German luxury company MCM says it will market “comfortable luxury” and emphasize “heritage” to young professional women in its strategy for global expansion.
Despite being late to the luxury bag craze in the states, CEO Sung Joo Kim believes MCM’s strategic positioning as a “functional, new luxury [company]” will differentiate it from “conventional luxury” brands.
Kim made the comments Tuesday in an interview on CNBC’s Power Lunch.
The maker of luggage, ready-to-wear clothing and leather goods sells handbags that are priced between $350 to $10,000—“comfortable, top luxury, between Burberry and Louis Vuitton.”
One of Asia’s most successful businesswomen, Kim has since sunk over $40 million of her own money into Mode Creation Munich since acquiring the brand for an undisclosed amount in 2005 and starting a global relaunch. Since then, MCM’s global sales of $250 million in 2009 were more than double its sales of $100 million in 2007.
When Kim acquired the company, however, MCM’s emphasis was mostly on Asia’s booming luxury markets in China, Korea and Japan. Since relaunching in Europe, the CEO says the brand has now turned its focus to the States, where MCM saw only $5 million in sales compared with $16 million in 1993.
With this relaunch, MCM opened its first American stand-alone boutique in New York’s Plaza Hotel. One of MCM’s handbags—the bright yellow "Alda" tote—also made a cameo on the CW teen drama series “Gossip Girl.”
“Young professional women and American ladies love to have new luxury,” says Kim, who hopes to appeal to career women rather than “bling bling buyers…The U.S. is a great market. I love the U.S.”