Today’s Big Interview comes from the American edition of WatchPro, where we spoke to Lisa Bridge, chief executive of Ben Bridge Jeweler, the biggest jeweller on the West Coast with over 85 stores in California, Washington and several other states.
Ben Bridge has a history of transferring power to the next generation early on in their careers, which is how the millennial Lisa Bridge came to take over the family business in 2018. The theory is that youthful CEOs will be more attuned to ever-changing trends, and so it has proved under the company’s first female leader. When Covid-19 hit, Ms Bridge found herself grappling with the greatest business challenge since World War II. What’s more, she was still in the maternity ward having just given birth to her first daughter, Rose. How did she manage? Rob Corder finds out.
WatchPro: I don’t want this conversation to be all about the Covid-19 crisis, although we can hardly ignore it as we speak in mid-July so let’s start there. How did you feel in those very first days when you were faced with a genuinely existential threat to the future of the business and the livelihoods of around 1,000 employees?
Lisa Bridge: It has been an extraordinary experience. The added complexity for me was that, at the start of all this, I had my first child. On March 15, Rose joined us and it was from my hospital bed in between seeing a pediatrician and a hearing specialist that I had to make the decision to close all of our stores. So that was not quite the smooth entry into motherhood that I had anticipated.
I am forever thankful to my team for stepping up in a huge way at that time. It was a challenging moment to navigate, and we are lucky that we have such wonderful people.
As you mention, we have a large extended family of people that have spent their lives and their careers at this company. So trying to care for that team as best we could while navigating such an uncertain time was difficult.
We paid them for the first three weeks before we had to go to a furlough. We paid for medical throughout but we did have to make some hard decisions.
I am happy to say now that we have stores back up and running. It continues to be an adventure with the political climate, the rioting and looting, the situation in California with stores within indoor malls having to close again.
It continues to be an unusual time but I am incredibly impressed by how resilient and how creative people have become during this period. I remember thinking the day we heard from Governor Newsom in California that we would have to close our doors again and, had we heard that order four months’ earlier, we would have had no idea what to do.
But when it actually happened this time, we said to each other, “OK, we can figure this out,” and everybody was willing to get their heads down to find a way to continue to operate and care for our customers. We are definitely more resilient and creative than we were six months ago, and that will put us in good stead moving forwards.
WatchPro: It’s incredible to hear these human stories of how people adapt, but let’s go back a little further to see how Ben Bridge was trading coming into the crisis. You took over as CEO in 2018, and had been president and chief operating officer before that. Since you fully took the reins, what have been your key priorities?
Lisa Bridge: I am the fifth generation in this company, and we have always seen that one generation has passed on the business to the next when they are reasonably early in their careers because, as a retail business, we always have to evolve.
It was the right time for me to take over, and since then we have been really working on and evolving our customer experience. We have developed a new store experience from the point of view of its physical design and also the overall experience.
We launched the first of those two years ago at our Southcenter Mall store, about 20 miles south of Seattle. We have had that store for over 50 years and it has a wonderful team that really wanted to create a unique experience for our customers. We looked at how we could create different moments for customers throughout the store; how we could we bring in more storytelling to share the richness of watchmaking and jewelry.
We are selling beautiful objects, but it is much better to share how they came to be through things like the curio cabinet where we have large geo specimens; tools like an original diamond polishing saw that Peter brought back from Botswana in his carry-on.
We have bought our watchmaker forward into the store in a space we call the alchemy lab, so people can see Ray at work even if you are just walking by. It has been exciting to see the success of that store since.
WatchPro: I think of Ben Bridge predominately as a jeweler rather than a watch retailer, but how significant is the watch business to you and how has it changed over the years?
Lisa Bridge: We have been in watches historically. My great great grandfather, our founder Sam Silverman, was a watchmaker. He made his way out west, setting and maintaining the pocket watches for train conductors. They needed to be serviced and certified every year and Seattle was the end of the train line so he set up shop there.
Watches have always been a huge part of who we are and right now we probably employ more watchmakers than any other retailer in the country. We and Rolex were part of establishing a wonderful watchmaking college here in Seattle, which brings more people into this great industry.
WatchPro: Have watches become a bigger part of your business compared to jewelry in the past 5-10 years?
Lisa Bridge: I think they have. We want to have customers for life; that is our philosophy. We want to have an entry point into our brand, which a lot of the time is with bridal jewelry, so we have invested a lot there with our new brand Bella Ponte, which is a combination of technology and customization. That will launch somebody hopefully into a lifetime with Ben Bridge celebrating all of those life occasions that watches are perfect for.
WatchPro: Looking through your brand portfolio, three global powerhouses stand out: Rolex, Cartier and Pandora. What have you learned from working with these hugely successful brands from different parts of the watch and jewelry market that you can apply across the Ben Bridge organization?
