To own a Sunseeker has become an aspiration for many and an obsession for some. Phil Popham in his role of CEO has put the wind back in the sails of this British yachting icon and here he talks to Sir Eric Peacock about the brand’s core values and its luxury aspirations.
Phil Popham, it’s a pleasure to be with you here. As a man who’s spent his career with luxury brands, what would be the attraction of Sunseeker?
Yes, it’s a question I’ve been asked quite a few times actually. I spent 25 years at Jaguar Land Rover – I joined from university and I’ve been quite fortunate to be involved within a company that allowed me to have a say in the development of the brand because it was a relatively small company when I joined back in 1988. Being on the company’s board, running different functions and being the legal entity director, I realised I actually wanted the opportunity to run a business. For me, it had to tick the boxes of Luxury, British, Great Heritage, but also provide a role that can be challenging.
After having a conversation with my CEO at JLR, I received a call from a headhunter at Sunseeker. I’d been involved with Sunseeker before – back in 1991, I was a regional manager in the south west for Land Rover who were selling Range Rovers to Sunseeker. At the time of the call, I was consciously thinking about running a business and after weighing up the different attributes of the company that ideally I’d like to run, I realised Sunseeker was that one. It just felt like the right place at the right time, and I was in the right mindset, plus the company had got the right need.
And how would you define the brand values of Sunseeker?
Joining Sunseeker and being aware of its reputation and history, it was surprising that when you asked what the brand stood for internally, neither of those elements were clear. I worked on a lot of brand positioning work at Land Rover, establishing what ‘Go Beyond and Above & Beyond’ meant for Land Rover and its customers.
When I started at Sunseeker, I was confused because it had a really proud heritage yet no one could really articulate what it was. So, we purposefully organised – with help from consultants as well as the internal team – workshops to get back to what we’re all about. The keywords that came out were ‘pioneering’ and ‘daring’, reflected in our accomplishments as a brand and the attitudes of our founders, Robert and John Braithwaite, who are still active in the business today.
They were daring, they loved the product they were producing and they pioneered a way to actually go and do something different from what everyone else had. After compiling the feedback, we worked on rebuilding those keywords back into the company by asking questions like: what is that Sunseeker DNA? What should actually drive the design and engineering of our product? And it’s not a single thing at Sunseeker, it’s actually a blend of things. Its distinctive design is what distinguishes a Sunseeker yacht from any other yacht in a marina.
When it comes to British-ness how does this tie into the Sunseeker brand?
The design, engineering and craftsmanship elements are something that adds to the brand’s Britishness. It’s that blend of distinctive design, performance and craftsmanship, together with a degree of customisation to our larger models that makes us unique and very British. I wouldn’t say we’re over the top with it but we’re quite overtly British.
So for the last two or three years, this is what you’ve worked on to establish.
Ultimately, we want to pull together everything we’ve always been, get that focus, define what we are and then work on communicating that. This was how the concept of ‘Seek More’ came about – obviously a play on words with Sunseeker. But it was really about the pioneering and daring aspects of the brand that we wanted to channel to reflect how we always seek perfection, and that applies to all the attributes of the brand including our customers. The Seek More concept mirrors their beliefs too, and that’s why they’re successful and ultimately the reason why they’re buying a Sunseeker.
In terms of size, how does Sunseeker sit within the rest of the luxury yacht industry as a business?
We’re approximately a £300 million business with 2,500 employees, a number which has grown by about 25 per cent in the last three years. During this time, revenue has also increased and we’ve gone up in boat numbers by about a third.
We’ve briefly touched on the Sunseeker customer but could you share your thoughts on who the Sunseeker customer is.
The thing that brings them together is clearly their high-net-worth status and they are generally self-made. They don’t come from any particular profession, background or age category – there’s a huge range from early to mid-thirties up to sixties and beyond.
It’s not a cheap hobby to run any sort of boat, and our boats start at about £650,000 plus tax so it’s a big investment. Our customers are therefore successful and they’re buying the boat for a reason; for the enjoyment, quality family time together and the luxury lifestyle. Very few of our customers actually buy to charter and they see their boat as a very personal asset.
I hear you’re expanding dealer distribution and moving into markets where perhaps you’ve not been as visible before; could you share with us what this entails?
I’ve got a lot of experience setting up networks around the world with Jaguar Land Rover, which have approximately 2,500 dealers in over 175 countries. At Sunseeker, we have possibly the largest dealer network in the industry with 125 appointed dealers operating in 74 countries, and they are vital as the first port of call for our customers.
In terms of expansion, it was quite clear that the focus needed to be in the Americas, especially North America where our market share is well below what it was in Europe. So, for the last two, three years we’ve been quite focused on building up that network and we’ve gone from less than a quarter of our sales in as recently as 2016, to over a third last year only in the US. Our focus now is moving towards the Middle East and to the Asia Pacific region as well.
With a workforce of over 2,500 people and a combination of artisan legacy and high technology, what are some of the people opportunities and challenges you have and have had?
