Ride and seek: Fran Millar on her plans for Rapha’s turnaround

Hello, and a cosy November welcome to the Luxury Society podcast brought to you by Digital Luxury Group. I'm your host, Robyn Swithinbank, and I'm your core host, David Teddy. Now this is our regular listeners will know, is the podcast that dissects the luxury industry, using insider conversations and data-driven insights to try and find out how the gilded world of luxury works, and to identify who's winning, and who's not doing so well, as the tectonic plates of the global economy continue to shift, reshaping the luxury landscape. In that vein, this week's guest is Fran Miller, chief executive of the high-end fashion cycling brand Raffa. Fran has an incredible CV having been pivotal in the founding and the development of the Uber successful team-sky cycling team, and more recently in the turnaround of British Heritage Luxury Fashion brand Bell Staff, our conversation with her coming up, and then we're heading over to China to catch up with our man in Shanghai, Max Payro, whose latest compass index gives further reason to believe China might just have turned a corner. So David, on with the show, let's do it. The imagery from the 1960s and 1970s cycling is quite rock and roll, it's quite punk, it's got some glamour to it, and Raffa lent incredibly hard into that. When you're in this level of turnaround, with this level of turmoil and this amount of change, the big bits are so important that you're not at the marginal gains stage yet, you have to be willing to be disliked, because I think you can't be loved unless somewhere in the world someone hates you. It's one of the only sports in the world that makes you more sustainable while you're doing it, so it's like you're fitter, you're more sustainable, and it's adding positivity to your life. The biggest influence on my personal and professional life by a country mile has been Dr Steve Peters. His approach has always been, the excellence isn't subject-specific. I think we can be the prince of King of Cycling. On this week's episode of the luxury society podcast David and I are saddling up and pelling into the world of high-end cycling for the first time. Today's guest is Fran Miller, chief executive of the high-end cycling fashion brand Raffa. Fran began her career in cycling by setting up her own talent management agency that counted her brother to professional cyclist David among its clients. In 2009, she and her David Brailsford would set up Team Sky, the road cycling team that would become the dominant force in road cycling in the 2010s. Winning no fewer than seven Tour de France, Fran would spend 11 years with the team rising to the position of chief executive. The team was taken over by the billionaire Sir Jim Rackliff in yours in 2019, and she would stay on for one more year before Rackliff asked her to revive the fortunes of one of his portfolio of companies, the loss-making British luxury brand Bell Stuff. After four successful years with the company during which she has said she returned the brand to break even point in September 2024, she was appointed Raffa's fourth chief executive in three years, on paper and even a steeper task than she faced at Bell Stuff. Founded in 2004 and shielded by the genesis of the so-called mammal or middle-aged man in Lycra, Raffa's reputation revenue has gone skyward during the cycling boom of the 2010s, prompting a £200m acquisition in 2017 by RZC investments, putting it under the ownership of billionaires at Stuart and Tom Walton, part of the U.S. Walton family dynasty. But it since lost its way, posting seven years of losses prior to Fran's arrival with no light end of the tunnel, the season's executive, with the winning track record was appointed to return the company to the front of the peloton and set it back on the path to growth. So 14 months into a new role, Fran joins us now from her base in London, Fran, a very more welcome to the podcast, thanks so much for joining us on the lecture's society podcast. How are you? Very well, thank you, Robin, most to meet you both, hi David. Hey Fran, welcome. So Fran, quite a journey you've been on, and quite the journey Raffa's been on these past few years. The first question, why take on a job that, on day one, must have felt like standing at the foot of the Tour de France, is famously intimidating out duers? Er, a host of reasons really. I think I've known the brand for a really long time. I think as per my bio, I've been in and around the sport since way before it was cool and way before it was interesting. And I think I'd watched the creation of Raffa, I'd seen what they'd done in the pride of them coming on board as a parallel part of the team sky, obviously worked with them during the time they were with us at Team Sky for that four years, and then had seen them subsequently go on through their acquisition and everything else. And I think whilst I was very much outside of at that point in time, after my four years of build stuff, looking in, I was all, I have always felt, actually, even in its haze, the Raffa had more potential than I think any other brand with that level of subject, with specialism. And I was just really intrigued and excited by the proposition of something that I felt I could bring. I actually have said in other podcasts, in other interviews, that it felt like the perfect marrying of my experience, like 20 years in professional high form at sport, four years cutting my teeth in a turnaround brand, a British heritage brand. It just felt like, wow, that opportunity's not going to come around again. And I have had a career spent grasping opportunities as it come my way. And it felt like one that would be silly not to go after. These are challenges. I mean, this is a big challenge, isn't it? Yeah, it is. But I think that's where all the great opportunities you'd lie. I think if you don't see opportunity in talent, and certainly probably not care how to be a CEO, so I've always loved the idea of doing the things that people tell me I can't do, and telling me that things are either impossible or insurmountable. I think those are things I relish getting involved in, personally, and professionally. But I don't think Raffa is that I think, yes, it's a big challenge. Yes, there's a lot to be done, but it's an incredible brand. It's exponentially bigger from an awareness perspective and equity perspective than the sales have ever been. It's held in such incredibly higher steam by all different pockets of society, and interestingly, for your listeners, I'm sure. It's always been held, certainly, for the first ten years of its life, as a real kind of example of what a great brand can be, and what it can show up like, and how it can engage customers. And certainly, for my time at Team Sky and the Interbell staff, every London agency that I got in front of would have a Raffa reference in their deck. And I think that speaks to the work that was done and the opportunity of the brand to build on that and go somewhere really special. So when you walked in the door, what was the first thing you realised needed to change? I mean, the first thing quite literally walking in the door, you know, we are in a very, very cool office in Archway, beautiful warehouse