Carl F. Bucherer
Under the sign of the Manta ray Page 14
A EUROPA STAR GROUP PUBLICATION
WATCH BUSINESS PAPER | USA VOL. 53 NO. 300 | CHAPTER 4/2017 | WWW.EUROPASTAR.COM
Of bricks and paper, clicks and storms by
As a reading of this issue’s substantial “Brick & Click” dossier will reveal, watch retail is truly in the doldrums – or, more accurately, in total disarray. It finds itself not at a turn in the road, but at a crossroads of a hundred and one different routes. Should it take the traditional highway, lined with solid brick-and-mortar buildings, some of which, despite being brand new, are now falling into disrepair like ancient mausoleums? Or should it leave the physical world behind, metamorphose into electronic impulses and speed from click to click across the immense and lim-
The brands that come out on top will be those who understand that, while they can’t survive without bricks, they also need to be very active with their clicks. itless skein of the internet, hoping to catch something in its nets? Or should it take one of the narrower paths that wind through the long grass, follow the wind, become a nomad, open pop-up stores and invent new ways of doing business? The crossroads of indecision is peopled with hordes of people beset by doubts, unable to make up their minds. This way, or that? But the right answer to this question is not binary. The answer is more likely to be an “and” rather than an “or”. The solution is to choose a physical road, and at the same time to explore the virtual sphere. In short, we need brick and click, as one of our correspondents succinctly puts it (read the views of US consultant Steven Kaiser). The watch is a material object, and an object of desire, that needs to be touched, felt and tried on the wrist. And we need brick-and-mortar locations in order for this to happen, as well as to be able to compare this one with that one. When it comes to actually buying the watch, that’s where the clicks
come in. You can’t have one without the other. Any retailer who refuses to countenance both these options is doomed. Operators who confine themselves to a virtual showroom will find that many potential clients vanish into thin air. Nevertheless, for the time being, the brick-and-click landscape is something of a jungle. Yes, we are at a crossroads of indecision. New rules will have to be created, and the brands that come out on top will be those who understand that, while they can’t survive without bricks, they also need to be very active with their clicks. Physical retailers, whose bricks provide the venues for the material experience, play an essential role as influencers, advisors, guides and... after-sales service points! (We will be devoting a future dossier to this “blind spot” for the watch industry.) Abandoning the bricks would be suicide. We could say the same about our own role as a publisher. Instead of bricks and mortar, we have paper. But we also have the clicks. We are convinced that, without a parallel virtual presence, paper – a longterm medium – cannot survive. But without paper, online journalism – like a tap that is never turned off, forever emptying into the drain of oblivion – is condemned to an ephemeral and transitory existence. Yes, we need breaking news – it ensures we remain relevant – but we also, if we aspire to longevity, need reflection, analysis and perspective. And for this reason, paper – or brick – remains the best vehicle for weathering any storm. Paper-and-click, a bit like brick-and-click Since the beginning of the year we have revolutionised our paper edition, to increase our reach and promote our mission as an enduring place of reflection and analysis, serving the international watch industry. We have been present on the internet for more than 20 years (welcoming almost a million unique visitors each month). This autumn we launch completely redesigned sites in French, www.europastar.ch, and soon in English, Chinese and Spanish.
Brick-and-click a special dossier compiled by
Pierre and Serge Maillard
Once upon a time, things were simpler. A watchmaker would find an agent for each country. That agent had representatives who would pack their watch samples into their attaché cases and pound the streets, knocking on doors and visiting retailers. These retailers were largely family-owned businesses that stocked a variety of different brands; they were well established in a clearly delimited territory, with a wellunderstood and loyal clientele. In those days, people might refer to “my watchmaker” as they might have talked about “my baker” or “my florist”. This model, which survived throughout most of the 20th century, has gradually been eroded, to the point where it is now virtually obsolete. Many factors have played a part in this transformation. Some, such as societal and technological develop-
ments, are external to the watchmaking business. But others are entirely its own doing. First came the big groups’ ascent to a position of power, and the brands’ gradual reassertion of direct control over distribution, first in the form of subsidiaries, later through the proliferation of own-brand boutiques. Then came the internet revolution, which facilitated the creation of a direct link from producer to consumer, without the need (or expense) of numerous intermediaries. The edifice started to crumble. Watchmakers have been notoriously slow to seize all the opportunities afforded by the internet. After investing heavily in bricks and mortar (the bricks to vertically integrate their production, and the mortar to build their luxurious boutiques), it was only natural that they should try to resist the inexorable onward march of e-commerce. Now, they no longer know where to turn. The old mod-
el has been placed on life support, but that hasn’t made the new landscape any easier to read. The vertical integration of manufacturing has had the unfortunate side-effect of encouraging overproduction, which in turn has fed into a burgeoning grey market. Cracks are starting to appear in the mono-brand boutique model. Not only does it cater exclusively to a highly circumscribed and already loyal customer base, but any increased profit margins from the physical stores are entirely swallowed up by the running costs and exorbitant rents dictated by their prestigious city-centre locations. It’s a zero-sum game. Or worse. Clients, who these days often know more about the watches than the sales assistants trying to sell them, have been put off by outrageous price rises. (Continued on page 4)
Floral skeleton mechanical movement. 18K white gold, set with diamonds. Fine Watchmaking movement designed and developed by CHANEL Swiss Manufacture.
4 | WATCH.AFICIONADO
(Continued) Millennials are eschewing their parents’ ideal of luxury and turning to vintage chic, at a single blow overturning the brand hierarchy and forcing them into stylistic contortions. And we certainly haven’t heard the last of the smartwatch, despite its being dismissed as an irrelevance by most conventional watchmakers. Smartwatches have added to the general confusion and the mixing of genres, as well as cutting a swathe through the low- and midpriced segments. The backdrop to all this is the internet: a seething hive of special offers, discounts, amazing (or suspect) deals, opportunities, consumer-toconsumer trades, comments and opinions. Anyone intending to buy a watch today is spoilt for choice. Or, perhaps more accurately, they are overwhelmed and confused by the tyranny of choice available today. Where will it all lead? That’s anybody’s guess.
“Brick-and-mortar stores are still very important. You can dream about the product when you touch and feel it but not through a computer.” (Angelo Bonati, CEO of Panerai, in Style / South China Morning Post)
“The rise of e-commerce is advantageous to multi-brand retailers because, by virtue of our business model, we offer choice. And choice is clearly one of the key tenets of online retailing.”
Mono-brand boutique, multi-brand retailer, shop-in-shop, supermarket, electronics shop, souvenir shop,
general e-commerce platform, specialist e-commerce platform, brand website, social media,
“In places like Hong Kong, brick-and-mortar stores are so accessible. It’s convenient for customers to go into a store and try on watches. You might be able to sell limited-edition watches that are exclusively online but there won’t be so much of a competitive edge if the same watches are sold at boutiques with same prices.”
“Asked whether IWC envisions selling directly online at some point, (...) chief executive Christoph Grainger-Herr says it is a “logical consequence . . . The question is never ‘if’ but ‘when and how’.”
“McKinsey & Company projects that by 2025, the online share of total luxury sales to be 18 per cent, worth about 70 billion euros annually, making e-commerce the world’s third largest luxury market, after China and the United States.” (Style / South China Morning Post)
vintage e-commerce platform, sale rooms, online auction sites,
specialised agents, media e-boutiques,
eBay, concept store, etc.
In an attempt to see the wood for the trees, Europa Star interviewed various players, experts, analysts and retailers from around the world. We would like to thank them for their honest and open responses. From these testimonies and analyses, which bear witness to the dozens of different ways in which the actors concerned are attempting to keep their heads above (increasingly murky and turbulent) water, one vital lesson for the watch industry has emerged: bricks-and-mortar and internet retailing will have to find a way to coexist in the future. Steven Kaiser, a consultant in the USA, has coined a phrase that sums up the situation very neatly: Brickand-Click Watch Retailing.
“We cannot view e-commerce as a threat but rather as a challenge, and one more channel and opportunity to sell.” João Carlos Torres, Torres Joalheiros / Lisbon and Cascais
“When Omega launched its Speedy Tuesday model in January — its first watch sold directly to consumers online — the full run of 2,012 was snapped up in just over four hours.” (Financial Times)
(Jimmy Tang, CEO of Prince Jewellery and Watch Company, in Style / South China Morning Post)
Michael Tay, The Hour Glass / Singapore
“Online luxury watch sales – estimated at just over 3 per cent of the watch market, or around €1.1bn, in 2016 – remain a small part, says John Guy, a luxury analyst and managing director at Mainfirst Bank.”
“Ultimately, the divide between online and offline might become less important, says (The Watch Gallery’s) Mr Coleridge: ‘Customers are not the slightest bit interested in whether they’re buying online or in a shop. For them it’s a process.’” (Financial Times)
WATCH.AFICIONADO | 5
Coming Soon: brick-and-click watch retailing A top watch consultant predicts e-commerce will revive U.S. brick-and-mortar watch retailers by
It’s a tough time to be a brick-andmortar retailer in America. But to be a brick-and-mortar watch retailer is brutal. Malls are dying, store traffic is down, e-commerce is up, grey-market watch sales are booming, and authorised Swiss watch sales are tanking. “The United States remained weak (-5.9%) in the first half [of 2017],” the Federation of the Swiss Watch Industry reported in July. “The situation there has not improved for more than 12 months and for the time being there is nothing to suggest that the outlook will brighten soon.” So, why does one of the U.S. watch industry’s most experienced consultants say that the future of embattled multi-brand, brick-and-mortar watch retailers is “better than ever”? Because they will soon expand into to e-commerce. That’s the view of Steven Kaiser, founder and CEO of Kaiser Time Inc., a watch and jewellery consultancy in New York City. Kaiser has worked in the U.S. watch business for 35 years. In 1982, he joined the family business, David G. Steven, Inc., which distributed Baume & Mercier watches in the United States. Later, when the Richemont Group set up its own Baume & Mercier subsidiary in the U.S., Kaiser served as CEO for six years. In 1999,
he left Richemont to set up Kaiser Time, first as a watch distribution company, then as a consultancy specialising in the U.S. watch and jewellery markets. Europa Star met with Kaiser at his office in New York City to discuss the future of watch retailing in America. Kaiser says the most important development is the coming embrace of e-commerce by Swiss watch brands and their authorised retailers. The dominant trend in watch retailing in America will be “brick-and-click,” he says. “It’s evolving that way. The future is bright for the strong independent jeweller in conjunction with e-commerce. I don’t see brick-andmortar and the internet as against each other. I see them as supplementing each other.” Increasingly, so do Swiss watch companies and their authorised dealers. The current slowdown in the U.S. is concentrating their minds – and changing them – about e-commerce. Not everyone who shops online is looking for a deep discount, Kaiser argues. “There are intelligent customers who want to shop online in addition to shopping brick-andmortar. We are losing business as an industry because that customer cannot purchase watches the way they want to.” As a result, they either buy a watch from an unauthorised online site, or they buy a different luxury product online.
US RETAIL FACTS Average retail surface area: USA: 2.2 m2 per person AUSTRALIA: 0.9 m2 UK: 0.46 m2 In 2016, more than 7 million square metres of retail space closed down. This figure was reached in the first seven months of 2017. At the current rate, it is estimated that more than 100,000 jobs could be lost in 2017, in retail alone. In parallel, on Wednesday 2 August 2017, Amazon recruited 50,000 employees. In June 2017, Amazon paid 13.7 billion dollars for Whole Foods, the leading US brick-and-mortar supermarket chain specialising in natural and organic foods, with its 431 retail stores. It intends to create the shops of the future. (Figures published in Le Monde, 6/7/2017)
Watch retailing will be multiplatform. As the industry adapts to e-commerce, watches will be sold through a combination of brickand-mortar and online. Brands will be able to sell direct to consumers through their boutiques and their own e-commerce sites as well as through their authorised retailers via their brick-and-mortar stores and e-commerce sites. This will enable consumers to buy watches wherever they want. “It will work synergistically,” Kaiser says. “Some people will buy online, some in the store. Some people will educate themselves online and buy in the store. Some will educate themselves in the store and buy online.”
“I think the majority of customers still want to purchase luxury watches within a store environment. But there is an increasing percentage who don’t,” Kaiser says. “Let’s say the percentage is 10% to 15%. That’s enough for a retailer to see a decrease in traffic. We as an industry need to service that customer as well. If they want to purchase online, the industry must provide a luxury online shopping experience for them.”
