As womenswear brand Luisa Cerano celebrates its 20th anniversary, managing director Jürgen Leuthe outlines its transition to an omnichannel operator.
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German womenswear brand Luisa Cerano has built a strong reputation as a much-loved premium womenswear brand. It is a favourite of the UK’s independent sector with 85 wholesale accounts in the UK and Ireland, and regularly appears in Drapers round-up of independents’ bestselling brands.
As the brand celebrates its 20th anniversary this summer, changes are under way. Under the guidance of managing director Jürgen Leuthe, Luisa Cerano is tentatively testing the waters of expansion, expanding from purely wholesale, and tiptoeing into the worlds of physical and online retailing.
The brand is part of Stuttgart’s family-run Hauber Group, which also owns orthopaedic shoe maker Sporlastic. Founded in 1870 by Ferdinand Hauber, the business is still run by the same family, and Leuthe is part of the fifth generation to run it. His father, Walter, and brother Michael are also involved in the management.
Having grown up immersed in the company, Leuthe went to work for German company CBR Fashion Group for three years, before joining Hauber Group as managing director 10 years ago. Since January 2018 he has been managing director of Luisa Cerano, leading the team of around 300 from the Stuttgart head office.
We always try to combine the international fashion trends with German craftmanship
Leuthe is chatty, welcoming and stylishly dressed in a softly tailored navy blazer, suede sneakers and round glasses, as he describes the shift to his new role – “a natural move” – and his strategy for the brand.
“When I joined it was not like coming into a company as an external employee,” he says. “Because it is our family business, we have always worked on the strategic direction together and I think the goals we have at the moment are to adapt the brand to the changing markets.”
The group has run several brands over the years, most notably the longstanding Hauber womenswear label, which was founded in 1870 but axed in 2015 following the financial crisis in Russia, which was a key market.
Leuthe says all the Hauber Group brands have shared a common foundation: “How we have run brands has always been a little bit similar. We always try to combine the international fashion trends with German craftsmanship.”
Luisa Cerano was founded in 1998, and epitomises this ethos, targeted as a high-priced, premium brand.
“It started out as a very small knitwear collection, which flew out from the first day,” says Leuthe. “We added some trousers to get a bit more of an outfit and then we did some blouses. As the years went by more categories came in. Today we are a very complete product group.”
Underpinning the collection is a relentless focus on quality, and Leuthe credits the brand’s manufacturing methods for this: “We do all our samples and cuttings in house, and then we send the whole package to our European producers, who build the products with our technicians. That’s why we have those high quality standards.”
Despite its Italian-sounding name, Luisa Cerano is based in southern Germany’s textile manufacturing heartland and 80% of all designs are manufactured in Europe. The highest-quality items are made in Italy.
Wholesale prices reflect the quality and premium fabrics, and spring 19 prices range from £20 for a T-shirt to £317 for a leather coat.
The brand’s customers tend to be aged 30- – Leuthe describes them as “strong women” with a flair for fashion. With its vibrant styling and luxurious quality, Luisa Cerano is certainly a brand for the bold, and unique separates form the basis of collections.
“One of our strengths is that the collection looks like single items, but if you put them together, then it all fits,” explains Leuthe. “It’s not classical and co-ordinated, which can be a little bit boring. We have strong single items that you can mix together because all the colourways go hand in hand.”
It is an effective formula.
Denise Green, womenswear buyer at Norwich independent department store Jarrold, explains: “The customer who buys Luisa Cerano loves quality fabrics, interesting styling with a high-fashion twist but styled for a wearable, comfortable and contemporary look. She probably loved Jaeger when it was making similar styles. The clothes can build year after year as they tend not to date, but the quality of the fabric also means that the colour dyes look extremely expensive.”
Buyers highlight Luisa Cerano’s trouser offering as a hit with customers. Dresses and knitwear also perform strongly.
One of our strengths is that the collection looks like single items, but if you put them together, then it all fits
“The trousers are amazing: a great fit, and customers return for them season after season,” says Tiffany Ross, buyer at Oakham independent Cavells. “Our customers rely on the consistent styling of the brand and have confidence in the investment of the quality.”
