Dubai: Even when it comes to deciding where to build the next hotel, Jean-Christophe Babin brings in a jeweller’s perspective. And that’s certainly not of out place when you are the CEO of Bulgari, one of the most desired names in jewellery.
“There are plans to take the Bulgari hotel to five new cities, including New York and Beverly Hills,” said Babin. “But I still haven’t decided where the locations need to be.
“Choosing a location for a boutique hotel is very much like crafting jewellery. You do so after you find the gems — the very unique rough diamonds or rough sapphires. Once you find them, only then you will start setting the jewellery.
“In New York and Los Angeles, we haven’t found the “rough diamonds” — the perfect location where we think our hotel should be.
“A rough diamond location for me is not just about offering scope for a consistent size or requirements, but a location that is quite unexpected for what it offers … and what it doesn’t.”
These days, Babin and Bulgari are as likely to put finishing touches to a bespoke hotel or resort experience as they would a fine piece of bauble or an intricately designed leather accessory.
The CEO was in Dubai for the opening of the region’s first Bulgari-branded hotel, on Jumeirah Bay island, and which also features a constellation of super-premium apartment buildings.
Is there a chance then that Bulgari might consider creating just the residences elsewhere in the city? Babin gave the thumbs down to any such thought.
“Look, the way I see it, the core benefits we are offering relates to hospitality. The core must be the hotel, its bespoke services and what we could offer as gastronomic experiences.
“Only if the real estate allows it and it makes sense, then why not have the residences. But the hotel needs to come first. And in most locations, we don’t have the residences.
“In Dubai, the location we have is unique — it allowed us to be in a downtown location and “tropicalise” it for a resort-type experience. We need to find something comparable in New York or Los Angeles.
“This (the Dubai project) sets the base. We are not in any urgency to add more hotels. But we have to develop something comparable.” (Bulgari, part of the luxury-focused LVMH Group. now operates five hotels and with two more to join next year and in 2020. These apart, it has five other city possibilities in mind.)
So, is hospitality pulling its weight in the Bulgari portfolio? “Its weight when compared to the total company remains marginal,” said Babin. “A very good hotel — depending on the city, and depending on the number of keys — can score between 30 million euros (Dh130 million) to 60 million euros.
“And even if you have 10 (hotels), it’s only 300 million euros to 600 million. Our overall company is worth much, much more than that. As hotels came late to the portfolio, it will remain somehow marginal. But it will be successful because we will only have a few.
“We also take our time to try and really deliver something new in each and every location and that hasn’t been delivered before. Even now, hospitality is already profitable.”
Babin said it is difficult to think of Bulgari adding something new after hospitality. “The markets we are playing in are pretty niche or fragmented — that’s how we can grow marketshare. It would be foolish to venture into others when we can accomplish so much in what we already do.”
Jewellery can never go out of style
Buying jewellery will remain a “visceral choice for mankind, whatever be the times”, says Bulgari’s CEO.
“The style, the design, in the case of Bulgari they remain very strong,” said Jean-Christophe Babin. “That’s how you have a chance to grow.”
This year has turned out to be a good one for luxury labels and an improving global economy means more cash in hand among likely shoppers to splurge on those must-haves.
Babin clearly likes most of what he is seeing in terms of consumer sentiments. Even in the case of China, he insists not to put too much store in the negative news.
“China has been very much driving the show over the last 10 years ... and even this year. Whether it is growing at 7- or 8 per cent, eventually it doesn’t matter.
“Discretionary money for millions of Chinese is being added significantly. The fundamentals of the economy look as good for the next five years.”