that's been kind of converted to be the sort of mecca of the brand. And the first thing I thought was, this doesn't feel all look like a business that's struggling, so I think culturally a big shift in kind of what are we now? Like, what is this brand and what does it stand for? And how do we have to show up both internally as a business, but also externally to our customers, because we have to make sure that we really are putting our customer first, getting back to what we really stand for and really building from, like I said, that incredible base. So the first thing I saw walking in was there's a big cultural piece of work to be done here. The second thing I probably thought was, this place needs to get its confidence back. The market has been incredibly busy for the last five or six years, and I think when Raffa started in 2004, they were literally two or three other power brands, all of them very historical, all of them had been around for quite a long time and were very established. And what Raffa did and the way it did it was completely unique, they effectively created the category and created the market, that is not true anyway, right? We are in a very crowded market with a lot of competitor brands, and we have to reestablish our position within that. So I think they were the first two takeaways I have. Yeah, that gives us some context, and that's quite internal, and also it's a reflection on their parallel business itself. But of course, as has been the case for most businesses, and not just in the cycling world, the marketplace, the landscape has been very complicated and complicated by the world fluctuations that precipitated by COVID and by its aftermath, and what I do wonder whether the cycling industry was particularly heavily affected by the social and economic effect of the pandemic. Is that a fair reflection of something you wondered as you came into the door that first of it? Do you know why? I hadn't reflected on it in that way. I think the sport was absolutely impacted for the positive, actually, by the pandemic. I think a whole host of people got a bike out the shed and dusted it off and got on it to use their hour of exercise and to get out the door and to move beyond just a walk around the house. So there was this huge boom in the sport that I think a lot of people in the industry have subsequently been like, all the boom of COVID and we're all dealing with the boom of COVID after in a negative way. And now we're seeing the other side of it, and that's really negative, whereas this isn't me being an optimist. For me, I was like, that's a whole host of people who weren't riding their bikes, who came into the sport, who bought a parallel, who bought bikes, who bought things. Now they may have subsequently put them back in the shed, but that doesn't mean we can't get them back out again. So I've always been like, it suggests that the market still has latent potential. And interestingly, when we worked with Team Sky, that was one of the things that Jeremy Derek, who was the CEO of Sky, recognized, was in that period between the 2008 Olympic Games in 2012, the sport that represented the most opportunity for participation perspective was cycling, because actually lots of people rode bikes as kids, lots of people have bikes in the shed, lots of people wanted to do more cycling, but the barriers to entry are they're there and they're things like weather and safety and things, but they're surmountable. So for me, yes, I think COVID was a horror show for a lot of industry. I think the challenges that the cycling of parallel industry faced are exactly the same as all brands faced, which is overstocking high inventory, big boom in sales, and then dealing with the aftermath of that. I think we are in a unique position because what it did for us was brought a whole new influx of customers that we still have the details of, that we still have the information about that we can still go out and speak to. And I think that's a huge opportunity. It's a total thing to do, but I use myself as a case study of one. I bought a bike during the pandemic. I bought myself a Raffa cycling vest, in fact, and was a very proud cyclist for a good 18 months. And all sorts of things happened. We got busy again. And I don't cycle nearly as much as I used to and I haven't bought an apparel in three or four years. So I assume that I'm not completely unique and might be one or two others. That means that Robin, you might receive like some CRM activation email to reactivate you as like a COVID past customers from France team quite soon. One hundred percent. You mentioned in another interview that Raffa tried all of these different things and diluted itself in recent years. What specifically had the brand lost and was it trying to be too many things to too many people? I think without a shadow of a doubt, you know, I think it's a really interesting one when you look back at the lot of the work that I've been doing internally with the team. And so myself is looking back at the genesis of the brand and what was the DNA. And I think, you know, we were an incredibly Eurocentric brand. We were very focused on that sort of romantic view of the kind of French and Italian history at the sport. And it's a luxury place, right? The kind of the great brand, the great luxury brand from France to Italy, cycling kind of in some way has a romantic link to those territories in that space. I think the imagery from the 1960s and 1970s, cycling is quite a rock and roll. It's quite punk. It's got some glamour to it. And Raffa lent incredibly hard into that and appropriated a lot of it. It's the San Rafael logo and the aesthetic and the font choices and all of those things. We borrowed very heavily from that era and we also borrowed very heavily from luxury. And I think we as a brand built a fan base and a custom and it is a fan base. What's interesting is that we have fans of this brand, you know, they're not just customers. They feel very deeply about the brand and they have a connection to it in many ways because we brought them into the sport and we showed them a lens and a world that they hadn't seen before in this sport. And I think when you are that clear about who you are, what you stand for and what you represent, you've got to be very careful about what the next steps are to broaden out the aperture and bring more people in. And I think probably over the course of the last seven years, we haven't given things enough time. First of all, I think we were clear enough about what we were going to try and expand into. You know, I think it was like we knew we wanted to grow, we knew we wanted to scale, we'd obviously been bored. And I think there was a pressure to kind of demonstrate that the price had been worth it. Therefore, how do you take this very boutique brand and make it scalable? And I think potentially probably should have done one or two things and tried it and stuck with it for a little while. But what happened with change of leadership, change of strategy, when things didn't work, it was like, okay, we'll stop and we'll go and try something else. So firstly, we'll try being a bit more mass-mochi, we'll bring in an entry price point product. That works okay, but now we need to go and do