Miroslava Duma in conversation with Hermès CEO, Axel Dumas
Your background is in banking. Why did you eventually decide to join the family business?
To be frank, I had never imagined myself working for Hermès. It was mostly the work of my uncle, who was the CEO then, and my mother, who was the managing director of production. It was their thing and, quite frankly, it took up a lot of family time! (laughs). My first introduction to the brand was when I was 14. I tried to learn how to stitch but I couldn't even stitch in a straight line.
So you started out as an intern?
Yes, an intern. I'm very bad at stitching. I can't stitch to save my life but I can polish pretty well (laughs). After I completed my studies in political science, I really wanted to go to China and applied for a lot of jobs there. The only one that was suitable for me was banking so that's why I started there. It was actually quite a lot of fun.
We are over 180 years old, but we have always managed to keep up with the times and reinvent ourselves.
Why China? Why not Russia, for example?
Russia was in second place. It was my interest in literature that made me want to go to these countries — Fyodor Mikhailovich Dostoyevsky for Russia and André Malraux's La Condition Humaine for China. I wanted to experience something different from New York or London — something a little bit more exotic. I went to China for two years, then I worked in Paris for a bank. After that, I spent four years in New York. When I was in New York, my uncle Jean-Louis Dumas, who was the CEO then, came to see me. He was starting to get sick and asked me if I would like to join the company. I admit I was quite surprised, but I said yes.
Because you can't you really say no to Hermès...
Maybe it would have been wiser to say no, so that they'd court me a little bit harder. But I did say yes, and he asked me what I wanted to do.
Did you know that you wanted to be the CEO then?
No. I was very much humbled (laughs). I just said: "Anything that you think would be better for the company except finance." So he made me start in finance for a year and then I was assigned to be a retail manager for France. At that time, I took over the smallest métier of Hermès, which happened to be jewellery. Now, it's one of the brands fastest growing métiers.
It was a great achievement and victory to be able to keep the brand independent. How did the company and team manage to do that?
Let's look at things in perspective. I'm the sixth generation of the family. Hermès has been a family business for almost 180 years. It's important for the brand to be a family-owned company because we want to keep the values of the brand alive and true to its craftsmanship, quality and spirit that makes Hermès what it is. There is no marketing department, there's freedom of buying and there are a lot of things, which are a little bit crazy. That's why we were fighting for Hermès' independence in terms of shareholding. We also knew that we didn't want to depend on banks so we tried our best to be cautious.
That is why I feel that Hermès is unique and what you've done is literally a victory.
Yes, I hope to keep it that way. I love Hermès and I can fully understand why others want to love it too (laughs).
They just can't resist...
Maybe they can't resist. But everyone can resist everything except temptation (laughs). But for us it was not a question of finance, it was a question of principle. The family decided to put our 51% shares in the holding company because it took a lot of their holdings. But having said that, it took probably less than an hour of discussions to come to that decision. They said, "If it's a good thing to protect Hermès, then we are all in agreement and we will sign it". It reflects a big commitment from the family to the company and also a big commitment from the staff to help us stay independent.
Do you think Hermès will be able to continue being independent in the future?
We will do everything we can to keep Hermès independent. I'm quite confident we will manage that. I'm not sure if there will be other battles or if there will be people who will try to conquer us, but it seems like if you work very hard, you sometimes encourage envy.
In your view, what are the most important things when managing a company like Hermès?
I think there are two things that are most important. The first is respecting and maintaining your heritage, which for us means retaining very strong craftsmanship and respecting our history. The second is to not be afraid of change when change is needed in order to remain relevant in the contemporary world. We are over 180 years old, but we have always managed to keep up with the times and reinvent ourselves.
The first person in the company who reinvented himself was Émile Hermès. He did two important things. When he was 27-years-old, he decided that Russia was a big market and he went there. He spent two years in Saint Petersburg and Moscow before he became the supplier to the royal court. It was our first foreign and overseas success story. The second thing that he saw was how the car was replacing the horse — something that was not good for our business. It was a big issue for the brand because we had been selling to the equestrian market for one hundred years. It was Émile who saw that we needed to reinvent ourselves by still keeping our craftsmanship but adding women's bags, silks, ties and ready-to-wear to what we do.
