Who is the new luxury consumer? Richard Mille’s Peter Harrison on adaptability and knowing your customer

0:11Hello and welcome to The Entrepreneurs on Monocle Radio, the show all about inspiring people, innovative companies and fresh ideas in global business. Today's programme is all about knowing your customer, whether you're operating at the cutting edge of timekeeping technology or at the heart of a hospitality empire. First up, we'll meet the CEO of a Swiss watchmaker to find out about the changing needs of luxury consumers. In the last 25 years, wealth has changed. I think what's happening in the last two or three years is more about how perhaps big groups have struggled to reach a changing consumer.

0:51And later, we'll head north to meet the co-owner of the largest hospitality group in the Nordics. The best hotels in the future are going to be the ones who take an active part in shaping the customer demands, not reactively just sitting waiting for it. This is The Entrepreneurs, with me, Tom Edwards.

1:16You're listening to The Entrepreneurs. Peter Harrison is the CEO of Richard Mill, Europe, Middle East and Africa. The Swiss luxury watchmaker is dedicated to creating pieces that are expertly engineered, lightweight, shaped by a fascination for technology and a passion for racing, and made to be worn every day. Founded in 2001, the company's growth has been truly remarkable, especially when you consider those founding principles endure with the painstaking production of limited quantities of truly exceptional timepieces. Also at the heart of Richard Mill, a focus on direct relationships with clients and always a product-first attitude.

1:57Our Laura Kramer caught up with Peter at one of the world's most exclusive winter gatherings, the International Concourse of Elegance Samarits, sponsored by Richard Mill. Laura began by asking Peter what made the brand so radical from its very beginnings. I think the way we set about making watches was different to anything else that had been before. And the type of watches we were making were made to be worn, rather than that type of watch before was more something that was either historically important or the top of the tree in terms of what a brand made. And you put it on once a year and you showed your children, you put it back in the safe again.

2:44And ours were made to be warm every day. They were very distinctive the way they looked. They were very light in the most part. And that was a new thing. And how did you originally get involved at the start of the company then? So Richard and I have been friends 35 years. we both worked for separate companies i worked in london for a small plc that i think we distributed around 15 luxury brands and richard worked for a company in paris called mobisa and we collaborated on a few things didn't work out and then we stayed friends and we'd see each other two or three times a year. I went off to do my own thing.

3:29And then he went off to start the company. Maybe after one year, we had a, there was a funny, I was doing some things, we were doing some things together. And he wanted to make it quite correctly, more formal. So we started a JV company and set it up together. And when you look at, you know, I keep going back to the beginning, but it's so interesting because for Swiss watchmaking, it never wanted to conform. There was this attitude of rebellion, like you said. It was so different coming in. Do you think that attitude is still prevalent today? And how hard was it to keep that going throughout? Maybe now those values have changed.

4:09No, I don't think so. I mean, we work with really good people. Obviously, as a company, we're significantly larger than we were before. You know, in the beginning, we were making 10 or 15 watches a year. Now we're making 6 ,000 watches a year. you know the way the company's grown we've managed to keep the core dna of how we started which i would sum up in quite easy ways that you know we have an idea to make a watch we go out we figure out how we're going to do it sometimes it can take two years sometimes it can take seven or eight years and then finally the watch comes and we look at everything and the watch is going to sell for x amount that's how we've operated from the beginning we haven't ever set out and said we need to make a watch that sells for y because we've got the one that sells for x and we've got the one that sells for z and we need something we've never set out to do that we have an idea what we want to make how we want to make it we go look at how we're going to manufacture the movement what sort of cases we're going to use what the ideal scenario is going to be how it's going to be warm that applies for men's and women's watches and then at the end that's the product and it's i'd say in the luxury industry that's pretty unique because most people set off and say right we need to make something for x because we've got all these other areas done and so all our work is in the research and development the marketing perhaps and And the product, the price of the product is kind of at the end.

5:45Well, you brought up growth there. And I did want to touch on expansion. How do you decide that a market is ready for you? What are those factors that you look for? And is there an area that you're really excited about going into that maybe you're not there yet? Well, yeah, I mean, the company changed a lot, I would say, around seven years ago, when we decided to only sell through our own retail outlets. That was great because that was a real game changer. We already had, I think, maybe around 20 stores. Now we have around 45, 46 stores. And the fact that you as a client could come into a Richard Meal store and see everything rather than perhaps go into a retailer who would pick, you know, a certain type of watches that he felt would represent what his customers would want from Richard Mill.

6:42And that was a big change because, for example, our ladies' watches were important and we had this one particular watch called the Diamond Cruncher. And it was a great watch, great women's watch. But a lot of retailers thought, actually, I don't want to really sell that. I can't sell that. I've got this brand, which is perfect for women. I've got that brand. I don't really want the Richard Meehl women's collection. So it was kind of difficult in the beginning to get a comprehensive collection into a store. So having our own stores, that changed everything. And clients would come along. It made a big difference the way we were able to grow the brand.

