The Best Of What’s Going On In MENA

The Legacy Behind Damas Jewelry

Anan Fakhreddin has been CEO of UAE jeweler Damas for four years. It's not a short time, but feels a mere flash in the pan compared to Damas' story, which spans over a century. It's a story Fakhreddin is proud of narrating. "Damas started 106 years ago in 1907 as a small goldsmith in Syria that became so well-known locally that we decided to expand." The workshop might have started in Syria but Damas' retail journey commenced in the UAE. "The first shop in the UAE opened in the Gold Souk in 1959. It's called Damas 01, and was the start of everything. It's still open and doing well," says Fakhreddin. “We are a UAE company. We've grown in the UAE. Our roots are here. And this market contributes three quarters of our revenues." "Today, Damas has 300 shops and represents 45 international brands. Some of our top brands include Graff Diamonds and MikiMoto. We have direct presence in eight markets and a proxy presence in four more markets. We hire 2,000 employees and process around a ton of gold every month," Fakhreddin said. The 1980s and 90s were a purple patch for Damas, and saw the company expand rapidly, particularly in the higher end semi-boutique and boutique segments. "We started our first high-end boutique in the Burj Al Arab in 1997.” That's now spread to 15 locations. Damas has succeeded magnificently in a crowded market. Fakhreddin believes the company's origins as a humble smithy are partly responsible. "Our products have craftsmanship and quality. We started out as goldsmiths. Most of our staff [were] aware of the artisanal process and attention to detail that goes into creating a memorable piece. Even today, for all our expansion, our quality control procedures are far tighter than many international brands," he explained. Customer trust is key. "In time, we have built trust with our consumers. We're considered the local jewelers. At Damas, we want our clients to have the confidence that a piece labeled 18 carats is actually that – without needing to double check. Trust is the most important asset that we have." Damas has also been successful in piggy-backing merchandise onto special occasions. "There are of course advantages of being born in the UAE, and growing with the country. Our product range reflects the calendar in Dubai. Be it Mother's Day, Valentines, National Day, Eid, Ramadan, Christmas, Diwali, we've created a culture where people buy pieces from us to celebrate the occasion. We've become part of the social fabric of the country." For all that it is doing well, Damas has to contend with a rapidly changing market, and competition from global brands coming into Dubai's shopping spaces. "Today, every international brand has a presence in Dubai, which has completely changed consumer expectations. 20 years ago, the gold souk was the standard by which everything was judged. Now, even local shops have branched out into more sophisticated models and have opened up in new malls." This has led Damas to conduct a complete re-strategizing from the ground up, coupled with a rebranding. "We've been around for 100 years. Now, we need a roadmap for the next hundred. So we've decided on a big strategic change in terms of brand positioning and also in terms of segmentation. We want Damas to become global, and being global obviously has certain requirements in terms of customer service, brand values and importantly segmentation," Fakhreddin explained The new strategy and rebrand was released a mere couple of weeks ago, in mid-November 2013. It sees Damas ready itself for a global charge. The first step is a change in market segmentation. “The new segmentation is now built around the concept of two types of retail outlets – one mid-market and the other high-end. This replaces our original retail segmentation policy where we were dividing based on products – 22-carat shops, 18-carat shops, semi-boutiques and full boutiques. We're now segmenting based on consumer demographics." Damas is also evolving its product lines. "What we were selling 10 years ago is vastly different to the products that do well today. Younger consumers today are far more global. An 18 year old in Dubai will not accessorize differently from an 18 year old in LA." And that global consumer convergence turn has made Damas far more contemporary. "We are much more fashion-oriented now, and focus quite a bit on the branding side of things. Instead of focusing on bulky pieces of jewelry that would be typically purchased and stored away as an investment, we're now looking at fashions, trends, colors and what consumers want. Our product lifecycle has shrunk to six months. Traditional shops could have gone years without changing designs. Damas is set to grow regionally and globally. "The most immediate expansion is in our core markets. We have 28 shops in different phases on construction in the UAE and Saudi Arabia. We've just revamped the Graff boutique in Dubai Mall, and we'll be opening another in Saudi Arabia. Beyond the GCC, our focus is on the fashion centers of the world, both east and westwards." The next step is international. Fakhreddin notes that the global luxury market is worth USD 300 billion, of which US makes up USD 60 billion, China USD 75 million, India USD 30 billion and France around USD 9 billion. That is where Damas wants to head. So will Damas ever carry the cachet of a Van Cleef & Arpels, or a Cartier? "To be honest, we're already there in terms of product quality. We just need to work on our global reach and brand.” It's been many a year since Damas was a new entrant in the market. But Fakhreddin says that the entrepreneurial basics remain the same even today. "You have to earn consumer confidence. You must be honest with yourself and your consumer. You have to add value, which is usually through craftsmanship and creative design." The market might be competitive, but there is room still for newcomers, Fakhreddin believes. "A big chunk of the market today is fashion driven. So if you have on-message products that are reasonably priced, you will find space in the market. And that's actually healthy. Yes, we compete with one another and all of that. But in reality, every good ad and new launch brings jewelry to the forefront of the consumer's mind. And that's good for everyone.”

Subscribe to MENA Prestige and get more...