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Bang & Olufsen partners Paul McCartney

In an effort to reverse its fortunes, cult Danish audiovisual company Bang & Olufsen is firing on all cylinders, with a slew of new products, a new store concept, and a partnership with Paul McCartney.

Take a stroll along the 1.1km-long Stroget, Copenhagen’s main shopping thoroughfare (and Europe’s longest pedestrian walkway), and one thing will strike the casual observer: High-street shops and luxury-brand boutiques mingle with the surest of ease. Here in egalitarian Denmark, one of the most equal societies on the planet, the strict hierarchy that dictates the prime positioning of luxury brands in other cities is virtually absent.

You won’t find the Louis Vuittons, Guccis, Pradas and Hermes of the world clustered together; instead, they are interspersed with high-street staples like H&M, COS and Urban Outfitters.

Hand-in-hand with this egalitarian attitude is the Danish inclination towards Bauhaus functionalism. Form follows function; there is no place for extraneous detail. This credo defines the national ideal of luxury, where elegant design, high quality and attention to detail trump overt displays of wealth. Such values are manifested in all the country’s major luxury brands, from cult audiovisual purveyors Bang & Olufsen and upscale furniture marque Fritz Hansen to acclaimed silversmiths Georg Jensen and fine-china specialists Royal Copenhagen.

It’s on Stroget that you’ll find Bang & Olufsen’s flagship store. In typical Danish fashion, the facade is stylish and low-key, not quite the gleaming temple to consumerism as might be expected of a global company with annual revenues of about 2.8 billion kroner (S$650 million). Rival company Apple, the Goliath to Bang & Olufsen’s David, with its distinctive retail concept – all soaring architecture and clean lines – comes to mind.

Bang & Olufsen president and CEO Tue Mantoni is well aware of the comparisons between the two design-driven companies, and of consumers’ growing expectations. “Expectations are going up and up. Gone are the days that people wanted just a beautiful design. Design for us is how a product looks, but also how it works or makes you feel or the experience you get from the product,” he says in an interview at Bang & Olufsen’s headquarters in Struer, a small town four hours’ drive west of Copenhagen. It was here that engineers Peter Bang and Svend Olufsen founded their company 88 years ago.

The energetic, straight-shooting 38-year-old took up his current post in March 2011, amid less than favourable conditions. According to an Oct 2 Reuters report last year, the firm has posted annual net losses in three of the past five years. The same report also pointed out that the company made a 68-million-kroner loss in the first quarter of its 2013/2014 financial year. But Mantoni remains unfazed. “There’s huge potential for Bang & Olufsen in the long term,” he maintains.

STRATEGIC MOVES
Part of his strategy was to launch Play, an entry-level, portable-product range targeted at younger consumers than the traditional Bang & Olufsen brand, and sold through Bang & Olufsen stores as well as premium third-party retailers such as Apple Stores and Illums Bolighus, Copenhagen’s high-end homeware emporium.

Play’s product portfolio includes headphones, earphones, radios and speakers, into which users can stream music from smartphones. Launched in February 2012, Play not only reached out to a market segment that the company never had before, but also encouraged that segment to aspire towards higher-end Bang & Olufsen products later in life. It was a tremendous success, achieving a double-digit percentage growth in sales, and now accounts for 25 per cent of revenue.

BeoPlay A9

It wasn’t enough to lift the company out of the red, however. Neither was strong growth in the fast-growing Bric economies. Revenue from those markets grew by 28 per cent, compared to the same quarter the previous year, reported Reuters. For a luxury brand, the company was, in fact, a late entrant to the booming Chinese market, establishing local operations only in July 2012.

Mantoni attributes this to an overly product-centric company culture. “We’ve always been very product- focused. We went through a period where the product focus was so intense that we lost sight of what was happening far away from where we were,” he explains. “I think it’s important to maintain the strong focus of the product, to maintain the drive to deliver something immaculate but, at the same time, never lose sight of the fact that you’re actually doing this to enrich people’s lives and, therefore, you need to get out and meet people.”

Since taking the helm, Mantoni has done just that, visiting two or three shops every week. So far, he has called on 250 or so of the 650 around the world. “The main focus right now is to build the brand through the stores and the products with a really strong offering. That’s where I spend 80 per cent of my energy right now,” he says. In the summer of 2013, a new store concept was unveiled at the Copenhagen flagship and, subsequently, at the Shanghai and Hangzhou ones as well. It was a template that will roll out progressively across all stores.

The foyer of The Farm, the name of B&O's headquarters that's four hours' drive west of Copenhagen.
The foyer of The Farm, the name of B&O’s headquarters that’s four hours’ drive west of Copenhagen.