something else. Let's do mountain biking, let's go and do this, let's go and do that. And you just end up, and then, as I said, the lifestyle proposition that was brought in, you know, that's a bold play to try and kind of be the sort of a loo loo lemon of cycling. It's like, what are you? So I think within all of that, there are probably too many initiatives, not enough clarity, not enough consistency, and the brand didn't stick to the things that had made people fall in love with it in the first place. And I think any one of those things in isolation, you probably could have done okay and not had the ramifications that we've had, but they're doing them all together, and several times over, I think has led to a lot of brand erosion. Well, let's look at the turnaround strategy, then, and our sport said, it's core, an unpacked little forest, and tell us how it's going. Well, I think first and foremost, at its core is getting back to what we are, like, who are we and who are we for, and understanding our customer now as well, you know, you reference the mammal, and I think, you know, they've been much disparaged. I love a mammal and I think understanding who our customer is, who we're for, and who our new customer is. And, you know, we have gone on that journey, you know, over the course of the last seven years, we've brought lots of people into the brand to have a very different perception of it to what it was before. So the first piece of work has been around that, which is about really consolidating behind our community, really recognising that we're cycling brand for cyclists, and then we have a role to play in the sort of world in terms of, you know, I fundamentally believe the cycling can provide an answer to a lot of society's ills, whether that's in mental health crisis or, you know, mobility or the city congestion or any of those things. And it's one of the only sports in the world that makes you more sustainable while you do with it. So it's like, you get fitter, you're more sustainable, and it's adding positivity to your life. So we have a role to play, but we are a cycling brand first and foremost. And I think making sure that we can re-communicate our connection to the sport, re-communicate our role within the sport and re-establish ourselves as the authority and the established brand is key. And then I think the other key thing is doing a few things brilliantly well. We have to focus back on customer service, it's what we built our brand on, that customer experience, the element of surprise and delight, the all the little details that built up to the experience that you had with Raffa that made it completely unique. We have to get back to those things. So really it's about our customer, it's about our community, and it's about some consistency. And I think if we can deliver on that over and over again, we can get back to where we want to be. Our listeners will recall Jean-Claude Biver as Mantra, be first, be unique, be different. Your philosophy equals that, hated, adored, never ignored. So does returning Raffa to greatness mean also accepting that some cyclists will actively dislike the brand again? 100%, and that's absolutely fine. You do have to have a point of view and you have to have a position and you have to be willing to be disliked because I think you can't be loved unless somewhere in the world someone hates you. So it's the kind of the rough to the smooth. So yeah, I think as long as this brand has a strong point of view and a strong opinion and for the people who love it, they love us again and they feel something for us again and a passionate about us again and advocates for our brand again, then I'm absolutely comfortable with the fact that we won't be for everyone. Who are we for that I suppose is the question, who are you for? The new Raffa customer today I suppose might be different to the Raffa customer. Ten years ago you talked about loving mammals still. Is there a particular customer that you're targeting? I think the reality is we're 85% male brand. I think we wanted to continue to grow our female base. I think we're seeing that is one of the areas in the sport you're seeing of real growth opportunity. But it's the Fisionardo cyclist, the person who knows the sport understands the sport. They probably have more than one bike. They're riding quite regularly. They understand what being a cyclist is and what it represents for them and they identify as it. It's something that means something to them. I think what's interesting is that as we've broadened the lens on the brand, we recognise that it's not the only thing to them and I think we're very comfortable that our customers are probably runners as well. They might even do triathlon. So it's not like we're only for the cyclists, it's like with the people for whom cycling plays a role in their life. I think the reality of that customer for us is it's, you know, they tend to be higher net worth. They tend to have more disposable income. Time is the luxury that they put the highest value on. And I think that's the thing for us that we need to get back to recognising that the people who choose to get on their bikes and spend time riding, we want their experience for them to be the best it can possibly be and we want Rafa to be part of that journey with them. It's interesting. You mentioned that because this idea of having also a very clear point of view, not being just vanilla is something we have seen as being like a recurring element of a success factor for many brands trying to get successfully relaunched. Now the reality from what we understood is that Rafa expanded from road cycling to gravel, mountain biking, trail running. So critics might say you need to be the prince of one thing before becoming the king of everything. Why broaden the portfolio when you haven't yet won back the road cycling crown? Very valid. One of the key things that I have done is actually bring down the product category range, to bring down the SKU count, to really focus back in on this year, any of our customers who have been paying attention to our comms. We've really focused on our protein collection, the evolution of the product development cycle that we've been on, so from spring, summer, 26 and into autumn, winter, 26. The really key areas that we've really pushed on are protein training. Now, gravel is an interesting one because gravel is effectively protein in the same way for us. It's like a lot of the guys that have written on the road now ride on gravel. And you say, what's the difference between our customer of 15, 20 years ago and our customer of now? On the whole, he or she will probably also be riding gravel as well as road. They won't just be a pure roadie, so I think making sure that we cater to that is absolutely important for our customer. I would say mountain biking, we have a small range, it's a fantastic range. I don't need me to stop doing it, but we do need to make sure that we win back that road and gravel customer first and foremost, and then we can return our attention to mountain bike as well. But continuing to service the mountain bike customers that we have, it's really important. And I also think multidisciplinary cycling is part of the shift that we've seen in the sport, more