7:24And then going on to the other bit of your question, that then restricts. you know having a store you've got to build the store you've got to make sure you're in the right place you've got to find the right location and that all takes time and the sales from that store you know the demand from that store is so high to then go out and say oh well let's go open another store over there or over here where we know there's demand it's very difficult when you've got a wait list as long as your arm in your existing store so that's been quite restrictive however as we've been able to grow the brand we're now in a position where we can open new stores and the one i'm very excited about this year is in madrid i mean our best ambassador our most well-known ambassador is rafa nadal and to have a store in his not necessarily his hometown but his home country is a really big thing for us we always sold in spain when we started the company we had I think three or four retailers on the Spanish mainland.

8:29And I saw the old king of Spain in Abu Dhabi a month ago, and he's still wearing his Richard Mill. And that, I mean, that's an important market for us. And we haven't been able to really do it justice. And the fact that we're going there and we're going to open a store, that's really exciting for me. One of the things that we're really, really focused on, and I know it's a big bugbearer Tyler especially is discovery and how you still bring a sense of discovery to a customer who has everything they're exposed to wonderful experiences all the time what responsibility do you have and how do you kind of bring that discovery to your clients we try and do quite a bit in the stores the interaction with the watchmakers is still very important we do some really nice collaborations with Ferrari, which, you know, you can find elements of the DNA of our brand in them and their brand in us.

9:25So that's really quite interesting. The connection we have with our customers has always been really important. It's my background. It's where I come from. I like to know the customer. I like to understand, you know, what brings them to us. Why do they want a Richard Mille? What do they think? If it's their first purchase, why is it their first purchase and why have they come to us and what's the appeal and I try and put that across to all the staff in the stores and say you know try and understand try and see what they like what's the appeal how they're going to wear their watch what they're going to do with it over the years has been really important to us and I think we we've kept it and we've by doing that you have a strong understanding of the customer what they want what they'd like to see from us And it's working particularly well in the women's collection.

10:15You touched on two points I wanted to ask you about, actually, which is, first of all, who is your customer now? Who is buying the latest models? And also big conversations around talent. How do you know when somebody gets it? You're so reliant on these forward-facing people dealing with your customers. What does that take? I think the important thing, excuse the pun, is time. as long as you give people time and you sit down and have a coffee with them and see what they're going to how they're going to wear their watch where they're going to wear it what they're going to do that's always important i'm really proud that i think i've got a glacial staff turnover they don't really leave the brand which we're really proud about i think i can count on one hand the people that have left us over the last 25 years.

11:06I think that's because they're given time, they're given good coaching, they're given good training, and they're able to form nice relationships with their customers. You know, when we do an event like this in St. Moritz where we bring people to the ice, they're always accompanied by the person that they work with in the store. So they get to know a little bit more about them. I mean, their children's names, their children's birthdays, where they're going on vacation, how long they've been married. It's a really nice personal relationship. It's not a traditional kind of retail cash and wrap. And I think in this day and age, some of our customers certainly know before they come into the store what they want.

11:51But some don't. Some have seen a Richard Meal on a friend, want to know more about the brand, what might suit them, the size of the watch, the weight of the watch, what they're going to do with it. So to have that relationship is great. I want to touch on luxury because, of course, big conversations that have been had about the industry. And I wondered, do you think the energy is back? Are we confident again? What are we missing about the luxury conversation that we've been having? I've been quite vocal about this in the past. luxury is something you feel something you touch the way you're dealt with in a restaurant the relationship you have with the end client and I think some of the big groups don't get that I think that they have a kind of recipe that's what they're going to do they're going to open a store do their marketing fill it with staff and the people will come in and you know and there's a real lack of empathy in that kind of relationship and I think I can really only speak from my side of luxury in horology I think so many brands have great historical backgrounds you know been making watches for more than 100 years we don't have that and I think in some ways that's restrictive because you come with handcuffs well we can't make that because our early watches you know 50 60 70 years ago look like this we come with this then people aren't going to accept it so we're going to have to stay more in our field and i think that's very restrictive for talent for making people excited about stuff and i think as well in the last 25 years i've digressed from what you were talking about but i'll come back in the last 25 years wealth has changed who has wealth how they're spending it where they're going what they're doing and that has been difficult for some luxury brands to get on the back of and we actually it was perfect for us because we're 25 years old we came from nowhere we're not making watches to be necessarily handed down or whatever we're making watches for the people that maybe only made their wealth last week.