A tipping point
The U.S. watch industry is at a tipping point on this matter, Kaiser says. Consumers are forcing the issue. They already buy luxury products online from fashion and accessory brands and from watch and jewellery retailers like Tiffany & Co. and Cartier. Those two iconic brands sell watches and jewellery online with great success, Kaiser notes. “Why does it have to be mutually exclusive? I think the consumer will continue to force the watch industry to adjust, which is going to make it better. Ultimately we all work for the consumer.” Savvy American jewellers also want e-commerce sales. The challenge is the partnership with the brands and their authorised retailers, Kaiser says. Both parties need to work together to effectively sell luxury timepieces online. “Brands need to provide the content and retailers need to provide a luxury experience to their customer equal to the experience in the store.” Swiss watch brands are getting the message. Top brands in the U.S. are currently working with top watch retailers on ways for authorised multi-brand jewellers to sell watches online. Kaiser declines to give details,
but behind the scenes there are a several initiatives underway, he says. “Influential brands are doing their homework. They’ll come up with solutions that help the industry move forward. The industry is responding to these changes slowly, but that’s all right. Historically the industry moves slowly. But it always adapts.” That’s what makes him so optimistic about the future of brick-and-mortar jewellers in the U.S. “In five years, we won’t be saying anymore, ‘Am I going to be online?’ or ‘Is e-commerce going to hurt my business?’ No, we’re going to adjust. Brick-andmortar and online will coexist.”
The future Kaiser summarises his vision of the future of luxury-watch retailing in America in three points.
There will be fewer, but better, stores. “There are currently too many jewellers in the market. We have way too many stores,” Kaiser says. However, America’s Swiss-watch slump (Swiss watch exports to the U.S. are in the third year of a downturn) is culling the herd of watch retailers. The result is a shakeout that will eliminate weak jewellers and leave the best ones in a stronger position, Kaiser says. “Nobody escapes the business cycle. It’s a tough market. We are in a low cycle, but it’s changing. The strongest retailers, who continue to incorporate online into their businesses, are going to do better. Their future is huge.”
The majority of watch sales will be done by multi-brand, brickand-mortar stores with an e-commerce option. Watch brands may well have their own brick-and-mortar boutiques and their own e-commerce sites. But those platforms won’t match the volume of a brand’s retail jeweller network, Kaiser predicts. “Brand boutiques are great for PR and marketing. But if you look at the U.S. market, very few brands do really well with their own boutiques.” As for brand e-commerce sites, “Some brand loyalists will go there. But the significant part of a brand’s business is with multi-brand retailers. Most consumers want to shop in multi-branded stores. The majority of the business will continue to be at the independent jeweller level.” Kaiser is aware of new forms of watch retailing cropping up in the U.S., like luxury-watch rental services and retailers selling luxury goods, including Swiss watches, in luxury apartment settings. The U.S. has always been a crucible for retail experiments, Kaiser says. Some work, some don’t. He cites TV shows like the Home Shopping Network and QVC, which have proved successful for some watch and jewellery brands. Inevitably, though, they are small experiments in a giant market. “Nobody is really reinventing the wheel,” Kaiser says. Such niche retailing amounts to “a little here and a little there, but it is not significant.” The big opportunity in the U.S., he says, remains with a national network of retail agents. In a country with six time zones, they know their local markets and have the confidence of the local consumer. “If I owned a brand today, I would work with my retail partners.” Kaiser says. “There are certain things that nobody can do to match the independent jeweller. The good ones offer service, selection and experience better than anybody.” Kaiser says most Swiss watch CEOs understand the importance of retail partners in the U.S. market. That won’t change as the market shifts from brick-andmortar to brick-and-click. “Brickand-click,” he says. “That’s the future of the luxury watch and jewellery industry.”
6 | WATCH.AFICIONADO
Getting future watch distribution right – the fate of an industry Statements by industry professionals made some 15 years ago reveal that even experts had only a vague idea about what watch distribution would look like today. No wonder, as our ability to forecast what lies ahead has become increasingly difficult. In a complex (meaning complicated and rapidly-changing) world, driven by the highly dynamic digital revolution, how can we be sure that the former and current values, structures and procedures of our social and economic lives will still apply tomorrow? Hence, predictions about the watch industry’s future in general and its distribution in particular will likely be scenarios with relatively fuzzy probabilities. And yet, it is tempting to take a look into the crystal ball. The sad destiny of other high-end product categories such as writing instruments, porcelain, the gentleman’s wardrobe, antiques and silverware, not forgetting the recent travails of the watch business, clearly indicate that no one can take a safe future for granted.
Dr. Frank Müller,
the bridge to luxury
The past decade In the decade from 1990 to 2000 the watch industry’s business model was still mainly classical. Although the quartz watch revolution of the 1970s had initiated a painful restructuring process in Switzerland, creating the first dominant player in the Swatch Group, the industry’s post-World War II structure remained intact: the flow of merchandise followed the manufacturer-distributor-wholesaler-consumer trajectory (NB: including some grey market and corporate business). The industry was full of independent brands forming a coherent pyramid with a few top-end, more middle-end and a larger number of low-end priced offerings. They would serve brick-and-mortar watch stores and jewellers in small, medium and big cities. At that time, the American consumer would have no knowledge about
watches and pricing in China, Chile or Australia – and vice versa. As a matter of fact, one had to go to the painstaking effort of pounding the aisles of Baselworld once a year to collect enough catalogues and price lists to get some kind of global overview (in those days they were still given away for free…). And the decade of the 1990s witnessed the first still tentative steps into potentially huge but virgin markets, eastwards of the established ones.
The heyday Around the turn of the millennium, five major forces started to impact the industry and, consequently, watch distribution: • The renaissance of the expensive mechanical timekeeper, • the introduction of more modern branding, • the internet revolution, • an accelerating process of concentration at the manufacturing and wholesale level, • a shift in the commercial focus.
Despite the quartz crisis, the Swiss watch industry had fortunately preserved its ability to invent and manufacture traditional fine mechanical movements, when consumers’ interest in traditional watchmaking returned suddenly in the early 1990s. With companies such as Blancpain (“Since 1735 there has never been a quartz Blancpain, and there never will be”) and TAG Heuer (“Don’t crack under pressure”), branding was modernised to offer consumers devices that would indicate not only the time, but also their social status. The internet started to give birth to new communication platforms that could spread information about brands, new products and their availability on a global scale. Collectors could share their enthusiasm internationally in pioneering forums like timezone.com or LOG (Lange Owners’ Group). Due to their substantial resources, worldwide networks and manufacturing abilities, the bigger groups were able to leverage their business and initiate a process of brand acquisition and concentration (e.g. Les Manufactures Horlogères/
Richemont, 2001) and supplier integration (cases, dials, hands etc.). On the distribution side, smaller family-owned brick-and-mortar stores outside of the big cities started to vanish, while a few in metropolises grew into national, sometimes even international chains. Reaching the markets through distributors or agents became a secondary priority for groups and brands. They now preferred establishing their own regional hubs and dealing with wholesalers directly. This led to new forms of partnerships with classical watch and jewellery stores, translating into more cofunded and co-organised marketing efforts in advertising, PR and events. To enhance recognition and image further, these partners were asked to install the suppliers’ branded showcases, displays and shop-in-shops – leading often to awkward-looking patchworks. And, in their quest for even more ways to boost sales and profits, brands commenced to truly integrate vertically towards the customer by opening boutiques (retailing), first as franchised projects with wholesalers, and later as their own stores. Furthermore, some brands experimented with factory outlets as a way of liquidating old stock. And based on the 1990s’ groundwork in emerging markets, major players were now able to benefit from the huge interest in Swiss and by then also German fine watchmaking in the former Soviet Union, the Middle East and, particularly, the Peoples’ Republic of China – while often neglecting their traditional markets. These five forces were the drivers of an astonishing success story: Swiss exports of mechanical watches with a value of more than 3,000 CHF per unit would grow by 12.2% from 2000 to 2015 – on an annual average! And this was done while simultaneously absorbing such disturbing events as 9/11, SARS, and the Lehman Brothers and Euro crises.
New realities Today, the watch industry is in bad shape. It is struggling not with the usual cyclical economic downturn, but with an existential crisis. The reasons are related to the same five forces described above, while new ones have appeared alongside. Some problems have come upon the industry from the outside, and yet many have been homemade. • The hype over the traditional and fine mechanical wristwatch as the industry’s main growth driver is over. Since 2012, the share of exported expensive watches (value +3,000 CHF per unit) of all exports has remained stable at 60% (2000: 23%) – and if it were to grow again then it would be merely a statistical effect, as Switzerland continues to export less inexpensive timepieces. • The consumer is changing. Across many related high-end product categories, shoppers simply care less about luxury and prestige (the “millennial” phenomenon). The customer base is shrinking as the demographic factor sets in (Europe, Japan, China). According to the United Nations, the growth rate of people aged between 25–59 years will be halved in the next 35 years, while the 60+ age group is expected to rise by 240%. Of course, the BRICs will continue to provide new middleclass consumers, but there will be far less potential than in the past. • Examples of truly innovative marketing and product concepts from the traditional brands over the last 10 years are few and far between. Patek Philippe, Hublot, MB&F, Richard Mille and Nixon could be named as rare examples. • The smartwatch meteorite has hit the industry completely unprepared. In the space of just a few years, Apple, Samsung & Co. now sell almost as many timepieces as Switzerland exports (21.1 million units in 2016). With high-end watch brands introducing Android-based timekeepers too (TAG Heuer, Montblanc), and the advent of 3D printing, LIGA, silicon et al., classical watchmaking continues to be replaced (e.g. cases). And with information being so abundantly available on the internet, the technical revolution will continue to downgrade the myth of the fine traditional wristwatch further. At the same time, omnipresent smartphones and tablets continue to render classical timepieces obsolete. At worst, the fine watch will become a niche collector’s item like a Japanese maki-e fountain pen.
WATCH.AFICIONADO | 7
THE FUTURE OF DISTRIBUTION
The distribution system will remain turbulent. Technology will impact further and require more interest and investment from industry actors. On the one hand, flexibility, creativity and speed will be important, while on the other, strategy and commercial discipline must ensure that money is spent wisely.
© The Bridge To Luxury
© The Bridge To Luxury
• Wholesale, retail, online shops, factory outlets and so many new ways of selling watches create a complex multichannel environment in which ambitious sales targets lead to an overflow of merchandise, eventually fuelling discounting and grey markets. Today, the liquidation price tag offered by grey market and online dealers for the slow-movers of any watch brand is some mere 20 cents on the MSRP dollar – and that means at variable production cost! Investments into retailing aimed at controlling the flow of products, prices, services and so on obviously make no sense if at the same time parallel channels are heavily nourished.
The decisive factor The key to the survival of brands, groups and the industry itself in this new, tough and perhaps even end game is very much related to the distribution question: commercial ambition and commercial discipline. Most of the industry’s current problems are self-inflicted, and caused by one essential misstep: greed. The key to survival is control over distribution, which nowadays essentially means control of online commerce, which implies control of goods being sold, which is linked to a company’s reasonable long-term business plan and the management team’s ability and willingness to stick to it. Some players have understood the challenge: in 2016, Richemont started to buy back merchandise from wholesalers to clean up the market. With a share in Net-à-Porter, the same group keeps a foot in the door of internet selling platforms to control online commerce – for the same reason LVMH has recently launched 24 Sèvres. Good moves. Richemont
has created a foundation for preserving traditional craftsmanship, while LVMH is investing in small luxury start-ups to keep the luxury industry’s offering alive and colourful. Good moves, too. Only if brand strategy and commercial ambitions are realistic, appropriate, long-term and converted into healthy distribution environments can the essence of the prestige of the luxury watch industry be defended: exclusivity! Exclusivity
• Up to today, the industry has rarely passed up any opportunity for a commercial push. On an annual basis, some 1,500 brands introduce around 15,000 to 20,000 new models – consumer overkill. Many firms have followed the car industry in introducing every possible category from A to Z, in order not to miss out (sports and pilots’ watches, traditional ones, master lines, ladies etc.).
Exclusivity = price points; volume = size of business. Scenario 1: healthy industry; Scenario 2: bigger volume business is pushed by global groups, yet independent brands disappear; Scenario 3: a growing business yet a shrinking one at the high end, due to the indifference of luxury watch consumers; Scenario 4: an overall shrinking industry due to declining demand, substitution by the smartwatch and industry mistakes.
The crystal ball However, in a stagnant and saturated watch market that will grow only moderately in the future (basically in line with national GDPs), even the most disciplined brands may give in and make short-term compromises. Gaining market share will be king. But what if, following the experience of other luxury segments, the market for mid-end and high-end watchmaking even shrinks? The industry’s homework for the future will obviously include more refined customer segmentation and marketing (including the elderly target group), truly creative branding concepts with epic story-telling, synergies and cost-sensitive lean operations, better customer service at reasonable prices, innovation and so on. But most importantly, the industry needs to leave its comfort zone and admit that the glorious past cannot be extrapolated any more. Yes, national banks change currency exchange rates and yes, governments introduce anti-corruption rules without informing the watch industry in advance. While it is a common industry experience that, every three to four years, major external calamities hit, most budgeting cycles from the corporate profit and loss statement down to single business plans for brand boutiques are based on a time horizon of generally no more than three years. Under such procedures, who feels obliged and is encouraged to bother about the next 10 to 20 years and to incorporate contingency plans for likely crises? The industry will be best served if – for a change – it expects the worst. So what can be expected from the future?
