Welcome to Eat Takeaway! In this series we hear from business, brand and marketing leaders on their ambitions and challenges this year and beyond. We explore their day-to-day and what lessons they have in the fast-changing and sometimes overwhelming worlds of brand experience and delivering for customers and employees. Check-out our take-aways at the end!
In our first volume of 2024, our Head of Growth Robert Costelloe speaks with Colin Chow, President and Representative Director of iconic home accessories brand Lladró. With the brand known for its precious porcelain figurines turning 70 last year, we hear about Lladró’s storied history, customer preferences across international markets as well as where the brand is experimenting with new partnerships and collaborations.
Please note this interview has been edited for clarity and brevity.
Robert Costelloe: Thank you so much for speaking with me, Colin. I think many people know the name Lladró and its iconic porcelain figurines, but tell me a little bit about the history of the brand and how it came to Japan.
Colin Chow: So Lladró was founded in Valencia Spain in 1953, starting from a small atelier, a workshop, and then growing into a fully-fledged factory where the company is still headquartered today. Originally the business focused on figurines, depicting scenes from Victorian times for example, but over the past 70 years, we’ve evolved a lot and now the business is spread across three main areas.
The first is what many in Japan would see as ‘THE’ Lladró, the figurines which convey the heritage and classical nature of our brand. The second is what we call the ‘new concept’ which is taking the figurines but bringing in different inspirations, cultures, designs or trends to the product. So recently we’ve had a collection inspired by tattoos as well as a collection based on Japanese origami.The third part is lighting of which we do a surprisingly large amount of business. So we are talking chandeliers, wall lamps, table and floor lamps.
We’ve been in the Japan market for around 40 years, operating as a 100% subsidiary of Lladró in Spain. We started out really assessing the opportunity for the Lladró brand in Japan, doing research and trying to identify the strategic opportunity, and then growing the business in Japan from the 1980s onwards or so.
RC: And what does your day to day look like? What’s taking up your time?
CC: All Lladró products are still made at our factory in Valencia so we import the product directly into Japan and sell to consumers here. Retail is around 80% of our business so we have big representation in the main department stores across the country. Those department stores are in the major urban centres, but we’ve operated a wholesale business with regional department stores. These regional stores are a challenge though as less urbanized areas continue to depopulate. We also have wholesale business with independent stores, be they lighting companies, or home interior shops, as well as an online business. We have around 70 people in the organisation here in Japan.
We started out really assessing the opportunity for the Lladró brand in Japan, doing research and trying to identify the strategic opportunity, and then growing the business in Japan.
Ultimately my role is pretty hands on. When I started with the firm four years ago, we were in the middle of COVID so it was all about survival. It was really, really tough. My thinking at that time was ‘How can we get through this, how can we keep paying our staff and keep stores open?’. Now, obviously we are past that challenge but there are plenty of other challenges to tackle. We have a lot of tourism coming back to Japan but the dynamics have shifted. Tourists aren’t spending at the same level and domestic audiences in Japan have evolved. During COVID, people were spending a lot more time at home and taking a big interest in their homes and interior design. But today we are competing with Japanese consumers spending their money on overseas trips and experiences rather than their homes. So a lot of my time is figuring out how do we adapt to these changing spending patterns.
RC: How is a Spanish brand like Lladró perceived in Japan. Does a Spanish story come through in how you communicate in the Japan market?
CC: Typically Japanese people travel a lot. So possibly they’ve been to Valencia, they’ve been to the Lladró museum and the factory. The fact that we have kept all our manufacturing in Valencia has been a real strength compared to other brands. Of course, Japanese consumers care about quality so that is a big selling point in our communications. And colour also plays a big role – conveying a Spanish palette, inspired by the Mediterranean, with warm colours that you actually don’t find easily in Asia or Japan. We don’t really see a competitor that is close to what we do, producing these exceptional, beautiful pieces that customers want to display in their homes or offices.
RC: And how is the Lladró product and brand evolving, be it here in Japan or globally?
CC: We are updating our core product catalogue very frequently, so moving almost to more of fashion brand model where you have Spring Summer and Autumn Winter collections. This sense of newness is helpful but it requires a lot of effort. Broadly we have the same product catalogue as other markets and territories but we also have products that are very tailored to the Japanese market. For example, you will see our hina dolls in department stores across Japan until March 3rd which is Girl’s Day, an annual festival in Japan that celebrates the health and happiness of young girls.
