design:CASE / Vipp

design:CASE From a back garden in the small town of Randers to an international design success with offices in Copenhagen and New York. Vipp has turned a stagnant company into a business with increasing growth rates. The basis for this success story is a unique design product and an ambitious branding strategy. danish design centre

This master case illustrates the value-creating and business potentials of design through the story about Vipp.

Facts about Vipp (mio kr)

2005

2006

Gross profit

13.2

20,2

Pre-tax profit

5

8,2

Profit

3,6

5,7

• Vipp was founded in 1939 by Holger Nielsen when

he made the first version of the Vipp waste bin

• The company name reflects the Danish term for

the way the lid “flips” open on the pedal bin

• In 1993, Jette Egelund took over the company

after her father’s death

• Today, Vipp is owned by Jette, Kasper and Sofie Egelund • HQ on Islands Brygge, Copenhagen • A New York office opens in Tribeca on Manhattan

on 1 January 2008

• Today, Vipp has a staff of 35 • The average age of the staff is 33 • The Vipp pedal bin is manufactured in Denmark • Vipp works closely with 8 countries but has exports

to an additional 30 countries Export accounts for

some 70% of total turnover

• Vipp has seen annual growth rates of 40-60%

in the past five years. Vipp has an ambition of an

annual growth rate for turnover of 25-40%.

• Vipp has been on the list of Danish gazelle

companies for the past three years

Vipp A/S 22, Snorresgade 2300 København S Denmark Tel +45 4588 8800 Fax +45 4588 4446 www.vipp.dk

“A good design product is the main key to success. The second-most important factor is having a sound business sense.”

Jette Egelund

Kasper, Sofie and Jette Egelund

THE CREATION OF A DESIGN ICON

Holger Nielsen is the man behind the design icon, the Vipp pedal

components. In 1999, Jette Egelund found a company in the

bin. The idea for this functional and aesthetic waste bin arose

Danish town of Nakskov that was able to handle the entire

in 1939 when Holger Nielsen’s wife, Marie Nielsen, opened her

production process. The outsourcing made Jette Egelund close

own hairdressing salon. The bin soon became a popular item

down the plant in Randers and move back to Zealand to run the

that sold particularly well to doctors’ and dentists’ clinics.

company from there. “The decision to outsource all production

In 1992, Holger Nielsen passed away at the age of 78. He did

to Nakskov and move the HQ to Copenhagen made it much

not leave any plans for the company’s future. Until then, Jette

easier to involve Sofie and Kasper in the decision-making and

Egelund had never imagined that she would carry on the

new initiatives in the company. Besides, it enabled me to focus

company, but her father’s passing made her consider taking

on the main thing: profiling the Vipp products to the customers,”

over Vipp to add new energy and a more modern vision to

says Jette Egelund.

the company. The decision to take over Vipp meant that Jette Egelund had to give up her job on the Danish island of Zealand

The relocation meant a change in Vipp’s business concept.

and create a new work life in Jutland.

Outsourcing production freed up resources for focusing on sales. “We set out as a company whose main target groups

The first few years at the helm of the company were difficult for

were contract customers – dental clinics, hairdressers, restau-

Jette Egelund. The company had cash-flow problems, and Jette

rants and hospitals. Gradually, we turned our attention to private

Egelund had to handle everything herself. Sometimes, her two

customers and modified our communication to match this new

children, Kasper and Sofie Egelund would help out, when they

target group. Since our change in strategy, our brochures, ads

came to Jutland for weekend visits. Despite the difficulties, Jette

and overall profiling have been aimed at the end-user: any man

Egelund and her two children had a firm belief in the quality of

or woman who is looking for quality products for the home”,

the Vipp pedal bin. “It is both old and new in its design. It’s an

says Jette Egelund. The changes in Vipp’s business concept

evergreen. I have looked at it all my life, and I’m still not tired

led to growing sales and profits, which enabled Vipp to relocate

of it. So, from the beginning, I was convinced that it had good

to an exclusive location on Islands Brygge on the Copenhagen

possibilities both in Denmark and abroad,” says Jette Egelund.

harbour front in 2002. Ever since, Vipp has had its HQ in recently renovated buildings on Islands Brygge, with offices for the

In the late 1990’s, the production facility in Randers was so worn down that Jette Egelund began to outsource production

35 employees.

6 PIECES OF ADVICE FROM JETTE EGELUND: 1. The product has to be “sound” in order to sell,

in terms of both design and function. It is an

added advantage if the design is ageless.