I think Hermès has always had the capacity to reinvent itself. It's something that we naturally always had to keep in mind especially after six generations have gone by. You need to maintain things that are very important like quality and craftsmanship, but also emphasise on the importance of creation. There is a lot of talk about the pressure on creators and designers, and I'm not saying there isn't any pressure at Hermès. We don't have a marketing department because we want the freedom to create. There is a very short brief that we give to our creators and artisans and the end results are really their view of the moment. On the other hand, there's also freedom of buying. It means that every store has a say in the merchandise selection for their boutiques, thus all our stores are different from one another. There is no one goods supply chain and it's only possible because we are craftsmen and not an industry.
It's interesting that the majority of brands are following the rules of the industry. Trend forecasting agencies dictate what colours designers should use. Fashion houses are obliged to produce both seasonal and tran-seasonal collections. Yet this doesn't guarantee them success. Hermès creates its own rules and it's one of the most successful companies in the world. How do you do it?
You should always be very humble about your success. When I was a kid, Hermès was not as big as it is now. The values of Hermès were not always as popular, and it's even tougher to keep these values alive when you are successful. When the company is growing, you are able to do things that you couldn't do before. There is a hero in Greek literature called Ulysses. He confronted many issues during his travels, sometimes for the bad and sometimes for the good. Even when he was with a goddess, he still left to continue his journey. I think what we can learn from this story and apply it at Hermès is that the journey may have many obstacles but it's important to stay true to yourself and your mission. Our mission is about mixing creations and craftsmanship together. This is what we always want to retain.
Hermès is the essence of luxury where craftsmanship is priority. Sometimes luxury brands are little conservative with technological advancements. Hermès was one of the first to launch an e-commerce platform back in 2001 when everyone was talking about how the digital era was the future, yet no one was really doing anything significant about it. Now with the major shift into the digital world, how does Hermès find the balance between tradition and innovation?
It's always a fine line. But I think that digital is not just a matter of innovation. It's also about looking where the world is going and trying to embrace it instead of resisting it. When we launched an e-commerce platform in 2001, it was the decision made by my uncle. My cousin Pierre-Alexis and I were young and we were saying that we needed to look at the Internet and what the others were doing. Everyone was pushing for the creation of a website to tell the Hermès story. And he would say: "I don't need to explain the story of Hermès. People need to live it and feel it. What I am is a merchant and we have a store, so what we are going to do is to open a store". We were the first ones to do it and we did it on a very small scale in the beginning — only in the US selling perfume and ties.
What I find funny is that the discussion now is similar to what was happening in the '70s. At that time, it was not about digital, of course, but about "should we go international or not". And people were saying that there was no need to go international because the world was coming to Paris, and it would be too risky. They didn't know if it was going to pay off. Fortunately for us, the decision was "let's go!". And I think it is the same with digital. You can say that our stores are doing well so why should we go digital. Are we trying to give our customers a luxury experience, etc? But in ten or twenty years, people will want to have a relationship with you in the digital realm — be it for shopping, communication or just for information. So we need to do it now to get ready and to do it with our own philosophy and style.
The second parallel with this period, which I find funny, is that when French luxury companies started to go international, most of them decided to do it via licenses to reduce the risks. But we decided to do it on a much smaller scale so that we can control it. I think this is very important for digital. If you really believe digital is strategic, then you probably shouldn't get someone else to do it. You should do it yourself. Although maybe we don't have the economy of scale and we did make mistakes in the beginning, it's still important to control it. And that's why we are investing a lot in developing our digital expertise within Hermès and not just delegating it to someone who is bigger.
As a CEO, I don't like collaborations and it was the same for Apple. Are you following the digital world and what is happening with all these amazing start-ups that are actually changing our lives every single day? The Internet has changed our lives completely. I recently came back from the New Establishment Summit in San Francisco, where people like Elon Musk, Marc Andreessen and Mark Zuckerberg were speaking. At some point, I felt like they live in the 22nd century while we still living in the 21st. They were talking about investing in space programs, virtual and augmented reality, and the Oculus Rift project that Facebook invested two billion dollars in. A lot of things are happening, take Google Glass or Apple watch, for example. Can you tell us a little bit about the collaboration with Apple that everyone was talking about? Honestly, I thought it was genius.