We have a lot of tourism coming back to Japan but the dynamics have shifted. Tourists aren’t spending at the same level and domestic audiences in Japan have evolved.
RC: Does this also extend to how partnerships support the brand?
CC: Clear in everyone’s mind at Lladró is a constant need to renew and tap into new customers. Our typical customer is over 40, and in most cases in their 50s or 60s. They have money – our products are not cheap – and they are at a period in their lives where they are appreciating the finer things. They are not in their 20s, fighting for a job. They have stability, their kids are probably heading off to university and the worries are lessening. But we still need to rejuvenate our clientele. There are a lot of younger consumers out there with money to spend so we need to introduce them to our brand and partnerships have been a very strong way of doing that.
We’ve had a very successful partnership with the Star Wars property which included in the collection a 70th anniversary, limited production, gold Darth Vader figurine. This was completely sold out almost immediately. It’s been a great way to present Lladró to younger audiences.
We’re also trying to bring the art world more into the partnerships we develop at Lladró. So developing unique pieces with artists, not only product designers but also designers from a range of backgrounds. For example we created a beautiful chandelier with the famous Japanese designer Naoto Fukasawa and just launched a partnership with a Spanish artist Javier Calleja at the world’s largest art fair, Art Basel, in Miami. This is a new challenge for us but we are doing something quite unique. The partnership with Javier comprises 25 unique, unrepeatable works with each piece having its own decoration and is hand signed by the artist.
So we are experimenting a lot and trying different things. Be it different designs, colour palettes, or different marketing approaches, we are trying to tap into a wider audience – not just the audience that knows our classic porcelain figurines but an audience where we can design products that are relevant to their lives.
Clear in everyone’s mind at Lladró is a constant need to renew and tap into new customers.
RC: Where do you see Lladró moving as a brand in the future?
CC: We’ll continue to strengthen our position across all three of our core product areas – the classic figurines, the new concept, and lighting. This means strengthening the product offer but also streamlining our operations to better deliver product and managing capacity when the demand is growing. We also want to continue to expand Lladró’s connections and participation in the art world. Our latest partnership is at such an early stage but if its successful, we will certainly look to develop new partnerships with artists and bring the brand to new, bigger audiences.
RC: And what will success look like for you in 2024?
CC: In 2023, we had our 70th anniversary as an opportunity to drive engagement for our brand, an opportunity we won’t have in 2024. But there are new opportunitiues coming along as well – new partnerships and collaborations – that can support our success in the year ahead. Ultimately if we can continue the success of 2023, I’ll be very happy.
The Eat Take-Away
Know the market: Assessing the market opportunity is an absolutely essential first step for a brand considering entering the Japan market. We speak with brands everyday and too often there is a preconceived notion that what works in a brand’s domestic or other market, will work in Japan. Wrong. With its unique historical, cultural and socio-economic attributes, Japan truly stands apart from any other market. Taking it slowly, exploring target audiences, potential competitors, channels and macro-economic conditions is a must-do, even if you’re just exporting to Japan. And be patient. If you’re expecting results from this market within the first year, prepare to be disappointed.
Brands never stay still: Many long-established or heritage brands can be uncomfortable with change and doing new things in new ways. An adherenece to ‘tradition’ and an unchangeable story can mean they quickly lose relevance and consumer engagement. Brands are evolving, flexible things and they never stay still. In recent years, we have seen global and local market issues that have drastically changed the consumer landscape. During times of plenty, organisations can be prone to sit back and enjoy these good times. Don’t. Always be thinking about where your brand can move next, building in contingency and adaptability to the brand so that it quickly move and adapt to whatever market change comes next.
The right partnership: Over the past decade brand partnerships have explored with tie-ups becoming an almost endless source of reinvention and opportunity to engage new audiences. Be it partnerships with other brands, designers, artists or musicians, evaluating how and where your brand can extend must be a carefully executed exercise. Many brands have built partnerships that have moved the brand into territories that cause confusion to the consumer – be they current customers or potential customers. No one wins. By evaluating where authenticity for your brand truly lies you can identify the industries and products your brand can naturally stretch into, delivering new products and experiences that delight and excite rather than confuse and anger.