About Eraldo Poletto
In 2014, Furla CEO Eraldo Poletto discussed the brand's strategy and performance in India. He described the Indian customer as "very peculiar very sophisticated" with a clear sense of what she wants, and noted a strong response to color and decoration in the bags. Poletto stated that Furla focuses on the "premium segment" rather than luxury, which he said is "by definition a very small segment of a population," and expressed a preference for being "affordable for a wider segment of a population." He identified the Indian consumer's demand for evening bags as an opportunity, noting that Furla was introducing more evening and crossbody bags to complement its traditional focus on day bags.
Poletto also addressed Furla's broader business, stating that Asia, including Japan, accounts for more than 50 percent of the company's business, with much of that purchasing occurring outside Asia. He said the company is organized to serve the Asian consumer abroad. Regarding competition with brands like Michael Kors in the same Indian malls, Poletto said it is "good" and gives customers a reference for comparison. He noted that Furla was in a partnership with Genesis and had applied for a joint venture, and that the company planned to expand in cities where it already had a presence, though he cited real estate limitations as a challenge. Poletto stated that Furla was "here for the long term."
Source: AI-verified profile updated from Eraldo Poletto's recent appearances.
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Transcript (12 segments)
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Host0:00
So increasingly brands are experimenting with alternative uses for leather, but of course the most common remain handbags. But interestingly enough, brands are experimenting even their Vikram? They seem to be going in the other direction and finding new fabric. Yes, there is a lot of experimentation with material across the board, especially in the luxury space. We've seen a lot of that in watches, but let's talk about handbags because that's where we're seeing so much experimentation, so much buzz around that space. In fact, let's talk about the Furla candy bag. We've seen it not use leather at all. In fact, the candy bag has become so popular. We have the CEO of Furla joining us from Delhi, Heraldo Paletto. It's great to have you with us on the show. Do tell us, this bag, the candy bag, has done very well for you, hasn't it, especially through your two years in India?
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Eraldo Poletto0:47
Our sensibility about color made the magic of classic shape, technological innovation, and joy, like for the colors, and made the magic. Actually, it's been very, very well received in India, in Asia in general, because it's a very fun, peculiar piece.
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Host1:10
Give us a sense of your experience here in India, in coming to terms with, you know, certain peculiarities about the Indian customer and what they're looking for. What have you discovered?
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Eraldo Poletto1:21
I think the customer is very peculiar, very sophisticated. She has a very clear idea what she wants. And again, I think the key thing that we see is a very strong response to colors and the make and the decoration of the bags.
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Host1:39
You know, Geraldo, the action in India is more or less restricted to the bridge to luxury space. Do you find that happening right now? Compared to the rest of the world, where India is more concentrated in that space rather than real luxury?
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Eraldo Poletto1:54
I think that we, what we call the premium segment, is the segment that overall, I think particularly in India, has great potential. Because okay, luxury is great, but actually by definition it means a very small segment of a population. We like the idea to be, you know, affordable for a wider segment of a population.
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Host2:18
The other differentiator out in the Indian market is that consumers here look more for evening bags or dress bags, as opposed to day bags, which Furla is known for. So does that restrict you in any way?
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Eraldo Poletto2:30
The very peculiar need of the Indian customer for the evening bag is something that, I would say, is a great opportunity for us. Because yes, we are more focused on the day bags, but actually we did introduce and we are introducing more and more the evening bags or the crossbody bags.
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Host2:49
Geraldo, compared to the past, Asia is now a much bigger contributor to revenues for companies like Furla. Do you find that the case with your company as well? How much Asia is bringing to the table?
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Eraldo Poletto3:01
Asia as a whole, including Japan, actually is more than 50 percent of the business. It's not necessarily that the product has been bought in their hometown or in their country, because a lot of the buying is done outside Asia. And in fact, our company is organized to serve the Asian consumer outside Asia. And that, I think, is a key asset that we have, even because the customer service is very different country by country. So I think that is the key to not look at the world by geography, but look at the world as consumers and customers. I think that is a true modern approach on the business.
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Host3:50
All right, now Michael Kors and Furla are in the same malls in India. Has competition shaping up? I think it is good that you are in the same mall. It makes sense. We have to say more all around the world, and we play against each other, and actually I think sometimes it is a good gives to the customer a good reference to compare the product or the customer service, store environment, etc. As far as your presence in India goes, you have a store in Mumbai, one in Delhi, another in Kolkata. But tell us now what the future is looking like. You're in partnership with Genesis, and you've already applied for a joint venture, and that proposal lies with the ministry. But tell us how you're seeing the future in this country.
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Eraldo Poletto4:34
The way a CVS pension is, we have a great partner with a fantastic team with a lot of experience of this market. The opportunity is still to expand in the cities we're already in, probably particularly Delhi. Bombay is, I think, one of the limitations is most of the time in the real estate and to find the proper mall center, but again, development is starting again in 2016 and 2017. So we see it is going to take time, but we are here for the long time. And I think every five years from now, we will be here talking about how great businesses and our great potential and opportunity was to be here to stay on the course.
