In Conversation With Luisa Delgado, CEO, Safilo

Following a strategic move to establish its Middle East and Africa headquarters in Dubai, Luisa Delgado, CEO, Safilo, shares the company’s future plans and how they aim to positively contribute to the eyewear industry in this region

VisionPlus (VP) : Hi, Luisa. Safilo has been known for its elite products, innovation and Italian craftsmanship since 1878. How has the eyewear business been for you, particularly since the last year when you were appointed CEO of Safilo?

Luisa Delgado (LD) : Eyewear is a fascinating business. It’s all about craftsmanship, product and a combination of design and the technical ability to really make and put together a product, and that is exciting and very, very interesting. A lot of work is done with customers in building a brand. Safilo, you know, has 5 proprietary brands which we own and develop.

VP : How would you compare it with the other businesses, like consumer goods for instance?

LD : There are many similarities with consumer goods, like brand building, trade marketing and in-store merchandising, which are similar to other industries as well. And, of course, working with customers to build the business together is something many industries do, and ours has an aspect of relationship which is very, very important. There are many special aspects, and yet also many common things together, which make it quite interesting.

Our business is related to a very comprehensive portfolio and of course, every single segment has specific dynamics with which we deal daily then the luxury and the very high end ranges of our business have very selective and detailed rules and codes. It’s definitely a very interesting industry.

VP : You recently signed a new agreement with Gucci, we hear. Could you please tell us more about it?

LD : We have had the licence with Gucci for almost 20 years. However, the mother company of Gucci has recently decided to, what they term as, take in house of their brand with regards to eyewear, and as a consequence we negotiated together to close the licence two years before the contract was scheduled to mature. Instead, we have added on four years of product development and production for Gucci in exclusivity with Made in Italy for the first two years. And, therefore, we will have a different nature of partnership going forward until the end of 2020. Commercially, we will stop selling at the end of 2016, and as per agreement, we will receive a compensation of 90 million euros for the change of terms
of agreement.

VP : You also have a new collection of Polaroid launched in this current period. What kind of potential do you see for Polaroid in the near future?

LD : Safilo globally acquired Polaroid two and a half years ago, and we have gradually been taking ownership of the brand in every market worldwide, and rebuilding the brand and expanding it globally. Polaroid is a tremendous brand. It has, on one side, the trust in the Polaroid lenses — the original polarised lenses that we make ourselves in Glasgow, Scotland, and its reputation of trust and consumer confidence dates back many, many decades.

Polaroid has quite an accessible price. We wouldn’t want our customers to pay a very high price for the original lenses. We really want to bring value to our consumers, broaden the segment of consumers from children, adult, youngsters to ordinary people. We see that our consumer base for Polaroid lenses is very vast and the value is really appreciated. We are very pleased to now directly offer Polaroid in this region too.

VP : Safilo has now established independently in the Middle East. After 20 years of collaborating with Optitalia, why did you feel that this was necessary now?

LD : It is a natural evolution of any company that, at a certain point of time, it should be directly present in a given market, particularly if the market is strategically important and has big enough growth potential for Safilo. We are tremendously thankful to Optitalia and Mr Mauro Casotto for the excellent work that they have done for us for almost over 20 years. We are clearly in this region what Mauro and his team have made for us and for Safilo. It is a tremendous and positive foundation to build on.

VP : And how would this affect Optitalia?

LD : Our partnership remains very solid. We are simply adding on to this presence for what we call our many, many independent customers. We are adding on a direct presence of Safilo for certain key account customers with whom we wish to build business directly. That’s how the partnership continues to grow into the future, and like in any business venture, when the time is right, the mother company of the brands needs to be directly involved in each important region.

“Optitalia is a very important partner for us, and we are here to enable them even better, in turn, to do their partnership with customers”

Remember, we have 24 licensed brands, besides the proprietary brands in our portfolio, and we only need to go broader as well as deeper and learn from the consumers in this region. So, that is the purpose of this step which, I repeat, is not unusual in any industry as companies look at their global market and grow broader and broader into the world’s market.

Optitalia is a very important partner for us, and we are here to enable them even better, in turn, to do their partnership with customers.

VP : Safilo is one of the biggest players in the world. What kind of an impact or boost can the Middle Eastern eyewear industry expect with your direct presence here?

LD : There are, perhaps, two-three angles to consider. For us Dubai is a hub, and it is a hub of Middle East very clearly. The Middle East itself is vast,
in the sense that there are many important markets in the Middle East for us, where we see we will clearly grow over time. The region has many people as well, even beyond the immediate region that is. For instance, Egypt has over 50 million people.

We also intend to use this move as a springboard for the whole Africa region. We want to get to know the consumers and consumer needs of this vast region better. We think that with our presence we can have a positive contribution to the eyewear industry in this region, strengthening partnerships with the very important and some very innovative retailers that we have in this region and make our contribution.

VP : What about design development for the Middle East market?

LD : It would also be my hope to get to know designers in this region, as well as to launch some inspiring additions and bring some of the interesting and creative work in eyewear that is happening in this region, particularly in Kuwait. As one of the bigger players in our industry, we hope to make our contribution. I do believe that, in the present or near future, we will start seeing stylistic influences from across the world playing a role in our industry.

VP : What are your plans ahead in terms of enhancing relations with opticians?

LD : As I said before, we are concentrating on enhancing our relations with certain bigger customers and key accounts in this region, while we will work via Optitalia with individual opticians. Our direct plans with the chains and with big key accounts are clearly to work in the spirit of building business together, having joint business plans and working together on complete packages of how we can drive in-store marketing, logistics and total commercial conditions that will incentivise to build efficient performance forward.

VP :  Would there also be increased consumer interaction and engagement directly from Safilo?

LD : The more you are in the region, the more you understand the needs of the region. Our primary strategy is to know the consumers so that we can serve the right models and right styles and subsequently enable the opticians to do their job and build their loyalties with customers. And, of course, then digitally communicate so that consumers get access to knowledge which we believe we are obliged to provide to the market.

Besides this, for our proprietary brands, we are clearly going to drive them further through consumer marketing, and also our licensed brands, wherever it makes sense. For instance, if you go to some key countries in Europe, you would see Polaroid advertised big time and it is one of the key brands. Few consumers know exactly what a polarised lens does and it is our job to explain that. It is important, it is very useful, and it should be known.

VP : In the long term, does Safilo ever plan to enter retailing?

“Safilo has a strategy of being a superior product creator”

LD : No. Safilo has a strategy of being a wholesaler. This is a different strategy from several of our competitors. You may ask why. It’s primarily because we don’t want to be competitors of our customers. We want to be an independent wholesaler who works
with every retailer in an independent, neutral, but very committed way. Safilo is not a retailer.

We do have 130 stores in the US for historical reasons. However, their main purpose is to be a marketing tool and a shopper laboratory for us in the prime locations of US. We have several stores on 5th Avenue, World Trade Centre, prime locations in Miami, San Francisco, Los Angeles, but not because we want to be a retailer, but because we inherited those stores. Once we had them, we decided that we could have them as a learning laboratory to become a better wholesaler when we sell to our customers. But that is an exception.

Safilo has a strategy of being a superior product creator; we want to be at the forefront in terms of product quality innovation, technology creativity and
as a wholesaler, partner of the retailers. But we don’t want to be competition to our retailers.

VP : Thanks, Luisa, for talking to us. We wish you and Safilo all the very best for the future.

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