A Luxury Watch in Frankfurt

DAVIDE LUNGHI IS BAA CHAPTER LEADER FOR THE CITY ON THE MAIN. MANAGER OF THE LVMH WATCHES JEWELRY DIVISION, HE TALKS ABOUT HIS VIEW OF THE LUXURY MARKET

Two years spent at Fendi in Rome, managing the leather goods division, then in 2004 the career leap by joining the watchmaking division of LVMH, starting from the position of controller at TAG-Heuer, Hublot and Zenith, to arrive at the current position of General Operations Manager for Watches & Jewelry in Northern European and Central European Markets. In total, 14 years invested in the development of luxury goods. These are the highlights of the CV of David Lunghi, 38, who graduated from Bocconi in 2002, and has led the Frankfurt Chapter of the Bocconi Alumni Association (BAA) since 2012.
 
How is the luxury industry chessboard evolving?
The outlook for luxury goods is good. We are experiencing strong demand, driven primarily by  Dubai and the Gulf states, and Latin America, which will grow at a rate of 5% per annum in the next three years. Also Iran is expected to grow (and in fact we look to the country with much interest), while in China we see growth slowing down. As for LVMH, we have posted positive growth in Japan and the United States, while Europe remains a solid market.
 
Luxury keeps on selling, then. But how will it have to change remain on top of consumer desires?
In watches, at the moment there is great interest on the part of customers for products that combine luxury with technology, such as for instance connected watches. Also, the love for high-quality watchmaking is still there. The industry, however, is undergoing two disruptive changes.
 
Are we talking about a market revolution?
Although watchmaking is and will remain a traditional industry, the product is changing, since it will be increasingly connected to the web, as well as its distribution. In the latter, two things are happening: the weight of retail chains is increasing compared to independent stores, because chains have more resources, higher economies of scale and enable greater visibility for brands, and the growing role of digital retailing. For LVMH, this means either in-house e-commerce or strong presence in online luxury platforms. We said no to Amazon, for example. In general, the luxury industry will change, if it can innovate not only the products but also their distribution and communication.
 
Along watchmaking, in Frankfurt are you also revolutionizing the activities the BAA chapter?
No, in this perhaps we are more traditional. In October, we organized a major event at the Eurotower with ECB economist Agostino Consolo, which was attended by about sixty alumni. This event was part of the continuous learning opportunities we offer our members. In addition to continuous learning, our main areas of intervention are collaborative networking and fundraising.
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by Andrea Celauro
Translated by Alex Foti