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Back to basics: Baselworld confronts home truths

With the world’s foremost luxury trade show in the midst of a well-publicised fall from grace, COLEBY NICHOLSON caught-up with Baselworld managing director Michel Loris-Melikoff in Mumbai to discuss his vision for the future.

Michel Loris-Melikoff is not backwards in coming forwards. Indeed, as managing director of Baselworld, he wears his heart on his sleeve when it comes to the problems facing the venerable watch and jewellery show.

It’s a refreshing approach, although one wonders whether anyone could get away with off ering anything other than brutal honesty: make no bones about it, MCH Group, Baselworld’s parent company, stuff ed things up!

Loris-Melikoff says it’s his job “to make Baselworld attractive again”, but in truth – to put a new twist on a well-known turn of phrase – he has to “make Baselworld great again”. Once the world’s premiere watch and jewellery trade show – an awe-inspiring, must-attend event – Baselworld has fallen from grace, to the extent that its exhibitor numbers have dropped from 1,300 in 2016 to between 500 and 600 this year.

There’s little doubt that the difficult economic conditions in the jewellery, diamond and watch industries have contributed to Baselworld’s problems; however, much of the pain has been self-inflicted, and Loris-Melikoff does not shy away from that.

 Michel Loris-Melikoff, CEO Baselworld
 Michel Loris-Melikoff, CEO Baselworld
"The first time I met the Baselworld team, I asked them, ‘Who pays your salary?’ Why did I ask that question? Well, [the answer is] it’s the exhibitors"
Michel Loris-Melikoff, Baselworld

He joined MCH Group in 2014 as director of third-party events and became managing director of MCH Beaulieu Lausanne SA in 2015. As a result, he had an internal view of the show’s problems.

“When the board of directors asked me to manage Baselworld, the first question I asked myself was: do I have enough passion for watches, jewellery and gemstones? Well, when it came to watches I knew, but I had absolutely no knowledge of jewellery and gemstones,” Loris-Melikoff reveals.

Despite that fact, he accepted the position and started on 1 July 2018. After one week, he says, his outlook totally changed and he knew he had the passion for all products that would be exhibited at the show.

His vision for how to turn the tide on Baselworld’s fortunes also began to take shape. He recalls: “The first time I met the Baselworld team, I asked them, ‘Who pays your salary?’ Why did I ask that question? Well, [the answer is] it’s the exhibitors.

“Baselworld is supposed to be an ecosystem of the whole industry, which comes together for different reasons. For some exhibitors it’s marketing, for others it’s communications, or sales and networking. All companies have different reasons why they exhibit.”

He explains that in the past, the prior management concentrated on the needs of the big Geneva watch brands, but “when I started I knew we had to think about a new vision”.

“My job is to improve the quality of Baselworld and if we do that correctly, then the market will decide which show becomes strong and successful or not,” Loris-Melikoff adds.

He acknowledges that in the past, everything was done for the benefit of Baselworld, and not for the exhibitors and visitors.

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L to R: Loris-Melikoff giving an address at Baselworld. Panel discussion at opening press conference.

Identifying the problems

The cost to exhibit at Baselworld is not cheap, and many suppliers complained about the unnecessary on-costs forced upon them by MCH management for things that were not required. There was no escaping the expense.

One example was the requirement to advertise in the Baselworld Brand Book, a whopping 5kg hardcover that few wanted and even less read. However, it was one of many costs that exhibitors had to bear – even if there was no benefit.

Loris-Melikoff  acknowledged that the Brand Book was inappropriate, saying that when he first attend Baselworld after joining MCH in 2014, he was handed the heavy book and didn’t know what to do with it.

“This is the change of mindset and a personal issue to me: [previously] MCH organised Baselworld and if you wanted to be part of the show, you had to accept everything – take it or leave it. And when I started, my mindset was that we organise a show because the industry needs a show,” Loris-Melikoff explains.

“The industry still needs an internal event where suppliers, retailers, journalists – everyone in the eco-system – can meet one time per year. MCH is also part of the eco-system so we need to create a platform from the industry for the industry. And that’s been my motivation and that’s why I had 800 meetings between my first day in the job to the closing press conference of this year’s show, to understand what the needs are and what has to be changed to make this platform more successful.”

