Porsche Accelerates Fashion Offerings Outside the Sports Car

SAN DIEGO (TheStreet) -- The Porsche is an instantly recognizable luxury vehicle, but the same cannot necessarily be said of the Porsche fashion collection, watches or smartphones.

Since 1972, the Porsche Design Group, founded by Ferdinand Alexander Porsche, has been creating far more than sports cars. If you haven't seen all the other stylish products Porsche has to offer, you may soon.

Porsche Design Group is in the midst of a global expansion strategy that last year included opening 50 Porsche Design stores, increasing the company's total retail presence around the world to 152. Hong Kong, London and Los Angeles are now all home to new Porsche Design stores.

This year there will be more openings -- from an expansive, two-level store on Madison Avenue in New York City to Milan, one of Europe's most important fashion capitals. Further in the future there will be even more stores. The company is negotiating for space to establish a flagship store in Paris, is on the hunt for a location to open its first store in China and will even open in cities including San Diego, Phoenix and Scottsdale, Ariz.

"In total, we expect at the very end of the day, to have about 180 stores," says Porsche Design Group CEO Juergen Gessler during an interview from New York Fashion Week, about an hour before the brand's own show was about to hit the runway for the first time.

Nearly 200 stores is a long way from the seven Porsche Design Group had in 2004.

At the same time all the stores are opening, product lines are still being launched and others are expanding as the company seeks to establish itself as an overall lifestyle brand.

Porsche Design Group began selling its first women's handbag last year, a truly sleek bag with extendable straps that ranges in price from $1,550 to $29,000 and can double as a shoulder bag. A bigger variety of shoes are also on the horizon, and a line of women's shoes is to be launched next year.

"We are focusing much more on shoes then we have in the past," Gessler says.

A store concept being rolled out in various locations emphasizes a minimalistic look with no permanent furniture, Gessler says, allowing the stores to be flexible and showcase the company's various product lines throughout the year.

All of this activity is based in large part on what Gessler describes as double-digit growth for the company in 2012 and last year.

The company's product lines include fashion, luggage, a sport collection, sunglasses and watches, with its fashion line being among its most popular and contributing to a large part of the product turnover.

The company's design philosophy is to offer a mix of functional, timeless and purist influences, while also always trying to include some level of innovation.

For those who didn't know that Porsche Design has so much to offer, including phones, the product range may seem surprising. But Gessler says it is customers who drive the offerings.

"We look at what customers are buying at this time," he says. "Ten or 20 years ago, they were buying smoking accessories and writing tools. It is the customer who is choosing fashion, shoes, bags, sunglasses, watches and phones."

"People are not asking their partners anymore 'What writing tools are you using?' they ask 'What phone are you using?' " Gessler says. "And as a brand, you have to follow the customer."

During the past two years, the company sold 130,000 phones, Gessler says. The company's P'9982 Smartphone helped established the luxury brand as one of the market leaders in the segment.

Those already familiar with Porsche Design and generating the robust profit for the company are from a very specific demographic: affluent, style-conscious 40-somethings.

"The men's customer is someone who is interested in design, functionality, is very wealthy and likes some added value," Gessler says. "Our female customer is the very successful businesswoman looking for some new style brand, who likes sleek design and is very self-confident."

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