Is Cortefiel Group the next Inditex?
23rd Sep 2016
A selection of the Cortefiel brands, from left to right: Cortefiel, Springfield and Women's Secret
In a world where expansion is key to survival, what is it about Spanish retailers that are getting it so right? Cortefiel Group, owner of the Springfield, Women’s Secret, Pedro del Hierro, Fifth Factory and Cortefiel brands, this week opened its first stores in Reykjavík, Iceland, at the city’s well-respected Smáralind shopping centre. The move marks a new leg of the group’s expansion plans into Northern Europe, partnering with Gjord Capital Partners for Iceland, before adding new stores in Oslo in November, and Denmark and Helsinki.
With so many macro-geo-economic challenges facing a global retailer in the past few years, a climate has emerged in which it feels like there are no blanket rules for expansion or franchise. My-Retail Media spoke to Antonis Kyprianou, the Franchise Manager for Cortefiel Group, at the launch of the Springfield, Women’s Secret and Cortefiel brands in Iceland, to find out if there can be a method to aggressive expansion, and what it is about Spanish retailers like Cortefiel and Inditex, that seem to understand that.
"Scandinavia was an area where we could challenge ourselves"
My-Retail Media: Why Iceland and Scandinavia for this new leg of the expansion?
Antonis Kyprianou: Scandinavia has been in our plans because it has a lot of scope for Spanish companies, as we are in more or less all the regions today - Scandinavia was an area where we could challenge ourselves. Obviously we know the market well, and we believe we are bringing something new and something fresh for the market. And we believe it's a very good market for us, and hopefully the market will respond to that. With a Spanish background it's something fresh for the market.
And why Iceland? Well we targeted the Scandinavian countries - we are opening in Oslo in November, so then we will move on to Denmark and then Finland as well. So we believe it was the right time for us to come to the market, even though it's more challenging- I believe we should be here, and we see no reason why we shouldn't try Iceland.
The reaction to Springfield and Woman's Secret has been very good so far, and we expect that for Cortefiel. All the stores that we've launched, they've all been new concepts, so we've had to really look at what is available in the market- so it's new all the way.
MRM: What are the concepts you've taken on - the store design, new products?...
AK: The store design, the ambience, the whole. We launch a new Springfield concept every three years. We launched the (most recent one) last August, so it's quite new. Cortefiel was renewed last November. And Women's Secret is two and a half years old and is looking very new.
MRM: So it will feel like a brand new stage for the brand? That Scandinavia gets first?
MRM: There aren’t any Cortefiel stores in the UK right now- are there plans to expand there too?
AK: Of course, there is always a plan. I mean - it's an important market, and nobody can ignore the UK, absolutely. We are in Ireland, with Springfield. Of course we are looking to the market, but it is taking more time because there is a lot more studying and we need to find the right way to enter the market. But it's definitely a market where we are looking to open, maybe in the next couple of years.
MRM: Obviously there is Cortefiel and Inditex- what do you think it is about these Spanish retailers that get it right? Do you think there's something in the Spanish retail scene that the rest of the world loves?
AK: I mean, it's a fact that the Spanish retailers have dominated these markets worldwide, and most global market brands are the Spanish ones- and if you take Inditex, ourselves and another couple of retailers- we are very, very global.
For our company, one of the things we believe we have delivered successfully is that today we have launched in our 84th market with Iceland, by next month 87 markets. Every market has its own requirement, and we do adjust what is needed in order to play the market. We approach every market with a care that the market needs. It is very important finding the right partners for the market- that's where we put in a lot of effort and time, in analysing the market, and then we have a strategic plan of where we can grow and where we could grow. And we believe that the fashion that we offer can travel very well, all over the world. It is one of the things that is also very important. Also we talk a lot about patience, in local market environments.
For example we have special collections for our brands for Ramadan, which is very important for the Middle East. We cater for that in a special way. Also we cater for the colder climates- we produce products that work for the whole climate for the northern part of the world, and also cater for the hot climates and the markets that have extended summers. So that's why I said we are looking from every aspect at the market. We study well, based on our plans, and then we enter the market at the right moment. So we've been studying an entry into the Scandinavian market for the last three years, until we've reached where we have today.
"When you have a brand, you need to remove the arrogance of the brand and look at every market with the respect that it deserves."
MRM: For a lot of brands, I think their mistake in expanding, in the past, has been that they just want to show that they can get to so many markets. But it sounds like a better strategy is to focus on detail and research and knowing that those markets will be completely different.
AK: Exactly. When you have a brand, you need to remove the arrogance of the brand and look at every market with the respect that it deserves. Even if you have the best brand in the world, I think you need to do that, because there are variations from regions to regions. It doesn't always mean there are adaptations you need to do on the product. It could be in the way you approach the market, and that's why you need to look into each market in a certain way.
MRM: Cortefiel was founded in 1880- is there anything from that initial heritage that comes into the operations today, or has it changed so much over time that it's a completely different company?
AK: We keep to our heritage. Of course. But we follow the trends of what should be in the market. In our group we treat every brand that we have with its own identity- for every brand, we have the strategy that suits the brand- so it doesn't mean all the brands can go in all the markets at the same time. But we do keep to the heritage that we have and the DNA of the brand.
MRM: What do you think it takes to be a global retail player?
AK: With the strategy that we have today, and the countries that we've managed to grow in- we've been into markets where other competitors didn't manage to be successful. For example, we are in Africa, which is a new market that everybody's talking about. We are there, and we are leading in a lot of countries as well. Which is very challenging, for many reasons. So we've managed to be very successful- and our objective is to become more global. We are aiming in the next year and a half to reach 100 countries, which is a big challenge for us. But with the globalisation that we have today, the brands are becoming stronger and stronger, because they are more seen as well. And of course the internet and e-commerce has an important role to play in the brand worldwide.
The group has survived through times of crisis, but it's a group that a lot of people look for- and we have a lot more to offer in the market, and we believe that being humble, we do well. We push and challenge ourselves, and our aim is to take the brand into many retail markets- and one day hopefully the UK as well.
"A lot of companies think that international expansion is the solution to their problems. It’s not."
MRM: Of course-I had to ask!...
AK: The UK is a very confident market, a market a lot of people look up to, and it's a very challenging market. It's not a market that you can look at very lightly. So you have to give a lot of respect to the market, which is why it is taking us a longer time to get there.
We are in all the Continents. Africa is the next region that a lot of market players will follow as well, but in that respect, we feel we are leading in that markets.
We are not afraid to experiment in a market- we know how to handle a market. It's not important saying it, it's important to deliver. Because a lot of companies think that international expansion is the solution to their problems. It's not. That's why you need to be an expert there, before entering the market. You need to look at everything from the right perspective. But I think with the challenge we offer to ourselves, we feel confident we can trade in any region. We want to grow in every possible market.
MRM: Thank you very much for your time Antonis!
My Retail Media
Previous InSight Articles…
- Let’s get digital: UK will need 60,000 fashion retail roles to keep up with online revolution
- Zalando gears up for a fight with own-label investment
- Topshop announces a see-now-buy-now London Fashion Week
- Crisis? What crisis? UK retail figures defy Brexit results
- Zalando still focused on UK market despite Brexit vote
- Airport retail market set to be worth £70 billion by 2022
- Consumer confidence drops to lowest level since 1990, but is it all bad news?
- Fashion’s revolving doors: All change once again as Oscar de la Renta and Calvin Klein prepare to welcome new names at the top
- Does Pokemon Go really have the power to transform retail?
- Consumer confidence takes a battering after Brexit vote