In fact, products other than pens now account for 35% at Montblanc, a unit of luxury goods group Richemont that has evolved over the past 15 years into a diversified luxury brand, expanding (in what Mr. Schmitz calls "concentric circles") first to desk accessories, then leather goods, cuff links and key rings, then watches, fragrance and, finally last month to women's jewelry. But despite a portfolio of products in department stores, fine jewelry stores and a recent outcrop of 250 freestanding Montblanc boutiques across the world, Mr. Schmitz admits that "we are basically new to a lot of people today beyond our functional roots."
To change that, Montblanc plans to launch a 100th anniversary blowout in 2006, with significant marketing increases put toward more dramatic plays in print media, a dedicated Montblanc cable program, public relations and a slew of events. The work is being handled in-house. Although TNS Media Intelligence figures show Montblanc put only $3 million in traditional media toward its brands in 2004, Mr. Schmitz said the outlay last year was in excess of that. He said spending this year (pegged at $1.6 million for January through June) has grown by as much as 40% with the addition of women's jewelry ads to an ongoing charity campaign. Print ads feature Johnny Depp and Julianne Moore as spokespeople for a children's education cause, the Entertainment Industry Foundation, and for Montblanc's watch brand.
In a rare look at the Montblanc brand last year (Richemont does not typically provide brand-level data), Bear Stearns analyst Dana Telsey said in a research report that the company "has successfully leveraged its brand DNA of quality, craftsmanship, exclusivity, style, elegance and enduring value in order to evolve from a pen manufacturer into a global luxury brand." The report showed that Montblanc's plan to move beyond the luxury pen market, which it leads significantly with an estimated 70% share, has proved successful as non-writing instrument sales made up 35% of annual sales (the report didn't break out total sales) last year as opposed to only 20% in 2000 and a mere 5% in 1995, and said that developing women's merchandise "could support future sales growth."
The recent foray into women's jewelry is an outgrowth of the fact that women have always been the predominant buyers of Montblanc products as gifts for loved ones. Since Montblanc added watches in 1997, more than 50% of its watch sales have been for women, thus prompting the idea to develop a line of affordable-luxury jewelry at price points ranging from $200 to $500 (a precursor, Mr. Schmitz said, to higher-priced precious jewelry once credibility is built for the brand in the segment).
Alison Burwell, editor of W Jewelry, said the line "has been received really well," in large part due to the reasonable price points, "fun pieces that will appeal to a younger clientele" and to Montblanc's efforts to reach out to that youthful demographic with events such as its New York jewelry kickoff featuring celebrity Selma Blair and hot Hollywood stylist-to-the-stars Rachel Zoe (a regular in the pages of Us Weekly and other mags).
Despite praise for Montblanc's efforts, Milton Pedraza, CEO of research firm the Luxury Institute, warned of the dangers that extending to ancillary categories can do toward diluting a brand. "In the luxury world, specialists always win and the numbers have shown that."