1. New channels:
7. New business models:
a) The digital revolution will create new distribution and communication platforms like call centres with brand videoconferencing, for more and cheaper 1-to-1 communication with consumers. b) Virtual reality boutiques with virtual solutions for watch fittings. c) Home stores: direct selling on the “Tupperware” model. d) Subscription stores: subscribers receive a new watch after an agreed period of time at a reduced price. Some subscription brands may even offer lease options.
Global centralised logistics will reduce classical wholesaling further. By becoming a “gallery” (hidden retailing), brick-and-mortar stores will no longer have to purchase collections. The wholesalers’ revenues will consist of commissions and/or retainers. Consumers will receive truly new watches delivered to their home from central brand warehouses, and headquarters will take full control over the customer relationship. After a likely difficult period of adaptation, groups and brands will be able to reduce inventory cost, increase stock rotation and better allocate watches to where the demand is.
2. Old wholesale concepts reimagined: a) Fusion stores: lifestyle-orientated multicategory points of sale. These could be co-branded stores with thematically related offerings. This is valid for intrabrand line extensions too: new product categories will demand more complex branding and experience-orientated store solutions (e.g. Shinola). b) Pop-up stores and mobile points of sale. c) “Gallery” stores: showrooms for presenting and testing the products physically.
3. New competition and distribution players: Information platforms (e.g. WatchAdvisor) will increase and transform themselves into paid agents, connecting brands and consumers.
4. Omni- and multichannel management: Enabling customers to shop anytime, anywhere, in whatever channel they want. All market players will take advantage of all distribution channels available. Online brands have started to venture into offline (e.g. Daniel Wellington), while brick-and-mortar stores are trying out online selling, increasing the need for professional multichannel management.
5. New (old) territories: To reverse the trend of luxury mainly being sold in the major cities (according to Bain, more than 50% of all luxury sales occur in the top 20 global metropolises), groups and brands will have to rediscover the neglected “mid-west”.
6. New efficiency: As market concentration continues, players will have to adapt their organisations to be cheaper, faster, more flexible, leaner and better. One special focus point: inventory management, with more globally integrated logistics chains and warehouse hubs.
8. Re-selling of retail: As not all retail is providing enough profitability to please shareholders, some car manufacturers (e.g. Mercedes-Benz) have started to re-sell parts of their retailing network to external investors. However, such outlets will continue to be under the indirect control of the brands, through contractual leverage regarding collections to be carried, pricing, corporate identity and design, etc.
9. Hyper-segmentation and demanding customers: Consumers will ask for more focused and better branding efforts at any touch point. With more demanding customers, point-of-sale experiences will have to evolve in parallel (e.g. home delivery of Hublots with a Ferrari; fragrance space at Harrods; the art of Ai WeiWei at Le Bon Marché). Branding fun, information provision, product testing and availability will have to be further harmonised; integrated marketing will be as important as ever.
10. Market research and smart stores: a) So far, the watch industry has been very hostile concerning market research and external consultancy. However, institutes such as Responsio’s “Watch Monitor” offer completely new and relevant consumer insights that will help the industry better understand the outside world. b) The smart store: with more market research and (digital) consumer data available, CRM systems will become more powerful and able to manage consumer relationships throughout the entire sales cycle. Artificial intelligence will ensure that offerings are more personalised at the point of sale. As was the case some 15 years ago, it is difficult today to foresee the near future in watch distribution. However, if the industry is now ready to learn more from past mistakes, especially regarding overly ambitious sales objectives, it will be better prepared to survive – and, of course, there will always be a demand for mechanical, prestige and luxury watches. Yet, renewed efforts in terms of strategic wisdom, operational flexibility, marketing and service creativity, and a great deal of investment will be needed – and not just in distribution. The future will belong to those brands that persevere.
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Business climate, competition and the digital future An analysis by Michael Tay, The Hour Glass / Singapore
Business climate The Hour Glass is present in the markets of Singapore, Malaysia, Thailand, Hong Kong, Japan and Australia. In 2016, in most of these markets, the watch industry experienced significant headwinds and contraction. For 2016, The Hour Glass saw a 2% decline in sales, and was fortunate to have sized its inventories to match demand conditions. For the watch industry overall, we see that there is still a general inventory overhang for several brands in the industry, which will take considerable time to be absorbed into the market. I remain hopeful that this can be done within the next 18 to 24 months. We continued to invest significantly with our core long-term partners: Patek Philippe, Rolex, Audemars Piguet and Hublot. These companies not only demonstrated tremendous resilience during this period, they each continued to consolidate their strengthening positions in the market. Though 2017 can be still characterised as a challenging environment for the industry, the outlook for the world has become somewhat lighter and with that, we anticipate more positive consumer sentiment to return. As an aside, it is vital that at every moment – and more so at times like this – the industry focus its efforts on enticing newer and younger enthusiasts and buyers into the watch collecting universe. It is only through them that our future can be secured.
Competition and the Digital Future The global retail landscape is littered with casualties of the changing profile of consumers and consumer behaviour. Baby boomers are all but retiring and Millennials born in the year 2000 will, by 2020, account for 40% of the luxury market, exerting their influence on global shopping habits with their minute-to-minute updates on social media of what’s hot and what’s not. Shoppers are hunting online for the lowest prices, and shopping malls and traditional retailers are struggling to attract customers through their doors. Even what were once considered mainstay fashion brands, controlling both their own standalone boutiques and webstores, are facing the threat of online retailers undercutting them on pric-
ing (excess inventory strikes again!). Other trending observations we have made are that in 2016, in mature retail markets such as the US, consumers spent 31% of their discretionary income on goods and 69% on services and experiences. Three decades ago, 45% of their spend went towards goods. To compound matters, by 2026, it is estimated that 25% of all luxury goods consumption will be online, leaving physical retailing of all goods products with only 20% of the overall discretionary spend of this consumer. With an increasing number of independent dealers starting up new businesses by way of establishing a social media account, the battle traditional retailers will have is to either define and demonstrate their relevance to luxury shoppers, or face their fate of retail redundancy. The watch industry is notoriously slow to adapt to change, and their recent embrace of the digitalisation of the world is approximately fifteen years behind the rest of the luxury goods sector. But now that the inevitable is firmly at the forefront of everyone’s strategic agendas, manufacturers and retailers are wasting little time in playing catch-up. Richemont is an example of a watch company whose leadership is embracing this digital transition with aplomb. Rolex too has internalised an entire digital division staffed with the best technology minds, and has begun to develop solutions to combat online grey marketeers and drive a superior omni-channel experience with their retailers. The implications are obvious and twofold. First, digital will be a key pillar of the industry. In the past year, several established brands owned by Richemont, LVMH and Swatch Group have sold limited edition capsule collections direct to consumers online, reportedly with tremendous success. These early wins will embolden them to further develop more such projects. What this tells us is that the conquest of the digital landscape is only just beginning, because as recently as last
year, the battle for sales still existed exclusively in the physical domain. Key luxury groups are now recognising that online retailing is an additional channel of distribution, and acts as a complement to their bricksand-mortar operations. The second implication is that to survive, bricks-and-mortar retailers must differentiate and specialise. The future is not solely predicated on how watches are sold, but on who will sell them. The demise of multi-brand specialist watch retailers has been bandied about for nearly a decade now. But, if anything, the current crisis enhances the strength of retailers with scale, reach and tech savvy, who have teams with deep specialist knowledge of the fine watch domain. While brands have been consolidating their distribution networks, the culling has been primarily on what the industry defines as “B” and “C” retailers. Networked retailers will be required to play a more important role in this transmutation of the watch ecosystem. The rise of e-commerce is advantageous to multi-brand retailers because, by virtue of our business model, we offer choice. And choice is clearly one of the key tenets of online retailing. The world leaders in luxury fashion are not the brand’s own webstores but rather e-tailers such as Sephora and Yoox Net-a-Porter. Success in the realm of online multi-brand retail is far easier imagined than accomplished. Our reading of the manoeuvring in the online luxury space is that developing a fullprice, multi-category, multi-brand platform is a challenge that even the most cash-rich luxury goods conglomerates have admitted diffi-
culty in navigating. Two years ago, Richemont divested themselves of online luxury fashion juggernaut Net-a-Porter, merging it with its direct rival Yoox and at the same time declaring that their rationale was because with CHF 5 billion in cash, they (Richemont) did not have the resources to become a winner in this space! It is also too early to speculate on LVMH’s attempt at building their multi-category, multi-brand e-commerce platform 24 Sevres and its eventual commercial success. With the watch industry, we recognise that there are tremendous opportunities to be exploited, and the argument for engaging online is evidently stronger than that of remaining on the sidelines. But we see three key challenges for any authorised watch retailer intent on developing a global e-commerce platform for new, primary market watches. Firstly, there is the notion of global pricing parity. Watches are not priced the same all over the world. Retail prices vary with historical market conditions, import duties, consumption taxes and foreign exchange rates. And the possible arbitrage between markets could be up to 25%. Several brands such as Rolex, Cartier and Omega are addressing this issue by geo-fencing prices based on IP addresses. A recent case of Omega releasing exclusively for sale, online, a special 2,012-piece limited edition watch was met with such overwhelming demand that Omega’s servers went offline several times in the span of a few hours. All the watches were sold to clients with the geo-fenced retail price of their home country,
and the difference was as much as 20%. However, due to the limitation of the offer, clients accepted, and many were not even aware of the difference. We cannot discount the novelty effect of such launches but, should they occur more frequently, the results are unlikely to be as robust. Secondly, there is the issue of crossborder selling. Brands continue to assign the privilege of online retail to themselves whilst restricting their traditional specialist retail partners to the geographies that they operate within. However, with the rise of omni-channel commerce and a prospective desire to lever off pure play internet re-sellers, this model may soon be put to the test. Specialist watch e-tailers with large common markets that embrace online buying such as the United States, Europe and China may eventually give rise to the next corps of specialist retailers of the digital world. Such a development, however, will take time to manifest. Finally, logistics. The single biggest logistical challenge for all watch brand owners and resellers is their ability to have a returns policy when selling online. Unlike other fashion and leather goods, the cost of refurbishment of a returned watch can be in the range of 2% to 10% of the retail value of the new watch, depending on its price. Additionally, when volumes increase, it is within reason to anticipate that a separate after-sales division needs to be created to accommodate the servicing of returned watches. Assuming the preconditions stated above have been met, the first positive news about the internet is that it doesn’t always pay to be first. The second is that, owing to the apparent lateness of the watch industry to embrace the online realm, the real winners of the game have yet to be determined. In this quest to discover the digital El Dorado, there will be room for several players to securely entrench themselves, and even more ways to eventually disrupt and dislodge them.
BRICK-AND-CLICK Future Two years ago, we recognised that The Hour Glass was facing an inflection point in its phase of business and organisational development, that for us to respond to the digitisation that was taking place in the watch retail industry, to be futureready, we had to unshackle ourselves from our incumbent mindsets and broaden our views of where the world and the watch industry were headed. In the past 18 months, we saw to that. We reorganised our senior management ranks and flattened our organisational structure, reallocated resources to bolstering our technology, customer experience management and engagement marketing teams, committed to a series of course-altering technological capital investment programmes and, most important of all, engaged in a process of augmenting our organisational culture to meet the new demands of our business and clients. Part of this journey is our emphasis on developing an omni-channel model that humanises the shopping experience every step of the way, from our online engagement with clients to their offline interactions with our corps of watch specialists. When we think about the consumer, we must consider that the new consumer is one that survives in an ever-present connected social environment. The merging or blurring of online and offline does not exist, as they are no longer mutually exclusive realms. A shopper, whilst engaged in a physical retail store and dialoguing with one of our watch specialists, will be concurrently online chatting with a friend, a group of friends or engaging in product and pricing research on their mobile device. Appreciating all these developments, our team invested considerable grey matter in architecting our technology roadmap, and is due to go live with our inaugural customer experience management platform – a solution that will form the backbone of our group’s omnichannel strategy.
Smartwatches Evidently, there is a market for wearable tech, and smartwatches form one segment of this category. They are very useful, and I personally wear a Garmin watch when I exercise as it provides instantaneously highly accurate data that a conventional analogue watch would not be able to do whilst on the move. So I believe that functionally, there is a bright future for such devices. And I do not believe I stand alone in this view. I am certain traditional watch clients are interested in smartwatches. But not for the same reasons they would be interested in a mechanical timekeeper. Smart watches are really just the new tool watches for collectors.