Lisa Bridge: There is so much to learn from each of them. The attention to detail and the service level expectations with Rolex is a wonderful standard for us to apply to the rest of the business. With Pandora, we have learned a lot in terms of connecting and really getting to know our customers. When we first started carrying Pandora, one of our long term associates said they had not found another product category where you got to know your customer as fast as you did with Pandora.
You immediately know who the people are that are important to that customer, what they do, the places they go and the relationships that flow from that. The way we use that detailed customer information is something we take to the rest of the company. We use an acronym, MAFFING, which means we have to make a friend first. Before a customer buys anything from you, they have to connect with you at a human level.
WatchPro: Pandora was one of the first highly data-driven brands in our industry across customer relationship management, inventory control, reporting, KPIs and more to a new level of detail.
Lisa Bridge: Very much so. It has been a good lesson in how we use KPIs at both a corporate level and down to an individual store level. We speak to our associates about what is expected of them not only every month, but down to each hour. We use data to manage the hours, the staffing, the flow throughout the store. It is incredible.
WatchPro: Accepted wisdom these days is that retailers can’t really impose their way of wanting to do business on customers, they have to respond to the way customers want to shop. What do you think the key changes in consumer behavior have been over recent years, and how have you adapted?
Lisa Bridge: The key is to look holistically and connect with our customers however they prefer. That is a unique challenge for associates. Some of them have been doing a tremendous job at this for years, and now we have taken their best practices and made them the standard that every associate must reach.
The job is no longer to wait for somebody to walk through the door, associates need to be very proactive at building relationships from a very personal place.
After the recent rioting, we had customers calling to ask whether they could come in and help board up, clean up graffiti and check we were OK. It was amazing to see how personal people felt about the business, and I think that comes from the deep and meaningful relationships we create.
It also needs the right technology so that our associates can proactively reach out and manage their clientele files. We are really looking at next generation technology to achieve that.
WatchPro: The goal for a large chain like Ben Bridge must be to make every store feel like it is family-run, but you provide the tools and technology to make them commercially successful as well as warm and inviting.
Lisa Bridge: We like to take the best of both worlds. We encourage our store managers to think as if it is their name above the door, but also having the systems in place to really be able to build a business at scale.
WatchPro: Before we get into the immediate challenges of this year, how would you describe the health of the business coming into this year?
Lisa Bridge: We have always taken pride in being a very financially strong business and the last few years have been very good for us. We came into this situation in a healthy situation. But this is not a 10-year storm or a 50-year storm; this is a 100-plus-year storm that nobody could have foreseen. We were fortunate coming into it that we were in such a strong position and we will emerge in a strong position as well.
WatchPro: Ben Bridge has stores in 10 states and one province in Canada, which means you are dealing with many state governors as well as the federal authorities. How did you keep track of the way the virus affected states in very different ways and then deal with inconsistent advice and regulations in so many places?
Lisa Bridge: I have an amazing team that did an incredible team managing through all of the constantly changing regulations. It has been very regional, not just in terms of regulations, but in terms of how people are feeling. The most important thing we did was to put people at the forefront of every decision we made, and that held us in good stead.
WatchPro: Some issues ought to be quite black and white, like whether or not you are allowed to open your stores, but there must also be details that vary from place to place, for example whether staff and customers need to wear face masks or visors?
Lisa Bridge: You are right. We have a wellness certificate system that means everybody is taking their temperature at home and reporting if they have any symptoms. But in San Diego they changed their mind and said everybody has to have their temperature taken at work. This seemed crazy because it would be better if people knew they had a fever before heading into work, but it went ahead and we complied.
It is interesting working across the international border to Canada. We have five Pandora stores in the Greater Vancouver area, and we now can’t cross the border to get to them.
WatchPro: At the very beginning of this crisis, all business owners will have looked at fixed and variable costs and their cash position to work out for how many months the cash would last with no revenue coming in. For some businesses that might be two weeks, for others it could be two years. Is that a process you went through and what conclusions did you reach?
Lisa Bridge: We had to make some excruciating decisions because they affect people’s lives. Making the decision to furlough the majority of our team was really difficult, but we had to make sure we were managing our cash flow and ensuring we would have a business on the other side. In those early days we did not know how long this would go on for so we had very difficult choices to make.
As much as we were able to, we took care of our people so we continued to pay their healthcare. For the couple of months before we were able to reopen we were paying 100% of the coverage they needed. We had to look at how we might be able to reopen without knowing what the state of the world would be.
WatchPro: Thankfully there is still a world to open up to. How has trading been since you reopened?
Lisa Bridge: We have been very encouraged since we reopened that business has been there. Our customers still have occasions to celebrate. Birthdays and anniversaries did not stop and we have even seen a significant increase in engagement rings. I guess people decided that if they could live together for four months in lock down, they could live the rest of their lives together.
WatchPro: Did you take comfort from the fact that, ultimately, Ben Bridge is owned by Berkshire Hathaway so you could never really run out of money. Were they hands-on during the crisis?
