Many brands have success stories; Hermes is one of the top ones. This luxury fashion brand has been around for over two centuries. It is known for its luxury products, and many would argue it is the leading luxury brand. Hermes’ image is one of style, wealth, and quality. It is also known as Hermes of Paris, and its iconic status in the fashion world is due to many effective strategies. With a combination of heritage, an innate eye for detail, and excellent craftsmanship, Hermes has gained a position of superiority in the competitive world of luxury.
Unlike many people think, Hermes is not a conglomerate. It doesn’t have a portfolio of brands like its other competitors. However, Hermes is known for its leather goods, lifestyle accessories, and many more. This article will explain the brand from a marketing view. It digs into Hermes brand origin to help you understand it even better. To begin, let’s dive into the background of this luxury fashion brand, Hermes.
Hermes was founded by Thierry Hermes back in 1837. It all started at a harness workshop in Paris. Hermes began with the aim of serving European noblemen. He wanted to provide them with leather riding gear. However, in the early 20th century, Charles-Emile Hermes, Thierry Hermes’ son, moved the company from the harness workshop. The new location was 24 Rue Du Faubourg Saint-Honore, and this continues to be the company’s headquarter to this day.
Over the years, Hermes has expanded into the most prominent luxury brand we know it to be. Between 1880 and 1900, the brand began selling saddlery and started placing its products in retail stores. In 1900, Hermes began selling Haut a Courroies bags, which were for riders and meant for carrying saddles. Further down the line, Hermes introduced a leather gold jacket with a zipper in 1918. This jacket was made for the Prince of Wales and was the opening for the brand to add accessories and clothing to its portfolio in 1920.
In 1922, Hermes introduced leather bags. They also launched travel bags that were quite a success in 1925. In the 1930s, the company decided to widen its horizon into the United States. It also began to explore adding a watch to its portfolio. Down the path in 1980, Hermes also acquired tableware manufacturers. In quite a short time, the company consolidated its position in various segments of the luxury market.
The Hermes brand has over 300 stores globally and more than 15,000 workers on its payroll. It is the largest luxury maker and draws a lot of admiration from people around the world. Many would argue that its success over the centuries is because of its strategic consistency. Keep reading to find out how true this is.
Hermes Brand Origin: It’s Philosophy
A statement by Jean-Louis Dumas sums up Hermes brand philosophy. He states that Hermes doesn’t have a policy of image but of product. The philosophy of Hermes revolves around quality and refined products. It is due to these principles that Hermes doesn’t support mass production or outsourcing. Hermes believes that every product that comes from the brand should reflect their hard work. That’s why the creative director still signs off on every Hermes product before it leaves the building. This action shows the company’s commitment to providing customers with the best quality available.
Axel Dumas, the new CEO of the company, states that Hermes’ greatest strength lies in its craftsmanship. Hermes’ objects aim to reconnect people to humanity. Additionally, it seeks to make every customer feel the presence of the manufacturer while regaining their sensitivity. Hermes products aim to bring the customer pleasure through their senses. Impressively, Hermes hasn’t wavered from these firm principles in close to two centuries. To ensure this, the management and leadership of this luxury brand pass through the various Hermes generations.
In addition to this philosophy vital in this Hermes brand origin study, the creative director once made it clear that each product was manufactured by hand and by a single craftsman. The purpose is to explain the quality of craftsmanship that Hermes holds dear and the uniqueness of Hermes’ luxury products. Hermes’ main driving force is the need to remain exclusive.
The company needs this exclusivity because it doesn’t want to join the mass-market luxury. The aim is to remain ultra-premium luxury and to only provide products affordable to a few. To keep with this brand philosophy, Hermes doesn’t have a marketing department.
Hermes Brand Origin Case Study: The Brand’s Strategy
The company’s report shows that their products fall into leather goods, saddlery, silk and textiles, watches, ready-to-wear and accessories, fragrances, and more categories. The brand’s strategy across these categories continues to be consistent. Hermes’ strategy ensures the brand maintains the aura of exclusivity. However, there are six values that this brand relies on, and we’ll be exploring them below.
Spirit of Conquest
Hermes strongly believes in the spirit of conquest. That’s why it allows its store managers to manage store collection completely. These managers even have the freedom to buy what they want to meet the needs of their clients. Twice every year, there’s a program called Podium in Paris where store reps troop down from around the world to attend. You can pick one item from the product categories. This selection process doesn’t consist of standard products like fragrances, scarves, ties, handbags, and watches. The idea is to make sure every representative showcases one of Hermes’s complimentary products.