and more people, you know, when I was young, you were a roadie or you did mountain bike. Whereas now, most cyclists will have a mountain bike, they'll have a gravel bike, they'll have a road bike, they're relatively comfortable jumping on a multi-terrain environment. And therefore, to be totally sacrosanctable, we will only speak to the road cyclists. I don't think we'd be talking to our customers in a true reflection of how they're showing up in their cycling lives nowadays, so it has shifted a lot. So in many ways, the prints are one thing of the king of everything. I think we can be the prince and king of cycling, because I think cycling in the way that it manifests. And it's still, for me, it is still the sort of the pointier end of cycling. It's not line bikes, it's probably not people on Brompton's, because at the moment, the predominant product range that we have is like red. So we want people out riding their bikes and doing it as a natural physical activity. I think we can absolutely move to commuting over time, but for now, it's that pointy end of the sport that was really important for us to win back. We are seeing a bit of the same type of challenges between tennis and paddle at the moment. I don't know if you have been following a bit the trends like trying to conquer paddle, but it reminds me a bit of the gravel trend and how legitimate the brand from cycling are like trying to enter, but also like newcomer brands as well. Yeah, I wanted to pick up on this male female spirit. She said 85 to 15 male to female. I was reading a little bit out of this year about male wills, middle aged women in Lycra, which isn't even worse than I think they're male, but there are clearly women who are interested in cycling. That doesn't obviously think to say, but it's interesting that only 15% of your customers at the moment are women. Are you looking to increase that percentage? Definitely. I think it's interesting as well, because it depends in what territory, you know, in APAC, jumps up to about 30%. In China, it jumps up to about 40%. So depending on the territory, we see a very different demographic of people coming into the brand and participating in the sport, and that's one of the other unique things about referees. We are a truly global brand with a truly global community, you know, we have 23 club houses across the world. We're represented in about 40 different chapters of our club. We sell all over the world. So I think making sure that we are aware of the cultural nuances with how people are riding their bikes is really important. But for me, female cycling, women cycling has been on this exponential growth trajectory for the last 10 years, whether that's a competitive level or participation level, and lots of sports brands will know the kind of pinky and trinket approach that I think many brands have tried, and it doesn't work. And I think Raffa has been one of the few pioneers of making sure that there's female specific product available, and that it's tested on women by women that it's built for women in the riding experience that women have. I would like to keep pushing on that area, and I think making sure that we as a brand are the product of choice for female cyclists, I'd absolutely want that to be one of the key pillars of the growth strategy in the next 10 years of the brand, because I think like I say, whether it's Strava, whether it's Zwift, whether it's any of the kind of participation indexes that you look at, the one area that's getting double digit growth is women. So it would be naive of us not to go after it, and really make sure that we're catering to it properly. Let's move away from the specifics of Raffa and more to your approach and your mindset. We've obviously worked in a lead sport, and with some of the most focused and wind centric people on the planet, whether that's the day of marginal gains, Braille's food, or the Tour de France winners, Sir Bradley Wiggins, Chris Froome, Geraintos, people like, loved watching the 2010s. Does the world of business in some way seem quite low wattage to you by comparison to the thrills and spills of being on a cycling team? I wish. No, do you know, like speaking openly, one of the reasons when INIOS asked me to go and run L stuff, the reason I wanted to do it was I had done 15 years effectively within the high performance cycling world, whether that's as an agent or as the boss of a team. And then I had done the Elliot Kipchow, you sub to our marathon project, I'd been operations director of that, and going into that project, the Kipchow, you project, it was, you know, we had to galvanise a team, we had to get six disparate groups of people to work together, we had one overarching objective. We were going to make him fitter in the six months that we had to deliver that product. So the only thing we were going to be able to do was to improve execution. So it was like, can we take to the marginal gains point, can we take every single aspect of this performance and improve it by one percent, two percent, and therefore deliver what we needed, which was 26 seconds. And obviously we were able to do that and then some. And what I was interested in having taken everything I had sort of learned, seen and been a part of in cycling and applied it at a small level to a different sport. I was like, hmm, I wonder if you could take this stuff and apply it somewhere else. And, you know, ultimately, the biggest influence on my personal and professional life by a country mile has been Dr. Steve Peters. His approach has always been that excellence isn't subject-specific. So like, I'm going to be excellent at cycling, I'm going to be excellent at business. Human excellence comes from the same place and the approach that you take to engender excellence within yourself and within others is replicable in any environment, but you just have to know the principles of it. I think that taking and that, taking the sort of the methodology, the thinking, the approach and seeing if I could apply it in a completely different environment was what really motivated me in doing it at Bell Stuff and being like, oh, okay, that quite a lot of this works, some of it doesn't, but quite a lot of it does. So then to be able to come into Raffer and be like, well, can I take now what I've learned at Bell Stuff and do it in an environment where performance is still very much part of our DNA. So it's like, you can, I can dial up some of the performance stuff that I've had in my experience. I couldn't dial up a Bell Stuff, but I can really dial it up here. So yeah, I think it's been, it's not lower wattage. It's, if anything, it's more stressful because there's so many more variables in my mind. Like, I can't control customer behavior, but we can train athletes to, you know, you can measure how an athlete is going to perform what they need to put out, how they need to develop from a VO2 perspective or any of those sorts of things. And you can can't control the environment necessarily, but you can certainly control more of the parameters. You come into a business environment and it's like you've got to grow your customer attention and you've got to grow your AOV or you've got to, and I'm like, wow, the variables seem huge. That could just