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watch aficionado
URWERK Past and future clash…
Baselworld Everything and its opposite
www.watch-aficionado.com Watch business paper – USA & Canada – VOL.50 N°3 JUNE / JULY 2014 with index of all in-depth articles published online
editorial
The empire strikes back
www.watch-aficionado.com
uPierre M. Maillard Editor-in-chief Europa Star
In Italy and elsewhere it is common to see advertisements proclaiming: “We buy gold, silver, Rolex.” A Rolex is more than just a watch. Over and above its value as a status symbol, Rolex has long been seen as a safe-haven investment, something that can be kept for a “rainy day”. There are plenty of testimonials, like this one from an online forum: “For me, a Rolex isn’t a status symbol; it’s a guarantee that I have on my wrist an instrument that has been carefully crafted down to the last detail, that I own a watch that will still be in style 40 years from now. Another point in its favour is that Rolex is the only brand you can sell immediately if you need the money, without losing too much of its value. I know this from personal experience.”
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UR-105M Iron Knight by URWERK Titanium and steel watch equipped with a Calibre UR 5.01 manual-winding mechanical movement with 42-hour power reserve. Hours, minutes and 10 seconds indications, lateral seconds and power reserve indications, control board: ‘Oil Change’ and power reserve indications, timing adjustment screw. Sapphire crystal with anti-reflective coating, waterresistant to 30 metres. www.urwerk.com
EDITORIAL The Empire Strikes Back COVER STORY URWERK – Past and Future clash in the Dark Knight and Iron Knight BASELWORLD Everything and its Opposite WorldWatchWeb – Social Media & Baselworld The Kaleidoscopic World of Jewellery Watches The Beautiful Game comes to Baselworld The Sports Watch Segment continues to be Popular Getting a Handle on Fashion watches The Basel Marathon Ice, Jungle, Savannah and a US General come to Switzerland RETAILER CORNER Retailers under Pressure from Watchmakers as never before LAKIN@LARGE After-Sales What?
Read all articles on www.watch-aficionado.com
This unique status did not come about by chance; it is the result of continually improving product quality, combined with a pioneering marketing strategy that, from the brand’s earliest days, has gradually built up an image of solidity, reliability and professionalism. Conceived as an avant-garde piece of technology (being both automatic and waterproof), it was only gradually that Rolex acquired its status as a symbol of success and social standing. The risk, of course, is that this image is turned against it, as we saw in France a few years ago, when a sunbed-tanned publicity mogul with more money than sense declared: “If you haven’t got a Rolex by the age of 50 your life is a failure,” sparking a national outcry. Through no will of its own, Rolex has come to represent the epitome of luxury, even though products bearing the famous crown probably offer some of the best value in the entire watchmaking industry.
The risk that this image of excellence might begin to crumble under the weight of continuing attacks and scandals, that the desirable icon could become a hated symbol, cannot be brushed off lightly. Up to now Rolex, true to its reputation for discretion, has appeared to be keeping a low profile. The recent surprise appointment of Jean-Frédéric Dufour as managing director certainly marks a change in direction or, at the very least, an adjustment of strategy. It was crucial to counter the risk of a gradual fall from grace, and show that Rolex is not just the Fort Knox of watchmaking, but a powerful and living enterprise, creative, dynamic, and with its sights set firmly on the future. To see a young and charismatic figure (JeanFrédéric Dufour is just 45 years old) installed as MD of the watchmaking giant, one who moreover earned his spurs outside the Rolex stable (he was CEO of Zenith after working for Chopard, among others) is in itself a minor revolution. And it sends a clear signal that the “Empire” is about to strike back. But if there is to be a counter-strike, it probably won’t be a terribly spectacular one. There is no reason to expect a radical change of attitude, to believe that Rolex, that paragon of media reticence, will start shouting from the rooftops. No, what we shall see is an unhurried, measured effort to reaffirm the relevance of Rolex’s watchmaking approach, particularly with the newer generations for whom Rolex watches reflect a somewhat conservative image. Paradoxically, then, JeanFrédéric Dufour will do for Rolex the opposite of what he successfully achieved for Zenith. Appointed to replace the overly flamboyant Thierry Nataf, at Zenith his task was to calm things down, restore reason and return the firm to more serious watchmaking. As MD of Rolex, on the other hand, he will need to temper the brand’s staid horological image with a dash of youthful flamboyance. But the great advantage of working for such a stable “empire” is that he knows he can take all the time he needs. p