We have always had a lot of respect for Apple and vice versa. Jonathan Ive himself owns a lot of Hermès products.
He is considered one of the greatest creative minds in history, so for him to collaborate with Hermès must be a great compliment.
As a CEO, I don't like collaborations and it was the same for Apple. When we met with Jonathan Ive, we discussed our philosophies and views and they were very similar so we decided to give it a try. I must say that the product itself is beautiful. It combines the craftsmanship and the sharpness of Hermès designs with Apple's technology. That's how we launched it. It was not a worldwide master plan for global domination. It was about mutual respect and admiration. That's what I love about Apple. We share a common vision and that is to keep making objects that we care about. Apple makes things that are addictive — well at least for me, as you may have noticed (laughs). They still care about typography and details. We had a discussion with Jonathan Ive and the craftsmen about changing the watch slightly. The sensor really needed to be on your wrist, but it didn't allow you to move as it usually does. It was a very old craftsman, a lady, who found the best solution. I think we have many shared values with Apple. I respect them yet they're a very different company. The purpose was not to make something cool. It was to have fun and to try to create a beautiful product together.
I think it's great that you brought technology geeks to the fashion capital of the world. The day after the presentation at Paris Fashion Week I was flying with the Apple team to San Francisco for the summit. They were really excited and told me that Steve's wife was also there at the presentation. I had a long conversation with an old friend of Steve Jobs. It was his first time in Paris during fashion week and he was very excited. They reminded me of kids who found themselves in Disneyland for the first time. They loved and admired this world, which is so different to theirs.
I think in a way we are quite different. We selected a number of cities that had Apple stores and we decided to do the training for the sales staff together. It was great to see the two teams mixing together. It was easy to see who is who, because some wore T-shirts, while the others wore suits and ties. It was a very nice experience to see the teams from different environments interacting but still sharing a common point of view. Most importantly, we had a lot of fun working on this.
How important is it to you to have modern means of communication with your clients through what we now call social media?
I think for Hermès it's something that we can still improve on because we are always very cautious about the messages we sent out. Social media communication goes back and forth. You can't control it as much and as well. Sometimes it can be a bit unsettling for a brand. We need to find our own way to communicate. A part of what we do is to add to the mystery. We don't show everything. My uncle says that the kitchen of a good restaurant is usually not seen. How do you deal with all the envy and the constant flow of information on social media and still keep that mystery? We need to find the right balance, but I do think that with social media we still need to do better. We have an Instagram, which is much more visual. We are a very visual company so this has opened a new avenue for us.
For us, it is very important that only one person makes a bag and signs it at the end. I think it shows our respect for the craftsmen.Talking about mystery, it's so beautiful when you can show what Hermès does to the public. Once in the Hermès factory, I remember seeing some very talented craftsmen in white coats making Kelly bags and silver bracelets by hand. And I saw the film, which I thought was amazing. We should bring it to Moscow, if that's possible, with Sophia Kapkova and the Center of Documentary Cinema. I think this is what you need to show people because everybody understands that Hermès stands for the highest quality handmade products that you can imagine, but still when you witness it, you re-think the whole process and your perception of the brand changes.
I think we have three things that make us very different. The first one comes from Jean-Louis Dumas and the care we put into our manufacturing. His view was not to show it to anyone else. He said "You need to have a beautiful setting to do beautiful things", and that's why we care a lot about the architecture of our buildings.
The second thing, which is important, is that we always try to keep it at a human scale. That's why we don't say that it's a factory but a manufactory. We try to keep the number of staff at 200 to 250 people because we believe that above that the manager doesn't know everyone by name and it becomes something different, so we try to keep it at a small scale.
And the third important thing, apart from the cutting, is that every bag is made just by one craftsman. For us, it is very important that only one person makes a bag and signs it at the end. I think it shows our respect for the craftsmen and also, it's not quantifiable and it gives the product more soul. Some people get attached to their bag and they have to let it go. It's very funny when a bag comes back for polishing and they find that it's a bag that they've made — they get quite emotional. I think there's nothing quantitative about that. You simply cannot quantify that — it's part of the magic of Hermès.
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