“The first thing you’ll notice is a clear separation between Bang & Olufsen and Play,” Mantoni says of the concept. “At the same time, you can see the shared values between the two. We wanted to create opportunities in the Play area for customers to interact with the product: Take your own iPhone or Android phone, stream your music, use the headphones. This is to take away the notion that Bang & Olufsen is very expensive and you don’t want to touch it. In the Bang & Olufsen area, we have created different experiences for people: You can sit on a sofa and watch TV, and a revolving platform will take you from a stereo set-up to a surround-sound set-up. There’s also a speaker wall where you can listen to and compare the different speakers.”

IT’S A KIND OF MAGIC
In typical Bang & Olufsen style, it’s no ordinary speaker wall, but one composed of individual panels that rotate, via remote command, to reveal the speakers mounted on the reverse. A Chinese client in the Shanghai boutique was apparently so taken by this “mechanical magic” – as Bang & Olufsen personnel refer to it – that he asked to purchase the wall. This “magic” – mechanical or tactile surprises such as soft-closing lids and moving parts (remember the iconic Beo Center 2500 with motion-activated glass sliding doors?) – is another aspect that sets the brand apart from its competitors, and will continue to do so in the forseeable future.

For instance, where other TV manufacturers are caught up in making TVs that are bigger, flatter and cheaper, Bang & Olufsen is working on user-friendly, intuitive features such as the different ways a TV can swivel around, or how the device springs to life on demand. “There, you will see us taking some really big steps in the next six months,” says Mantoni.

Factory

In the meantime, Bang & Olufsen fans can satiate their desires with the new range of wireless speakers, Beo Lab 17, 18 and 19, introduced in October last year. The all-digital speakers leverage the new Wisa standard for multi-channel wireless sound, and are equipped with the company’s proprietary Acoustic Lens Technology (ALT). The key advantage of ALT is that it distributes sound horizontally with 180 degrees of dispersion, giving audiophiles an optimum acoustic experience from anywhere in front of the speaker.

The collection’s centrepiece is the Beo Lab 18. With its sleek aluminium tubular body and wooden slats arranged in a radial pattern on the front, the Beo Lab 18 is as beautifully designed as it is engineered. Its designer, Torsten Valeur, 47, head of David Lewis Designers and a long-time Bang & Olufsen collaborator, introduced his latest creation at the Copenhagen flagship.

Torsten Valeur, designer of the Beo Lab 18.
Torsten Valeur, designer of the Beo Lab 18.

I thought of creating a more poetic way of having the sound come out of the tube. That’s how the (wooden) slats came about.
Torsten Valeur, Beo Lab 18 Designer

“The idea was to have a design that stood on a toe, instead of going straight down to the ground. The curved chromed feet is my way of making the tube appear slimmer than it actually is. And then I thought of creating a more poetic way of having the sound come out of the tube. That’s how the (wooden) slats came about – they’re like rays that shoot out from a central point. I love being in a room with a lot of natural wood. There’s a certain hygge,” he says, using the ubiquitous Danish term for cosiness. “It was hard to produce this design, because wood is organic and wants to move depending on the humidity and temperature, for instance. The first reaction from Bang & Olufsen was that it couldn’t do it. But it hasn’t compromised the sound in any way; in fact it sounds crisper.”

The centrepiece of the company's range of wireless speakers, the Beo Lab 18.
The centrepiece of the company’s range of wireless speakers, the Beo Lab 18.

Besides the main line and Play, the firm also does a thriving business in car Hi-Fi systems. Currently, it supplies four premium/luxury marques – Audi, Aston Martin, Mercedes and BMW – with stereo equipment. The system comes standard in top-of-the-line models like the Aston Martin Vanquish, while it is optional for other models. Over 150,000 units are sold every year, accounting for 25 per cent of total company revenue. At Struer, journalists were given a chance to test the system installed in an Aston Martin Vantage. As this correspondent discovered, the sound was crisp and three-dimensional, with the bass solid and distinct, unlike the bass overkill that sometimes occurs in systems of lesser make.

The company’s latest salvo is The Living Room Tour, an online platform that aims to reassert the company’s credentials as the go-to brand for musicians and audiophiles. To do so, the firm teamed up with no less than former Beatle, Sir Paul McCartney, for the launch. A dedicated site was set up to live-stream an interview with the musical legend, and fans could tweet their questions live, too. Mantoni stresses that the collaboration wasn’t an endorsement. “You didn’t see him with a Bang & Olufsen product saying how much he loved it, but you heard him speak about sound and music and his journey through life. We will continue to build on this (platform) with other artists, but they may not have as big a name as Paul McCartney. They might have different musical styles, or come from a different culture or country.”