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“The clients’ desire for pre-owned timepieces”
Danny Govberg, Govberg Jewelers, Philadelphia, Ardmore, Clevelan
“Founded in Philadelphia in 1916, Govberg Jewelers’ speciality was limited to jewellery. But for the last 35 years, under the direction of Danny Govberg, the name has become synonymous with horology. Today, Govberg operates from their recently inaugurated headquarters in the Philadelphia suburbs and three welcoming showrooms in the Philadelphia region and Cleveland suburbs. Danny recognised years ago that selling new timepieces was only one avenue to support the life of a watch enthusiast, and he developed expert services – such as a highly active pre-owned watch initiative – to support the evolving needs of the watch consumer. Since then, a dedicated pre-owned buying division has earned the trust of thousands of clients worldwide, and Govberg actively purchases luxury timepieces from private collections and individual estates each day, including many in the form of a trade-in alongside the purchase of a new timepiece. And the company answers its clients’ increasing desire to purchase pre-owned timepieces with an ever-expanding, curated inventory of luxury pre-owned watches for sale. But this model is a reflection of the trust and confidence clients have when working with an established, authorised retailer. We have put in place (and continue to expand) a sophisticated team of watch enthusiasts with an deep understanding of secondary market value, and forward-thinking computer developers and engineers. This allows us to offer services across multiple platforms (plus communication via phone/ in-store), meeting the demands of tech-savvy luxury consumers and streamlining the processes of buying and selling pre-owned timepieces. These services are ultimately
the driving force for year-over-year growth in sales and revenue. In addition to watch selling and trading portals accessible on govbergwatches. com, Govberg also offers the ultimate toolbox for the enthusiast – a mobile app designed for collection management, ease of buying, selling and trading timepieces and access to the latest pre-owned inventory and news hitting the watch scene.
Sophistication, connection, influences… The modern consumer is increasingly sophisticated and connected, and digital technology affords exposure to an endless range of influences. Consumers are empowered by social networks and digital devices, and since they are no longer bound to a store’s hours of operation, they dictate how and when they want to interact with a brand. Accordingly, Govberg’s evolving business strategy maintains a focus on the end consumer, operating under the premise that time is the number one luxury. Govberg’s services are designed to save the consumer time, and we must be agile and focused as we bring new concepts and opportunities to the marketplace. This agenda is backed by extensive and reliable market data, with an ongoing emphasis on innovation and efficiency. In his personal thesis on ‘luxury commerce’, Danny Govberg sought to define the intersection of traditional bricks-and-mortar retail and e-commerce, when the conditions of personalised client service, education, expert counsel and tech-aided convenience are at peak levels. One pillar of luxury commerce is the consumer engagement that takes place before one steps into a showroom, lands
upon a homepage or picks up the phone. Through a product-forward video initiative, Govberg has leveraged the expertise of its media team to bring hands-on watch exploration to a global audience; communicating functions, features, provenance and context of new and pre-owned collections – at the reference number level. The digital space affords the flexibility that the consumer expects, so we bring your watch of interest to life on your iPad late at night, on your smartphone at a red light, and at any other moment that curiosity is piqued. Consumers enjoy access to Govberg’s highly-trained, conciergestyle associates via phone, email, live chat, in-app communication and, of course, the traditional dialogue at the store level. We focus on environments and opportunities to engage, connect and foster an authentic rapport, and that is achieved with respect to individual communication preferences. This also comprises collector events, casual gatherings, formal brand dinners and ultra-exclusive factory tours and trips; the relationship is fluid and does not require the confines of a store.” ABOUT Name: Govberg Jewelers Boutiques: Philadelphia, Ardmore, Cleveland Launch date: 1916 Category: High-range & middle-range Brands represented: Audemars Piguet, Ball Watches, Baume & Mercier, Bell & Ross, Breitling, Bremont, Bulgari, Cartier, Ebel, F.P. Journe, Glashütte Original, Graham, Grand Seiko, Hamilton, Hermès, Hublot, IWC, Jaeger-LeCoultre, Longines, Maîtres du Temps, Montblanc, Movado, Nomos Glashütte, Omega, Oris, Panerai, Patek Philippe, Perrelet, Piaget, Raymond Weil, Ressence, Rolex, TAG Heuer, Tudor, Ulysse Nardin, Vacheron Constantin, Victorinox Swiss Army, Zenith Website: www.govbergwatches.com
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“How can brands operate in the secondary market?” net. Today, we have a catalogue of 8,000 watches and we’re sending out the following message to the brands: we can help you, we’ve gathered mass data on people who are interested in your watches, whereas the traditional distribution model has broken down.
Andrew Block, Sophy Rindler and Tirath Kamdar, truefacet / online store
“Online watch sales are soaring and they’re not set to stop. But you find all kinds of things on the internet and we feel it’s important to offer a serious approach in the premium segment, with quality guarantees. Moreover, the market lacks transparency, especially about prices, and also quality when it comes to pre-owned and vintage watches, which is our niche. We founded TrueFacet three years ago in a growing online market and with state-of-the-art technology for pricing the watches we sell. We analyse a huge amount of data to set the right price. We offer guarantee certificates that insurance companies will accept, and we service the watches. The watchmaking industry hasn’t yet adjusted to the new digital reality, and traditional distribution is dying. Besides that, the brands have shortcircuited the traditional family retailer networks, which had personal relationships with their clients and their own identity, by launching their own boutiques, accelerating their extinction. The result has been a levelling out and homogenisation of
Supporting small brands watch distribution. Without meaning to, the brands have destroyed the important, strong link between traditional retailers and their customers that had existed for generations, killing a large part of the passion that went into the business, as well as a lot of expertise. Today, the boutiques take orders, they’re no longer genuine vendors. A few brands, like Rolex or Patek Philippe, have been cleverer, preserving or even stepping up their relations with quality, local retailers. And they didn’t follow the rush on China either, and they’ve retained a large American customer base. Today, they’re benefiting from that long-term strategy.
Even so, in growing many brands have lost the ability to convey their peculiarities, their capacity to communicate what made them so special, with their workshops in the Joux Valley... At the same time, the watches themselves have become more and more complicated, which has accelerated the disconnection from the baseline customer, especially the younger ones. The latter are very keen on buying pre-owned watches online at a low price. The challenge facing the brands is this: how can they act on this ‘secondary’ market in order to preserve their own market? Because their perceived value is at stake via the inter-
Today, the smallest brands, the independent ones, are obliged to work with agents, which affords them little visibility and slim margins. We want to support these small brands as a priority in the future by introducing an e-commerce platform for new watches dedicated specifically to them, quite separate from the already extant pre-owned model. That will serve them both as a marketing and a measuring tool, gathering very useful data. And maybe even, ultimately, help get them into traditional, quality retail stores! The pathways between digital and physical stores need rethinking. Today, 90% of our customer base is American, but we want to expand beyond the United States. Our main competition comes from person-to-
“A more direct distribution structure needs to happen” Sky Sit, skolorr.com / online store
“We set up an online shop-front for each brand on Skolorr, once they have been vetted and approved as a partner (to ensure trust, credibility, quality, ethos, etc.). We see the future of our business as running on a fair-trade marketplace model, because the next generations are more socially aware, more globally connected, more individualistic, more entrepreneurial, more digitally at ease with purchasing online (as many luxury consumer studies show). More shoppers question authenticity and provenance. The independents are a good fit for this growing profile, when we match/connect them online. Trust is there, exclusivity is there, provenance is there. When more independents come together on Skolorr, creating a bigger voice, we have a chance to gain more awareness and interest collectively, and more importantly, to inspire change. Buyers will benefit by having more knowledge of the true value derived from a timepiece, vs the perceived
value from celebrity endorsements and five layers of intermediaries, and then getting a 30–40% discount. The shift to a more direct distribution (fewer middlemen) structure needs to happen, slowly but surely – it needs to start somewhere, however small. The digital realm will enable that. We employ pioneering marketplace technologies to serve this purpose, and closely follow the emerging technologies such as blockchain, for when it’s more market ready in the future. I believe business is a force for good, and it’s about people. Skolorr as a business advocates win-win along
the value chain, to power the primary market where innovation occurs (hence, no pre-owned, no vintage, no buying and selling grey market stock, only direct from the makers to buyers). Also, to instil strong values in the process, to educate the next generations to be conscious of whom they are empowering by the purchases they make. We are hopeful for the future, and that’s why we exist. But changes will be harder to push through the mainstream market. Brands and distribution have been in a power struggle; whoever wins is down to who gets the customer. A paradigm shift is necessary. Good traditional retailers who add value are still important, but they need to remain relevant to the digital age. Brands need to be more in touch with the market, and consumer demand. I hear this is happening, but I hope they work together rather than against one another. Also, consumer/market demand can drive change. Meaning, education for the consumers is also key. Sourcing information
from recognised bodies and media such as Europa Star can play a part. I hope fewer buyers get their ‘intel’ from dealers, grey market traders, or their collector friends who claim to know a lot about watches and the industry. The watch media can exercise more influence, beyond the reluctant industry folks... But people will always love going into shops when the experience is modern, interactive, enriching, eyeopening, problem-solving, welcoming and gratifying. When shoppers buy into the experience, they buy the products. The questions are, ‘what are the new ideas?’ and ‘do they have the budgets?’ I’ve heard about the gallery concept, which is not new – Marcus and William & Son in London have been doing that for a long time. And a lot of retailers need to shift stock, without sell-out, which funds ‘the gallery’. Perhaps a multi-experiential space, adding a drinks lounge / cigar den / augmented reality play room etc. is the type of experience that will help cross-sell watches...?
person sales platforms like eBay and Chrono 24. Unlike them, we offer selected watches with service, guarantees and experience. We source our watches from a variety of suppliers; they may be retailers we partner with or industry professionals in 65% of cases, but also private individuals in 35% of cases. We don’t show who is selling the watch, but we authenticate everything. We’re not like Amazon; we try to create a community with more of a ‘family’ spirit. Often, our buyers become vendors. Our sales commission varies from 8% to 20%. Delivery takes three to four days on average. The American market is rapidly becoming digitalised. We’ve noticed that we’re attracting the attention of the brands and industry professionals much more than when we started. It has to be said that the Swiss brands have for years been striving to control their distribution network and today, with the internet, they have the impression that they don’t control anything anymore. But the web has advantages too, especially when you see the proliferation of references and the way stocks are managed, which has done the multi-brand retailers so much harm. We’re a better choice than a ‘liquidator’ because we preserve a certain brand image and guarantee a fair price. We believe that, ultimately, there will be room for both multi-brand retailers and quality digital platforms.” ABOUT Name: TrueFacet Website: www.truefacet.com
We don’t agree with ‘uberisation’– Uber is not a good company. If you refer to the democratisation of service/product provision, the peerto-peer distribution model through a platform – we believe in AirBnB, and Farfetch, which maximise use and consumption of under-utilised and under-exploited assets/capacities to provide better value for customers, while connecting people/ communities in the process; and this is what Skolorr is offering. Customers are hyper-connected and increasingly mobile. Instead of asking them to visit a fixed physical location, we should bring those services to them where they are. That is the future of retail. It has already been shifting in high fashion, furniture, food, and other industries. Consumers will expect it as a matter of course sooner or later.” ABOUT Name: Skolorr Launch date: 2017 Category: High-end independents Brands represented: AkriviA, Antoine Tavan, ArtyA, Brellum, Claude Meylan, Clerc, Czapek, DeWitt, duManège, Fiona Krüger, GoS, Hautlence, Jaeger-Benzinger, Ludovic Ballouard, Manufacture Royale, Olivier Jonquet, Pierre DeRoche, Struthers London, Zeitwinkel Website: www.skolorr.com
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“We’re multi-brand and we still firmly believe in that model” Chiara Pisa, pisa orologeria
“We have a main Flagship Store in Milan, still run by the founding family. We also operate the Rolex and the renewed Patek Philippe boutiques there. We employ around 70 people altogether, including several watchmaker technicians. We have just opened the first Hublot boutique in Milan, inside our Flagship Store, a separated but still integrated space. For us, the year 2015 was outstanding with the World Expo in Milan, which attracted more than three million visitors. It was an exceptional year. Naturally, 2016 couldn’t match it, but we were still up 14% on 2014. For the past two years – this may come as a surprise – Milan has been the most-visited city in Italy. It’s an easily accessible city, much more so than Rome or Venice, and it attracts more diverse visitors, not only tourists but also professionals, between industry, fashion, culture and the numerous trade shows of all kinds that are held every year. So our customer base is 30% Italian and 70% foreign. Italy has always been an avant-garde, very mature market for the watchmaking industry. Italians have a “special relationship” with watches. We’re multi-brand and we still firmly believe in that model. Patek Philippe and Rolex are exceptions
in a way: their reputation is such that they can fend for themselves, which is why we launched dedicated boutiques with them. But we believe in the power of brand competition and maximum choice for the customer. Customers always ask our opinion and they like to compare brands and their models. We are attached to our identity and we always try to filter the marketing displays of the brands. We have a broad portfolio of brands and the watches ought to be argument enough in themselves! We’ve built up long-term relationships with our customers, who respect our opinion, just as our partner brands do. Many products in the industry can seem rather similar today, but our vendors know how to explain the differences between one brand and another, and the characteristics peculiar to each
brand and each model. That’s our role. That’s why we don’t suffer too much from competition from brandowned boutiques, some of which are just 200 metres away ... I think that the customers of mono-brand boutiques aren’t the same as those of the multi-brands. While the customers of the former are 100% certain that they want a particular brand, those of the latter are open to different brands. In fact, the mono-brand boutique concept isn’t very highly developed in Italy. Of course, our mission is becoming more and more difficult as custom-
ers are increasingly knowledgeable. But that’s not always a good thing. When customers have done their research and formed an idea for themselves, they’re rather rigid in their assumptions even though the information online is not always reliable, and pay less attention to our advice. That devalues our work somewhat. But we’re still ‘watch consultants’.