be a lack of familiarity, but I feel far more, it's more complex doing this than it was doing a professional sports team. Yeah, controlling the weather versus controlling the consumer, which is harder to discuss. Well, no, maybe that's for another time, David. Yeah, no, I said you literally created a winning behavior framework at Raffa using your 2013 Team Sky Playbook, how does that translate? Are you training like the Raffa team like athletes and how specifically? So not training them like athletes, but definitely thinking about what are the areas where you have the biggest impact on human performance, because it's like people work best when they have a certain set of parameters. Like, do they know what their role is? Do they know how they're being measured? Do they understand how they're going to get rewarded and recognised? Do they have the tools they need to do the job? Are you creating an environment where they feel safe to challenge and question and interrogate? It's all of those things, from all of those business books, are the things that actually are the sort of whether rubber hits the road, that is what makes a difference. And I think if you can create an environment where people feel psychologically safe, where they understand the direction they're going in, where they're given the support and the tools they need to do the job, and you relentlessly pursue that like over and over again. And do we know where we're going, are we measuring it? Do we know if we're on track? How do we course correct? And you're constantly doing that cycle. That is high performance in any environment. So yeah, that's what I did, basically. I took that approach that we had used within Team Sky. And the only reason I actually did the Team Sky thing specifically here, and I didn't do it specifically at Bell Stuff, is that when I was thinking about my first team day and what I wanted to do within Raffer, I went back and looked at all of my old materials and the deck that we had used in 2013, in New Yorker, to the team that's when Bradley and Fremey had both won a tour, and it was in the November camp, and it was the actual PowerPoint presentation that we had used, and it was all about how do we build a team that has changed so fundamentally over the course of the last three years, went from being the British upstarts, who'd never won anything except stuff on the track, we'd never won anything on the road to winning the Tour de France twice with two different riders in the space of a year. And it was like that piece of work when I looked at it. Not only was everyone wearing Raffer because it was the first year we were sponsored by Raffer, so it was like beautiful, but it also spoke to all the things like what got us here when we get us where we need to go, and I joined the business at the 20 year anniversary point, so it was like all of that history, all of that stuff that's come before, it's really important, and it's the plinth that we stand on, but if we're not careful, it's going to be the cage that keeps us in, and we have got to find a way to move forward, and it was exactly the same message that we had at Team Sky. It felt pretty prophetic, and I was like I'm just going to use this, and they loved it because there's pictures of athletes, and there's cycling, and it's something they were involved in, and there's Raffer logo everywhere, so it just felt very symbiotic and a good opportunity. So where can we find it, because I'm passionate about culture and like winning culture, I would love to read it. Yes, both of them to material, I might be able to send you a little copy of it, David. Does the same reply with marginal gains? I mean, Team Sky, yesterday Braille's business of marginal gains, finding about percent, it was an integral part of the philosophy that made the team so successful. A lot of what you've talked about sounds at a fairly top level, this is the structure that we create, and the environment that we're going to create in which our people can, well, perform. But does it go down to a granular level as well, are we looking for marginal gains on a daily, on a weekly basis in a business? I think you get there. I think you do get there. I think there is, I think, when you're in this level of turnaround, with this level of turmoil and this mark change, the big bits are so important that you're not at the marginal gains stage yet. Do you see what I mean? When you think about what marginal gains was actually brought in to do, it was like, we're 85% of performance, and we need to get an extra 15% because potentially we think of the doping or whatever else. So you then go out and you look in pro sport, and you're like, finding 15% is going to be really hard. But you've already done the 8590, right? You've already done that bit, and I think we've got to get to the 90s before we start looking for the incremental ones and twos here and there that take us from really, really good to absolutely excellent, and we're probably about a year away in my view from having those really big building blocks in place to start looking for what I would consider the discretionary benefits of chipping away at the 1%. Interesting. I would love to know a bit more about your retail strategy, and how do you plan to expand what's the mix? Do you really believe in those only channel strategies? Basically, what's the game plan, and it seems that you have strong conviction? What are they? So I love it the way that it's like leading the witness, do you really believe in that omnichannel? I don't really. Never. We never do that. I'm trying to become a podcast interviewer. Be nice to me. I am. Listen, I think the customer experience nowadays, omnichannel and verticalis is important, but it's basically a delivery and operations piece, right? It's like, if I buy something online, I want to be able to return it in the store. I want the experience and the service proposition to be the same. I think where we are very different is that our retail proposition is the heart of our community. And community for us isn't just the odd thing here and there and getting a group of people together. We have, from every single clubhouse, we have weekly rides going out, anything from tens to hundreds of people who come and ride with us on a weekly basis, who have 2,500 rides this year alone. We have over 450 ride leaders out in the world leading rides for us across the globe. So our retail proposition is absolutely at the heart of that. So we want to ensure that we are creating a clubhouse environment. And that is a challenge because ultimately, you know, as I am sure many of you are the guests and I am not from a retail background, right? So, denser, deeper square foot and all the other sorts of things that I have learnt about a bell staff, you come here and it's not relevant or as relevant because you've got a clubhouse, you've got a coffee shop, you've got, yes, there is the store, but there is also the community managers, there is community evenings, there is the ride out, there is everything else. So they are at the heart of our channel mix and proposition, but for a set of different reasons to what a traditional retailer or traditional apparel brand would use them for. That being said, they need a huge amount of