Changing priorities

Loris-Melikoff says he analysed the needs of everyone by creating some simple spreadsheets for the different categories, from the watch brands to gem and jewellery suppliers, retailers and even what he calls the ‘connectors’ – journalists from traditional and digital media.

What he found was that not only are the needs different across each category, the needs within each were not uniform: “The needs are different between the bigger and smaller companies in the same category, but they are even different between the big brands. Compare Rolex and LVMH; they have different needs to each other, it’s a totally different approach.”

Identifying problems can be easy; rectifying them is not. And with the problems being in place for so long, coupled with a world that is very different to five years ago, let alone 10, what are Loris-Melikoff’s solutions and priorities?

"Everyone would understand that we are not able to make all changes in one year. It’s simply not possible"
-Michel Loris-Melikoff, Baselworld

“In the past, Baselworld was a B2B platform and now we need to be also B2C, which, in our definition, is business-to-community. And in this community we have retailers, the producers [manufacturers], the brands, journalists and finally the consumer. But the main focus will remain B2B.”

He says that 60 per cent of business is still done with traditional retailers “and in 2020 we have to concentrate on the needs of the retailers”.  A questionnaire was issued to exhibitors in August to help create a long-term strategy which Loris-Melikoff describes as “you spoke, we listened”.

The focus will be on an event that is one-third watches, one-third jewellery and one-third diamonds and gemstones. Indeed, the gem sections will be relocated to Hall 2, the three-storey building that remained closed this year.

Hall 2 will also include a new area called Innovation Square, which management describes as ‘a space for innovation and digital transformation’. Here, Baselworld’s first section devoted to smartwatches and wearable devices will be located. The gemstones section will move to the first floor while the national pavilions will fill the ground floor.

The Incubator concept for start-ups and other smaller, lesser-known brands – which debuted this year in the watch section – will be expanded in future shows to the jewellery and gemstone areas.

Exhibition Square, the very busy large area outside the entrances to Halls 1 and 2, will be ‘completely redesigned and interactive’ in time for 2020, and will include an event area.

Looking to the future

As previously reported by Jeweller, the layout of Hall 1.0 will also change for the 2020 event, in order to make the show floor’s central zone more affordable for exhibitors.

Businesses will not have to construct their own expensive multi-level booths, as they have in the past. Instead, each structure in this area – which has been named the ‘community district’ – will house two to three brands, private conference rooms and customisable interiors.

The plan has already succeeded in wooing back Maurice Lacroix, which quit the event in 2018 but will exhibit in 2020. And perhaps the most important change of all is that the cost of exhibition space will drop across the board.

There’s no doubt that the high cost of exhibiting at Baselworld is a major reason for the exodus of 800–900 exhibitors over the past three years, and Loris-Melikoff has vowed “to reduce all costs that are in our power to reduce”.

He points to statistics that show that floor (square metre) space represents about 15 per cent of overall costs, with booth construction at around 55 per cent. The rest is made up of travel, hotels, marketing, staffing, entertainment and hospitality.

MCH Group has listed other improvements needed to get Baselworld back to its former glory, however Loris-Melikoff stipulates, “Everyone would understand that we are not able to make all changes in one year. It’s simply not possible. In 2020, we will concentrate on three to four main changes.”

Can he pull it off? Well, a cynic would suggest Baselworld’s fortunes couldn’t go much lower, so the only way is up. If the proof of the pudding is in the eating, then perhaps one important measure will be whether the behemoth Swatch Group likes the changes and eventually rejoins the show.

Understandably, Loris-Melikoff is tired of questions about Swatch Group and says only its CEO Nick Hayek Jr can decide that outcome – but he believes that if he achieves his aims, it is highly possible.

With Loris-Melikoff at the helm it appears the ship has changed course; the only question now: is it headed home in the right direction?

Only time will tell, but it looks like it’s ready for more passengers!
 

A TIMELINE OF Baselworld's Woes

Baselworld 2019


Image Gallery (4 Images)









ABOUT THE AUTHOR
Coleby Nicholson

Managing Editor • Jeweller Magazine


Coleby Nicholson is publisher and managing editor of Jeweller magazine. He has covered the jewellery industry for more than a decade and specialises in business-to-business aspects of the industry.

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Thursday, 12 December, 2019 04:37pm
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