On the Marriage of Two Companies
last summer, De Rigo Vision, part of De Rigo Group S.p.A., purchased complete ownership of REM Eyewear. The move—which furthers De Rigo’s goal of international expansion—formed the fourth-largest maker of eyewear in the world. Here, EB checks in with both Massimo De Rigo, executive vice chairman and head of Design and Operations of De Rigo Group S.p.A., and Mike Hundert, CEO and CCO of De Rigo REM.
ERINN MORGAN: SO, WHY DOES THIS MAKE SENSE FOR DE RIGO? AND FOR REM? HAD YOU BEEN TALKING ABOUT THIS FOR A LONG TIME?
Massimo De Rigo: Before the marriage we had a long courtship. And, at the end we married.
Mike Hundert: Technically, it goes all the way back to 2008.
MD: The serious talking was over about one year. And, why it makes sense for De Rigo is very simple. De Rigo never had a real presence in the U.S. And, the U.S. is kind of a big market, I heard [laughs]. We talked with many people during the years, but our way of thinking is that if we are not really convinced, we don’t do it.
And, when we started seriously talking with Mike and his team, we really liked them. We really liked the company. We really liked the way of thinking. We really liked how they treated people. We really liked the way that they work on the product—that is very important for us, the design. And, so, this is why it happened.
EM: THE MERGER TRANSITION HAS BEEN RELATIVELY SEAMLESS—TO WHAT DO YOU ATTRIBUTE THAT?
MH: In our case, I chalk it up to great people that figured it out, mapped it out, went there, and executed it. Done. No drama. Just got the job done.
You’d asked why would REM be interested in doing this. We have an American portfolio of brands including Converse, Lucky Brand, Jones New York, John Varvatos, and Jonathan Adler. Our portfolio couldn’t be more American than it is. And, the De Rigo portfolio is global.
So, combining those was a no-brainer. Our customers in the U.S. will now have access to so much more wonderful product from the same team of people—the same marketing, same customer service—that we’re so well-known for.
We were family-owned, growing organically, doing a nice job. But to really accelerate growth, it required more resources, and De Rigo has those resources. So, it could very quickly help REM become a much more fulfilling supplier to retailers with more robust offerings. We are at about 25 brands combined.
EM: HOW WILL ECPs WORK WITH THE NEW DE RIGO REM?
MH: To launch, we have introduced a second sales division that will run parallel with the first division. We have a great sales force and our main focus is their success. So to be the most strategic, we have split the portfolio in two and have hand-selected complementary brands that each division will represent as we move forward during this exciting time of change.
And, we are still family run. There’s no big public company dictating how to run it. This is a family concern whose objectives are all long term. This is not a quarterly mission. It’s a life mission.
MD: This is a good point, because when it’s a family business, it’s different. Not only for us, but also for the people who work with us, like our customers. Why? Because they feel like it’s home.
EM: LOOKING AT TODAY’S MARKET, WHAT’S YOUR TAKE ON ONLINE EYEWEAR SALES?
MH: It’s a channel that will continue to grow. Therefore, it’s one that we have to pay attention to and create strategies to leverage. When I say I’m in the eyewear business, to somebody outside the business, the first thing they bring up are the online competitors that have emerged in the market. So, my feeling is, if that’s creating dialogue about eyewear, that’s great. I don’t care if they want to talk about these other companies—they’re talking about eyewear. That’s going to help everybody.
EM: IS THE ONLINE SITUATION GLOBALLY AS STRONG AS IT IS HERE IN THE U.S.?
MD: Particularly in Europe, there are some new sunglasses brands that are becoming popular selling exclusively online. Certainly, online eyewear sales are an important trend and, for that reason, we are monitoring it. At the moment traditional sales continue to be a main focus as well as elevating our level of customer service with REM’s help, especially when it comes to the optical business. This is very important to us and this type of hands-on service is something that online sales cannot provide.