Lisa Bridge: The way that they operate is that Ben Bridge is our business to run. When the family sold to Berkshire 20 years ago, Warren [Buffet] told my father to continue running the company as if it were the family’s only asset for the next three generations and has been completely hands-off to let us run the business. That is a wonderful thing because we have not had to change who we are as a business or second-guess our decisions.
During this time, Greg Abel, who is my boss, has been wonderfully supportive and checks in on occasion but continues to let us run independently.
WatchPro: I get the sense that Berkshire Hathaway is unlike some private equity investors that are always looking to buy and sell companies. It seems to take a much more long-term view of the businesses it owns.
Lisa Bridge: Absolutely. They buy and hold. That is how they keep really great people running their companies because they are not micromanaged.
WatchPro: While the stores were closed, how much did ecommerce compensate for the loss of brick and mortar sales?
Lisa Bridge: It shone a big light at the beginning on the system we were using for ecommerce. Until now, we have used our stores as distribution points for ecommerce sales. We did not hold separate inventory for online sales. When the stores closed, we also had to close ecommerce for a time because we did not have any way to fulfil the orders. We worked hard to get that changed and up and running. A number of our vice-presidents did incredible things to go into stores, fulfil orders and meet customers in extraordinary ways.
Ecommerce was the first thing back up and running, but we immediately looked at making sure that it would not need to close down again.
Since we reopened we have seen huge growth in ecommerce, and it is interesting that these sales have not tailed off since our stores reopened. Now we are going to invest to make sure that our stores can utilize our ecommerce, just as our ecommerce utilizes our stores, and doing more to connect both sides.
WatchPro: Having your stock spread around almost 100 stores does not sound ideal at the best of times. Have you managed to build an ecommerce warehouse or hub in the same time as it took some cities to build Covid hospitals from scratch?
Lisa Bridge: It has its pros and cons. It is expensive to hold inventory, so making sure you have it just in time where it needs to be is a good challenge for our teams.
WatchPro: Did different stores pick up more quickly than others as they reopened?
Lisa Bridge: We have been pleasantly surprised. Ten of our stores had their best July ever. That is not just beating our expectations or even beating last year. They have had their best July ever.
It is not uniform across all of our markets, but we are doing business.
WatchPro: Are city centers affected more than suburbs or commuter towns?
Lisa Bridge: I haven’t looked at it in that way, but I think no. Our downtown stores are doing very well, even though traffic is much lower than usual. People are really purposeful when they come into stores. We see fewer people, but they are coming in with a purpose.
WatchPro: Have you introduced an appointment system so that you know who is coming in, when and for what?
Lisa Bridge: Yes, we are definitely doing a lot more appointments and it has become much more important to our business. One of our stores is operating exclusively with appointments. Because we are working shorter hours with a smaller team, they are busy all the way through. There is much less down time than we anticipated.
WatchPro: Audemars Piguet’s CEO said recently that he did not think he needed four walls to sell watches. When you think about the rising importance of appointments, it begs the question of whether those appointments need to take place in stores that are costing you so much money? If so, would you expect to see fewer Ben Bridge showrooms in the future?
Lisa Bridge: We have chosen to close a number of stores that no longer make sense and our virtual appointments are increasing. All the in store teams, especially those working at indoor malls in California, are running virtual appointments and curbside.
We also just appointed our first virtual salesperson because we want to see what it looks like to have an associate working permanently outside of a physical store.
WatchPro: Accepting that neither of us truly knows what is going to happen with Covid, are you able to make any forecasts for how the upcoming holiday season will look?
Lisa Bridge: I wish I had a crystal ball, but I think things are going to look different from one market to the next. I think that the strength we started with as we reopened was pent up demand, so we cannot be sure how long that will last, but we also have customers turning to jewelry and watches to celebrate occasions that they might have done differently in the past. For example, they might not be taking that big holiday but still want to mark a significant moment. Hopefully that will continue through the holiday season.
I don’t think this is going to be our best holiday season ever, but the business is there to be done and we have to inspire our customers with the incredible stories that go into watchmaking. That is our job and we have to work hard to connect with our customers and make that holiday season a success. It is not just going to happen, it is going to take a lot of work.
WatchPro: It is hard to think long term when there are flames all around you, but business leaders have been taking time during lock down to think about high level strategy and future direction. Have you had any thoughts or inspiration about what Ben Bridge might look like in five years’ time? Perhaps you will no longer have shops and all your sales will be done by virtual assistants?
Lisa Bridge: I think there will still be a combination. Customers will still want to come in to touch and feel products. People talk about millennials wanting to buy everything online. I am a millennial and I am very comfortable shopping online but I also want to go into a store and see how a watch looks and feels on my wrist. There is something about that emotional moment that still needs to take place in person. There is going to be more ecommerce, but stores are also going to be needed to balance that.