to China in 1992 with one outlet, which it closed in 1998. It made a concerted effort to build a significant presence from 2000.
"We made a real start with the intention of becoming a leader then. We began putting in the right money and invested in products, public relations, boutique networks, and communications and this has paid dividends."
Fornas, 62, who visits China up to 10 times a year, took over his current role in 2002.
He began his career in mass volume, rather than luxury goods, with Procter and Gamble, joining Cartier as international marketing director in 1994.
He says the Chinese buy anything from love bracelets priced at 15,000 yuan to 150 million yuan necklaces.
"There is a market in China for all these products because the market is diverse. You have very rich people to secretaries who buy our products."
Cartier is currently displaying 346 classic pieces at the Meridian Gate Gallery of the Palace Museum.
"We believe the exhibition builds on the phenomenal image of Cartier," he said.
Fornas said Cartier had not matched its China success in India, mainly due to the imposition of 50 percent luxury taxes there. He said affluent Indians tend to travel to Dubai to buy luxury goods to avoid the tax.
"India will take off one day. It is the only place that has such high luxury taxes. The taxes in China don't compare," he said.
Fornas also says its key Japan market will be quite tough for the foreseeable future.
"Japan is more difficult today for all types of product categories."
Fornas admits the company was tackling the problem of fakes in China.
"We have been quite active on this with quite outstanding results. I think it is quite difficult to find fake Cartiers compared to other brands now," he said.
(China Daily September 10, 2009)