NEW YORK — Paul Blum, just seven months into the job as David Yurman’s chief executive officer, is already bringing a new whiff into the air.
In an effort to propel the $500 million brand into the next stage of growth, the 26-year-old jewelry firm has inked a deal for its first fragrance with Groupe Clarins.
But the beauty deal is only one leg of Blum’s strategy to grow the Yurman brand. The company also plans to aggressively expand internationally, including the opening of the first freestanding stores overseas, beginning in the Far East, said Blum.
Terms of the fragrance deal, which was signed Tuesday, were not disclosed. Ancillary products are also part of the Clarins contract.
“For the best product extensions, it’s important to have two things,” said Blum. “It needs to be an understandable evolution of the brand, which the consumer has an emotional relationship with, and there has to be a close relationship to the brand.”
David and Sybil Yurman, the husband-and-wife founders of the firm who in January appointed Blum as the company’s first ceo, will work closely with Clarins on designing the bottle and the fragrance. David is designer and chairman of the firm, while Sybil is president and chief marketing officer.
“The real big news is the fragrance,” said Jonathan Zrihen, group president and ceo of Groupe Clarins USA, of his first big project since taking his post in September, noting the companies had been in talks for over four months. “Clarins has always given a lot of attention to the personality, the values and the creativity of the brands we’ve been signing licenses with. We are more interested in the people behind the brand, and what we really liked in the David Yurman brand is the personality of the creators.”
Zrihen said it was too early to project sales, although the fragrance for the first 12 months will only be sold through Yurman’s existing distribution channels. That amounts to only hundreds of doors, and industry sources estimated that as a result sales of the fragrance in the first year would be about $2 million to $3 million at retail.
A $1.3 billion company, Clarins also produces Thierry Mugler Parfums and Azzaro fragrances.
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Though a launch date has not been set and the fragrance has yet to be created, Blum plans to advertise the scent using Yurman’s current campaign contrived by ad guru David Lipman, with black-and-white shots of Kate Moss photographed by Peter Lindbergh.
Blum also plans to increase the jewelry company’s focus on watches and men’s jewelry, fairly recent additions to its product array, but said Yurman won’t license out many categories, unlike the strategy he employed in his 15-year stint as president of Kenneth Cole.
On par with Blum’s growth plan, in late December Yurman will open a 1,000-square-foot flagship on Rodeo Drive in Beverly Hills, which Blum dubbed the company’s first international store by virtue of the scores of shoppers from Asia and elsewhere.
“Learning about this business and the jewelry business has been an incredible experience,” said Blum. “This is our strategic plan for where David Yurman is going in the future. It’s been fun, and things are starting to coalesce.”
The Beverly Hills store is expected to bring in $4 million in sales in 2007 and is being designed by Yabu Pushelberg, who is also designing Tiffany & Co.’s new store in New York’s Financial District. The space’s open-air layout with glass and wood jewelry cases is more inviting than typical jewelry stores, according to Blum. A light installation by artist Catherine Hibbits inhabits the rear of the space.
Yurman’s 10 U.S. stores will be updated to coincide with the look of the Pushelberg-designed emporium, while specialty stores that carry the brand are in the process of refreshing their Yurman selling spaces to meet the new aesthetic.
Yurman has stores in locations such as Bal Harbour, Fla., Houston, Atlanta and at 729 Madison Avenue in Manhattan. In March, the company will open a store in Austin, Tex., while Blum is seeking another retail location in New York and others in major U.S. cities. The company has yet to tap key retail havens like Boston, San Francisco and Washington, D.C.
In 2007, Yurman will open its first international stores in Macao, Hong Kong and Tokyo, which also will be designed by Pushelberg. The stores will range from 1,000 to 2,000 square feet. The firm is contemplating opening additional units in Bangkok, Taiwan and Seoul. Yurman is also setting up an office in the region.
Each of the new Yurman boutiques will feature installations by a different artist, referencing David and Sybil Yurman’s own artistic backgrounds. David started as a sculptor in the Seventies, and Sybil was a potter and printmaker. Each store will also have exclusives from the firm’s Couture collection, a pet project of David’s in which he experiments with higher-priced stones and more elaborate pieces
“We have a big international clientele in American stores,” said Blum, adding that the firm advertises a bit in Europe and Asia.
The company has had some international wholesale distribution in Canada, the Caribbean and Mexico, which it plans to grow, although the vast majority of Yurman’s sales continue to come in the U.S. In the next few years, Blum envisions opening stores in select European cities.
“It’s not about being big, it’s about being beautiful,” he said of the growth. “The David Yurman brand is really about American luxury. It’s more accessible than European luxury. It’s a high-quality product that has a classicism and strong icons, and I see that translating internationally.”
The firm sees watches and men’s jewelry, launched in 1994, as budding opportunities.
Yurman has its own watch factory in Jura, Switzerland, that produces popular watches like the Cable and Madison styles, which take influence from the jewelry collections of the same name and limited-edition watches like the High Jeweled Pavé Diamond watch from the Thoroughbred Watch Collection, retailing for $35,000 and in high demand by retailers this holiday season due to its limited run of 10 pieces. Yurman’s watch business was up 10 percent in 2006, and the company plans to grow it by another 15 percent in 2007, with a watch ad campaign featuring still-life images of the watches and an increased focus on limited-edition styles.
This week, the company sent out its first all-men’s catalogue featuring styles like dog-tag pendants done in silver and pavé diamonds and chunky rings set with gray and red dinosaur bones. Sales in the men’s jewelry sector are ahead 25 percent this year, and the company plans to grow it by another 30 percent next year.
Emanuel Weintraub, president and ceo of Emanuel Weintraub Associates, said the brand can grow from $50 million to $60 million a year with these strategies in place, but with an expansion of this breadth comes some risk.
“They have a very good reputation, and their product is widely accepted — that’s not an issue,” said Weintraub. “The risk is, is the organization properly positioned to deal with the geometric complexities of multiple businesses? If their reach is greater than their grasp, it could be fatal.”
On the brighter side, Weintraub noted that Asian and European consumers continue to be taken by the concept of American style and that there is booming demand for luxury goods like fine jewelry and watches.
“Yurman will not sweep Europe or Asia,” he said. “But there will be enough people in these teeming markets to support the brand.”
According to LGI Network, a Randolph, N.J.-based independent audit firm that measures the sales performance of watch and jewelry brands at retail, the market for women’s watches in the $1,500 to $5,000 price range amounted to $450 million in sales for the 12 months ended in July 2006, a 7 percent growth.
Candy Udell, president of London jewelers, which has five stores on Long Island in New York, believes that Yurman’s watch business has tremendous promise.
“[Yurman] is our top brand in jewelry for sure,” said Udell. “There’s so much potential for the brand to grow with the watches and men’s jewelry. Their brand name is so strong that they can go into many different categories and continue to be successful.”
The brand’s stepped-up expansion program not only will grow the company’s sales but allow David and Sybil Yurman to increase funding of their charity, the David and Sybil Yurman Humanitarian and Arts Foundation. The privately owned company is funneling an additional $1.5 million into the foundation, which contributes to the Creative Artists Agency’s art auction to benefit Project Angel Food, Los Angeles Museum of Art, P.S. Arts and others.
And as for those within the industry who doubted whether the always-in-control Yurmans would be able to cede day-to-day decision-making to a ceo from the outside, Sybil dismissed such concerns. “We’re really on target with Paul,” she said. “He’s very smart. He moves in a more studied, thoughtful way then we do.”