improvement. So our clubhouses were an amazing jewel in our crown 10 years ago, but they have increasingly been allowed to, they get like a lot of what's happened in the business, they've become a bit of a jack of all trades and a master in that. Like depending on the CEO at the time or the person's opinion at the time is like they're really important, but they're shops, you know, so we have our Tokyo clubhouses at the top of Cat Street, you know, one of the most commercial, retail, footfall locations, not great for riding, but then you have like our Brewestreet Clubhouse, which is a true clubhouse, you know, it's 25% of the footprint is a coffee shop, we're riding from there 10 to 12 times a week, we've got hundreds of people coming to the door on bikes, and so you've got this bizarre mix of things. So one of the big pieces of work that I'm doing with our clubhouse and community director is to really work out what is the role of a clubhouse in each of the territories. How do we make those clubhouses feel clubhouse and community focused, but how do we also make sure they're not a millstone from a P and L perspective, because if they're not making money from a commercial perspective, everyone will be like, oh, but they're for the community, if they're not driving community, everyone's like, why, they're not making any money. And I'm like, find the trade off, agree on that trade off and then go after it. So we've done a big piece of work on that. So we're not going to be expanding the footprint right now, we're going to be getting that footprint absolutely optimised and making sure that we are delivering the promise to the customer and the community that we say that we will. We're just about to open in Shanghai, so that will open at the end of November. And that's the newest version and iteration of the clubhouse in our new brand world, much more elevated. The community is absolutely at the heart of it, and much more about how do we integrate and return into the community experience as opposed to bolting either one of those things on. And I think that test and learn proposition in Shanghai will then inform all of the relocations or refits that we do over the course of the next two years. It's interesting that you do the first one in Shanghai, is there like a specific reason? A host of reasons, actually, I think first and foremost, it's a relatively discrete market. China is a different space, it's a different market. And I think we can try things there that we maybe would be less willing to try in some of our established territories. So you look and feel new experience, new community tests, etc. It's also a huge growing market. I know China has been in trouble and everyone's worried about China from a luxury perspective, but from our perspective, cycling is absolutely booming in China. And we want to be at the forefront of that. We have been the leaders in the marketplace for a long time globally. We didn't want to be on the back foot in China, so it felt like Shanghai was a really good place. We already had a community there. We've been working for the last 18 months to build our club in China, and certainly in Shanghai. We had a thousand women join us across China for our women's 100s. So we've got this really interesting traction there to start like two good not the opportunity to miss. Just on the China topic, Robin and I did our homework out of this interview. And we've noticed that you also launched your Timo store in 2024, a family at Pistachian. What have been the results so far? And also a vision bar like Rafael in the Chinese market? It's interesting, actually. A really good start on Timo and JD, we had a little bit of a tail off. And some of our competitor brands came into the space and quite aggressive in their discounting strategies and how they went after there. And we've actually been really disciplined with how we've approached the market, we've kept a full price proposition, we've really tried to maintain a luxury position. We really worked hard to maintain a very product focused and product marketing focused approach. We want people to understand that our product is best in class, it's highly engineered, that it's that we make it all ourselves, that we develop each of our patterns and fabrications. So we've been really focused on that in China because I think that market was, it's new to a cycling perspective, there are very educated market about product, and so making sure that we are delivering a product promise and a community promise in China that sets the standard for how we then want to be globally. So we're currently ranked number one on both Timo and JD, so that's been for the last couple of weeks. Obviously in premium cycling apparel, but that's the area that we're interested in. So it's a really interesting market, we've got a new country manager out there who's doing a great job. So yeah, it's a bit of a test and learn. I know nothing about the Chinese market, so I'm learning at the same time, which is always dangerous. So does it mean that you are like selling the same SKUs and the same product assortment on Timo that you sell offline? Yes, same product assortment. We have local buyers who are an allocators who are choosing that range, so choosing from the main range, because I think there's quite a lot of market specificity around what works and what doesn't, and I think what our allocators would choose versus what our local country manager has now started to pull in, are actually quite different, and then the nuances around what the market is going after. And it's interesting. We're seeing really great traction in some of the really classic rougher product, the kind of Brevey product, the classic product with the YR band. The stuff that is iconically rougher, that is getting huge traction, whereas obviously in more of a Western market, you're seeing much more of the prints, bright colours, all that sort of stuff, which definitely is just a different demographic. For me, I'm going to have to bring this conversation across the line at some point, but I wanted to reflect on something that you said in the past about achieving the impossible, quite clearly, many people outside to the UK, but obviously inside the UK as well, it would be impossible that British writers could come to dominate the Tour de France for a decade as indeed they did. Thank you for all the joy brought to us by the way for that. But the reports don't lie, rougher is on this eight-year losing streak. Is turning it round impossible? No, definitely not. It's got incredible potential, it's massively under potentialised, it's, I think, by its own admission, and the admission of those who have come before me, it's been poorly managed, and the strategy has been poorly executed. So I think the fact that we are still where we are from a revenue perspective and a bit of our perspective speaks to the strength of the brand and the opportunity and the size and scale of the opportunity. So we've just got to get it right, we can't afford to make many more mistakes. So it's everything we do at the moment, it's the one role of the dice analogy I've got with everyone. We're doing this once, we're not doing it several times over. David, final thoughts from you? Yeah, no, we can't let