Of course, our mission is becoming more and more difficult as customers are increasingly knowledgeable. We haven’t expanded beyond Milan, because Italy is a market that is highly fragmented into regions. And from Milan, we have international visibility. We’re even compared to giants like Wempe or Bucherer, sometimes, although we’re much smaller. But we’ve certainly had a historical presence in the market, since 1940. We were the first to introduce A. Lange & Söhne into Italy, in 1992, and Greubel Forsey. And we were also one of the precursors for Rolex in Italy. We take risks and our staff aren’t ‘mainstream’, but always on the lookout for new faces. And our partnerships are usually for the long term… Our proximity to Switzerland is an advantage in that respect. Not to forget the special editions, like the IWC for the 75th anniversary of Pisa, for example. Stock turnover is a crucial issue. When we buy in for the next season, we’re always thinking of a handful of customers who we’re sure will appreciate the models in question. As for vintage watches, they’ve enjoyed a real boom these past few
years, but it’s a different world that demands a different approach, for example with regard to the guarantees, condition and conservation of the watches. We’re not present in that niche. As for smart watches, today we’re seeing some new habits. For example, a smart watch on one wrist and a mechanical one on the other. Nevertheless, I think smart watches will have more chance of succeeding if they look more like ‘real’ watches. Online sales are part of the future, there’s no getting away from it. Social media have already changed customer behaviour. We’re already able to trace some sales from posts on Instagram. But a watch is still one of the most complicated items to sell online. They’re things you need to see, touch, try on… I observe that for the moment, few retailers have their own e-boutique. It’s not an easy task. You can’t content yourself with reproducing an e-commerce platform. You have to create your own identity online, a shopping experience. We think that e-commerce will never completely supplant boutique sales. But the boutique could increasingly become more of a showroom. We have a certain number of digital projects in mind. The big issue is our expertise – how can we reproduce that on the internet? And we work with 45 brands; that means we’re going to have to defend our identity. A digital strategy decided in the meeting room of a brand or a group in Geneva can’t be applied blanket fashion in every market. Milan and Hong Kong are still very different places!” ABOUT Name: Pisa Orologeria Boutique: Milan Launch date: 1940 Category: High and middle range Brands represented: More than 45 Website: www.pisaorologeria.com
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“We’re creating a garden of tranquillity in contrast with the digital jungle” Jens Lorenz, juwelier lorenz
“Faced with chains, supermarkets and mono-brand boutiques, a good number of traditional family boutiques have closed. And this concentration of the market is putting the brands themselves in danger, because they’re dependent on a smaller number of retailers. Our boutique dates back 142 years. We recently renovated it and we could have designed something very modern, modelled on an Apple Store or an airport shop! But you find that kind of thing everywhere. We preferred taking our inspiration from the original boutique from a century and a half ago. All our inspiration comes from the passage of time. As retailers, we ourselves have to play on time. The way
you design your space is crucial: we’re in the centre of Berlin, but when you walk through the door, you can slow your pace down. We have space here, a garden… It conveys an impression of tranquillity and isolation while everything around you is in movement. It’s a kind of stability and permanence, like the mechanical watch,
“The enemy we have to beat is the online grey market” Imran Imranov, zewi / berlin and baden-baden
“It’s crucial to go digital, and the watch brands have to start engaging with it now or things are going to get very complicated. An online presence ought to help protect the brands; the platforms serve both to promote and to sell their watches. Ultimately, I think we’ll post half our turnover online and half in the boutique. Our role as retailers is to help the brands to make their transition to online and to feel at ease there. But there’s one enemy in particular that both the brands and their partners have to deal with: the online grey market, where watches are sold at rock-bottom prices with a minimal mark-up. We mustn’t allow those players to come into power on the internet. So in a few months’ time we’re going to be launching our own online sales platform for watches, in agreement with the brands we represent. We’re in separate talks with each one. Combined with our physical presence in Berlin and Baden-Baden that will give us a real boost. We’re antic-
ipating growth in the order of 200300% over the new few years, and we want to open five new boutiques, in Germany and in Europe.” ABOUT Name: Zewi Boutiques: Berlin and Baden-Baden Launch date: 2008 Category: High and middle-range Brands represented: Ulysse Nardin, Parmigiani Fleurier, Frédérique Constant, Louis Erard, Raymond Weil, Maurice Lacroix, Perrelet, Century, Arnold & Son, Franck Muller, Visconti, Pop-Pilot Website: www.zewi-luxury.de
an instrument that hasn’t really changed for centuries, apart from its quality and accuracy. Personally, I wear a model with a piece of meteorite in it, as a reminder of how we’re rooted in time. Time that goes back billions of years! We’ve also set up a museum dedicated to objects that have told the time since Antiquity. I know I won’t be attracting Berlin’s hipsters. But you have to be clear about what you want. My main target is aged between 40 and 60. Today, you no longer need to wear a watch. But remember when quartz arrived, mechanical watches seemed obsolete. We’re in the luxury segment, so we address an exclusive customer base that appreciates art and history and has ready cash. I see our role like that of bespoke consultants. Because we address maybe 3% of the population.
Crisis? Give me a break. 2016 was better than the previous year, which itself was better than the preceding year. Of course, the figures aren’t in the stratospheric region, because the competition feeds on promotional price campaigns. What we really need to do today is to tweak every parameter: everything should be geared to promoting a common watchmaking culture. If all you’re seeking is a return on investment, you have no idea of what watchmaking is all about. What’s more, the price issue is much more crucial on the internet than when you go to a boutique. What percentage of our target customer base will prefer to have a watch delivered to their door; how many will opt rather to go to the boutique? What will their choice be, between our physical garden and the digital jungle? I’m not going to
go running after them. It’s like the vintage segment: if it attracts people towards watches in the first place, so much the better.” ABOUT Name: Juwelier Lorenz Boutique: Berlin Launch date: 1875 Category: High and middle-range Brands represented: Cartier, Jaeger-LeCoultre, Omega, Rolex, Baume & Mercier, Breitling, Ebel, Frédérique Constant, Longines, Maurice Lacroix, Oris, Parmigiani Fleurier, Rado, TAG Heuer, Tudor, Askania, Junghans, Meistersinger, Mühle Glashütte, Nomos Glashütte, Tutima Glashütte, Union Glashütte, Casio, Grand Seiko, Seiko, Bomberg, Certina, Michel Herbelin, Raymond Weil, Tissot, Erwin Sattler Website: www.juwelier-lorenz.de
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The “Doors” concept portunities for the traditional business in boutiques. But at the end of the day, service quality will make the difference. Accordingly, we train every day to stay ahead of the crowd. In order to live up to our claim “The Leading House of Leading Names,” training is one of the key elements of our success. We offer regular training courses for our sales force internally and encourage them to attend as many of the courses offered by our brands as possible.”
Joachim Ziegler, les ambassadeurs / zurich, geneva, lucerne, lugano and St. moritz
“From the beginning we had a very clear strategy and positioning as a multibrand retailer. Our concept is unique and the brands realised the added value for them as well. We have our own brand identity with the famous “Doors Concept” (one “symbolic” door for each brand) that has become iconic the world over. We have seen major changes in Switzerland in 2015 with a very unfavourable exchange rate, resulting in new travelling and buying habits for tourists and locals alike. In 2016 we were able to stabilise results, also thanks to the opening of our new boutique in Lucerne. And we are now about to grow our second retail brand called Watches of Switzerland, for which we will be opening our third boutique beginning of 2018 in Interlaken. During these last years, we paid more attention to adjusting our range and have the right offer with a good mix of special pieces, best sellers and new watches. Business has continually picked up over the last few months with positive growth compared to last year in just about every boutique and every segment. For the last 5 years we had a multi-
brand watchfinder on our website, which now includes more than 4,500 watches from 30 different brands. You can make your own selection and set an appointment online to see the watches in our boutiques. Five years ago, that was a revolution, but it has become standard today. The experience we gained through that tool helps us today for our next step that we are currently working on: ecommerce. I am very positive about the future, if retailers and brands alike are ready to adapt flexibly to the challenges ahead. I think it will be a perfect combination between online and offline, one nurturing the other to create more demand and traffic. Online will create new op-
ABOUT Name: Les Ambassadeurs Launch date: 1964 Boutiques: Zurich, Geneva, Lucerne, Lugano, St. Moritz Brands represented: (Watches) A. Lange & Söhne, Audemars Piguet, Bell & Ross, Blancpain, Bovet, Breguet, Breitling, Cartier, Chanel, Franck Muller, Girard-Perregaux, Greubel Forsey, Jaeger-LeCoultre, Hermès, Jaquet Droz, Longines, Omega, Panerai, Parmigiani, Roger Dubuis, Ulysse Nardin, Urwerk, Vacheron Constantin, Vulcain; (Jewellery) Diamonds of Excellence, Graff, Messika, Mikimoto, Ole Lynggaard, Pasquale Bruni, Pomellato, Wellendorff Website: www.lesambassadeurs.ch
“Why would the customer want to buy this product from me?” Hanspeter Pieth, gübelin / geneva, basel, lugano, lucerne, bern, st. moritz and zurich
“2017 started quite well in comparison to last year. We have many more guests from abroad back in Lucerne. However, they are buying less than in previous years. Overall, we are still up compared to 2016 – surprisingly, especially at the higher price points. In the other boutiques the business development varies from city to city, but overall our business is up. We expect the positive trend to continue. However, there will be new challenges and developments. Customer expectations change over the years and will continue to do so. We need to listen to the customer, offer a product that is relevant, create an experience that is unique; not just scratch the surface but go deeper. Customers want to know, they want to understand, they want transparency, they want products from companies that take their social responsibility seriously. They are
looking for companies and products that are doing more than just creating marketing stories. There must be substance. We see the future in providing our customers with experiences and insights, rather than just the product. Gübelin believes in the importance of a holistic experience and service, in keeping with our positioning as a retailer of top-end Swiss-made jewellery and watches. The ‘new’ customers have different expectations about luxury, about shopping, about brands. Boutiques that are not open to new ideas will find it difficult to justify their existence in the future. You must always ask yourself the question, why should a customer buy this product? Why would the customer want to buy this product from me? If the only reason is ‘best price’ then it will be hard. Everybody wants a good price, however, I think substance is also important. The real high-end customer wants and deserves more and is not just driven by the price. Service, trust, passion, expertise and
an outstanding consumer experience are the keywords here. Since March 2017 we have operated our own e-boutique. We are quite proud to be the first retailer in Switzerland to go online with a selection of luxury products. We believe that the e-commerce business is opening up many opportunities for us, not just in Switzerland but worldwide. Online business is becoming a new reality and it is our
ambition to be part of this world. We strongly believe in the importance of connecting offline and online, and in creating a luxury experience, even if the customer buys or informs him-/herself online. Many online suppliers (not just in our industry) are looking for retail space to get in touch with customers. We have the retail space, and we are happy to expand in the other direction. There is of course an impact from online business, especially where it concerns unauthorised platforms, who get their supplies from sources that have too much stock. The grey market is saturated with products from many different sources. The growing number of online platforms is accelerating the grey market issue. E-commerce in general is having an impact on the markets, although not yet all markets, in terms of turnover as well as price transparency. But in the end, the customer still wants to touch the watch. However, advice is available not just in our
Boutiques. For our e-commerce business we have a Concierge service phone line which is open until 10 p.m. Our Boutiques close between 6:30 p.m. and 7:00 p.m. With the Concierge Service Line we can extend our business hours. We are also available when the customer is off work. We do not know about the future, but there might come a time when we are available 24h/24h. Because we sell globally, we have to give our customers a global service when they want and need it.” ABOUT Name: Gübelin Boutiques: Geneva, Basel, Lugano, Lucerne, Bern, St. Moritz, Zurich Launch date: 1854 Category: High and middle-range Brands represented: Patek Philippe, Jaeger-LeCoultre, Parmigiani Fleurier, Roger Dubuis, Cartier, Piaget, Ulysse Nardin, Zenith, Bulgari, Breitling, Hermès, Montblanc, TAG Heuer Website: www.gubelin.com
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Carl F. Bucherer, under the sign of the Manta ray
Carl F. Bucherer has supported the Manta Trust for many years in order to help with the conservation of manta rays. This partnership now embraces a new dimension with the launch of a dive watch series limited to 188 watches and dedicated to the Manta Trust charity. Two manta rays are pictured on the ridged dial, appearing as though they are surfacing from beneath the ocean waves. Each watch is one of a kind – a unique engraving on the back of the case depicts the pattern on the underside of a specific individual
© Guy Stevens
The Swiss watch manufacturer is launching a limited-edition timepiece dedicated to the Manta Trust. This British charity is committed to protecting and ensuring the survival of manta rays, which are being threatened by overfishing. Part of the proceeds from sales of the 188 ScubaTec watches will go to help finance an entirely new kind of research expedition.
manta ray captured on underwater camera by Manta Trust CEO Guy Stevens and his team. The identification number is engraved under-
neath it. This number acts as an access code to a website where the new owner can bestow a name upon this real manta ray. The new Patravi ScubaTec Manta Trust features an automatic helium release valve, making it perfectly equipped for dives of up to 500 metres. The luminescent indices and hands round off its distinctly sporty look and ensure that it is easily readable underwater. With part of the proceeds from the sale of this watch, Carl F. Bucherer will finance an entirely new kind of scientific expedition, during which data will be gathered that will help to protect the habitat of the manta rays. In August 2017, a team will spend two weeks out at sea monitoring the manta ray population in the waters surrounding the Maldives to analyse their habitat use and feeding habits, as well as the planktonic prey on which the mantas feed. The information gathered will be essential for ensuring the survival of the species.