VIPP’S DESIGN PHILOSOPHY

2. We have a strong focus on selecting quality

“The crucial goal of any design process is to create products with staying power.”

materials, whether it is steel, rubber, ceramics

Jette Egelund

or fabric. And we have an even stronger focus

on detailing and finish. Packaging and graphic

design is an important focus area in its own right.

For Sofie, Kasper and Jette Egelund, the good design product

3. As head of a company, one must appear both

has been the key to success for Vipp. That is also the reason why

confident and respectful toward the human

design plays such an essential and visible role in the company on

resources in the company. Good, dedicated,

an everyday basis. In addition to the in-house design & product

hardworking employees who care about the

manager, the company includes external design assistance for new

company are a prerequisite of growth.

design tasks to ensure that Vipp is always able to provide the best design solutions.

4. Next, a company needs goal-oriented and skilful

leadership to drive the staff in accordance with

Jette Egelund set herself the first design assignment back in 1997.

a pre-determined strategy. Over the years, I have

She wanted to expand the product line in order to create renewed

become very aware of the need for simplicity

awareness of Vipp and decided to design a toilet brush. She based

and a systematic approach in combination with

the design on the existing Vipp design in order to match the existing

a sound supply chain. Another important factor

quality, design and materials. The next expansion happened in 2005,

is the partnerships at both ends of the

as Vipp put out a soap dispenser and matching towels. For this

supply chain.

design process, the company hired an industrial designer and a textile designer to ensure the best possible solution. Another

5. Furthermore, it is important to promote a

characteristic feature of all the design processes at Vipp is that

workplace spirit that gives everybody room to

Design & Product Manager Morten Bo Jensen maintains a close

develop and test their capacities and potential,

dialogue with the designers and product developers throughout the

and which is permeated by a sense of fairness

process. He keeps the development process on track at all times

and creativity, so that it is fun to bike to work

in order to develop end-products that live up to the high standards

every day.

for design and materials that Holger Nielsen set with the Vipp pedal bin in 1939. “In close collaboration with Kasper, Sofie and

6. Finally, it is important to spend time and

myself, Morten helps ensure that the Vipp DNA is present in all our

resources on branding in order to profile

the products and the company in a beneficial

and interesting way to the target group that

The most recent addition to the product line came in early 2008,

the products address. It is a good idea to practice

when Vipp designed a series of bathroom accessories. “This design

in the domestic market, where there are no

process has lasted several years. It wasn’t that hard to come up with

language problems, before testing one’s ideas

the designs, but product development has been a long and arduous

in the export markets.

process,” says Jette Egelund. So far, the design and production

products,” says Jette Egelund.

process runs into a few million kroner, high expenditures for Vipp, despite the handsome bottom line. Jette Egelund believes that the design philosophy of ongoing expansions to the product line through the addition of new design products is the only right path if a company like Vipp wants to keep growing. “To realise our ambi-

“We have consistently reinvested every single krone earned in the company.

I don’t need to spend money on myself, but I do need to see the company grow.”

Jette Egelund.

tion of up to 40% annual growth rates, we need to reinvest all our earnings in the company. And sometimes, we have to allocate large sums for new design investments to preserve Vipp’s reputation as an innovative, international design company,” says Jette Egelund.

“It is important for us to keep investing money, time and resources in design processes. That helps us maintain constant renewal.� Jette Egelund

BRANDING STRATEGY

In extension of the change in strategy in 1999, there was an

Vipp has also seen a possibility for boosting their profile every

increased focus on branding. To Jette, Kasper and Sofie Egelund,

year by producing a limited edition. “In 2007, we did a project

it was essential to create a stronger sense of quality in all the

together with Saga Fur. They made a beautiful fur bag, which

interfaces between the consumers and Vipp. Therefore, Vipp

our Vipp pedal was delivered in. Both the fur bag and the pedal

has launched a number of initiatives to accomplish the goals

bin are in the special Reykjavik blue, and only 40 were produced.

of the ambitious branding strategy. One of the first initiatives

We have to be creative to maintain a strong profile, and our

of this small family company was to publish a folder with attrac-

limited edition gives magazines that have already done stories

tive photos of all the Vipp products. “Once we had defined our

about us an opportunity to do another. Our limited editions are

branding strategy, one of the most important things was to

simply a way of placing a new story about Vipp in the media.

make a brochure aimed mainly at the end-users. Our goal was to

In 2008, we also have a limited edition,” says Jette Egelund.

make a brochure that did not end its life in the shop, but which people would want to take with them,” says Jette Egelund.