you go without asking you a question about artificial intelligence. We just finalise the AI adoption survey for the luxury and fashion industries, and the results are striking 71% of the brand's AI adoption cannot be delayed, yet most are stuck experimenting, consumer insight, and everything related to the market research you mentioned also Strava looking carefully at what's happening is like one of the top priority but training and data quality are actual blockers. As you turn Rafa around, is AI genuinely part of your strategy and how specifically? So I think the key there about the data and training is such an important point. I think AI is for me like anything, it's a business facilitator, and the quality of what guys in and give you, the quality of what comes out. So we've actually decided to work in an enterprise agreement with Google. We recognise that as a business with the amount of stuff that we have to focus on from an operational infrastructure perspective, we can't do it on our own, and trying to do the world is being too much test and learned to bring AI in first college in ourselves. So with the AI. Isn't it? AI is okay. Great. What does that mean? But I think do I believe that there is a role to play for the L&M work and what we're seeing in terms of automation and improvement in operation from supply chain all the way through to customer delivery? Yes, of course. But we intend to work with the power and to help us do that and to be doing it in the places where we think it can have the most impact on the customer. So one of the biggest projects actually that we're working on at the moment is a consolidation of customer data. We've got an incredible amount of transactional data for our customers over the course of the last 20 years. All of it's sitting in different places. So pulling that all in, consolidating it all and then enabling us to then empower our teams and our people to utilise AI tools to mine that data. That's the biggest opportunity for us that we're going to go after first. Nice gentle question to end our conversation. I know. Well, this is what happens when you get a tech entrepreneur and the CEO of a high end fashion cycling brand and a journalist in the room. A journalist who has a natural version to all such adantes, but for all sorts of different reasons, my light the way he discovers being complimentary rather than replacement. And well, let's stick with that thought as we move into thanking you so much for your time and for joining us on the luxury society podcast. We wish you a great success with the Raffer Turnaround and to look forward to hearing how it pans out. Thanks, Fran. Much guys. Nice to meet you. Absolutely pleasure. Thank you, Fran. OK, so let's move the conversation on and head over to China and Shanghai, where we find friend of the luxury society podcast Max Payroke, founder and CEO of DLG Cyster Company, Rehelp Max. Welcome back. How are you? I'm good. Thanks, Robin. It's great to be back. Yeah, good to see you. So now you've just published your most recent Compass Index before we get into the weeds of that. Remind us quickly. What is the Compass Index? The Compass Index measures brand momentum across China, luxury digital landscape, showing us which brands are leading and which ones are falling behind. We calculated every quarter using our own data from tracking over 150 luxury and premium brands across e-commerce and social media platforms, allowing us to have real time intelligence on brands, performance in China. Cool. Now, since you and I last spoke, we've had your DLG colleague Jack Ruizn on the podcast and he's been talking with growing confidence about the luxury landscape in China. Now, for where you're sitting and based on what you've reported through this latest Compass Index, is he right to be optimistic is the landscape improving? Yes, I would say that cautious optimism is justified. What we saw is that Q3 marked a real turning point after several quarters of slow down in China and brand momentum is speaking up again despite having tighter marketing budgets. Obviously, not every brand is growing yet, but even for the brands that are declining, this decline is slowing down. And one aspect that I found very encouraging is that leather goods, which is a crucial category for fashion brands, grew 22% year and year during Q3 after also several quarters of decline. Interesting. So, there are real green shoots. Would you expect to see these continue to grow through Q4 and into 2026? I think so and I truly hope so. I think that there are two elements that will define the performance in Q4 and later in 2026. First of all, product relevance, Q4 is a decisive quarter driven by fall winter seasons. So we have ready to wear, we have accessories, playing a central role in driving performance, and also we need to see these consolidations of leather goods category. Then looking ahead of 2026, I think that we should benefit from new creative energy. As we know, there are leading mezons like Chanel, like DR, with new creative directors and this is going to be the first full collection after them. So I think that the anticipation is very high after the recent fashion weeks. So besides product relevance, the second point that I think it's crucial to see this performance is marketing investment and local activations. We all know that it's been an extended period of tighter marketing budgets. So it's time now for brands to reinvest in China and to really focus on truly connecting with Chinese consumers and to be very sharp on driving commercial results. We'll come to those Chinese consumers and who they are and indeed where they are in just a moment. But this new climate that you're starting to see emerge, you've talked about leather goods being a category which is growing. Are there winners in this climate? Is everyone winning or are there some winners and some who are struggling to win, should we say, without saying losers? Not everyone is winning. In fact, the market is becoming increasingly polarized. Speaking first at category level, ready to wear remains very strong. Leather goods, as I mentioned, it's finally rebounding. And also we see accessories and jewelry showing positive traction, particularly at entry-level price points. When it comes to brands, the trajectories across brands are very different. In premium ready to wear, brands like Ravloren or ICCL are performing extremely well. In leather goods, we see brands that are having also a global momentum. So Chinese has an extension to it like coach or like Miu Miu leading this recovery. But interestingly, we also saw emerging brands like Songmon that are very strong performance. And then when it comes to jewelry, mayzons like Cartier or like Van Cleef continue to show solid traction. Yeah, that's interesting. You've mentioned a couple of Chinese brands in there. And we start to wonder I suppose whether this recovery is in part and it may be a really small part. I don't know. So this recovery in the market is driven by a new generation of Chinese premium and luxury brands. If we look in terms of market share, obviously Chinese brands represent a very small share of the market, but some of these brands are gaining real traction. And I'm going to, I'm going to mention