BASELWORLD
Everything and its opposite Through the aisles of Basel, lined with chapels and cathedrals Baselworld: mile upon mile of aisles, lined with hundreds and hundreds of booths looking every inch like places of worship, each dedicated to its own particular divinity. Whether the symbol is a crown, any number of crosses, an alpha or an omega, every brand, large or small, is hoping to attract new converts. It would be impossible for anyone hoping to join the ranks of the faithful to investigate them all, even if they share the task, as Europa Star has done in this issue. The visit is thus necessarily subjective, leaving plenty of room for chance encounters and serendipitous events. We therefore propose three different routes, respectively taken by yours truly in this article, by D. Malcolm Lakin (The Kaleidoscopic World of Jewellery Watches; The Beautiful game comes to Baselworld; The Basel Marathon; Ice, Jungle, Savannah and a US General comes to Switzerland) and by Keith Strandberg (The Sports Watch Segment; Getting a Handle on Fashion Watches). Without forgetting the DLG analysis on the effects and aftermath of this horological Mass on the social networks.
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Reflecting the paradigm shift
2013, according to official figures – although still well short of the Sochi Olympic Games at 13,000!
In her opening address Sylvie Ritter, Managing Director of Baselworld, stated loudly and clearly that it was the aim of the international watch fair “to provide a faithful reflection of the upheavals the sector has experienced over the last ten years.” In terms of those “upheavals”, two major phenomena have converged and accelerated over the last decade. The inexorable rise to power of the big groups, which today are more dominant than ever, has coincided (by chance?) with an astonishing media infatuation (nurtured at great expense, admittedly) with the world of watchmaking and which shows no signs of diminishing. More than 4,000 journalists attended the fair, almost as many as the über-famous Cannes Film Festival - 3,907 in
In ten years the watch itself has undergone an astonishing transformation. Initially a nice-looking, more or less disposable utilitarian object, it has now achieved star status, becoming virtually a cult object, invested with enormous symbolic weight and value. We often hear the word “icon” being used about certain watches that have achieved cult status. But perhaps the word “cult” is appropriate on more than one level. After all, it is very tempting to read Baselworld and its booths (from the smallest at 6m2 to the largest at 1,625m2) as so many chapels, lined up next to one other; temples, cathedrals even, dedicated to an array of different forms of worship. There are the great monotheistic religions that continue to domi-
nate, such as Rolex, whose temple is an impenetrable mausoleum (its “religion” continues to hold sway but, like the Vatican, it risks losing its influential position unless some way is found to revitalise and rejuvenate its message - see our editorial,“The Empire Strikes Back”). Opposite, Patek Philippe, another pillar of monotheism, has built itself a new altar, at the foot of which we are invited to worship the cult of transferable perfection: a white cloud is suspended in the centre of a glass cube. Both these monotheist establishments (although Rolex has successfully launched a new cult named Tudor) are surrounded on all sides by active pantheistic religions u
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BASELWORLD
that encourage a multiplicity of different branches and schools, which may or may not be strictly fundamentalist, in the name of “authentic watchmaking”. Thus, Louis-Vuitton-Moët-Hennessy (LVMH), which is stationed at the entrance, lines up its various and varied tributaries side-by-side, from the Roman Bvlgari to the severely Protestant Zenith, not
ex nihilo. In the wonderful polyglot bazaar of Baselworld (which could as aptly be named Babelworld...) you can find everything, and its opposite. But let us put aside the religious metaphor and look at the facts: what did they all have to offer? Journalists returning home from the great annual watchmaking fair are ritually asked the same question: so, what’s new? What are the trends?
