Late one night in April 1997, the phone in Frederick Levinger’s hotel room in Basel, Switzerland, rang. After a full day at the Basel fair, followed by a typically large dinner with clients, the president and CEO of the Colibri Group had one thing on his mind—sleep. But when he picked up the phone, he woke up again. Ted Bonsignore, the CEO of Krementz & Co., was calling to say the company was going up for sale. He thought the Colibri Group might be a potential buyer and wanted to know if Levinger was interested.
“Hell yes, I’m interested,” said Levinger. Meetings with Bonsignore and Krementz & Co. owner Richard Krementz followed, and by Labor Day 1997, the deal was complete. The Krementz name and its Shiman brand of religious jewelry officially became part of the Colibri stable of brands, which also included Colibri, Van Dell, Dolan & Bullock, and Linden clocks.
While Colibri was not the only bidder for Krementz, Levinger saw in its product line something his competitors didn’t: the value of the Krementz Overlay collection.
“Everybody [potential buyers] wanted Shiman; it’s a gold line with good distribution to the majors,” he said. The Krementz Overlay line, however, wasn’t finding many takers. It was popular with small independent jewelers, and the Krementz name had a good reputation for integrity and quality, but its strong association with a gold overlay product—rather than karat gold—was a turnoff to many potential buyers.
A glass half full. Levinger saw the overlay product as a good women’s bridge line, not a watered-down stepchild of karat gold. The collection had strong brand recognition in a segment of the industry with relatively little branded merchandise. It had an established sales force, and there was a scarcity of good bridge jewelry in the marketplace. In short, the brand was definitely viable—and had lots of growth potential. (Note: “Bridge” refers to a product designed to fill a gap between two categories. In apparel it refers to clothing priced between designer and mass; in jewelry, it is the niche between costume and fine.)
Six months after the acquisition, Colibri introduced sterling silver into the Krementz line. Within a year, silver accounted for 50% of Krementz collection sales. Its instantaneous success was due in part to fortuitous timing—white metal had just become the dominant fashion trend—as well as to its niche of providing retailers with a good bridge line. But the biggest draw was simply its name.
“I think we would not have been as successful with sterling silver without the Krementz name,” Levinger says. “We took the best parts of the Krementz heritage and put it to new merchandise. We kept the Krementz integrity and its lifetime warranty.” In fact, the name is so valuable that Colibri is consolidating all its women’s jewelry brands under the Krementz banner: The Krementz Overlay line (and the sterling silver collection) will be called Krementz Essentials. The Shiman line is now Krementz Symbols of Faith, and the Van Dell line will become Krementz 14k Gold Precious.Phasing in. Brand consolidation will be a three-year process. The Krementz brand will actually be one of three core brands for The Colibri Group, encompassing all of its women’s jewelry. Mid- to up-market men’s jewelry will be housed under the Dolan & Bullock brand, and all accessories (pens, lighters, and such) will be grouped under the Colibri brand, along with base metal men’s jewelry, says William Gempp, the firm’s director of advertising. Separately, the firm also owns the Linden line of clocks, it has a licensing agreement with Movado to produce clocks bearing the Movado name, and in the United States it represents the S.T. Dupont line of luxury writing instruments and other accessories.
The first trade ad campaign announcing the new branding phase-in broke in May, and at press time the firm was finalizing a direct mail campaign to its retailers. Gempp says the sales force will remain the same.
“Acceptance of Krementz as a bridge jewelry line was easy. This [strategy] may take longer,” says Levinger. “Richard Krementz had a General Motors strategy of segmenting by price point. Essentially, we’re going back to the future.”
Levinger’s vision of the future, however, is streamlined: Instead of each brand having its own marketing and financial operation, back-office functions are being consolidated. The Krementz family retained its large factory building in Newark, N.J., and Colibri initially leased some space in it after the sale but later moved the Krementz division into its Providence headquarters.
Richard Krementz, the former owner of Krementz & Co., has no regrets about the sale. “I was getting older, and it was time to simplify my life,” he told JCK. “I wanted to stop having to manage something so big, and Colibri is a fine name.” He also applauds Levinger’s decision to make sterling silver a major component of the Essentials collection. He says Krementz under his own hand offered a few silver pieces, but “nothing like what Fred has done with it.”
Krementz and his son, also called Richard, have remained in the jewelry industry but are now focusing on the luxury market. Krementz feels confident there won’t be confusion between the family company—called Richard Krementz Gemstones—and Colibri’s Krementz brands.
“They’re two different companies,” he says. “I think Colibri is more in mass-market distribution, while Richard Krementz Gemstones is 18k and platinum with high-end gemstones, and a high-end bridal line.” The Krementz family recently sold its Newark building to a computer firm, but Richard Krementz Gemstones is still there, leasing back space from the new owners of its building.