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Ferretti Group recently invested in the construction site of Ancona to modernize and expand the existing and new sheds. In addition to this, there is many other news. This in-depth interview shows how the Group and especially CRN, the shipyard where custom megayachts are manufactured, deal with the future challenges.
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[dropcap]O[/dropcap]n last June we made an interview to Stefano de Vivo, Ferretti Group Chief Commercial Officer. We met him at the office in Milan and together we drew a comprehensive overview of the Group’s history, seven years after the Chinese acquisition. In 2012 the Ferretti Group was acquired by the Chinese company Weichai and in 2016 F. Investments, the holding of Eng. Piero Ferrari’s family. The Chinese ownership immediately showed an outstanding, serious, industrial and long-sighted vision. Weichai paid to the whole supply chain 100% of the debit, thus preventing the crisis of the suppliers and enabling the shipyard to be readily operational. Nonetheless, some suppliers were getting into financial difficulties.
“Today we work with a renovated supply chain; the task of the new management, which took office in May 2014, was to make a more accurate selection of the suppliers, both in terms of reliability and of ability to grow with the company”.
The first stage culminates with the arrival of Alberto Galassi, in May 2014 – says de Vivo – when the first management line was renovated and Stefano took the office as Chief Commercial Officer. Here the Group started to make significant investments in R&D, a business area considered as the essence by the Chinese investors. The company changed its building and procurement procedures: “the Group had reached a stalemate. We reorganized in order to launch new vessels. After few months, in January 2015, we introduced into the market 30 new models, which represented an unprecedented number. This wasn’t just about restyling, but they were completely new projects. The new goals included investments on a young team as well as the empowerment of the second lines, where they proved to be talented and worthy. And, also, hiring key people with an experience in industries other than yachting, but still related to the field of luxury. The Group needed new challenges”.
As regards fully-custom production, the shipyard adopted a specific strategy, allowing CRN to make a significant step forward in the product industrialization procedure: “while remaining a handcrafted and customized project, we managed to industrialize the basic stages related to procurement. Without this step, we couldn’t grow”.
With the arrival of Eng. Piero Ferrari in 2016 as a shareholder, even though he was already into the company from 2013 as Product Development Manager, Ferretti Group started what de Vivo describes as its “second stage”: the partners decided on a capital increase to give a push to the company and to ensure the achievement of the long-term goals set. The main strength of Ferretti Group was the power of its two shareholders: both the Chinese investors and Mr. Ferrari have a financial power which could ensure a long-term vision for the Group, to foster a sound and steady growth.
NEW DISCOVERIES, CHALLENGES AND OPPORTUNITIES – With their involvement in Ferretti Group, “the Chinese investors”, explains de Vivo, “learned to better appreciate the boats and the yachting lifestyle, mainly because they understood that they provide a larger framework of action compared to the holiday industry, that they aren’t just related to a concept of life at sea and that they could be also used in their business affairs”. Also Eng. Piero Ferrari, with his trained and experienced eye, master in the fields of design, innovation and technology, who was involved from the very first day in any project of the Ferretti Group, inspiring designers and specialists with his tips and insights, could take part to an exceptional event, meaning extraordinary, which characterized the history of the most iconic brand of the Group: the inception of the project Riva 50m, recently delivered to the owner, and the relevant construction. Speaking of challenges, Stefano de Vivo explains that certainly the dramatic team and organizational change in the company was a hard test for all the stakeholders involved. “People had to be persuaded that we were working to lead to an improvement. From 2009 to 2014 the Group was involved in difficult situation several times. But the messages we received were encouraging, we knew we were hitting the right track. And launching so many new vessels was a huge challenge as well. Many said it was impossible, but we did it!”
MARKET POSITION OF FERRETTI GROUP – Today Ferretti Group is on the market with yachts from 30 to 50m, a segment where it is the undisputed leader, with the highest number of boats launched in the last 10 years, including the years of the crisis. “This achievement shows the energy of our projects in terms of style, design and Group strategy; having different brands led by several drivers entails greater efforts and higher costs, but it also allows us to be more focused on their specific identity. This means that a customer who wants to have the top in the segment, finds the perfect match in the solutions of the Ferretti Group, specific within the different market niches. In short, being focused on different brands requires a harder work at the shipyard, but facilitates the targeting of the customer. Aiming at emphasizing the specific essence of each of our projects, this is perceived more clearly by the customer, making their meeting and mutual belonging more natural. This is the secret of the Ferretti Group below 50m”.
In the megayacht segment, above 50m, this strategy hadn’t yet been introduced. CRN, Riva and Pershing are three completely different brands, with different reference targets. “We are focusing on a communication aimed at strengthening the specific identities of these yachts and we expect soon that the Superyacht Yard of Ancona reaches the top of its operational potential, of course preventing any overloading. We work towards selling 3,000 GT per year, with the goal of becoming not the shipyard with the highest number of building units above 50 meters, but with vessels longer than 50m which perfectly match the identity and the needs of our clients. Who is looking for speed will choose a Pershing, who wants a rich and distinctive boat will buy a Riva, who intends to design his megayacht will build her with CRN”.
