Bigger, Not More Ubiquitous, is Better, Says Hermes CEO

Auspicious opening

The much-awaited opening of the latest Maison is either a masterstroke or a missed opportunity.

Auspiciously, given the brand's humble beginnings 177 years ago as maker of saddles and harnesses, the opening falls in the Chinese Year of the Horse. A Hermes firework-maker on horseback sits on the south side of the Maison's terracotta roof, and the brand's Chinese name "Ai-ma-shi" translates as "horse-loving gentleman".

Hermes is also gaining traction as trends converge in its logo-free favor: Chinese consumers of luxury goods are growing weary of the ubiquitous and flamboyant logos of brands such as Louis Vuitton, which for years have enjoyed prominence in Asia. Many brands are now making their logos more discreet.

But while Hermes was a trendsetter in New York's Madison Square Garden, Louis Vuitton, Cartier and Ermenegildo Zegna, as well as luxury department stores such as Lane Crawford, all opened stores earlier on Huaihai Road.

"Technically, we started our work here first, but they ended up finishing their one (before us)," Dumas says, referring to the LV showroom, which winks at its arch-nemesis through a haze of LED lights from across the street. "That's Asia."

LVMH, the group that owns LV, revealed in late 2010 that it had stealthily acquired a 17 percent stake in Hermes Int'l SCA, according to earlier reports. The holding later rose to 23 percent. Rumors of a planned takeover led Dumas to describe the move to the Financial Times as "the battle of our generation".

Now Hermes seems to won the "handbag war", at least for the time being. After losing a court battle in France, LVMH agreed earlier this month to give up most of its stake and not buy any more shares in its rival for the next five years.