14:20And those people are relatively new. And it's going to keep happening too. We know the grade transfer is happening. It's going to happen more and more. You know, when I started in this industry, most of the people buying those kind of watches were from inherited wealth. And they were kind of maybe told by their parents, well, when you're 21, we're going to buy you this watch and you're going to have it the rest of your life. And you'll remember because blah, blah, blah, blah, blah. But actually, it's not that. It's not like that. You know, and life has changed and everyone has changed. And I think some areas of luxury, I'm not talking about the last two years, in the last 25 years, they've struggled with that.

15:02But we've ridden that wave and that's great for us. What's happening in the last two or three years is more about how perhaps big groups have struggled to reach a changing consumer. Happy 25th birthday then. What are you most excited about for the year ahead? I think my store in Spain will be really exciting. We're going to open another one in Zurich, which will also be exciting. It's our second store in Switzerland. We've got some great launches of some new models. I feel, you know, I get up in the morning still raring to go and loving it like it was 25 years ago. And I'm very lucky for that.

15:41That was Peter Harrison, the CEO of Richard Mill in Europe, Middle East and Africa. You can find out more about the brand by heading to richardmill.com. Funny how many people get these things wrong. I go into a lot of jazz clubs and I go, what made you build it like this? Everyone's got an opinion about design these days. Join us on a journey to cut through the noise as we sit down with some of the design greats. It's possible to really improve how we live and how we work through design. We also have you covered on everything from architecture to product design to fonts and fashion too. She has her own signature and creates beautiful and also comfortable clothes that women can really spend their days in.

16:24Make sure you tune in every Tuesday at 20.00 London time for Monocle's weekly design show, Monocle on Design. Or find it wherever you get your podcasts.

16:36Join me, Nathalie Theodossi, Monocle's fashion director, and take a front row seat to the world of style and design with Monocle and fashion. Expect sharp insights. It really is a way to tell people what you do. I'm in the fashion industry, but beyond that, there really are no rules. Global perspectives. In Europe, where we would probably be considered a little more sleepy, over in Asia, it's really dynamic. And strong opinions. In times where people think twice before they spend, nice is not enough. Tune in on Monocle Radio or listen wherever you get your podcasts.

17:27You're listening to The Entrepreneurs. Emilia Stordalen is a co-owner of Strawberry Group, the largest privately owned hospitality company in the Nordics, a business her family founded. Today, the group runs more than 250 hotels across Norway, Sweden, Denmark, Finland, the Faroes and the Baltics, and is also involved in restaurants, cruises and package travel. With a background in consulting, a bachelor's from Cornell University School of Hospitality and a master's in strategy from Imperial College, Emila brings both hands-on experience and a global business perspective. Deeply involved in politics and passionate about promoting the Nordics to the world, she's also focused on the next generation of hospitality leaders.

18:12Here's our Laura Kramer again, who spoke to Emila about the trends she's seeing amongst Gen Z customers. It's such a broad subject, and I think it's a little too early to see what they care about. But what you see from the things that are published, the studies about them, is that they are the first generation that actually wants more from the business they, what they choose to consume from or work for. They want them to stand for something bigger, take responsibility outside their organization. We did a huge rebranding a couple of years ago, going from Nordic Choice Hotels to Strawberry, where we actually had the opportunity to look into the drivers of why people choose a certain hotel.

18:52and it was interesting because from the older generation the first drivers were like okay you choose a hotel based on budget or the location or if they have a conference room very like pragmatic stuff and for instance if they care about climate green sustainability like equality issues that was very far down on the drivers of why consumers choose a hotel but that changed if you filtered and saw that the younger the person who replied to this study, that came higher and higher. So and that reflects like the general trend. Like I think Gen Zs, they want to work for a company that care about something.

19:31It doesn't have to be Patagonia, but you have to choose something you care about and you have to be vocal about it. And I think that's going to really separate the companies that do well in the future with this generation and the ones who don't. You mentioned a few points there. Obviously, your big expansion, you're getting into how is Strawberry positioning itself? What's exciting and new at the company? Positioning-wise, our company, like you said, we are a big player in the Scandinavian. We're the biggest hospitality player in the Scandinavian market. So we obviously have 250 hotels ranging from business to luxury travel.

20:05So our positioning, and we chose a multi-branding strategy to meet the customers and their changing demands because we believe this is the right way to do it. sometimes you can be in need of a budget hotel sometimes you need a luxury travel like you're just you as a person like your needs changes so we want to be able to have that product portfolio that meets this you know so just in our nature like our size and the range we offer I think that's like a little bit reflecting in our positioning but the Scandinavian tourism industry is like booming right now it's so we're going to see like a 40 percent 45 percent growth until 2030.

20:42But at the same time, like one in out of two beds in Norway are empty on a yearly basis. So I think the leading hotels in 2026 are going to be the one hotels that like are a part of changing the business narrative, like who actively takes a stand in like, okay, how can we help change a little bit customer preferences? And I mean, like, how can we influence travelers to not go to Norway in January to see the Northern Lights when everyone is there or Lofoten in the summer when it's peak season? And I think it's for us, like the best hotel companies are going to be the one who works closely with politicians, with the travel destination companies to actually help change the narrative.