THE SUPERYACHT YARD AS A MEETING POINT FOR THE SPECIFIC CRAFTSMANSHIP FOR THE CONSTRUCTION OF MEGAYACHTS – Speaking of strategies, Stefano de Vivo illustrates the plans currently implemented for the shipyard of Ancona. “We have just invested in what we called the Superyacht Yard. We moved the construction of the Pershing flagship, the Pershing 140 and the Riva 50m where for 60 years we build CRN-branded fully-custom megayachts. Today in Ancona we build our yachts from 50 meters up, with each brand referring to dedicated teams, relying on specific know-how and preserving its identity: despite their size, they don’t lose their key feature. We have planned some other investments for the modernization of ground and sea infrastructures”.
THE GREAT REVOLUTION – Lately the shipyard has introduced in the technical department a software to design yachts: now the customer can see the planning of his yacht through 3D diagrams and drawings, which were already available but not on all the general plans of the yacht. Stefano de Vivo explains that “the shipyard is focusing on designing. We want the customer to know and to feel confident that he has a perfect boat in all its aspects, as regards design and systems. This investment not only allows to work better, and to give a greater satisfaction to the customer, but it should also be considered as a training project. Our technicians were accustomed to a different system, they had to learn to draw with this new software, and this unavoidably caused some slowing down, but this is the way towards the company’s progress and today we are working in this direction, reaping the relevant benefits”.
THE CRN’S ONE-OFF CONSTRUCTIONS AND CRN’S IDENTITY – Stefano de Vivo remarks that “even if Riva 50m is built in Ancona and is a megayacht it shouldn’t be confused with a CRN. It is totally different! Riva 50M is a yacht which should be immediately recognized as a Riva by observing its iconic details. Instead, a CRN is a fully-custom project. Many customers asked me to build big boats under the Riva brand, but I explained them that it doesn’t work like that. If we satisfy these demands we would distort the brand. It is just the marked difference between the construction of a Riva 50m and a CRN that makes possible the coexistence of the two hearts of the shipyard in the same facility, without risking to cause confusion. Riva 50m preserves all the distinctive design features of the Riva boats, despite being a megayacht; above all, it shouldn’t be meant as a custom project, except for the interiors and some details, such as the sunbeds. The difference between a Riva 50m and a CRN megayacht”, de Vivo points out, “is the possibility for the owner to create her/his own design”.
Going back to CRN, de Vivo specifies that a CRN yacht reflects the owner’s vision. “We build whatever he wants”. CRN is a hotbed of “unique pieces”, often inspired to lines specifically required by the clients. When CRN built Atlante, it was just the owner to present the idea of the yacht he wanted to build to the shipyard. “CRN is a shipyard where if the client asks what kind of design we can plan, without giving any tip about his tastes or requirements, he almost places us in crisis. Atlante is a very successful project because the client gave us his idea, his source of inspiration was the Mercedes GClass. The idea was then reviewed and modeled by the Nuvolari Lenard design studio and built according to the customer’s desire. CRN respects the owner’s taste and his stylistic requirements, and the project has to be jointly reviewed to find the right balance and the best functioning. With Yalla it was the same story. The owner requested a 73 meters which had to look like a motorboat, a yacht with a very slender line, but not necessarily with large volumes. And this is how we built it. With Chopi Chopi the requirements was exactly the opposite. What is cool at CRN is that we build whatever the shipowner wants”.
Even though CRN yachts are made jointly with the customer and although each of them has its own story, vessels like Latona, Cloud 9, Atlante, Saramour, Yalla, Chopi Chopi and J’Ade have the same capacity to reflect the philosophy of the brand. “Underneath their appearance, each yacht is manufactured meticulously. CRN can have a small team in its technical department because it doesn’t need to draw, or rather fully design, the entire megayacht before starting the construction works. We start the construction with a first engineered stage. This allows to fasten the process, without turning down high quality”.
Nowadays at CRN there are four hulls under construction, of which unluckily I can’t tell much due to owners’ privacy reasons. However, Stefano de Vivo gives us some details: “The units include a 60 meters, two 62 meters and one 70 meters. The first will be totally made in aluminium, a particular yacht designed by Nuvolari Lenard both as regards interiors and exteriors, and it will be very fast. It will be the first built in Italy, so large, entirely in aluminium. The idea stems from the yacht owner, who made specific draft, speed and range requests”.
The two 62 meters are made by Nuvolari Lenard and Omega Architects respectively. The same size for two yachts which embody completely different personalities, characters and styles.