to us an example. I know that a lot of people are talking about Laupo gold, for example. And it became very popular. They want to talk about two specific brands. One is Songmon in leather boots. They're performing strongly thanks to a very smart merchandising strategy, balancing design, but also value for money, which is a very important aspect nowadays and then a very strong and authentic storytelling. On the other hand, we have icicle, which is a ready-to-wear brand that continues to grow very strongly with their sustainable, timeless approach. Some people call it the Chinese Max Mara and I think that there are some similarities. Both brands, Songmon and icicle, they rank among the top performance in our rankings. Both of them are showing mid double digit growth and outperforming most of their international competitors. That's a very interesting development and maybe that will continue to shake key for in 26 beyond. Maybe you're in the business of making predictions, I don't know, but would you expect to see these Chinese brands become increasingly important to the Chinese luxury market? I think that we will see more and more brands consolidating their importance, obviously first in the Chinese market. Obviously we're talking more at the entry levels of luxury. As we know, heritage plays a very important role and obviously these brands lack the heritage. But in the entry level premium segment in leather goods and ready-to-wear, we'll see more and more brands consolidating their relevance and also I'm not in the business of fortune-telling, but I would expect some of them starting to expand internationally over the next few years. Well, that really will be an interesting development, but less than a while sticking with the international thing. Let's talk briefly about the role of outbound Chinese tourists in the future of luxury consumption. Before COVID, Chinese consumers appeared to spend far more when traveling than at home. This was commonly accepted ratio of around 70 to 30. COVID regulations of course ended that season. Where are we now in that respect and where are we heading? I think this is a very important point because we often focus on the domestic market and analysing the performance at China geographically, but we forget how crucial overseas spending by Chinese consumers is for luxury brands. Based on public available data, my understanding is that right now, Chinese travel consumption is roughly back to 2019 levels, but not evenly. Europe, which was a key driver for this consumption, is still around 60% of pre-COVID levels while regions like Japan, as everyone is aware of, also broader Asia-Pacific region or even emerging destinations like the Middle East are seeing strong growth. And I think that Chinese consumers preferences change. The travel habits also change, so I think it's no longer useful to look at the past, to really predict what's coming next. I think that we'll see more and more differences in the next few years versus what we're used to see pre-COVID. Yeah, I suppose that makes me wonder whether you've been able to identify any purchasing behaviors. In other words, are there specific drivers that motivate overseas spending compared to domestic spending among Chinese consumers? Yes. Before the main reason Chinese consumers bought luxury goods overseas was number one limited product availability in China and number to the significant price gap with Europe. On point number one, today availability is not longer an issue. Other brands now offer the fullest hormones locally as China is a crucial market. What remains is point number two, the price factor. Consumers are extremely savvy. When they want to make a purchase, they research prices online, they compare across different markets and they even check the grey market before making any purchasing. And in many cases, nowadays, it's actually cheaper to buy through the grey market in China than to buy the same product in European boutiques and consumers are fully aware of that. Yeah, I was going to ask you about the grey market, the Chinese grey market, which we talked about on this podcast before and recognized it as a growing threat to luxury brands. If you're good or real, what developments are you witnessing here? First, it's important to clarify for the audience that when we talk about the grey market, we're talking about genuine products, not counterfeit products. I think that the main point to highlight is how professional this ecosystem has become. From supply chains to selling channels, even the customer experience, this is something that it's completely normalized in China and consumers don't see it as something to hide anymore, but simply another legitimate way to buy luxury, especially considering this significant price gap that still exists between China and Europe. Interesting. Let's just pull us down, sum it up for us if you can. It's Euroview the year so far and look ahead into the critical final quarter. What are the key takeaways from this latest Compass Index? If we look at the year so far, it's been one of adjustment and stabilization after a pretty tough start on Age 1, Q3 finally show the first real signs of recovery. As we move into Q4, clear focus is on consolidation, really sustaining that momentum and translating it into consistent growth. This will be a decisive quarter for brands to prove they can turn early recovery into more lasting traction. Then looking ahead into 20 and 26, I see stronger growth potential, but with the market becoming even more selective. I still expect further polarization between brands, brands that can adapt and those that cannot. In my point of view, success will truly depend on how far they can align product, pricing and execution to where the real demand is. That's really interesting and that time is very tightly with what Jack was saying. In the past, we had a season where even the loses were winning, whereas if the realization continues, then we're likely to see a scenario where actually the loses are losing and the winners become, as you say, more selected. Well, in that light, just a final source, what are you advising your clients at the moment as they look to navigate and take advantage of an improving climate in China? Our advice to clients is simple, move with precision. The market is improving, but it's becoming more selective. So it's all about aligning fast where the real demand is. That means relying on fast data-driven insights to a product, pricing and activations, and being able to turn those insights into a real commercial action. Brilliant. Great. Max, we must leave it there. Thanks. As ever for coming onto the Luxury Society podcast and talking to us about the findings of the Compass Index. I'm sure we'll talk to you soon. Thanks, Robin. Thank you for listening to the Luxury Society podcast. If you've enjoyed this episode and would like to hear more, don't forget to subscribe. And if you want to go deeper into any of these topics, check out luxurysociety.com where you'll find stories, insights and profiles that unpack what's going on in the world of luxury right now. I've been your host, Robin Swyddenbank, and this has been the Luxury Society podcast available on Apple, Spotify, and wherever you get your podcasts.