21:19How can we make it attractive for someone to visit Norway on a conference in March? The best hotels in the future are going to be the ones who take an active part in shaping the customer demands, not reactively just sitting waiting for it. I wanted to chat a little bit about the expansion. You had the acquisition of the Sweden National Arena. And I just wondered, where do you look? And when you look, what are you looking for? Where do you see the next opportunities for creating these great experiences? We are very lucky in Norway because we are like kind of a small ecosystem. So we can test out different partnerships in a whole different way than you can stay in the US because it's just a huge market.

21:58But so acquiring Sweden's national arena was actually a small piece in the bigger picture because we want, like I said, like most people only visit hotels one or two times a year. so we want to find out like how can we be more relevant for people in their everyday lives and i think for us we want to try we are creating not a new loyalty club but a new loyalty currency where we link up with norway's biggest airline industry company which is norwegian and we put into this and now also write down retail which is a huge retail group to do so people can earn money like doing like shopping groceries or flying to Stockholm arena like a strawberry arena to see Taylor Swift and you like earn the money or coins that we the currency that we have created to spend on like a hotel so I think that is a really exciting bet that we have taken and it's hard it's it's not not complicated but I think that's the future to try to create like a universe around our hotels.

23:02From an outside point of view, it sounds like you have so much on, you're balancing a lot from everything that Strawberry has going on. And I guess, how do you balance with the heritages, with looking forward, with doing new things? What does that day look like for you? I mean, I feel like I'm pretty lucky. I feel, you know, I grew up in a family. My dad started a company and I'm very lucky to learn from him and see like he prioritizes his stuff. My brother's work in a different side of it. I'm lucky to work on the hospitality side. So I think, and we have a wonderful team around us who do most of this stuff.

23:36So I think for me, I'm just very lucky to be able to learn from great opportunities. And I try to like balance my day as much as possible. And I feel like this is also a lifestyle, you know, that like when you work with this, you, it's weekends, afternoons, it all blends together. But when you do something you really love. You feel very lucky. Looking outside of Strawberry, because obviously a level of excellence, unlike any other in the Nordics, what other maybe hotels outside of the Nordic region, Scandinavia, do you kind of, when you travel, is there best examples that you see in other locations that you think, oh, this is really inspiring.

24:17I think we could integrate some of these ideas. No, I think when you work in this industry, you're so, I call it damaged because I can't go to another, I can't go to the property. I feel like it's the same for you. Like you can't go anywhere and be like, oh, wow, that lamp is really cool. Wow. They put the laundry room there. That's very smart. Like you see like, ah, that means the business flows much better. So I think like when people ask me this question, I feel like you're so, because you're so turned on. So you see everything, like every little thing. So I think you take little things from all over the world and like Scandinavia, we're good at stuff and we are so far behind on other stuff, like the U.S.

24:51in terms of customer-centric ideas. England, I think, is superior in service, like the U.S. too, like Four Seasons Group, Amon. Like if you look at the luxury properties, insane. Look at their training programs, how they recruit, how they take care of their employees. You have Accor, I think, do great stuff in terms of their mergers and how they balance their brand portfolio. Like it's so broad. So I think you can learn, if you look for it, I think you can find little things here and there that people do really well. What's next then for the group, for you? What are you most excited for? It's so much that I'm excited for.

25:24We have 18 big projects coming up. So obviously it's a lot of everything ranging from budget hotels to like new cool luxury properties. For me personally, I'm trying to work a little bit closer with more of the politicians and the travel destination companies to see how we can manage the travel industry in Norway a little. I'm not saying we're doing a bad job now, but you see so many examples in the world like Prague, Barcelona, where cities that have been like built up on tourism, but also are kind of ruined by it. And I really, really don't want Norway or Sweden or Finland to come there. So for me, 2026 is going to be like a balance between our new cool projects, but also involve myself a little bit more and learn how we can help manage the tourism in Norway better.

26:09Because I really think like we are dependent on our nature, the collaboration with local communities to actually have a product to sell in the future. That was Emila Stordalen, co-owner of Strawberry Group. You can find out more. Head on over to strawberryhotels.com.

26:37And that's all for this episode of The Entrepreneurs. We'll be back at the same time next week. The programme's produced by Laura Kramer with audio editing by Jack Dewars. You can listen again and find out more about the show at the website. That's where you can and indeed should subscribe to Monocle magazine and ensure you're reading more about better businesses every month. You can always follow us and catch up with the archive wherever you get your podcasts. If you'd like to reach out, get in touch, email Laura. She's on lrk at monocle.com. I'm Tom Edwards. Goodbye, and thanks for listening to The Entrepreneurs.

27:15You