In ten years the watch itself is becoming virtually a cult object, invested with enormous symbolic weight and value. forgetting the charismatic Hublot or the methodical and unstoppable TAG Heuer. Louis Vuitton, the eponymous brand whose worshippers are notoriously faithful, hosts its congregation outside the walls, in the Wildt’sches Haus, an 18th-century villa named after a manufacturer of silk ribbons (as fashionable in their day as watches are today). At the geographical heart of the Baselworld compound sit the tentacular headquarters of the most pantheistic of watchmaking religions, whose name resonates around the world: Swatch (Group). Swatch promulgates a polychromatic faith, welcoming all congregations with open arms – populist, elitist, and all shades in between – embracing the world in all its contradictions. All around these giants, up stairs and around corners, myriad smaller cults attempt to reach out, to grow, or simply to survive, to win over some new converts, to be reborn from their ashes, or to break through 6
Well, watchmaking has always been a faithful reflection of its time. In 2014, it is absolutely anything you want it to be, and its opposite. There is truly something for everyone, from the enormous musclebound timepiece for the chiselled hero returning from a dangerous mission (the award for this category goes to U-Boat and its monumental watch whose thick glass is deliberately smashed before sale, a little like those ripped jeans that cost more than an unblemished pair...) to the Saxon ultra-purity of three hands against a white dial (the award here goes to Moritz Grossmann with its balance wheel stop-mechanism made of human hair: that of the CEO). Let us nevertheless attempt an analysis. (…) An exceptional examination of Baselworld by Europa Star’s Editor-in-Chief. To read the article, go to www.watch-aficionado.com
WorldWatchWeb
SOCIAL MEDIA From Education to Sales Generation, Watch Brands’ Digital Presence Peaks at Baselworld 2014 Social Media has altered the way brands are communicating with their customers, rapidly becoming a tool of choice to reach out and interact with them efficiently. Product launches, event coverage and celebrity endorsements are some of the key marketing techniques that are featured daily on all main social channels. Baselworld has the unique ability (with SIHH) to unify all these elements in order to convey a clear brand value that is shared with the world. Even the most traditional of watch and jewellery brands are leveraging on social media to ensure the highest visibility possible and be desired by their aspirational clientele during the most important watch fair of the year. The digital world is gradually becoming a medium to touch base with professionals (even watch dealers.) Brand marketers are more and more conscious of this reality and are seriously investing in their digital presence (website, e-mail marketing, banner advertising and social media). Their ultimate objectives being to differentiate themselves, to increase brand awareness and their reach. A few weeks before the world’s largest watch and jewellery trade show started, the social war had already begun on your screens. At Digital Luxury Group, we noticed (and managed), starting early March, numerous advertisements on Facebook’s News Feed by promoting watch and jewellery brands. They were hard to miss because of their frequency, creativity and precise audience targeting. In fact, if you came across one yourself, it was not a coincidence! Brands are targeting their audience by market (ie: USA, Russia, etc.) and by interest (ie: Hublot, Harry Winston, etc.). Social Media offers unique and cost effective techniques to reach markets in both B2B and B2C audiences. (…) Discover how Facebook and Instagram affect Baselworld at www.watch-aficionado.com
BASELWORLD
The Kaleidoscopic world of Jewellery watches A look at what some of the brands are creating to entice the ladies I was looking forward to feasting my eyes on the Graff watch that seemed to be on everybody’s lips during Baselworld. I had already heard rumblings and rumours concerning their Hallucination timepiece, imagining that it would somehow resemble Cartier’s 1929 Art Deco tutti frutti platinum bracelet watch that was set with diamonds, emeralds, sapphires and rubies. But nothing could have been further from the truth. When I actually set eyes on the kaleidoscope of rare coloured diamonds that make up this unique piece, I realized that it came from a different world, a place of dreams, of fantasies, perhaps even an hallucination. “The Graff Hallucination is a sculptural masterpiece;” Laurence Graff, the Chairman and