“Another important dimension is that we take great care in selecting our retailers. They may be anything from small, sexy

Vipp also uses traditional marketing channels including ads

design boutiques to large retail chains. However, a common

in home design and lifestyle magazines. “We do have a high

feature is that they all represent high-end design,” says

advertising budget, but ads are not the most effective means

Jette Egelund. “We also don’t leave it to chance how the

of profiling. People don’t share ads with each other – they share

Vipp products are represented in the stores. Vipp has a say

stories. Thus, we are aware that story-telling is a more effective

in everything from shelves to colours and selection to the

form of marketing and branding,” says Jette Egelund. Therefore,

placement in the shop.”

this small family company views their history as an asset.

“Our family history has been one of the most effective means

“One of the most innovative and effective ways we have yet

of profiling our products. Vipp is a good story, because we have

used to achieve PR and visibility is probably our spectacular

worked our way up from nothing to everything we are today,”

events in Paris. It began with a rather small event – Vipp’s Haute

says Jette Egelund. Besides, the company’s history has created

Couture bins. We contacted a number of acclaimed artists and

a Vipp DNA that connects the design products, and which

asked each of them to decorate a bin. All the bins were then

promotes the corporate identity.

auctioned off for charity. This event caused so much attention

the sky is the limit...

that we were contacted by Le Louvre, asking if we would be

“We have gone from zero to everything we have today.

interested in doing an exhibition with 36 Vipp products decorated

Hence, the past ten years have been absolutely wild

by the French designer Mauricio Clavero. Of course, we accepted

and fabulous. And that has given us the courage to

immediately,” says Jette Egelund. Mauricio Clavero was hired by

believe that we can achieve anything we want for the

Vipp for three months to decorate the Vipp products. The result

company,” says Jette Egelund. Thus, this small company

was 36 decorated Vipp products. The collection was presented

on Islands Brygge in Copenhagen has no trepidations

at Le Carrousel du Louvre in spring 2006 under great media

about its plans to take on Manhattan, New York in early

attention. This was an amazing entry into the French market.

2008. They have plans to promote Vipp in another five

But a good event is not going to make us world-famous. It is

American states, in the cities of Boston, Chicago, Dallas,

only a step on the way. After an event like that there is hard

Los Angeles, Miami and San Francisco. Kasper Egelund

follow-up work to do, which is just as important for success in

is moving to New York to be close to the action. “He

va new market,” says Jette Egelund.

is going to be running everything over there, and I’m sure he won’t come home until he has secured a big

As a result of the ambitious and well-defined branding strategy,

success,” says Jette Egelund with a smile.

Vipp is no longer a product that only appeals to doctors and dental clinics. Today, the Vipp products appeal to old and young

As they did for the French market, Vipp had planned

alike, men and women, hippies and yuppies. According to Jette

a spectacular event with a hairdressing salon for a

Egelund, the branding strategy in combination with a good

showroom. Various circumstances led to a change in

and unique design product is one of the main reasons for the

plans, so as this goes to print, they are finalising plans

explosive growth that Vipp has seen since she became the

for another, equally high-profile debut in the American

managing director in 1993.

market.

“We have inherited a unique and ageless product, and we have a good and sound business sense, which is a requirement for growth.” Jette Egelund

There is no end to Vipp’s plans. A good design product and an ambitious branding strategy have made Vipp confident that the company can continue to grow.

“We have a growth strategy, which means that none of us is considering when it might be enough... The sky is the limit...” says Jette Egelund with a smile.

VIPP’S INTERNATIONALISATION Vipp works intensely in the following export markets: Norway, Sweden, The Netherlands, England, Germany, Finland, Iceland, Belgium and Switzerland.

In addition, Vipp has exports to another 30 countries around the world. Vipp takes on the American market in January 2008, as the company establishes its own sales corporation with a showroom on Manhattan, New York.

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design@ddc.dk

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www.ddc.dk Text: Sanne Lund Hansen

The Danish Design Centre’s assignment is based on the Danish government’s design policy of promoting innovation and growth in Denmark and strengthening the international competitiveness of Danish businesses.

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Design and layout: Scandinavian Branding A/S and Peter Ørntoft, DDC