Michelin Guides: Can the once-revered restaurant bible become relevant again?

FT
Stories from the Financial Times. 
July 17 2011 8:25 AM

Rating the Michelin Guide

Can the once-revered restaurant bible become relevant again?

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"Obviously now we don't have anyone with the same spirit and at the same time the guide was carrying his name on the cover, which is obviously not the case any more," adds Naret. "I would imagine there is a change taking place; developments that were brought in have stopped. A ­magazine we launched called Etoile, a beautiful magazine, was stopped."

For its part, the current Michelin management team insists that fears about its stewardship of the guides are overcooked. Senard and Michel Rollier—the current boss of the tyre firm and a Michelin family cousin—fully appreciate the marketing "genius" behind André and Edouard Michelin's 111-year-old idea, it says.

"One of the biggest assets of Michelin is the brand, so it is key," says Claire Dorland-Clauzel, the Michelin executive in charge of international branding. "It is not a question of the financial background of Mr Rollier or Mr Senard [both former finance directors] or other things. They are both not only financial, they have an industrial background also and they have a global view. They are very careful about the brand. Without the brand, Michelin group is what? I can tell you that finances are not the only drivers for these two men."

Naret and others also concede that Rollier should be applauded for turning round the fortunes of the parent company during his time in charge, carrying on a restructuring started by Edouard and instilling a sense of fiscal discipline.

Nevertheless, there has been a clear change in attitude towards the guide over the past few years, which some say helps explain the departure of Naret—even though he insists that he always intended to leave at the end of last year and had even considered leaving after the death of Edouard before being persuaded to stay by Rollier.

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According to a person who knows the ­company well, there was a feeling that while the big-spending Naret had done a fine job expanding the guides into new international markets such as New York and Tokyo, he was a bit too "bling" for the stuffier types in Clermont-Ferrand, the tyre company's home city in the Auvergne.

"Jean-Luc was different from the old Michelin inspectors," the person says. "He was glamorous and international, a bit of a playboy even in his style of dress, so he was absolutely the opposite of the traditional approach of discretion above all things. But he did a great job, I think. First of all he internationalised the guide, and he also modernised it, opened it up to the world. He loved to talk, he had an enormous ego, he liked to be in the papers, but he was fun and sympathique too. But he was so over everything, so often in the papers, that I think it started to bother the top guys."

There are rumours that Michelin's new choice of editorial director is somebody from Clermont-Ferrand, possibly even someone from a tyre factory. To put a "tyre man" in charge of the famous old guide books would be a pretty remarkable change from Naret, who will take the reins of a luxury hotel group in Mauritius in August.

Michelin declines to comment on the identity of the replacement, saying that an announcement will be made in the next few weeks. It also defends the seven-month delay by arguing that it needed first to complete a bigger restructuring of the non-tyre businesses. It merged the company's guides and maps business with its digital travel assistance division, a decision that it says also explains the move to the new suburban premises, where they will all be under one roof.

Michelin stresses though that when taken together, the maps, guides and digital businesses are profitable. But the losses incurred by the red books have become such a concern that Michelin has turned to outside consultants. Accenture looked last year at three different scenarios for the red books, including outright closure.

The nuclear option was quickly rejected, partly in recognition of the undoubted brand value of the guide but also because of the political impossibility in France of such drastic action. However, Accenture warned that to carry on with things as they are today would mean yearly losses at the guide hitting €19m by 2015, representing a cumulative loss of €70m over the next four years.

As a result, the consultants proposed a new business plan that would allow Michelin to make money by offering online "services" to the hotels and restaurants included in the guides.

The thinking seems to be that Michelin would do well to seek a share of the good fortune that its awards bestow on restaurants, possibly by creating a "red book" website that provides paid-for links for those establishments with Michelin stars and allows users to make online reservations.

The danger of such an approach is if it threatens the cherished independence of Michelin's inspector system, particularly if restaurants without stars are allowed to buy into the online service—one suggestion made by consultants. Michelin has always made great play of the fact that there is no charge for entry in its pages, which means that it retains credibility.

While it appears happy to take on the chin the constant stream of criticism from Parisian food critics like Simon who say its innate conservatism has turned French cuisine into a museum piece—or the suggestion that its inspectors are awed by big-name chefs such as Gordon Ramsay and Alain Ducasse—it is much more sensitive when anyone questions its propriety.