founder of Graff Diamonds said of the timepiece, “a celebration of the miracle of coloured diamonds. For many years I have thought about creating a truly remarkable watch that illustrates our all-consuming pas- sion for diamonds. The Hallucination has made my diamond dream a reality.” But this dream, this quite exquisite combination of 110 carats of multi-coloured diamonds that somehow blend together, that shimmer and shine from every angle, that took thousands of hours to create, is like nothing you have ever seen in a watch before – or, probably, will never see again. The delicate colouring of these rare diamonds bears no relation to the obscene ‘in-your-face’ multi-carat single gemstones that Sotheby’s and Christies are more than happy to auction, these gemstones subtly fuse into a white gold bracelet with, at its centre, a miniature Swiss watch with a quartz movement showing, rather discreetly, hours and minutes. As a piece of art it is exquisite. As a personal adornment it works. As a watch, let’s be honest, it leaves something to be desired - the movement is quartz and reading the time on a mini-
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The Beautiful Game comes to Baselworld “Some people believe football is a matter of life and death, I am very disappointed with that attitude. I can assure you it is much, much more important than that.” Bill Shankly, Liverpool Manager, 1959 – 1964
At Baselworld this year, I counted six brands that were caught up in the all-consuming world of soccer: JeanRichard and Arsenal; Hublot and Chelsea’s Mourinho and the 2014 FIFA World Cup; Maurice Lacroix and Barcelona; Rotary and Chelsea; Ritmo Mundo and Brazil players and Breitling for Bentley and David Beckham. Football or soccer, depending on your continent, is a spectator sport, so this particular article, although it introduces you to the relationship between watch companies and the world of football, it is as much for your visual enjoyment (see Ritmo Mundo) as for your appreciation of the horological values of the illustrated timepieces. (…)
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ature dial in a maze of colour is a little bit of a challenge unless you’ve been at the kryptonite – but if you have that price tag of 55 million dollars won’t be a deterrent! (…)
In addition to Graff, there are magnificent illustrations of watches by Jacob & Co., Rolex, Bulgari and de Grisogono. To see and read about them simply go to www.watch-aficionado.com
With the World Cup in full swing, here’s your chance to see and read about who wears what by connecting to www.watch-aficionado.com
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COVER STORY
URWERK – Past and future clash in the Dark Knight and Iron Knight
The new school of watchmaking owes a great deal to the URWERK company, which has captured imaginations since 1997 with a string of pioneering creations. URWERK has indeed appeared to break decisively from the conventional round dial with central hands by proposing innovative indications of the hours and minutes with revolving satellites.
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Although this style of watchmaking was immediately hailed as being at the forefront of modernity or even as decidedly futuristic, it is too easy to forget that it is in fact rooted in the past with its origins in 17th century. 8
URWERK’s watchmaking, however much apparently at odds with tradition, owes much to ancient watchmaking and more precisely to the Campani (or Campanus) brothers who, in 1682, presented Pope Innocent XI with a revolutionary night clock. The pope wanted to be able to tell the time at night without having to light a candle or a lamp. The innovation, signed Petrus Thomas Campanus inventor Romae 1682, consisted of an oil lamp placed inside a wooden clock case. The lamp lit up transparent hours numerals in rotating discs. The hour travelled along a semi-circular arc in an aperture in the dial, its position indicating the minutes. When the hour numeral disappeared on the
right of the arc, the following hour rose on the left, imitating the passage of the sun from horizon to horizon. The watchmakers of the 18th century took up his brilliant idea by developing a system of satellite hours known as wandering hours, which had their moment of glory in pocket-watches. In its usual configuration, the 12 hours are divided into three sets of four hours (1,4,7,10; 2,5,8,11; 3,6,9,12) appearing on three different discs. The hours follow one another in turn along an arc graduated in minutes. The system thus combines a digital display and an analogue indication in an intuitive way of telling the time.
