Dynamically Reinventing a Luxury Business in the Midst of a Pandemic

In mid-March 2020, Claremont Rug Company, the firm Jan David Winitz founded was confronted with the same conundrum that tens of thousands of small and medium-sized businesses faced. Effectively, the global COVID-19 pandemic forced them to immediately close the doors of a gallery in Oakland, CA that Jan had nurtured and matured for over 40 years.

“I now have empirical and anecdotal evidence of how the business was reinvented and what our future success will look like.”, he says. International sales at Claremont, an elite level purveyor of antique Oriental rugs, have grown nine-fold during the COVID-19 period. Overall sales, despite having to greatly diminish their in-gallery sales model, steadily returned to previous levels. The number of first-time clients increased by 50% compared to 2019.

Claremont Rug Company is fully committed to a fundamental change in how to conduct business. With a transformation from 80% in-store sales and 20% online sales to almost the exact inverse, they have dynamically reinvented themselves and have a strong formula for continued growth and success. Jan’s expectation is that in-store and in-home sales will rebound and that online sales will continue to grow, producing incremental growth for 2021 and beyond.

Admittedly, when the company was forced to shutter its doors last March, they didn’t have a clear vision of what to do. Jan took a week to think and plan, then deliberated, took a step, deliberated again, and took another step. In doing so, he both avoided falling into the ‘inertia trap’ and gained clarity about what they needed to do to move forward. The team began to see that they could pivot their business by dramatically upgrading their website, intensifying their educational program, and moving for the time being to a primarily online business model. The company made dramatic improvements in their SEO and social media presence, and dynamically enhanced their Google Search capacity, which expanded their international business tremendously.

The New “Normal” is Sustainable

Recognising that it was not enough to just survive until the pandemic ended, Claremont Rug Company is committed to a “new normal” – one that is inevitable and also sustainable. They adapted the central components of their historical success: unparalleled inventory, enterprise-wide expertise, personalised consultation, and premier client service, all integrated through cutting-edge technology.

The company began offering FaceTime calls with virtual “walk-throughs” of clients’ homes and real-time conversations about how best to use antique rugs to enhance their environment.

By honing their Adobe Photoshop capabilities, the company enhanced their service of placing various rugs into the client-supplied photos of the rooms they wish to furnish, allowing them to see how a series of pieces they are drawn to or that the team suggested “perform” in situ.

Claremont Rug Company’s clients are extremely successful and affluent, residing in more than 40 countries on six continents and include more than 75 Forbes’ list billionaires. They are accustomed to having the flexibility to travel and to acquire what they seek in a stress-free environment. Fortunately, using the advanced tools the company’s now providing, they recognise that the restricted movement that is still a reality also provides much more time to contemplate how to make their lives more fulfilling, minus the onsite experience. “I expect that as travel flexibility returns, they will feel comfortable visiting the gallery, having in-home rug presentations, or selecting rugs online, all of which will combine to produce incremental sales”, Jan says.

“I have also observed a quantum leap in our clientele’s knowledge about antique rugs. The reasons are straightforward. Emotionally and intellectually connecting with antique Oriental rugs that were woven by master weavers 100 to over 200 years ago is something that they now had time to learn more about and appreciate”, he continues

The team at Claremont Rug Company is also gratified that clients who have not been in contact with them for as long as three decades have reconnected with a rekindled interest in collecting elite antique rugs from the Claremont collection.

Many return clients have expressed their appreciation that the company’s intensely personal approach had not changed over the years. “We have extended our phone hours, continue to answer the telephone directly, no voice mail during business hours, and the person who answers, as always, is knowledgeable and adheres to our Rule Number One that client service starts when we pick up the telephone, not when we make a sale. We are proud that our website belongs in the 21st century, but our approach is old-fashioned and personal.”, Jan says with a smile on this face.

Education and Communication

Another increasingly important factor in Claremont’s connection with clients has been the educational nature of much of the communication. The company’s always had an extensive education section on the site, but for the past year, they have also been sending weekly emails, which educate all team members on rugs, weaving and the weavers themselves. They’ve added an unprecedented 20% incentives on all of their rugs and free “on approval” shipping for US clients. “We made a point of featuring different rugs each week and publishing articles about topics that would add to their comprehension of what they were viewing and ultimately acquiring. We are encouraged that as a result, the average length of time of a website visit grew from seven minutes to almost 30 minutes.”, explains Jan.

“We have come to recognise that many of our clients are so used to online purchasing that the in-store experience was no longer necessary. One need not be a visionary to see that to survive and to thrive as an art gallery, “evolution” has to occur at an enhanced rate. We have come to see that rather than making a pivot, we have reinvented ourselves on the fly. Now in the midst of another shelter-in-place period, our sales continue to grow.”, he continues.

It is a lesson that Jan believes many businesses could benefit from – understanding that rather than continuing to wait for the time when their operations will return to “normal,” they need to be in charge of the capabilities they present to their clients.

“What was normal a year ago is in the past. We incorporated change out of necessity into our business model, and it has now become the essence of our interaction with clients, creating an even more dynamic and successful customer experience. We have repositioned ourselves to be well ahead of the curve, and we will continue making changes to set ourselves up for continuing success”, he says.

“We have been able to leverage our clients’ increased recognition that we offer rare rugs virtually never available elsewhere. (The majority of our sales of antique Persian and tribal rugs are in the range of $7,000 to $150,000 per piece.) This, in turn, allows us to pursue the purchase of private collections even more ambitiously from sources that I have nurtured over the near half-century I’ve been involved in antique rugs.”

This transformation has not been easy for Jan and his team, but it has been incredibly rewarding. Their business remains dynamic; their clients continue to express their deep appreciation for what the company offers, and how they serve them, and they are significantly more knowledgeable about what they acquire and collect. This has made for an entirely gratifying resolution to an extremely challenging period.