This process helps promote Hermes’s brand allure because you can’t find all products in a single store. Even the online stores only offer some of the company’s products. The unavailability of all products helps to promote the exclusivity that is the brand’s image.
Another value that defines this brand’s strategy is creativity. The brand ranks creativity very high, and it determines the brand’s activities. It is one of the substantial purposes of Hermes’ creative pillar. Every year, designers get a theme to base their designs on. Back in 2019, designers got ‘in the pursuit of dreams as the theme, and all products were created based on these. In addition, this company promotes collaboration with designers. This collaboration feature is especially true in the home decorations category. Partnerships take place so that the company and designer can benefit from the reputation and collaboration.
Like we mentioned several times, Hermes places a strong emphasis on quality craftsmanship. Before you can begin working for Hermes or producing a leather product in their portfolio, you need to attend a 2-year training. Although this tends to slow down production time, it still works with the brand’s philosophy of exclusivity and scarcity. Every year, the Hermes leather goods department hires only 200 artisans. This process has been the norm across six generations of leaders in the Hermes brand. Craftsmanship is at the very core of the Hermes brand origin case study.
Another top value that Hermes is quite particular about when shaping its strategy is quality. Hermes introduced patience as one of the principles in its approach that ensures it consistently achieves the highest quality. Customers cannot just walk into a store and purchase a Birkin bag today. Instead, you have to place an order and wait for some months before it is ready. Hermes rations by queue and not by price like most companies do. Most economists argue that the queue works to create surplus demand for the bag. Therefore, the queue tends to overflow into other Hermes products like belts and wallets.
Additionally, new employees go through a training session called ‘inside the orange box.’ This session traces Hermes’ origin right back to the beginning. It helps employees connect more with the brand, showing the brand’s dedication to its legacy. It also helps new employees further understand the history of the development process of each category. At the end of this training, employees tend to feel closer and more involved with the brand.
For very long, Hermes has steered away from celebrity endorsement as a form of brand building. Only A-list celebrities can afford the premium and exclusive products that Hermes offers. In the company’s opinion, that’s an authentic endorsement of the brand. In addition, they do not launch region-specific collections. It helps to avoid the scenario of the same product selections being sold everywhere in the world. Hermes believes in limited editions, and it has been an age-long tradition for this brand. Therefore, they limit the distribution of products in their stores. This action works to show how the brand is committed to displaying authentic products. One crucial thing you can be sure of is that Hermes products are never on discount.
Independence is another value that shapes this company’s strategy and matters in the Hermes brand origin case study. Hermes displays this in its shareholding culture. It further asserts this independence through the family ownership of the company. By sticking to its independence, Hermes ensures most production takes place in France. It also serves the company’s long-term vision. One of the few outsiders to run Hermes, Patrick Thomas, stated that luxury rests on a paradox. He explained that the more desirable a product is, the more it sells. However, when it begins to sell, it tends to lose its desirability. Thomas’s comment further proved the strategy of exclusivity Hermes follows.
Elements of Hermes Brand Strategy
There are other elements beyond the values explained above that factor into Hermes’ brand strategy. Below are some of them.
We cannot talk about the Hermes brand origin case study without mentioning innovation. The company is known only to provide products that increase the brand’s allure from the very beginning. It is a tradition by them to offer innovation in their ultra-segment. The company also ensures its position as an object of significant desire among its customer base.
Another vital element of the brand’s strategy is collaboration. Hermes is always inviting artists who are carefully selected to design iconic products in its portfolio. Partnerships are widespread in the silk and scarves category but aren’t limited to it.
One strong influence of this French brand marketing strategy is heritage. This is popular when there’s a need to launch new products or create a new line. The reason for this is it defines the core brand identity of Hermes. This company is continually going back to its roots to find inspiration.
Hermes is one of the most prestigious brands available, even though it is over a century old. Over the years, they have used different marketing strategies to connect with their customers. However, one brand strategy at the core of the Hermes brand origin case study is exclusivity. With limited distribution and controlled marketing, this company continued to grow over the years. We can all agree that Hermes is a luxury brand and will continue to be so. However, there’s a need for the brand to evolve to maintain its segment in the market.