“Every watch is unique and features a different manta ray pattern” The Patravi ScubaTec Manta Trust, in the silvery grey tones of the creatures the company is helping to protect, will appeal to lovers of both fine watches and sea life. Carl F. Bucherer’s CEO Sascha Moeri lets us into some of the secrets of this limited edition.
The watch is both elegant and mysterious, and its colours reflect the colours of a manta ray. Mr Bucherer himself, who generally wears a tourbillon or perpetual calendar model, always takes a ScubaTec with him on summer holiday! With all these advantages, as well as a price tag of CHF 5,900, I have no doubt that this limited edition will quickly find an audience when we launch it this summer.
Every watch is a unique timepiece! Each of the 188 watches features a different manta ray pattern that identifies an individual creature, a bit like a fingerprint. In addition, the owner of the watch can name “his” manta on a dedicated website. In addition to these unique features, we also wanted to contribute to a worthy cause by supporting the Manta Trust and their incredible work in more than 20 countries. As such we decided that a defined amount of the proceeds from every watch we sell will be invested in a two-week observation expedition as well as in a database which helps to classify the observations and findings. Scientists have been waiting a long time for both the expedition and the database. The manta ray is the symbol of our ScubaTec family. Each model
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What are the main features of the Patravi ScubaTec Manta Trust?
Sascha Moeri, CEO of Carl F. Bucherer
in this flagship collection has two manta rays engraved on the reverse. But it’s only the Manta Trust limited edition that features the markings of a unique manta ray. So, who are these watches aimed at? Traditionally, our ScubaTec collection is very strong in Europe, the Middle East and the United States. The limited edition will appeal to connoisseurs looking for an exclusive, high-quality timepiece with COSC chronometer certification, as well as to lovers of marine life.
Do you have any follow-up projects planned? Of course! This limited edition takes our partnership with the Manta Trust to the next level. Given the scope of the ScubaTec collection, there are lots of future development possibilities, and we’re not short of ideas. It’s very important to us that we continue to showcase the activities of the trust. For the record, it was because of this partnership, which we concluded quite a few years back, that we now engrave two manta rays on the back of all our ScubaTecs. In fact, our first joint project with the Manta Trust involved monitoring two manta rays in the Maldives. Naturally, we decided to call them... Carl and Friedrich!
PATRAVI SCUBATEC MANTA TRUST Reference: 00.10618.104.22.168 Mouvement: Automatic, CFB 1950.1 calibre, chronometer, diameter 26.2 mm, height 4.6 mm, 25 jewels, power reserve 38 hours Functions: Date, hour, minute, seconds Case: Stainless steel, stainless steel and ceramic bezel, automatic helium valve, screw-down crown, sapphire crystal with anti-reflective coating on both sides, water-resistant to 500 m (50 atm), diameter 44.6 mm, height 13.45 mm, unique manta-ray engraving Dial: Black with two mantas Strap: Rubber with finely adjustable diving folding clasp in stainless steel Limited edition: 188 watches
Reef Manta Ray, Manta alfredi, Dhiggaru Kandu, Ari Atoll, Maldives Â© Guy Stevens, Manta Trust 2015
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“There is still a great deal we don’t know about the manta ray” Whether ocean or reef dwellers, manta rays are a potent symbol of marine life, boasting the largest brain of all species of fish. But they are also extremely vulnerable, and are currently under grave threat from the fishing industry. The Manta Trust, which is supported by Carl F. Bucherer, studies them at close range and leads concrete initiatives to save them from extinction. Guy Stevens of the UK, who founded the trust, answered our questions. Maldives. Thankfully, manta ray fishing is banned there, as are the fishing nets that can trap them accidentally. That is why the islands are home to such an enormous concentration of reef mantas, with an estimated population of around 5,000. We have also helped to identify their key aggregation sites in the Maldives.
The manta ray is categorised as a “vulnerable” species by the International Union for Conservation of Nature. What are the main threats to its survival? The biggest threat comes from fishing – both fishing that targets the manta ray directly, and also what is called “bycatch”, where they are caught unintentionally. The manta’s gill plates are prized in medicine, which unfortunately has led to increased fishing for this fragile species. The results are shocking. Populations have declined dramatically in Indonesia, the Philippines and in the Indian Ocean. These fish have a very fragile life cycle, and their population levels are naturally low. They don’t reach sexual maturity until the age of 10 or 15 years, and then they reproduce slowly and bear just one pup at a time. This makes the impact of fishing all the more devastating. What concrete actions does the Manta Trust undertake to preserve the manta ray? We were heavily involved at a global level in having the manta added to the CITES, the Convention of International Trade in Endangered Species. We helped the countries concerned and provided scientific data. We are very proud that our perseverance paid off! We also campaigned to have manta rays listed in the Convention on Migratory Species (CMS). It is difficult for countries to take unilateral measures when the rays migrate to different habitats. Are you also active at national level? Yes, in Peru and Indonesia, for example. We’re also very active in the
Manta rays have the biggest brain of any fish. Are there any other scientific mysteries to solve, where the manta ray is concerned? Yes, a huge number! To give you an idea, it is only in the last ten years that we have begun to answer some key questions about their lifespan, how they reproduce, their habitat, what they eat, etc. And that’s just the tip of the iceberg. I’m a scientist myself, and I have many colleagues who are also trying to answer these questions. For example, the only way we can establish their lifespan is through photographic identification, which is why it is so important to record each individual accurately. The size of their brain is also a fascinating topic, and hints at the complexity of their social interactions. You go diving regularly to photograph and document the manta rays. What are the rules for approaching them in the water? In general, it tends to be the rays who approach the divers, they are very curious creatures! The best tactic is to remain as calm as possible and swim slowly, slightly off to the side and never straight at them, so as to leave their way ahead clear. Let them get a good look at you, don’t surprise them. How did your partnership with Carl F. Bucherer come about? A little over three years ago we were contacted by the company, who were in the process of creating a diving watch. Their designer was fascinated by manta rays, and wanted to engrave one on the watch. He approached us to find out more about the species, and the company decided to support us. With their support, we were able in the first instance to begin tagging rays in Mexico. Thanks to Carl F. Bucherer, we have also created a code of conduct to promote best practice in interactions
Researcher Using Stereo Camera to Measure Manta Rays, Hanifaru Bay, Baa Atoll, Maldives © Guy Stevens, Manta Trust 2012
with manta rays, which we have distributed to the tourist industry. The partnership is moving to the next level today with the launch of a Manta Trust limited edition comprising 188 watches, each featuring a different manta ray. Were you involved in designing these watches? During our discussions we all agreed on engraving pictures of the manta rays we identified during our dives on a limited number of watches. I felt it was a unique and amazing idea, because it allows us to monitor each of the 188 creatures chosen. The owner of the watch can give “their” manta ray a name of their choice. We always name the manta rays we identify: it’s more friendly, and it’s also easier to remember
a name than an ID number! The watch also creates a logistical challenge, because we’re creating a special database that will be accessible to the watch owners. They can get basic information about the manta ray they are sponsoring, like age, size, the state of their health etc. So you not only buy a great timepiece but you also help to protect Mantas by purchasing that watch. Another important aspect of this operation in partnership with Carl F. Bucherer is an expedition to the Maldives next August. What is its purpose? We’re bringing together a small group of scientists from different domains to try to better understand how manta rays feed. This will enable us to identify the species’ key
habitats, where they find their food, and consequently the places that must be protected as a priority. To achieve this, we will be diving to collect plankton – their sole food source – and tissue samples from the manta rays. By comparing them we hope to establish a precise link between the two. As a diver, you no doubt have a very special relationship with watches... A diving watch is an essential part of our equipment, but my view of them has changed. When I started diving, I was happy to wear a big, complicated block of plastic over my wetsuit, but today I have a proper elegant watch on my wrist, which I also wear on land. That would have been unthinkable with the watch I was wearing 15 years ago!
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Reef Manta Ray, Manta alfredi, Surface Feeding, D'Arros Island, Amirantes, Seychelles Â© Guy Stevens, Manta Trust 2016
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Mechanical watchmaking leaves Huygens behind The oscillator of the new Zenith Defy Lab, perfected by Guy Sémon, CEO of TAG Heuer and of the LVMH Watch Division’s R&D Institute, and his team of scientists, represents a major development. For the first time, watchmaking has reaped the benefits of an unintuitive, scientific, theoretical, multidisciplinary approach, calling upon mathematics, physics, materials science and the most advanced theoretical mechanics. The spectacular result means that we have now entered a new post-Huygens era. It’s a revolution. by
Huygens’ principle was constantly improved upon and gradually perfected by successive generations of watchmakers, and it continued to work flawlessly. There was no reason to give it a second thought. What is more, the trade secrets of watchmaking continued to be passed down from master to disciple, in the privacy of their workshops. And this meant that finishing and decoration came to be the “public face” of the watchmaker’s art. It was not until the 1970s and ’80s that engineers were first admitted through the manufactory doors. Even then, they were only there to design and install increasingly so-
Pierre Maillard, based on Guy Sémon
an interview with
When, on 25 February 1675 in Paris, Christiaan Huygens presented his revolutionary regulator, based on the principle of a balance spring connected to a balance wheel, he had no idea that his invention would dominate watchmaking for the next three centuries. As a scientist, he was uniquely qualified to establish the theoretical foundations for his regulator, which was more precise than any previous systems, but it was not until he teamed up with the royal clockmaker that he was able to put the theory into practice. The 17th century was in many respects an abominable time to live, punctuated as it was by wars, famines and epidemics, but it was, paradoxically, a scientific golden age. Many technical and theoretical advances were made, including the “calculating clock”, the first embryonic computer, which was invented and designed in 1623 by the German pastor and academic Wilhelm Schickard. It was also in the 17th century that the foundations of modern mathematics were laid. Nevertheless, back in 1675, while Huygens was able to observe the isochronism of his balance spring, he was unable to provide a theoretical explanation. That would not be possible until differential equations were developed, in the following century.
A largely intuitive development The paradox of precision watchmaking, which arose out of Huygens’ observations, is that it developed in a largely intuitive manner. Over the ensuing centuries, Huygens’ principle was gradually improved upon and optimised, thanks mainly to advances in metallurgy. However, its theoretical foundations were never really challenged. And that could be because... there were no theoret-
Photograph: Fabien Scotti | Arcade Europa Star
ical foundations. For generations, watchmaking has remained at a remove from scientific and mathematical theory. Any calculations that watchmakers undertook would generally be focused on the movements of the cosmos, which are essential for telling the time – not on mechanics. Mechanics is an integral part of mathematics and theoretical physics, but it was not until the end of the 19th century that mechanical theories began to be developed. The watchmaking community, tucked away in their mountain retreats, with their eyes turned either up to the stars or down to their minuscule cogs and pinions, rarely encountered any mechanical theorists, who in any case were busy at the time with the extraordinary machines that would power the industrial revolution.
phisticated production lines, to adjust the CNC machines and to operate the CAD tools that began to appear in the technical offices. No engineer ever set foot in the workshops where the Huygensian complications were discreetly assembled. That is why, even today, the theoretical underpinnings of mechanical watchmaking have never been fully explored.
