Handbag entrepreneur owes success to quality, celebrities

TAKING A CHANCE

Handbag entrepreneur owes success to quality, celebrities
By KAHO SHIMIZU
Saturday, June 23, 2007

From the start, entrepreneur Kazumasa Terada had his eye on the global market. Using celebrities like the Hilton sisters in 2002 to promote his handbag label, Terada has turned Samantha Thavasa into a household name in Japan, and is on the verge of bigger things abroad.

News photo
Kazumasa Terada, president of Samantha Thavasa Japan Ltd., poses with his products earlier this month at the company's head office in Minato Ward, Tokyo. YOSHIAKI MIURA PHOTO

With the opening of the first outlet overseas on Madison Avenue in New York City in November, Terada, 41, has moved a step closer to his long-cherished ambition: to transform Samantha Thavasa into a world-class brand.

Terada's promotional tactics of tapping famous fashion icons as ad models and designers for Samantha Thavasa have proved effective.

"We had a showroom in New York more than 10 years ago and the Hilton sisters were frequent customers," Terada, president of Samantha Thavasa Japan Ltd., said in a recent interview with The Japan Times.

When they came to the reception, Terada approached them and asked if they would be interested in promoting Samantha Thavasa items.

Others on the list of worldwide celebrities who represent Samantha Thavasa products in advertising campaigns are Victoria Beckham, Beyonce, Maria Sharapova, Penelope and Monica Cruz, Tinsley Mortimer and, most recently, Sarah Jessica Parker.

The company is also a sponsor of the Miss Universe Japan contest and got a boost when Riyo Mori was crowned Miss Universe this year.

Samantha Thavasa, which Terada founded in 1994, has enjoyed remarkable growth over the past years.

Both sales and pretax profit more than tripled in the five years through the 2006 business year. Generating 17.3 billion yen in sales, nearly 10 percent being spent for ad and sales promotion expenses, the firm now has 151 outlets nationwide and about 900 employees, some 90 percent of whom are women.

The company debuted on the Tokyo Stock Exchange's Mothers market for emerging startups in 2005.

"A brand is not only shaped by its products but also by the staff, location and promotional campaigns," Terada said. "These important four elements are different from country to country, so we'll have to learn the differences," and find the way that best fits each market, he added.

"We are aiming to make (Samantha Thavasa) a global brand of Japanese origin," Terada said, noting the term "Japan Ltd." used in its name reflects this desire.

Samantha Thavasa markets 10 brands of handbags, accessories and jewelry, including bag label Samantha Thavasa, Violet Hunger, jewelry brand Samantha Tiara and its first men's label, Samantha Kingz, which was launched in October.

While some foreign luxury brand bags are now produced in China, almost all the company's products are made in Japan, reflecting Terada's keen sense of quality.

 

Key events in Terada's life

1965 — Born in Fukuyama, Hiroshima Prefecture.

1987 — Takes year off from university to study business administration in Canada, where he began importing leather jackets specifically designed to fit Japanese to fund his stay.

1988 — Graduates from Komazawa University, faculty of business administration.

1988 — Joins a trading company and learns how to run a business.

1991 — Starts his own trading house to import designer bags and clothes.

1994 — Establishes Samantha Thavasa Japan Ltd. to start his own handbag label.

2005 — Lists company's shares on the Mothers market for startups on the Tokyo Stock Exchange.

2006 — Opens Samantha Thavasa's first overseas outlet on Madison Avenue in New York.

One of the company's bags that may come readily to mind is the long-selling Orlare series, which comes in vibrant colors with bamboo handles.

But Samantha Thavasa never lets its customers get bored.

The company releases about 250 designs for each brand every year — bags made with different fabrics and materials, those with floral stitching and glittering accessories.

"A fashion brand becomes dull and boring if products only come in regular designs of similar style," Terada said.

Terada's childhood dream was to become president of the company his father was running in Hiroshima Prefecture. But it didn't take long before he became aware at age 14 that his admired father wanted his older brother to take over the family's manufacturing business.

"When I realized that, I was determined to start my own company," Terada said.

Having worked for a trading company for over two years after graduating from university, the Hiroshima Prefecture native started his own trading business in 1991, importing bags and clothes.

At that time, importing designer goods was the mainstream approach instead of building a domestic brand from scratch, and Terada initially followed that path.

"I looked for a brand name unknown in Japan, something untapped by major trading houses, and brought it here to make it popular through marketing and promotion," he said.

But Terada soon realized the limits of selling someone else's name.

As the imported items began to sell well, thanks to Terada's marketing efforts, major trading houses came in and offered his clients purchases in larger volumes, leaving Terada with a feeling of emptiness when he witnessed his clients switching to other traders.

"To (the manufacturers), I was like a mere buyer. What mattered to them was how much I can buy from them. They didn't care whether end-users in Japan liked their products," he said.

Terada then launched his own handbag label and established Samantha Thavasa to deal with product planning, designing, manufacturing and marketing.

Believing that a global brand appeals to customers of all ages, Terada has been working to broaden Samantha Thavasa's customer base from women in their 20s to those in their 30s and 40s. Using 42-year-old actress Parker as a model and designer for the firm's new handbag series is one way to attract women her age.

"Regardless of whether they are in their 20s, 30s or 40s, women have their femininity and enjoy fashion," Terada said.

In this occasional series, we interview entrepreneurs whose spirit perhaps holds the key to a more competitive Japan.

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