2014 was a busy year for Natuzzi. Riding hard along the road of financial recovery, the world’s most famous sofa brand entered the bedroom arena, and repositioned its brands – Italia, Editions and Re-Vive – under the Natuzzi banner. Paul Farley had the opportunity to sit down with the company’s founder, Pasquale Natuzzi, at Brussels Furniture Fair, to discover the thoughts behind these developments from the man at the top …
Last year saw Natuzzi Italia branch out into bedroom furniture, as well as bolstering the range across the other brands. Do you plan to offer a complete range of Natuzzi home furniture and furnishings in time?
Natuzzi Italia product already covers the whole living room – the brand’s DNA is geared towards combining style and function to create harmonious living.
We reviewed our strategy in September 1997 and switched from being an industrial trademark to a consumer brand – we are an Italian company, an Italian brand. We like to offer the consumer great value, but because of the quality and cost of labour in Italy we cannot be the cheapest, so we decided to capitalise on the history of our brand by repositioning the Natuzzi product line – the design, the material, the high standards.
We also requalified the factory workers to help position the brand at a high level, and carried out product extension – which is set to continue.
Leather upholstery is our history, our heritage – but because we’ve been in this business for 55 years, we’ve learned a thing or two about how to decorate the entire house. Why bedroom? We’re a lifestyle brand. Whoever loves Natuzzi will want to decorate their house completely with our product – and with our experience we certainly have the know-how to make upholstered beds.
What challenges did entering these new markets present?
The entire thing has been a challenge. In the first six years following the brand realignment, we entered fabric upholstery, lamps, coffee tables and accessories, re-styling as we went. Then, six years ago, we moved into the dining area – it was a natural evolution, especially in today’s houses, which are becoming smaller and smaller, and many living and dining rooms are being decorated together.
The last introduction has been bedroom furniture, which we introduced last April in Milan. Today, all this operates under the high-end Natuzzi Italia brand, and, in order to offer the consumer the right shopping experience we started to retail Natuzzi Italia.
When you build a brand, you need to control and direct the brand – you need to manage the store, the advertising, training, customer satisfaction – everything! Today we have 300 stores around the world. We opened our flagship stores in Milan, New York, Spain and London, to test the concept with our money in our own stores. When we were sure that the concept was viable, we started to franchise.
And Natuzzi Editions? Is that a global range, or designed for specific markets?
Natuzzi Italia has a very clear brand identity. The product proposition is the mirror of the brand – it totally reflects an Italian lifestyle. While with Natuzzi Editions, which reflects the heritage of the Natuzzi group, we’ve adapted the product to fit the target market.
UK consumers like dark colours, browns, high quality leather, traditional and transitional styles, so we’ve designed products for Natuzzi Editions that fit the UK market very well. Natuzzi Italia targets customers that love modern styles, and has a very clear brand identity – if you like it you buy it, if you don’t, you don’t!
“My problem is that I always like to tackle the impossible missions – but we are succeeding in this one”
However, Natuzzi Editions has been adapted to respond to the demands of each market.
How do you envision the expansion of Natuzzi Editions?
We are working with a lot of stockists, and wherever we do that the power of the Natuzzi brand helps the retailer generate high volume per square foot, and maximises margin.
What are you most excited about as we enter 2015?
Probably Natuzzi Re-Vive – we’ve invested nearly €10m so far, because we believe in what we are doing, and our customers recognise that. When we launched Re-Vive a year ago, it was very modern – now we’re looking at a vintage product extension.
What part do you play in the company these days?
I’m very much involved in every kind of product we develop, and in everything involving the brand, be it advertising, store decoration, whatever, it’s my responsibility to have the last word. I’m 100% involved in the company, but what I love most is the creativity, the design.
What’s been the most difficult part of your job?
I know how to manage a factory very well, to organise production, and design and engineer a product – that’s in my blood. But taking Natuzzi to being a consumer brand all those years ago was probably the biggest challenge for me. However, I’m very pleased with the results – Natuzzi is now the most recognised furniture brand in the world.
In light of these developments, is the company recovering well?
I don’t know how quick it will be, but we’re certainly on track. The plan we submitted to the board last February was based on two pillars – a new brand strategy, and restructuring the production process.
When we decided to reposition Natuzzi towards the high end, we ended up developing several brands and sub brands, and it became very complicated.
“Each pound or euro we invest in Natuzzi will help to keep the overall brand visible”
Last year, when we began preparing the business plan, we focused on self-analysis – we looked inside the company to understand our strengths and weaknesses. Based on market research, and our brand awareness around the world, we concluded that we should focus on Natuzzi, period. Until March last year, we were selling Editions as Leather Editions, but the name didn’t mean anything – we needed to leverage the power of the Natuzzi brand.
That’s why our strategy is to focus on the Natuzzi brand – one brand with three collections, Natuzzi Italia, Natuzzi Editions and Natuzzi Re-Vive. Each pound or euro we invest in Natuzzi will help to keep the overall brand visible. So far, the strategy has been working very well – order flow is increasing, so far still single-digit growth, but we’re very confident that it will be double-digit soon.
While restructuring the production process, we’ve had some difficulties, as you might when changing culture or language. We have 4500 people in the factory – any change must be gradual. Between product innovation and production process innovation, we’ve been working on developing an integrated process – if we redesign the product, we should redesign the whole supply chain, and how and when everything is produced.
It’s been a really interesting experience, to be honest. I’m confident that while we innovate – we are not an upholstery company, we are innovators, I firmly believe that – we will keep on manufacturing the product in Europe, and in Italy, and will be successful.
Did you manage to maintain the existing staff through this approach?
It’s easy to say “goodbye guys, I don’t need you any more, let’s move somewhere else” – that’s exactly what everybody does. Part of our strategy was to maintain the continuity of the company’s history. How? Going to China, Romania and Brazil, buying the land, building factories, hiring people, training them, and starting production. That said, Natuzzi Italia is made in Italy, and will continue to be.
My problem is that I always like to tackle the impossible missions – but we are succeeding in this one. We’ve done that in the last 10 years, despite trading through some of the worst years of the economy at a worldwide level. This truly proves what collectively, as a company and with our valued retail partners, we are capable of.
This article was featured in the January issue of Furniture News magazine.