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From Superyacht Digest | The April Issue: Begallta, She, AlfaRosso
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The 70 meters sprouts from a personal idea of the client inspired by the design of the 70-meter She, by Vallicelli Design. “We take this project as a starting point since it was very close to the client’s idea, but the final project will differ from She. Vallicelli, in particular, will be again involved in other projects; we are analysing with him the interiors of a new project, about which you can learn more in the near future”.
ENGINEERED DESIGN – CRN works on engineered design, but if they don’t conform to the project required by the client, the shipyard studies a specific cutting-edge solution for layout and features.
“Our modus operandi is to propose own projects developed with international renowned design studios. We rely on concept designs and innovative proposals when the owner comes without a specific idea. This is when we offer a wide range of choices. Our team is specialized in the study of specific tailored projects. Our goal, and thus the niche where we stand, is the design of the yacht of dreams, building a pure custom”.
As de Vivo acknowledges, there are few customers with a clear idea of what they want to build. There are few “wise” customers, in terms of design; often when buying the first boat, even if it is a megayacht, since they haven’t a yachting experience, they barely know their needs. In this case we need to have some designs ready to be proposed. And here is where the collaboration with important brands of yacht design comes into play. “We contacted some worldwide renowned designers to develop new projects, which could be built according to our key design guidelines, that is water lines and engineering platform, technical rooms, engine rooms, etc. Today is not easy to find design studios willing to invest in new projects for a shipyard, but we were successful and we are very satisfied with the results”.
VERY PRIVATE CUSTOMERS – Considering the small volumes of megayachts market, it is difficult to build up a specific customer profile. But what Stefano de Vivo manages to identify in CRN customers is their request to remain as much private as possible.
“CRN customers, today and in the past, tend to be families paying great attention to their privacy, as a philosophy of life, not only in relation to the display of their vessel. They keep the yacht only for private use, they don’t charter it. Indeed, if it is true that CRNs are yachts created from their vision, they are lived with the same sentiment as if they were buying a house, an intimate dimension to be kept as such. An exception is represented by the story of Cloud 9, the only CRN built with the idea of making it available for charter. Even if the story tells us that the owner, after the delivery of the yacht, preferred to cancel all the bookings received for the season, keeping his yacht for exclusive use.
The CRNs currently under construction are strictly confidential projects. The owners want to protect their privacy. As they protect their house, their family, likewise they require strict confidentiality for their vessel. Even if it is true that at the launch, also with a private ceremony, this is visible to everybody, after the descent to the sea, there is the jealousy for the project by the owner and thus as long as it is possible to hide its lines and details, also to prevent any ‘plagiarism’, the yacht is covered by ‘professional secrecy'”.
IT’S A FAMILY AFFAIR – We wondered how yacht owners changed in the last 5 or 10 years. And if the new generation has a different approach to the purchase of a yacht. If it is harder today for a shipyard to deal with the fathers or the sons. Stefano de Vivo explains that the customers are so different that it is difficult to detect a change.
“Certainly clients in the past came to the shipyard without their sons. The purchase of the boat, whether it was small or large, was an individual choice. Today it turned into a family affair. The relationship is more complex, since we don’t deal only with the owner, but with all the family members. But this isn’t the only difference: often they are purchasing the first vessel, even if it is a megayacht. This means that neither the father or the sons grew up with the dream or the passion of the sea, and it leads to a normal lack of yachting experience, and thus a poor knowledge of their actual needs.
It’s important to understand what kind of yachting experience the owner wants to live with his family. Based on it, CRN with its in-house teams of project managers, project architects, engineers and technical designers work closely with the owner’s project team and the designers to shape the layout and the features.
Down the years, CRN team have all learned to listen to what our owners want and to turn those ideas into breathtaking yacht through a winning blend of expertise, creativity, flexibility and reliability and total commitment.
Moreover, also the interest in spaces has changed: today the customers visiting small or large boats are not interested to the engine room. In the past, it was a must. Today customers are focused on the liveability, the beach area, the jacuzzi… Therefore we need to make them understand that the technical areas should not be sacrificed to the benefit of living spaces, since it would undermine the proper operation of systems and plants, to the detriment of the on-board comfort.
We try to make our clients understand that differently from a villas, the yacht is independent in the production of energy. The yacht moves, it is a means of transport. And it moves through and lives in what also the NASA described as the most ‘threatening’ environment, the salty one”.
ENCOURAGE SALES, IS THAT POSSIBLE? – Statistics indicate a small percentage of UHNWIs who own megayachts, but they should also include those who charter. Stefano de Vivo explains that “if we look at the number of new yachts sold at international level, this may seem low. But we also have to consider who prefers to charter rather than purchasing. At this point, if the charter proves to be a good experience for the family, maybe in a couple of years the customers tend to purchase their own vessel”.