Eleven types of mechanical connection Mechanism design theory, a branch of physics, has identified eleven types of connections that, in combination, can accomplish everything.
In order to reach this conclusion, theoreticians had to understand and tame the complex interactions between tightness, weight, dimensions and materials. When he first made landfall in the watch industry at TAG Heuer, Guy Sémon, a former aerospace consultant and lecturer in theoretical physics, began by looking at the watch from a purely mathematical point of view. First, he tried to take the Huygens regulator to its ultimate expression. In 2011 he unveiled the Heuer Carrera Mikrograph, capable of displaying time in 100ths of a second thanks to two separate escapements, vibrating at 28,800 vph (for the hour, minute and seconds display) and 360,000 vph (50 Hz) for the chronograph hundredths. Later that same year he took the dual chain concept even further, and introduced the Mikrotimer Flying 1000, vibrating at 500 Hz, which represented the stratospheric frequency of 3.6 million vph. At this level, the watch was able to calculate and display time to one-thousandth of a second! But at this new frequency of 500 Hz, which requires the seconds hand to perform 10 complete rotations each second, Huygensian watchmaking starts to reach its limits. The escapement no longer needs a balance wheel because, at these high speeds, the spring would need to be so stiff (requiring only four coils – that’s ten times stiffer than a normal spring) that the balance is no longer needed for the return. But with this balanceless movement, we reach physical limits: the lever starts to have trouble keeping up, the regulating organ suffocates, the transmission between barrel and escape wheel gets out of sync, and there is no longer sufficient energy to power each impulse. The result is an imbalance in dynamics and energy. For Guy Sémon, this impasse was the starting point for his explion of new mechanical regulation technologies.
A detour into magnetism and the “vibrating beam” On the strength of his mastery of arcane scientific theory, he began exploring new, unorthodox (for watchmaking) connections between energy and how it is regulated. His first venture outside the Huygens galaxy was the Concept Watch Pendulum. The escape wheel and lever are still there, but the heart of the system, the sprung balance, is replaced by a magnetic stator and rotor. The device consists of four magnets. Two of these magnets (one positive and one negative – magnetised in only
one direction) are arranged faceto-face around the circumference and held in place by a fixed softiron support that forms a kind of Faraday cage. At the centre, on the same axis as the balance wheel and held in place by a traditional bridge, two magnets are arranged on a rotating mobile and thus alternate their positive and negative poles, which creates a magnetic field alternately on either side of the device. This system achieves levels of performance comparable with those of a balance spring, yet it falls short of COSC temperature sensitivity requirements. It was an interesting experiment, but difficult to implement on an industrial scale. Guy Sémon and the multidisciplinary scientific teams with which he surrounded himself therefore turned their attention to a different mechanical avenue, one that had not yet been explored in watchmaking. The principle from which they drew their inspiration, the theory of “vibrating strings” or beams, was discovered by French mathematician d’Alembert a few years before Huygens. Essentially, in place of the oscillation of a traditional concentric balance spring, this principle involves inducing vibration in a thin blade at very high frequency. In theory, the “perfect vibrating string” posited by d’Alembert, with infinite flexibility, constant tension, perfect elasticity and insensitivity to gravity, transmits a wave uniformly along its entire length. The wave therefore has an isochronous oscillation. The challenge was to find the closest practical approximation to this theoretical perfect wave. The principle settled upon by Guy Sémon and his team was conceptually simple, combining three “vibrating beams”. An exciter beam attached to the lever and an oscillator consisting of a thin “beam” are united by a “coupler” that is itself also a “beam”. By exciting the oscillator so that it gets as close as possible to the “perfect wave” of the theory, it begins to vibrate at perfectly defined frequencies. It can be adjusted using an eccentric that lengthens or shortens the vibrating beam, a little like tuning a guitar. This new type of “non-Huygensian” oscillator is therefore linear – like a string. There is very little inertia and practically no amplitude (it vibrates very quickly, but the oscillations are very low), which means that the system consumes less energy than a sprung balance – another benefit of high frequencies, since the power reserve can be a lot higher. Regulated in this way, the TAG Heuer Mikrogirder concept watch “vibrates” at the mind-boggling frequency of 7,200,000 vph, or 1,000Hz, which gives it the ability to measure 1/2000th of a second (TAG Heuer prefers to talk of 5/10,000ths). Thanks to the dual escapement system, the “normal” Huygensian chain for the time indications and the “vibratory” chain for the chronograph at 1/2000th do not affect each other at all. It’s an impressive exercise, but given that this “beam” can only oscillate at very high frequencies, its
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Fine tuning fork (equivalent to the “raquetterie”)
1st mobile mass in rotation (equivalent to balance wheel)
+/- 6 degree amplitude oscillation
Anti-shock hole (x6)
2nd mobile mass in rotation (equivalent to balance wheel)
Escapement transmission (equivalent palette stones)
Central attached area
3rd mobile mass in rotation (equivalent to balance wheel)
Location of the escapement wheel
20 microns beam (x3) (equivalent hairspring)
industrial and commercial applications are limited. (To find out more, read our article from 2013, “TAG Heuer: Waves and magnetism in the service of regulation”, available on www.europastar.com)
In search of a new “universal” regulator Guy Sémon was appointed CEO of TAG Heuer at the end of 2014. He decided to renew his quest for a new type of “universal” regulator, like Huygens’ principle but far more precise. He had been thinking about it for some time, but in order to succeed, he had to bring several different universes together: the field of compliant mechanisms, which had emerged in the 1990s, along with theoretical physics and materials science. The new theory of compliant mechanisms is based on new premises, and creates new connections based not on the interaction between separate components, but on the deformation of their materials. This concept of compliance is particularly relevant to robotics, where it is used to perform tasks that require subtle applications of strength, acting on “stiffness” and transforming into “flexibility”. This includes, for example, tasks such as grasping fragile or highly deformable objects, assembling tightly fitting components, or
deburring. In the case of watches, this new theory provides a means of replacing an element made up of several fixed or mobile parts – an oscillator, for example – with a onepiece “compliant” structure. Theoretical physics comes to the rescue with the theoretical underpinnings of this new kind of oscillator, called a “parametric oscillator”, which is used in physical optics, and for resonators in laser instruments. As Guy Sémon readily admits, this theoretical field is “extremely modern and very complex.” The third field of exploration is materials science. This new type of oscillator requires a material that is insensitive to both magnetism and temperature, while at the same time being highly flexible. These requirements rule out all known metals. After drawing a blank at Delft University in the Netherlands, which is in the vanguard of this new mechanical theory, Guy Sémon expanded his search to the University of Arizona at Albuquerque. No luck. He then went to the University of Utah, which takes a keen interest in nanotechnology. There, Guy Sémon says he “lucked out”, and found a nanostructured material that was highly flexible. This material would enable him to create balance springs out of carbon nanotubes, which would be used in the El Primero 21 unveiled by Zenith in Basel this year, but would not make it to the Defy Lab.
This experience with carbon nanotubes indirectly contributed to Guy Sémon’s development of the new oscillator. By combining the first two ingredients – theoretical physics and its
“parametric” oscillators, with mechanical compliance theory – to optimise the shape of the oscillator, and by using silicon, which can be chemically etched (as we have seen with microprocessors for years), Guy Sémon and his team could move on to defining and making their oscillator. In physics, an oscillator is a flexible beam with a given stiffness. In order to produce an oscillation, a mass is introduced. In order to achieve linear oscillation, the various parameters have to be filtered. The final product is a single monocrystalline silicon component measuring 0.5 mm thick (compared with around 5 mm for a standard regulator), in place of the 31 or so parts of a Huygens regulator, as shown in the diagram below. The energy supply for this oscillator is a fairly classic barrel and gear train. But, once the escape wheel has supplied energy to the oscillator, we leave the traditional watchmaking chain behind. The escape wheel comes into contact with two small teeth (see diagram) which set the monobloc oscillator and its components in motion. The oscillator starts to beat – or breathe – with a very small amplitude of +/- 6° (compared with around 300°) at an extraordinary frequency of 15 Hz, three times greater than that of the El Primero. But even with this high frequency, the power reserve is around 60 hours, 10% more than the El Primero. (Guy Sémon has no intention of leaving matters there, and is targeting power reserves of 100 hours, even as much as 150 hours.)
Multiple benefits The advantages of this revolutionary oscillator are manifold. There is no need for assembly or adjustment. No more contact and fric-
tion means no need for lubrication. Not only is energy consumption reduced, the device is largely impervious to incidental energy variations and changes of position. Not only is it extraordinarily precise, varying by around 0.3 seconds per day (the COSC standard is -4 to +6 seconds per day, or a total maximum of 10 seconds per day), but it also maintains the same degree of precision for 95% of its power reserve. Insensitive to gravity, magnetism and temperature (thanks to a layer of silicon oxide), this double-patented oscillator is also triple-certified: for chronometry by the Besançon Observatory; for thermal resistance by ISO-3159, which it comfortably exceeds; and for magnetism by ISO764, which it exceeds by 18 times, given that it can withstand 1,100 Gauss. Zenith was chosen for the public debut of the “Sémon oscillator” in a watch named the Zenith Defy Lab – “Defy” was the name of a case from the 1960s, which has been completely revamped for the occasion. Beyond its debut appearance, the oscillator is destined to equip the majority of watches produced by LVMH or, as a minimum, the more “horological” brands in the group – Hublot, TAG Heuer and Zenith. The operation resembles Omega’s approach to the co-axial escapement developed by George Daniels. But, strategically, this operation is even more important for LVMH, because it will help the group to attain even greater autonomy. Combined with its self-sufficiency in balance spring development thanks to carbon nanotubes, it will ensure the group is insulated from any strategic dependency. Guy Sémon and his scientific teams have now been promoted to head up a major research centre. But that’s a different story (one that you will be able to read very soon.)
THE ZENITH DEFY LAB AND ITS ULTRA-LIGHT CASE As if this major technical innovation were not enough, Zenith, under the initiative of Jean-Claude Biver, decided to bring out the new oscillator in equally revolutionary packaging: a 44 mm case made of Aeronith, the world’s lightest aluminium composite. This “open-pore metal foam, stiffened with a special ultra-light polymer, resistant to UV rays” is 1.7 times lighter than aluminium and 10% lighter than carbon fibre. It was originally developed by Hublot’s R&D department. On the face of it (and in our humble opinion), the decision to double down on innovative developments is perhaps not the best strategy, since it dilutes the impact of the revolutionary new oscillator, which is destined to usher in a new era for mechanical watchmaking.
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Julien Tornare, the twelve labours of Zenith Le Locle-based Zenith did not jump on the Chinese bandwagon in the course of the past ten golden years, and did not enjoy the same growth as its peers. Now, the new CEO intends to cash in on this ‘moderation’, which defined the manufacture while others succumbed to delusions of grandeur, and start afresh on a sound basis. Wishful thinking? Europa Star interviewed him. by
Geneva-born Julien Tornare has spent his entire career developing sales and markets for watch brands, firstly with Raymond Weil, then for seventeen years with Vacheron Constantin, initially in the US where the brand was on the brink of extinction, and then in Hong Kong where he had the opposite task of taking an already strong brand to yet greater heights. In other words, Zenith’s new CEO experienced the rise and then rapid fall of Chinese demand from the inside. And that’s no small advantage for 45-year-old Tornare, the new protégé of Jean-Claude Biver, who for the first time is entering the boardroom of a watchmaking brand and the greatest challenge of his career: that of turning Zenith around.
end’. We talked with Julien Tornare about two topics: business and their new watch products.
Business What’s your diagnosis of Zenith, a few months into your new post? I’ve presented a status report to the LVMH Group. For me, it’s a magnificent brand that’s been a part of the watchmaking landscape for 152 years, a brand for which I – like many other industry insiders – have enormous affection. But behind all that, you still have the impression that it’s never really taken off in terms of sales, marketing and desirability in relation to the end customer... It’s crucial to find a way to remedy that.
There was a period when the watch brands with the longest history found themselves entrapped in their own heritage.
We seem to have been hearing this kind of discourse from Zenith forever. Yet it’s a brand that has so much going for it, a history and products that other brands dream of having and, despite everything, top-calibre managers – but the take-off announced for so long has never happened, despite a golden ten years for the industry! Why?
