Of the many moments in the movie Sex and the City 2 that might strike North American audiences as unrealistic, there is one in particular that stands out. While visiting Abu Dhabi, Carrie and the gang find themselves in the back room of a dried-flower shop staring at seven women wearing black niqabs. What appears to be the ultimate cultural stand-off—four sexually liberated New Yorkers facing women with all but their eyes covered—turns into a moment of cultural harmony as the Muslims disrobe, revealing their designer duds. As the Americans ooh and ahh over the latest Louis Vuitton, Carrie’s trademark voice-over chimes in: “And there, in a dried-flower shop, halfway across the world, underneath hundreds of years of tradition, was this year’s spring collection.” If you hadn’t walked out of the 2½ hour movie already, this might be the clincher: a seemingly overblown Hollywood moment that offends by simplifying a complex issue. But the truth is, the scene depicts the real attitude of certain Middle Eastern women, an attitude western businesses could profit from understanding. If the Muslim women depicted in Sex and the City had gone a step further with their strip show, North American audiences might have been shocked by the sight of lingerie as frilly and lacy as anything available on Fifth Avenue. Few have capitalized on this hidden market more than La Vie en Rose, the Montreal-based lingerie boutique.
When CEO François Roberge was approached by a consultant about expanding La Vie en Rose to Saudi Arabia in 2004, he didn’t hesitate. “Why not try?” Roberge remembers asking himself. “If you don’t try, there’s no evolution. My concept of retail is, if you don’t move, you die.” The market for undies in Saudi Arabia, the largest (and most conservative) country in the Middle East, is US$1 billion a year, according to Reem Assaad, a banker and financial analyst based in Jeddah. A 2010 advertisement for Motexha, the Middle East’s largest garment, textile, leather and fashion accessories trade event, boasts that the United Arab Emirates and Saudi Arabia account for 77% of Europe’s total lingerie exports. To Roberge, expanding to the Middle East actually seemed like a safe bet. At the time, Canadian lingerie retailer La Senza, which is quadruple the size of La Vie en Rose, and the shoe store Aldo had both set up in Saudi Arabia, proving it was a lucrative market. (La Senza currently has 44 stores in the country and about 52 others in the Middle East.) “I’m not big enough to have 10% of our budget to travel around the world and discuss business,” says Roberge. “Those companies are so picky and tough in terms of relationships with partners that [if they’re there], we know it will be a good situation for us.”
Roberge decided to open 28 stores across three Middle Eastern countries. To oversee the operation, he hired Julie Crevier, a senior buyer with clothing company Marie Claire who, at the age of 25, had been headhunted by La Senza to be the merchandise manager for its 1998 expansion into the Kingdom. At the time she was approached by La Senza, Crevier had never travelled outside of Montreal, much less pronounced the names of Middle Eastern countries. She recalls asking in her initial interview, “Do they really wear underwear and bras there?” (A managing director responded, “Have you heard about gravity?”) What seems like an ignorant question in hindsight can easily be forgiven. Lingerie is linked with sexuality and seduction, words not often associated with Islamic culture. In most of the Arabian Peninsula, which includes the U.A.E. and Kuwait, women wear an abaya—a long dress that covers all of the body except for the hands and is usually paired with a niqab or a hijab, the latter of which covers the head but leaves the face exposed. Interactions between unmarried men and women are few—in Saudi Arabia, they cannot be alone in a room together unless they are related, and the Qur’an specifies they should avoid eye contact and touch. But Roberge had no trouble picturing his product under an abaya. “A woman is a woman,” he says in a gruff, accented voice. “The parts of the woman are the same.”
So too are women’s shopping tastes. In both Canada and the Middle East, La Vie en Rose is considered on the low- to mid-range in terms of luxury brands. Though its name incited a sense of opulence by evoking Paris, Crevier knew the company had to upscale its shopping experience to be on par with the competition. Shopping bags went from plastic to paper, and purchases were wrapped in pink tissue, neither of which was offered in Canadian locations at the time.