A formal and technical reinterpretation URWERK reinterprets this principle in a radical and contemporary manner, adding sophistication and a level of technicality and precision that the wandering-hour watches could never achieve. The satellite system was first applied in the UR-103, launched in 2003, and “the first URWERK watch that won the respect and understanding of the market” according to Felix Baumgartner, the watchmaking soul of URWERK which he founded with the designer, UR-103
Martin Frei. In the UR-103, the 12 hours are in groups of three, each on the satellites at the end of four arms of a central carrousel. As the carrousel goes around, the four satellites pass successively over four Maltese crosses that turn the satellites so as to display the right hour. The turning of the satellite in the UR-103 takes around five minutes and is hidden beneath a wide central strip that divides the dial. “If the appearance of the satellite displaying the correct hour seems like technical magic, the force required by the rotation of the satellite is a specific action taking place every hour,” explains Felix Baumgartner. “Watchmakers, of course don’t like this temporary demand for extra energy since it results in a periodic loss of amplitude, which makes the mechanism more difficult to manage over the long term.” Another tricky issue is that the central carrousel of the UR-103 turns on a tiny ball race in order to reduce friction. “However with time and the shocks that a watch on the wrist must endure during its existence, a certain amount of looseness can occur,” continues Felix Baumgartner. “We became aware of this through our after-sales service.” These technical reasons and also the stylistic considerations that we describe below led URWERK’s creators to come up with a new approach to the same satellite indications in the UR-105M (M for manual).
The new UR-105M The new UR-105M lacks the central band that hides the change in the satellite’s position from view. Instead the dial is completely open, concealing nothing of the satellite ballet. This takes place progressively and in full view, eliminating the bursts of energy that are detrimental to the constant amplitude of the balance. The four satellites fashioned from aluminium for the sake of reducing weight are attached to a structure made of a biocompatible polymer called PEEK (polyether ether ketone) used in surgery. PEEK is very hard, hardwearing and light. It can be machined, needs no surface treatment and can be decorated almost as if it were a metal. The carrousel protecting his structure in PEEK is no longer on ball bearings but on a long central shaft for precision, held by two jewels and a bolt that is visible in the centre of the watch. The aluminium satellites are coated with black diamond-like carbon (DLC). The entire construction is no longer held from on top as in the UR-103, but from beneath. The complex central component on which the four satellites are attached (see diagram opposite) is machined out of non-corrosive coppernickel alloy (ARCAP) while the four Maltese crosses that turn the satellites are machined out of a self-lubricating bronze-beryllium alloy. The entire operation of this astonishing mechanism is progressive without recourse to an additional supply of energy. Setting the time brings the continuous motion of the satellites into play with appreciable elegance and exactitude. u 9
COVER STORY T UR-105M IRON KNIGHT
“Technical challenges are at the heart of our watchmaking, but the performance is elusive,” says Felix Baumgartner, “since it’s a matter of moving complex but very light structures with horological precision. The other challenge posed by the UR-105M is quite different,” he adds. “It involves the openworked small seconds hand that indicates 10-second periods on the bottom right of the dial, which has to be synchronised with another seconds hand that can be seen on the right side of the watch.” This lateral seconds indication on a red anodised aluminium cylinder is placed under a fitted lens. Next to it, also under a lens, is a horizontal power-reserve indicator. If you turn the watch over, you’ll find URWERK’s characteristic control board as evidence of the company’s concern with precision timekeeping. It includes a 42-hour power-reserve indicator, which is more exact than the warning indicator on the side of the watch, a five-year gauge that tells the owner when it’s time to service the watch (humorously referred to as an oil-change indicator), as well as a fine-tuning screw to adjust the rate, with its scale in a small arched aperture.
A steel shield on a titanium body This delicate and effective satellite mechanism driven by a Zenith calibre is resolutely guarded by a tough and purposeful case topped by a big crown at 12 o’clock. The designer and URWERK’s co-founder, Martin Frei, is well known for his Star Trek-inspired futuristic imagination. Less well known, however, is that another of his muses comes from the past — medieval armour. This extraordinary idea had already been seen in another URWERK timepiece, the very complicated UR-110, but it takes a dif10
ferent dimension in the new watch. As Martin Frei points out, “the case of the UR-105M was entirely conceived as a suit of armour. The visible screws on the face of the watch, protected by covers, are not just stylistic features; they are there to hold a proper steel shield against the titanium body. The parallel with knightly armour is obvious to me: you have this force emanating from the armoured bezel that protects an ostensibly fragile mechanism from the violence of the outside world.” This analogy is not altogether obvious to those who can only spare a glance at a watch that
seems more futuristic than medieval. But the potency and aptness of the inspiration become apparent if the watch and a suit of armour can be directly associated. Martin Frei therefore took Felix Baumgartner to see one of the remaining traditional armour-making families who are still at work in the Austrian alps. These heirs to a 600-year-old craft had just received an unusual order: to replace the 120 antique suits of armour worn by the Vatican’s Swiss Guard. Put side by side, the UR-105M and a traditional suit of armour reveal a remarkable formal and functional family resemblance.
