I am on the Eurostar to Paris and came across an article in the latest edition of TIME - Style and Design on the Paris-based luxury children's brand, Bonpoint. Apparently, the company is actively in play to be acquired (possibly by France's Pinault family) after having been nicely prepped and dressed-up by Edmond de Rothschild Capital Partners, who acquired 70% of the company from its founders in 2003. Since then, the company has grown to almost €43m in annual turnover with about 60 Bonpoint retail stores around the world. This is impressive for a brand that has slowly been building itself in a market that is not very well understood.
I have to admit that I have always been sceptical of luxe for kids. Is there really a luxury apparel market when kids grow out of their clothes so quickly? Why emphasise quality when the clothes only need to last a year anyway? Is it healthy for kids to be exposed to luxury branding from such a young age? What does it say about parents who dress their children in luxury clothes as yet another way to flaunt their wealth?
This article made me think twice about it as a business. First if you can get brand loyalty from the buying decision maker, then you can expect even more frequent purchases of clothing as kids rapidly go through their clothes. The article even mentions mothers who buy the same children's outfit for each home! Yes, kids will eventually outgrow the brand and so new customers will have to be found, but while Bonpoint has the customers, they will be loyal and revenue generating. This is even more compelling when you take into account the demographic trends highlighted in the article. In developed markets where fewer children are being born, later in marriage, there is even more money available to lavish upon these children by their parents and grandparents, who are also richer and living loger.
Second, kids are exposed to all sorts of branding and marketing anyway. McDonald's, Nintendo, and increasingly MySpace, YouTube and MSN, so why not Bonpoint? That said, it does make me think about what potential Bonpoint loses in the "lifetime" value of a customer given that they have explicitly stayed out of the adult clothing business. After building a relationship with the customer (in this case, mother and child), they let them go and possibly won't see that customer again until they have their own children. I wonder whether there is a way to continue to capture value even after kids have outgrown the brand.
As for parents who dress up their kids to flaunt their wealth and status, there are always going to be parents who do that and with or without Bonpoint they will continue to do so. At the same time, not every parent who buys Bonpoint is doing if just for their own image. They may simply want what they think is the best for their children.
I was most struck by the way Marie-France, one of Bonpoint's founders, spoke about the way she was brought up in an artistic family to appreciate beautiful things -- not necessarily expensive things. "Our mother didn't have a lot of money, but the word we heard most often was REGARDEZ. Look at all the beautiful buildings in Paris. Look at the paintings. Look at the furniture...You were told to train your eye and always there was a dissassociation of beauty and taste from the idea of money..."
So, maybe Bonpoint isn't about conspicuous consumption for children? It could be more about injecting a sense of refinement and taste early into lives of children...who knows. The jury is still out for me, but the idea od luxury children's wear doesn't seem like such a bad idea anymore. I am going to try to check out the Bonpoint flagship the Rue du Tournon on this trip and judge for myself.
[Extracts from TIME - Style and Design, Winter 2006]
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