Building strong relationships with stockists is integral, says Leuthe: at its heart Luisa Cerano is a wholesale brand. In addition to providing marketing materials for stores, such as campaign images, there is also an online business-to-business ordering system. Orders are delivered within two to three days. It also offers a “swap system” whereby stores can exchange unsold items for new-season stock.
The brand also organises in-store events for stockists, so their shoppers can see the new-season collections.
“Once we’ve finished selling, we do 20 events all over the UK and Ireland,” says Sharon Jones, country manager for the UK and Ireland. “We find that’s a really good way to encourage new end consumers, and it’s good training for the staff.”
Julia Jaconelli, owner of Drapers Independents Award-winning womenswear store Courtyard in Guildford, says: “The team are great to work with and give lots of support. The ability to swap stock is good, and they arrange a lovely day for us where they have a fashion show and explain the new collection.”
Leuthe says the Luisa Cerano team “always were and still are very focused on wholesale”, but while the channel may remain the core focus, the launch of its first European ecommerce site, and a step into physical retailing are symptomatic of the brand’s need to evolve.
“Markets are really changing hard at the moment across Europe and across the world,” says Leuthe. “There is a change in the way of wholesaling and we have to adapt.”
While the brand does not have a UK ecommerce site, it launched its first direct-to-consumer website last year for the German market, before expanding to Austria.
Ultimately, Leuthe’s goal is to have ecommerce sites in all 53 markets in which the brand operates, but he is cautious over the rate and impact of expansion: “We will do it step by step and always so we can say that we exist in a partnership with our retailers. We won’t be one of those brands that opens an online channel and it becomes our main channel – it’s about integrating all of those channels.”
Leuthe is “looking at ways to connect local retailers with our online power”, to minimise the impact on wholesale partners, potentially through shared marketing or platforms.
There is a change in the way of wholesaling and we have to adapt
In addition to an increased online presence, Luisa Cerano is also beginning to experiment with its own retail spaces. It has franchise stores in Ukraine, Czech Republic, Germany, Spain and China, and it opened its first directly operated store in Düsseldorf in December 2017. Leuthe says this 12th Luisa Cerano store is a “test base” for own retail.
“For the brand now, in this decade, it is very important to show the brand in the whole surroundings,” he says. “In our materials we always say we are very feminine but also sporty, taking a high casual approach with luxury ingredients. That is what we looked to show when we did our store designs.”
The store exudes luxury: velvet and neutral colours dominate, while concrete walls and metal fittings lend an urban chicness to the space, which is a fitting representation of the brand.
As with the digital strategy, the approach to stores is cautious.
“We are in the beginning of testing stores and we will roll them out,” says Leuthe. “But it’s not a strategy where we’re aiming to open a certain number of stores per year – it’s too early for that.”
Leuthe’s strategy is to diversify so the brand can thrive in a shifting market, and he is paying close attention to in the UK. The company is looking for growth in this market, but Leuthe speaks nervously of the potential impact of Brexit, and notes that the vote has already altered what and when people buy.
“I think people here are nervous and scared about Brexit, and that is not really motivating for consuming,” he says. “It’s a difficult time and in my heart I hope it won’t happen.
“The markets are changing and so some are retailers are closing down but other ones are getting so much stronger.”
Nevertheless, Leuthe remains jovial and positive: although the brand declines to give exact figures as it is self-financed and does not report profit figures, its “mid-term” turnover target for the next two to three years is €80m, and the business expects to 10% year-on-year growth for the same period. Leuthe also reports a strong autumn 18 season and a good start to spring 19 buying.
Luisa Cerano’s glittering anniversary party at the Köning Galerie in Berlin – The dress code? “Just be glamorous” – is also taking place this month, and Leuthe’s excitement about the celebrations are palpable.
As Luisa Cerano comes of age, it is maturing into an omnichannel brand to serve its loyal customer base. Alongside a consistently luxurious offer and continuing focus on its wholesale partners, the addition of stores and ecommerce should help the brand face the shifting retail markets in Europe with confidence, and set a solid foundation for its next 20 years in the womenswear game.