It therefore seems logical for the two versions of the UR-105M to be dubbed Iron Knight and Dark Knight. Both have titanium cases with shot-blasted steel bezels, but the former has a circular and vertical brushed finish while the latter has an aluminium titanium nitride (AlTiN) surface coating. The cases do not have screw-held backs because the movement is fitted from the top, but their taut lines mean hat they are complex to machine and to make water resistant, for there are nine openings and as many critical points in the cases.
Just as the wandering hours are directly descended from a 17th century clock, the UR105M is rooted in the old days of chivalry. Who would have guessed that the most decidedly avant-garde watchmaking would be so much inspired by age-old techniques and practices? In fact it’s not surprising once you realise that Felix Baumgartner grew up in the workshops in Schaffhausen where his father restored antique clocks and watches, and that he had a close-up view of the fabulous mechanical interiors of many a venerable and historic
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clock. One can imagine the child fascinated by these scientific and mechanical playthings. This genuine and deep-seated horological culture is combined with the fantasies of Martin Frei, engendered not by watchmaking but by art schools. He is free to deploy its effects and inspirations beyond the watchmaking mould, giving URWERK’s products a depth, originality and a liberty that are undoubtedly unique in their kind. p Discover more on Urwerk at www.watch-aficionado.com 11
BASELWORLD
The Sports Watch Segment continues to be popular The sports watch is moving in three distinct directions: Sports Style. General Sports. Sports-Specific/Professional. These three very diverse groups demonstrate how popular “sports watches” truly are.
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Sports Style Entry level and fashion brands have appropriated the look of sports watches, without the high specifications. This way, the consumer can look sporty without having to spend the money to actually own a sports watch. This is a big segment of watches, as the look is a strong one and the price can be quite modest, it doesn’t require a manufacturer to do any real sports testing nor to make it highly shockproof or water resistant. “We find ourselves in sport-inspired watches featuring design elements such as: pure shapes with a sport-chic touch, structured and coloured silicone straps, perforated leather straps, iconic dials, over-sized cases, multi-eye function movements,” says Andreas Schwörer,
Sales Director Tommy Hilfiger Watches & Jewelry & Juicy Couture Timepieces for Europe, Middle East & Africa. A company like TAG Heuer is an interesting study, as the brand started with sports-specific timepieces and has evolved into having collections that are truly sports watches and having collections that are, as Stephane Linder, president, says, “sports-inspired. We are not just a sports watch brand, we are a brand inspired by the value of sports,” he notes. “We have real sports watches and we have sports inspired watches. These timepieces still have character,
but they are elegant and upscale watches. We have moved from professional sports watches to a prestige company that has sports watches, and much more.” (…)
If it’s sport watch models that interest your client such as those from Juicy Couture, Tommy Hilfiger, Ferragamo, TAG Heuer, Shinola, Maurice Lacroix, Rolex, Tudor, Citizen, Reactor, JeanRichard, Bell & Ross, Bremont etc., read about these and many others at www.watch-aficionado.com
Getting a Handle on Fashion Watches Fashion Watches at Every Level of the Watch Industry If you thought dealing with the tremendous number of watches introduced at Baselworld this year was challenging, consider what the watch industry’s fashion brands have to contend with. Instead of product introductions once a year, they have four major introductions, one a season, and for some companies, this can be hundreds of new products each time. It’s a big challenge, but the volume of watches fashion companies move is a big enough reward to make it all worthwhile.