Stefano de Vivo draws the attention also to another reason why encouraging sales is such a challenge. “Usually, the yacht is the last purchasing choice by owners, after the residences, the main one, the beach villa, the mountain house, then the small boat, and finally the airplane. It is almost natural: the megayacht comes at the end of this path.
Also any bad experience, including personal, should be taken into account. We should be good at educating the market and showing that there isn’t just one use of the vessel, but that it is possible to stay at sea following different lifestyles”.
What is fundamental and should be clear to yacht owners is that sailing must be comfortable and safe. As regards lifestyles and habits, to each their own. everybody is the master of his backyard.
A 360° RELATIONSHIP OF TRUST WITH OUR OWNERS – CRN builds custom yachts, it is crucial to establish a relationship of trust with the customer such as to access his private sphere, in order to understand how he likes to spend his leisure, how he lives the spaces, what is his idea of yachting experience.
“This is the good of this job, when you earn the customer’s respect. In the design stage, the relationship with the customer is handled by the project manager, a key figure between the technical, the construction and the commercial area working together with the project architects.
The yard’s Interiors & Design department vaunts a crack team of world-class architects and designers who support and work together with the client. In the after-sale stage, fully custom and semi-custom constructions, have a dedicated support, comprising 2-3 people, generally those who have supervised the building and who know every detail of that yacht. We have an extensive after-sale service network around the world and a good relation also with the captains.
This is why we organize events addressed to captains, to build with them a personal relationship, which is crucial in the service stage”.
To create a project jointly with the customer means reviewing and assessing it a thousand times to find the right solution for both sides, that for the shipyard means at a technical level.
The development of the idea of the latest 70 meters lasted 13 months. Stefano de Vivo explains that during the creation of the project the yacht owner is attracted by a detail that he saw on another boat, and that he wants to be incorporated. Until the client likes the project, the sale is not concluded, and this could lead to the risk of investing much time and work in the study of a project that will never be built, “but it is for this reason, to prevent situations where the negotiation is just a waste of time, that we only sign nonrefundable letter of intents with clients. It is a way to reduce the risk to waste time and to protect our actual customers who deserve the best attention. All the time we recover from fake negotiations, is time gained for our customers”.
THE RELATIONSHIP WITH THE BROKERS – “We resumed to nurture the relationship with the brokers, all of them; since 2016 we have a great management of the relationships with big brokerage companies, but also with minor players, such as consultants acting on behalf of customers as family office. For the second year we organized for a selected group of brokers a day at the shipyard, an event where we showed our production capacity and managed to explain in detail what we do, what is our current offer. We have an easy relationship with brokers, we aren’t forced to sell”.
Our clients are never oriented to speculative purchases, thus our relationship with brokers isn’t focused on choices based on the price. Also the relationship with our sales force is personal and daily: we put at the core the human relation.
“This is why our clients expect from us some flexibility, that is to say the possibility to require changes to the project while works are in progress, except in case of structural barriers or if a price increase or a delay in delivery is expected, issues of which however the customer is informed”.
THE COLLABORATION WITH DESIGN STUDIOS – In addition to the design projects published on the issue of April of Superyacht Digest, Begallta by Lobanov Design, She by Andrea Vallicelli and AlfaRosso by Francesco Paszkowski Design, CRN works constantly in developing new design projects to wide his fleet and to propose to CRN’s prospects who come at the shipyard without a clear idea. “The project by Omega Architects was born as an idea of sports yacht. Harrison Eidsgaard proposed the idea of a cutting-edge explorer. And the ingenious project by Nuvolari Lenard, a studio collaborating with us from a long time that helped in the realization of high level yachts, such as Magnifica, Clarena, Azteca and Atlante“.
THE BRAND EXPERIENCE PHILOSOPHY – Ferretti Group is focusing on private events and on the creation of branded lounges and clubs. Stefano de Vivo points out that the brand experience is the most important aspect in the relationship with the customer. “We have strong brands, with clear identities. And the private events or the lounge represent a strategy which allows to perceive the essence of the brand and to live it as an experience. The Riva Lounges allow the customer to get into the brand. The Aquariva moored outside the Gritti hotel in Venice, makes clear the brand positioning to those guests who don’t know it yet. A boat outside the Gritti is better than any business card. Going back to private events we saw that it is true that they are expensive for the company, but they also generate an extraordinary return. Our dealers feel comfortable to invite customers, more than at a vessel show, where the idea of luxury fades away among logistics and organization. As remarked, it all comes back in commercial terms. The last year the customers attending our private preview in Montecarlo, at our famous concert, acquired the 30% of our order intake within two months from the event. Our events are often an expression of power, not just a brand experience. Dealers and customers acknowledge the power of the shipyard, of its organizational and investment capabilities, aspects perceived as safety and reliability by the customer”.