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One for Eno, Eno for All, Says Lifestyle Fashion Brand
 Pacific Epoch retail analyst Marie Jiang caught up with Tor Petersen, the CEO and Founder of Eno, a creative lifestyle fashion brand that targets 18-24-year-old Chinese customers with its innovative designs. Petersen is the co-founder of Zou Marketing, China's premier sports marketing agency, and previously worked at both NIKE (NYSE:NKE) and Coca-Cola (NYSE:KO) doing China manufacturing, operations, marketing, sports marketing and Asia-Pacific branding.
Why did you choose to leave your previous positions, as a professional manager in NIKE and Coca-Cola, and go out on your own as an entrepreneur?
When I joined NIKE in China in 1990, they were in the process of setting up their business infrastructure and were much smaller than they are today. I enjoyed the process of building the ship and solving problems during the early stages of the business. When I eventually decided to start my own business it just felt like the right thing to do.
"Eno" – the brand is "One" in reverse. Can you tell us more about the origin of the name?
Exactly, eno is "one" spelled backwards. We felt that the word eno could reflect the dual meaning of "one". "One" can mean one individual (a focus on individualism) or one group (a focus on collectivism). We think this concept accurately reflects the character of Chinese youth today. Chinese youth crave individualism, but can’t live without a group. "One" is so commonly used across sectors as a slogan that the law actually prohibited us from registering it as a trademark; that's one reason we chose "Eno."
How do you see Eno's position in the future?
I believe that casual fashion will be the fastest growing apparel sector in China over the next few years. Nike entered China in 1985, and the sports market began to develop in the early '90s. Fashion has lagged far behind the sports sector, with brands like H&M, Zara, Vans and others beginning to enter China only in the last few years. Even though new brands like H&M, Zara, Uniqlo, Vans, Quiksilver and others have partially filled up the vacancy in the market, China still doesn't have many youth fashion brands, and both retailers and consumers are demanding that they have access to more choice in this sector. We believe that Eno is well-positioned to expand as the overall casual fashion sector grows as a percent of the apparel market in China.
Do you agree that one of Eno's main characteristics is originality?
Yes, the Eno brand is characterized by originality. We started the brand to tap into China's growing music, arts, fashion and extreme sports culture, and keep the brand rooted in these worlds in order to build the brand culture and identity. However, we don't want to be a niche brand targeting a niche market. We are scaling the brand nationally, and position the brand to be a commercial success, while maintaining our creative base. In the next few years, Eno will mature its current design to target a larger audience, beyond just 18- to 24-year-olds.
Who are your target consumers? What sets them apart?
Our target consumers, China youth, share one common characteristic: individualism. China's one-child policy has made this group comparatively individualistic and given them their own point of view from which to understand the world. This generation has more access to information through the internet and is more exposed to the outside world than their parents, who suffered to some degree from the Cultural Revolution.
Moreover, the younger consumers are, the more communicative they are with the rest of the world. Generations born in the '80s, '90s and especially the '00s communicate with people around the globe without any prejudice. These are the consumers that Eno seeks to target.
Young Chinese consumers are evolving all the time. How do you keep up with trends?
We paid special attention to design even in the brand’s initial stages. Other brands start with distribution and only begin to emphasize design once they have a nationwide sales network in place, but I believe that good design is indispensable for a fashion brand preparing to go nationwide.
In order to predict new trends, we first employ a group of young designers, who live in the same culture and have the same tastes as Eno's target consumers. Second, we look closely at the global trends that impact Chinese fashion. The Chinese fashion market is unique. Styles from Korea, Japan, Taiwan, Hong Kong and Europe have an overwhelming influence; there are some styles that become outdated in other markets but will remain popular in China, while some fashion styles become popular quite quickly in China, but fade fast. Eno watches global fashion trends closely and determines which trends are most attractive to youth in China.
What characteristic do you value most for your designers?
For an Eno designer, the most important thing is the thought process behind the design. Many designers in China view design as simply completing a task, whereas Eno designers should first learn how to conceptualize their ideas before designing a product.
How many points of sale does Eno have now, and in which cities? What is your expansion plan?
Eno currently has more than 40 points of sale in China, including cities such as: Shanghai, Tianjin, Beijing, Chengdu, Chongqing, Nanjing, Hangzhou, Ningbo, Harbin, Shenyang and Changchun. We are focused on expanding our presence into second and third tier cities via a franchise/retail operator model. We expect to open 50 new franchise stores in 2010, and plan to have more than 600 stores across China by 2013.
Which cities have the fastest growth? Eno doesn't have many locations in southern China. Do you have plans to enter markets like Guangzhou?
We've found that our northern district is growing the fastest, while eastern China ranks second. For this reason, our team has created specific designs that cater to northern people's figures and tastes. As for the south, markets like Guangzhou are hypercompetitive and heavily influenced by Hong Kong. Eno plans to first focus on high growth areas in China such as the North region, East region and certain fast growing cities in the West such as Chengdu and Chongqing, and then focus on entering the south region with the support of a strong presence throughout China.
What are the biggest challenges to Eno's development?
The most challenging thing for Eno has been establishing our distribution network. As China's retail market is largely single brand led, there are not many multi-brand retailers for our products. In order to scale the brand, we have had to build a single brand franchise network, which requires a full range of products to fill out a store, a unique and well-executed retail format and product that is tailored to the local market. Entering the China market is difficult for any brand, but as a start up with limited resources, building a distribution channel can take time, as the market is highly fragmented and regionalized. Although building our distribution network was a challenge when we started the company, now that our retail format is established and we have built a strong sales team, the single brand retail format will allow us to rapidly scale the brand across China.
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