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Brand Names The fashion industry is driven by brand names like Gucci, Chanel, Dior, Ferragamo and others. There are also fashion elements to many mainstream brands and fashion watches that follow the trends established by the bigger brands. In fact, it’s a bit difficult to define the fashion watch segment of the industry, as there are so many players at so many different levels. (…) 12
With designs and prices to suit most pockets, and fashion watches setting the trends, catch up with the latest creations on www.watch-aficionado.com
BASELWORLD
The Basel Marathon Discovering the soul of Baselworld requires more than two sturdy soles
Ice, jungle, Savannah and a US General come to Switzerland A brief look at three brands that dare to be different Ice-Watch: In seven short years, Jean-Pierre Lutgen, the amiable CEO of Ice-Watch, has brought a breath of fresh air to business and a colourful revolution to the wrist of millions by offering truly inexpensive watches in a myriad of spectacular tones, various sizes and innovative and trendy styles. Last year sales reached the 3 million mark at prices ranging from 69 euros to 129 euros for a chronograph and 149 to 209 euros for the Limited Edition of BMW Motorsport watches. This year, in addition to the ever-popular and vibrant silicone models there are new collections using materials, in addition to silicone, such as stainless steel and carbon for the cases, Swarovski crystals and leather, canvas and nylon for the straps: Ice-Canvas, Ice-Crystal, Ice-Checks, Ice-Electrik, Ice-Denim, Ice heritage, Ice-Polo, Ice-Sporty, Ice-Style and Ice-World etc. Patton: Just days prior to the opening of Baselworld 2014, Jean-Pierre Lutgen, Ice Group’s CEO, announced that his company had acquired Patton Watches. Patton watches are Swiss Made, robust and more than capable of withstanding the elements as the flagship model the P42 Hyperbare
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A somewhat tired looking exhibitor at Baselworld confided in me that he had calculated he and his staff each cover around three kilometres a day just walking around their booth. I smiled and explained that the average journalist probably covered the equivalent of at least one marathon (42.195 kilometres) as we trudge around the various halls attending press conferences and then probably complete another in our annual quest for the watch of watches. (…)
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has proved – having been submerged in the depths of the Indian Ocean for more than five years, it continues to this day to give the correct time. The unique feature of this model is that the movement and all its parts are permanently immersed in a liquid using a special process. Jean-Pierre Lutgen was drawn to the brand by both its name and history. As he explains “The acquisition means the beginning of a genuine partnership with JeanLouis Le Bec, the founder and grandson of watchmakers, and the furthering of the group’s development into the Swiss Made category.” Gc: Now firmly established as a Swiss brand, the Gc label of ‘Smart Luxury’ clearly does not impede it from creating watches that are strikingly unconventional. This year, its upbeat approach brought two head-turning models, the Gc Rainbow Python and the Gc African Dream Collection. With a similar horological landscaping, the two collections also connected via wildlife: the Brazilian jungle and the African savannah – the python and the giraffe. (…) For a closer look at what these colourful brands are proposing to the consumer, read on at www.watch-aficionado.com
This is an in-depth look at some of the watches and brands that had a statement to make at this year’s eight-day showpiece. To see the illustrations and descriptions of the numerous superb creations by names such as Frédérique Constant, Eberhard & Co., Graff, Bell & Ross, Pilo & Co., Omega, Gc, Rolex, Manufacture Royale and Franc Vila to name but a few, go to www.watch-aficionado.com
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Retailer Corner
Retailers under pressure from watchmakers as never before Tensions mount. No more free rides. Swatch Group is to invest massively in new company-owned stores. Watchmakers, particularly at the higher end of the market, are getting tougher with watch retailers. Over the last ten years or so, relations between the two partners, which were previously untroubled, have taken an entirely different direction, to the dismay of watch retailers and distributors both. The honeymoon is over. The phenomenon is not a new one; the number of single-brand stores has mushroomed over the last decade, but the stakes are getting higher and tolerances lower. Bernard Fornas, Co-Chief Executive Officer of the Richemont group, recently sounded a warning note in Le Temps. “We need a level of excellence in the distribution sector. Retailers must become more active partners, they must help us to build our brands and project our image in their sales outlets. Indeed, and I don’t say this lightly, we have become significantly stricter about the quality of our partners.” In other words, some of them no longer make the grade. Consequently, in recent years the Geneva-based luxury goods group has opened a number of its own shops and franchises. The result is that the group, headquartered in Bellevue, now generates 52% of its income via its own sales network. As of the end of September 2013 (based on the first half of the 2013-2014 financial year), the group owned a record 1043 shops around the world.