One of the big issues we had when I came to the business was that it was losing quite a lot of money. In 2014 we offered revenue at about £200 million but we lost over £14 million. That obviously is compounding a number of things: the product development process, for example, which we’ve since invested in with the 2016 and 2017 products.
We’ve also invested in our facilities, allowing us to physically rebuild production lines to fit new products because before, we were known for manufacturing a large number of small boats whereas now, we are making a lower volume of much bigger yachts.
We are not currently manufacturing boats in the 35–40 foot range which meant we had to reconstruct our shipyards to accommodate larger models and it gave us the chance to really clean up the manufacturing operation. We are absolutely focused on health and safety as it can be a dangerous place to work because of the weight of the things moving around. We have to work in a safe environment and by adopting best practices and making small changes such as cleaning and painting facades, making sure flags aren’t ripped on any of the sites, painting the walkways, and insisting people wear safety gear when they go on the boats, you actually start to see people’s change in mindset.
Even as an outsider looking in, the speed and the pace of new product development is impressive. Could you share with us a bit more about this process?
Well, we have had to change the process as it was lacking in long-term planning. For me, this is key because you have to deliver a financial plan that’s linked to investments and that wasn’t in place when I came to the business.
The starting point for any new product is the prototype so we learn as we go. It’s not so different to from cars; you have to balance your resource, ensuring you’re getting up to speed in terms of the very high quality of what we deliver.
And in terms of what’s happening with Brexit, how are you viewing that: opportunity, neutral, threat or a combination of all three?
It’s hard to actually answer that because with 50 percent of our business being in the Mediterranean, a lot of the business is being paid for in Euros. Ultimately, I don’t think people who spend upwards of £18 million are going to be that impacted by what’s happening on the exchange rate because a Sunseeker yacht is not an impulse buy. That said we did see some currency speculation going on, which gave us some uncertainty because this is a cash-hungry business.
As a consequence of Brexit, there’s more importance on being a sustainable business and trying to spread risk in terms of revenue, which is why the real focus over the last two years has been in the Americas and beyond.
Sunseeker has always had a social conscience. Would you like to share with us where that social conscience is now manifesting itself?
I think it’s really important to put back into the sector and the geographic area where you operate. I’ve always wanted Sunseeker to be a prominent player within Dorset; we are after all one of the biggest employers in the county and I sit as a non-executive director on the Chamber of Commerce and Industry. We were keen to actually work with a charity that could resonate with our employees, who have now personally raised approximately £73,000 for Macmillan Cancer Support. The Macmillan Dorset Bike Ride that we sponsor will this year surpass £1 million in donations since our involvement began. Most recently we’ve announced a long-term partnership with the Blue Marine Foundation, a charity that works to create marine reserves and establish more sustainable fishing methods.
And with the Sunseeker community and client base, how do you keep them connected both with the business and with one another?
We’re increasingly looking at how we promote experiential events that we can invite our client base to. Our boat shows are a time when we have a lot of boats for people to come and see. Our sales team will be at about 15 to 20 shows a year and I’ll attend six to eight; I’ve just returned from very successful shows in Miami, Dusseldorf and Dubai, and I was in London of course for our ‘home’ show in January.
From a personal perspective outside the world that you operate in now, what are the brands that you really admire in luxury?
The brands that stand out for me are those that are actually doing what I’ve just been describing that Sunseeker is working to achieve. Pioneering brands for me would be Ferrari and also Porsche. And in terms of those brands that have gone beyond their core, Harley-Davidson is another brand that really understands brand extension. Its entry strategy into China, for example, was around merchandise and the bike element followed.
Could you tell us a bit about the award-winning apprentice programme you have in place at Sunseeker?
It was set up 35 years ago and last year we had 40 apprentices join us, which was the most we’ve ever had. In total, we have about 115 apprentices on our books at all different stages, and that’s about investing in our future. For those 40 places, we had something like 450 applications and it’s growing every year, so we can see that people do actually want to work for our business. What we find with our apprentices is that they tend to stay for their careers and we can nurture them; by teaching them the skills they need and empowering them, we can garner tremendous employee loyalty. This year marks the 40th anniversary of one of our original apprentices and he’s still very active in the business and in product development.
Looking to the future at Sunseeker, what’s the game plan for the next few years?
We’ve now gone through a turnaround strategy in the last three years and we’ve delivered on that. We’ve gone from big losses back to breaking even and now we’re making a profit. It’s about reinvestment and that turnaround plan has now become a growth strategy of segments. We just announced that we’re going to go back to our heritage with small performance boats in collaboration with another exciting brand, Red Bull Advanced Technologies. We will expand our product range as part of that process and during the course of this year; we will be talking a bit more about what that looks like. We want to become an even greater global luxury brand with substance. There is far more to our brand than the award-winning products our customers love. The entire experience, at every touch-point, should reflect our luxury aspirations.