La Vie en Rose’s expansion also faced additional challenges, stemming mainly from cultural differences. In Saudi Arabia, religious police forbid lingerie shops from having fitting rooms. And though a law forbidding women from working in stores was reversed five years ago, in practice, things are only now slowly starting to change in certain cities. Though the company had to alter parts of its branding, like changing its colour scheme from red to pink (the latter being less provocative), nixing forbidden photos of skin-baring women and axing Cupid imagery due to its religious connotations, it was still adapting to a culture that celebrates sexuality, albeit in a different way.
Attempting such cultural adaptations may seem hazardous, but Roberge is no stranger to taking risks. When he bought La Vie en Rose in 1996 from the Algo Group for $2.4 million, it had 26 stores with annual sales of $16 million—and was losing a million dollars a year. Originally founded by Toronto-based businessman Harry Kaner in 1984, the company filed for bankruptcy protection within its first three years. Kaner sold to Algo in 1987, but the two Polish brothers in charge were more interested in the manufacturing side of business than retail, and the brand continued bleeding money.
Roberge, who had worked in the Quebec retail business for 13 years, financed his acquisition with loans and personal savings. To cut costs, he moved headquarters from Toronto to Montreal, and began outsourcing merchandise directly from factories in China. The company was profitable within a year, and has grown by around 20% annually ever since. With a target demographic of women between the ages of 25 and 55 looking for underwear, bras and sleepwear that are both sexy (satin) and practical (cotton), La Vie en Rose now brings in $130 million in domestic sales via 150 Canadian stores, as well as $10 million from 56 international locations.
When Crevier first arrived in Saudi Arabia 15 years ago, the western retail world had not yet taken over. On subsequent trips, she noticed a transformation in the appearance of local women: many had switched from veiling to showing their faces, wearing lipstick, and accessorizing. “They were very coquette,” she says. “They were really findings ways of their own to become feminine.” Alex Alagappan, co-founder of Rimagine, a Toronto-based consulting company specializing in the Middle East and India, noticed how women use clothing as self-expression: “Since there is no differentiation or individuality in the outer clothing one wears, when women are amongst women, they are walking, talking fashion models.”
As a result, over the past decade global luxury brands started expanding into the capitals of oil-rich countries such as Saudi Arabia, Kuwait and the U.A.E., giving women access to shopping on par with the biggest European cities (Dubai is home to the world’s largest shopping mall) and higher consumer expectations.
Based on these trends, it’s not surprising Middle Eastern La Vie En Rose performed well, and within two years, the company had 25 locations in the country. The company’s stores have now expanded to include seven more countries in the region and make up 20% of its total profits. The company’s overseas venture actually is less risky than its operations in North America, given the low labour costs, cheap rent and growing economy. The company’s Middle Eastern partners also operate on a master franchise model, giving them licence to develop the brand while they shoulder the costs of running the stores.
The Middle Eastern market is now so important to La Vie en Rose that the company has brand managers in each market who are required to check in with the Montreal office once a week and visit twice per year. Roberge and the company’s CFO, Luc Poirier, fly to the region at least once a year to visit the stores. That trip will become more complicated in 2012, when Canadians will need a visa to fly into the U.A.E. (they already need one for Saudi Arabia), but company execs will make it anyway to ensure their brand is still blooming.
While Carrie and the gang returned from Abu Dhabi to their failing marriages, stressful careers, complicated sex lives and the tedium of motherhood—all of which were miraculously resolved by the time the credits rolled—La Vie en Rose returned with a real fairy-tale ending. Because of its success in the Middle East, the company has been approached by partners in Russia and Ukraine. Its most recent location opened this January in Kazakhstan, and Roberge plans to expand to 10 new countries by 2013, including India, China and Georgia. The CEO says nothing seems daunting after having adapted to the Middle East, an attitude that will serve him well as an international player. “In Canada, we work for a small piece of bread,” he says, “but if you can be a good retailer in Canada, you can be a good retailer around the world.” In the end, both he and the Sex and the City gals learned a valuable lesson: we aren’t as different as we are the same.