“We have different philosophies at Zara and Mango, but end up helping each other”

In 1984, Mango opened its first boutique on Barcelona’s Passeig de Gràcia. Within a year, they had opened five more. This was the beginning of their unstoppable growth, which has led the company to have more than 2,000 retail outlets in 105 countries, making it the second-largest exporter in the Spanish textile industry. The brand, which is owned by Isak Andic, ended fiscal year 2010 with 1.27 billion euros in sales, 81% of which came from foreign markets. To top things off, the company has been opening one new boutique per day. Mango – which is funded by 100% Spanish capital – plans to continue to expand, opening more than 550 points of sale this year. Their CEO explained their business strategy to Barcelona és Moda.

 

Given the data, it seems you’ve been able to weather the crisis. Was international growth your secret?

Since some countries always fare better than others, we have been able to average 11%. The world is like a country; although its borders and currencies may differ, mentally, the world is globalized. Tastes are rather international, and what works in one place also works in another.

 

Did the national market flop?

Nineteen percent of our sales are in Spain, and we are quite aware of the crisis here as well as in England and in the United States. However, things are going well elsewhere, including in some European and South American countries, all of Asia, and especially in China and Russia, which amply make up for the most unfavourable data.

 

Are we lagging behind other countries with regard to the effects of the crisis?

That’s especially the case in emerging countries, which are experiencing significant growth. If we compare Spain to nearby countries, we are lagging behind – this is the case with France and Germany, which are doing well. For example, Germany is pushing to raise interest rates since they have had significant growth and are afraid of inflation, while we’re in the opposite situation: we need low interest rates to stimulate the economy given that consumption has not yet taken off.

 

Have you maxed out the Spanish market?

There are some countries where we can still enter the market and others we can take fuller advantage of.

 

A while ago you launched a line of more affordable products, but it was unsuccessful. Why do you think this was?

Think Up was designed to offer lower-quality clothing at more affordable prices. The collection was simpler, but we realized our market sees our products more as special items – something you’d wear to a party or for going out on the weekend – and prefers that we set ourselves apart based not on price but rather on producing special items for special days. Our clients expect this from us, so we are focusing on these types of products.

 

Do you plan to take other steps to alleviate the downturn in Spanish sales?

We are opening our Mango Touch boutiques, which feature accessories. At the moment we’re developing a line of products which will be available in all of our stores as well as some products exclusively for sale at Mango Touch.

 

Are accessories holding up better to decreasing sales?

Yes. Every major brand produces accessories because they are pieces anyone can hope to own. Even if you can’t afford an item of clothing from a big-name brand, you can afford an accessory. They’re complementary products, and greatly help our bottom line.

 

You opened more than one store per day last year. What’s your secret?

We opted to open points of sale in shopping centres. They are store-in-store locations, but are still 200 or 300 m2 in size. We’ve done this quite a lot in Europe, Asia, and the United States, and it’s working well.

 

I assume it entails less investment and less risk.

Exactly, shopping centres are great because you can open quickly – the building has already been constructed, and all you have to do is the interior design.

 

Does this model have a downside?

These shopping centres already have their target market, so you’re not selling to your regular clientele but rather to the people who shop at that site. We learned a lot in 2010 and are continuing to do so this year, and this experience should help us really excel in 2012.

 

Do you adapt your designs a lot for every country?

Of course, we do so for every country, and we also do so within every country based on the characteristics of every shopping centre. This is the hardest thing to do, since our industry faces many constant changes that force you to continuously adapt.

 

Are you no longer focusing on opening your own retail stores?

We are focusing on shopping centres, but not casting aside boutiques. Some countries – such as those in Asia – are better suited for store-in-stores, while others – for example, in Europe – lend themselves to opening boutiques on shopping streets. It depends on where you are.

 

You’ve told us about your growth, but what strategies will you adopt in terms of diversification?

We will continue to produce our regular collection, which is very global – 80% is for the entire world, while 20% is for local regions like the Middle East or China. When we grow a lot in a region, and we start to sell not only to people interested in the latest fashions but also break through to a broader portion of society, we begin to do specific things based on the culture, mindset, and tastes in that region.

 

Have you strengthened your menswear line?

Our menswear collection was launched in March 2008 and sales have seen steady growth since then, but they’ve never been comparable to our womenswear. Nevertheless, men pay more and more attention to fashion and change their wardrobe more often, which is strengthening our HE line.

 

Do you see differences in men depending on the country they are from?

The men who change their wardrobe the most each season are the French and the Italians, while Spanish men do so less often.

 

What´s the status of your new logistical headquarters in Lliçà?

We are working on the urban planning aspects and on constructing our main building in Can Montcau. Within four years, we hope to build seven warehouses in addition to the main one. Our final goal is to base our worldwide fashion distribution in Catalonia, with the exception of one site in China for the national market.

 

The El Botón Mango Fashion Awards have helped you gain prestige in the fashion world. Do you plan on making any changes to them?

The awards will stay the same; we will recognize style and design and help new designers. We will change the jury and president regularly, but maintain the same prize money.

 

Will the site of the awards rotate?

The prize will be awarded in Barcelona and the fashion show will take place in a variety of cities.

 

Celebrities always model your collections. You signed Gerard Piqué just after he officially announced his relationship with Shakira. Was that chance or just a quick reaction?

I suppose it was a stroke of luck, although Piqué had always seemed like a good choice for our menswear collection. Afterwards, his relationship with Shakira went public, and we got two for the price of one!

 

Will you continue to work with Scarlett Johansson and Penélope Cruz?

We like to make changes and not stick to a single face for our brand. Penélope turned out great for us, especially given the fact that her popularity grew while she worked for us. We’re very lucky in that regard.

 

Spanish fashion is primarily known on the international scene because of Zara and Mango. There’s a lot of competition between the two of you. For example, the Mango Touch line is now following in the steps of Uterqüe…

Our target markets and philosophies are rather different, but we end up helping each other when we expand into a new country, which is the hardest thing to do in a new place. Therefore we support each other rather than harming each other.