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Swatch Group: “Some way to go” Swatch Group, although in second place, is quickly gaining ground. The watchmaking world number one is set to continue expanding its network of shops through 2014 and beyond. Although at the moment its own sales outlets generate just 20% of overall revenues, this number is expected to grow significantly in the future. As Swatch CEO Nick Hayek said last week, sales from these stores could reach 14
30 to 35% over the coming years, although he believes there is still “some way to go.” Many of the group’s brands will be given their own retail outlets, in addition to which, new multi-brand outlets will continue to open around the globe. Take the example of Hour Passion, a label that brings together the group’s mid- and high-end brands. Present in airports since 2004, by the end of 2013 the chain had around fifty stores from China to Italy, Germany and the United Kingdom. Last year the concept was rolled out to a number of city centres, including London, New York, Las Vegas, Kuala Lumpur and Poznan in Poland. The first city-centre boutique was located in Rue de Sèvre in Paris. In barely thirteen years Swatch Group brand Omega has seen the opening of 123 own-brand boutiques, making a total of 322 sales outlets. Its boss makes no secret of his preference for singlebrand stores over traditional retailers. Stephen Urquhart told Le Temps: “In an ideal world, we’d only have corporate outlets. We can control our own destiny. It avoids all the inherent risks of a partnership, such as changes of management or bankruptcy,” he said. Retailers take note. These statements have not gone unnoticed, and have already caused something of a stir in Germany. Inevitably, brands fear that their competitors are being sold better, presented better and promoted better in single-brand stores. At the end of the day, it all depends on the margins offered to the retailer. And as Manuel Emch, CEO of RJ Romain Jerome notes, this figure is on a downward trend, falling from around 40 to 50% to less than 30% in recent years.
Swatch Group is targeting 35% of sales by ownbrand stores.
Rolex, a notable exception Nevertheless, the majority of brands cannot afford to dispense with their partners, or at least not entirely. And in any case, this is not the aim. Omega still uses 3,000 sales outlets in addition to its own shops. But the pill can sometimes be hard to swallow. “Brand X [name removed] opened a boutique in the same street as my shop, despite the fact that we had been partners
FUI BOUTIQUE BREGUET SHANGHAI
for over thirty years. It was like being stabbed in the back. Particularly since I wasn’t informed officially,” observes the owner of a number of watch outlets in Switzerland. However, not all brands are interested in building up a network of their own shops. Rolex is one notable exception. The “Crown” prefers to cultivate its differences. There are no own-brand Rolex boutiques on the horizon for the Geneva giant, which sets great store by its relationship with longstanding retailers such as Bucherer in Switzerland, arguing that they fulfill two entirely different roles. Rolex assures us that this approach is unlikely to change. Watchmaker Patek Philippe, which has significantly reduced the number of sales outlets in recent years (from 750 to 450), continues to focus on its retail partners. In the words of president Thierry Stern, “Without them, we simply would not exist.” Do single-brand boutiques affect the sales of retailers? The diplomatically-worded official response is that they don’t. But it is difficult to believe that this offensive has had no impact at all. Watch brand Hublot has opened 70 boutiques worldwide since 2007, concluding thousands of sales that would otherwise have gone to other outlets. However, no retailers are prepared to state openly that times are hard. Shops claim that they still have a role to play by offering diversity and providing a choice of brands to their clients. And it’s true, the customers are free to choose. What is also true is that the effects have been mitigated by the stratospheric increase in watch sales in recent years. Retailers have also benefited from “shopping tourism”, particularly from Chinese visitors. But what will happen if there is a sharp downturn? Who will remain in the game – single-brand boutiques or multi-brand retailers? The answer is worth its weight in gold. p
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