For the initiated, there’s not a shadow of a doubt: the brand is a little watchmaking gem. But in recent years the wider public has had eyes rather for megabrands Omega and Rolex, which are in more or less the same price bracket. How to compete? According to Le Temps, last year 30 million francs were wiped off the brand’s previous annual sales of 80 million francs. So it’s back to square one. At the same time, the brand is possibly the most talked about this year in the watchmaking sector, having found itself in Jean-Claude Biver’s crosshairs. He sees it as the third instalment in his LVMH trilogy, following his close and careful management of Hublot and TAG Heuer – especially since the launch of the Defy 21 at Baselworld and the DefyLab this autumn, both intended to relaunch the El Primero ‘leg-
It’s difficult to say. One thing did not work in the brand’s favour – lots of instability and changes at the top. That was reassuring neither for the retailers nor the end customer. It’s vital today to rationalise the brand structure: far too many models, references and calibres have been launched. In short, there’s been too much dispersion. The watchword today is concentration, on four lines of products. We have a vision for the next five years. And we’ll stick to it, I give you my word! Everybody wants stability at Zenith. And then there’s a second aspect. There was a period when the watch brands with the longest history found themselves entrapped in that heritage. Heritage can be reassuring, but a bit boring and dusty... In reality, few brands have been able to prevent their history from becoming a ball and chain, a gilded cage.
But during the golden “Chinese” decade the dust was swept under the carpet, because Chinese customers were discovering quality watchmaking and bought everything at any price without asking too many questions. Many classic brands, whether part of the Swatch Group or Richemont, played on that – their heritage – with their new Chinese customers, so much so that they neglected their local customers. In the meantime, the tastes of those customers had moved on and become more contemporary, and they also demanded prices in line with the product’s real value. The Chinese customers were a bad benchmark, because they could afford to pay crazy prices. Those brands lost ground with their local customer base. The dramatic fall in the Chinese market put an end to that system. Inversely, other brands, less geared to China, had to stay strong with their local customers. They got more contemporary, gained more punch, became more competitive and today, they’re the ones who came off best. I’m thinking especially of Audemars Piguet. But Zenith doesn’t figure in any of your case studies: it isn’t one of the brands who jumped on the Chinese bandwagon, and it isn’t one of those that developed a much more contemporary image either. No, we didn’t take advantage of that, it’s true. If Zenith had jumped on the Chinese bandwagon, it would no doubt be making five or six times the turnover it’s currently making in China. But the good thing is that we’ve kept prices at a reasonable level and are not, like others, having to cut prices in China by around 40%. We’ve missed the first wave of Chinese customers, but we’re not captive to them. So we’re going to concentrate on the new generations of buyers. Our priorities in the years ahead will be China, the United States and Japan. In Europe, most brands sell huge quantities to Asian tourists. So if you’re strong in Asia, you’re bound to sell well in Europe... But there you go again – China! Precisely where the others fell down, like you explained… We can’t afford to ignore Chinese customers. They’re still a driving force for the Swiss watchmaking industry! You’ve opened a few of your own boutiques – though far fewer than other brands. Today, the multibrand retailers are having a hard
time of it, caught between the competition from mono-brands and online sales. What’s your distribution strategy, and what message do you want to convey to them?
extra name or manufacturer in their catalogue, but did not really support sales. It’s fair game. They have to have some results if we’re going to work together.
The message is clear: we’ve developed the proprietary boutique model in very moderate fashion, we’ve never had more than twelve worldwide. Today, we’ve kept the seven most successful. Many brands rushed into the proprietary boutique paradigm on the crest of the Chinese wave, hoping to double their margins. That’s not my strategy, because they left out the multi-brand retailers, who still play a key role for customers who want choice, a selection and advice from more neutral interlocutors.
What is your stance going to be on the internet and e-commerce, a subject that’s getting the LVMH Group and Jean-Claude Biver – and the entire watchmaking industry – buzzing with excitement?
I’m going to re-direct Zenith to the best multibrand retailers who will be our priority for distribution. So I think that those retailers, who were snubbed by brands that used to work a lot with them but then pulled the plug on them, ought to return to centre stage. As I did with Vacheron Constantin in the United States, I’m going to redirect Zenith to the best multi-brand retailers who will be our priority for distribution. I’m going to present our five-year strategy to them and go ahead with those who want to, offering decent margins and enabling them to gain market share with us. I think that’s what these retailers really want – the best have been seeking to strengthen their ties with top-quality brands for years but were faced with group strategies in which they no longer had any say. Today, you have more than 800 outlets worldwide. How are you going to implement your approach, in concrete terms? We’re going to concentrate on the best, so overall there’ll be fewer outlets in every country. I think we’ll soon be down to 600 outlets. The launch of the Defy 21 is a key moment to set this change in motion. In any case, we won’t have the capacity to deliver this model to everybody. And then we really want to give priority to those who have continued to support us these past few years and who believe in our brand. We’ll gradually distance ourselves from the ‘semi-dormant’ sales outlets who only kept Zenith because it was an
It’s inevitable: we have to move into e-commerce. The question is how, and at what pace. For a long time, the watchmaking industry thought it was impossible to sell luxury products online. Figures today prove the contrary. We’re still just debuting, everything has to be built from scratch. We already work with pure players like Mr. Porter and Hodinkee for online sales. The second aspect is the retailers. Some are more dynamic than others online. Today, we are at the stage where we need to officialise the sale of watches on the internet with those who have an e-commerce platform. The third aspect is the launch of our own e-commerce platform. We’re working on the project. Basically, there are two ways of going about it: either very conventionally, by putting your entire watch collection online; but with that approach a brand isn’t going to sell much, with no discount or the service you find in a boutique. We have to work on another approach, with limited editions and a special online experience. But we’re really only just beginning. Will that profoundly transform your brand, ultimately? ‘E-commerce’ is a very loaded term, but sometimes we already practise it without realising it. When it comes down to it, what difference is there today, for a retailer, between selling directly online and doing what they already do for customers who phone the shop to order a watch and have it delivered to their home? Another fundamental issue for the industry is pricing. The internet has made prices much more transparent and consumers more demanding and challenging. Our advantage is that we haven’t abused pricing because of the Chinese market. Our average price is around 7,000 francs. Our direct competitors in the same price category are mass-product brands, whereas we produce just 22,000 watches a year with a notion of exclusivity. We have to work on getting this quality recognised. My problem isn’t the connoisseurs, but those who aren’t aware yet of Zenith’s potential, because it isn’t ‘glamorous’ enough.
Products What’s your assessment so far of the Defy 21 presented at Baselworld? I’m going to reveal a rather confidential piece of information: nearly half those we sold to retailers in Basel were already pre-sold to end customers, even though the watch wasn’t even in the shops yet. That hadn’t happened at Zenith for a long time! Your emblematic product is the El Primero, which can also be regarded as a ‘gilded cage’. What place will it occupy in your future collections? Globally, we’ve reduced our offering to four clearly distinct collections. Two – the Elite and the Chronomaster – represent the more classic, heritage side of the brand. But since we aim to be innovative and not simply repeat history, we take inspiration from what we’ve done before to enter contemporary territory. One example of this is Pilot, which we produce in limited numbers but which posts the best results, despite the fact that it’s vintage – because paradoxically, vintage is fashionable and contemporary! And the other contemporary line is Defy, a systematic reinvention of El Primero to enter the 21st century. After the Defy 21, with its hand displaying hundredths of a second, the Defy Lab is the second chapter in this remake of an iconic watch… A completely new oscillator: we’ve revolutionised the escapement system and the Christiaan Huygens balance spring of 1675 to create the world’s most accurate mechanical watch, with a variation of one second over 24 hours, a 60-hour power reserve and, above all, no loss in amplitude. We guarantee the constancy of this second variation per 24 hours. Thanks to its new silicon wheel, there’s no more friction, no more oil. We’ve eradicated the watchmaker’s worst enemies without leaving mechanical territory! No fewer than 31 parts have been replaced by one single part. Incidentally, with the LVMH Group’s new R&D department we’ve developed a new, ultralight aluminium, a composite of aluminium and polymer, on the principle of a sponge but with holes filled with polymer...
THE OBJECT: Spyglass “This spyglass is a good luck charm – and a reminder that you should try to take the long-term view. My wife always tells to me ‘step back a little’, especially at difficult times! She’s the one who gave me this antique object. When I left Hong Kong to come back to Europe this year and take up the reins at Zenith, I added it to the things I needed to take back to Switzerland with me for my new assignment!”
Photograph: Fabien Scotti | Arcade Europa Star
The horological Noahâ€™s Ark
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MB&F HM7 Aquapod MB&F plunges into the water with HM7 Aquapod. The organic jellyfish-inspired design of HM7 Aquapod is counter-balanced by the very mechanical horology within: a central flying tourbillion tops the concentric vertical movement architecture, with indications radiating out from the centre like ripples in a pond. HM7 Aquapod began its gestation as a horological jellyfish, and the architecture of its Engine is appropriately biomorphic. Jellyfish are radially symmetrical, Aquapod is radially symmetrical. Where a jellyfish generates power from food caught in its tentacles, HM7 generates power from its tentacle-like automatic winding rotor.
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Romain Jerome Octopus Lume With this 25-piece limited edition, Romain Jerome introduces a truly marine and highly craftMB&F HM7 Aquapod
ed timepiece, the Octopus Lume, incorporating all the characteristics and aesthetical features of MB&F plunges into thethe water withwith HM7 Aquapod.care Thedevoted organicto each detail. In line with its underwater inspiration, animal a meticulous jellyfish-inspired designthe of HM7 AquapodLume is counter-balanced by stealth look to echo the darkness of the ocean. The new Octopus sports an all-black the very mechanical horology within: central flyingintourbillion 47mm case witha all elements black PVD-coated steel reproduces the bilateral symmetry typical ofmovement the octopus, with the two crowns at 3 and 9 o’clock. The new model is equipped with an tops the concentric vertical architecture, with indications radiating out fromexclusive the centre like ripples in a pond. internal unidirectional rotating sapphire bezel featuring engraved five-minute graduaa luminescent time indicator at 12 o'clock, which is activated by the 3 o’clock crown for HM7 Aquapod began tion its and gestation as a horological jellyfish, controller, while the 9 o’clock crown sets the time. and the architecture ofthe its elapsed Enginetime is appropriately biomorphic. Jellyfish are radially symmetrical, Aquapod is radially symmetrical. Where a jellyfish generates power from food caught in its tentacles, HM7 generates power from its tentacle-like automatic winding rotor.
Blancpain Shakudo Coelacanth Blancpain Shakudo Coelacanth is a homage to a fascinating and endangered fish. Japanese in origin, Shakudo is an alloy principally composed of copper and gold, which acquires a dark patina between blue and black, according to variations in its composition and texture. This technique allows a rich level of detail as well as a lot of visual contrast. Mechanically, these Villeret watches are equipped with the inhouse manually-wound calibre 15B.
Chopard Animal World timepiece collection The Animal World timepiece collection has been created to commemorate the 150th anniversary of Chopard. These timepieces feature various designs of animals on the dial including a polar bear on an ice floe, a monkey swinging through lush jungle branches, a penguin amidst his companions, etc. Presented in 18-karat gold, these unique animal-themed models feature diamond-set bezels, specially decorated mother-of-pearl dial backgrounds that function as “habitat” for the various creatures, and the famous mobile diamonds. A combination of black and white diamonds has been used to dress the penguin.
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Bulgari Serpenti Misteriosi High Jewellery Bulgari Serpenti Misteriosi High Jewellery is a one-of-a-kind, white gold, quartz-driven, “secret” bangle-watch introducing for the first time a double-headed snake design that celebrates the dangerously beautiful part of the serpent - the Maison’s trademark symbol. The first head presents a gemstone flower made of a central round faceted emerald of over 2 carats encircled by nine marquise-cut diamonds culminating in a jaw opening to reveal the dial.
Gucci Le Marché Des Merveilles watches Gucci Le Marché Des Merveilles watches, with Alessandro Michele’s embroidered golden tiger or snake at its centre. Detailed with a navy and red dial and wrist strap, the strap also features the slogan L’Aveugle Par Amour and fastens with a branded buckle. Encased in stainless steel hardware, this Swiss made Le Marché Des Merveilles watch is finished with ETA quartz movement, a sapphire crystal glass face with an anti-reflective coating and a water resistant feature of up to 50 metres.
Panthère Arctique White gold, one 39.28-karat cushion-shaped faceted bluish green aquamarine, sapphires, emerald eyes, onyx, brilliant-cut diamonds, mechanical movement with manual winding, calibre 101.
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Slim d’Hermès “Grrrrr” An unusual encounter between a gruff bear and the delicate technique of miniature enamel painting. Once the introductions are made, the design originating from a Hermès silk scarf created by the artist Alice Shirley is tamed by the brush. Mechanical self-winding, Swiss made Manufacture Hermès ultra-thin H1950 movement.
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Tissot, Automatic for the people our isn’t part of our DNA,” explains François Thiébaud. There will be no confusing the backs of a Tissot and a Sistem51.
All rights reserved
The Swissmatic calibre supplied to Tissot by ETA is allowing the former to break through new price barriers in mechanical watchmaking. And without sacrificing quality. A portrait of a strategic movement. by
We have oral confirmation of the figures: Tissot manufactures more than four million watches a year, all Swiss-made, half of which at least are fitted with mechanical movements. Given the prices that the Le Locle-based brand has always practised, this confirms its vocation to democratise Swiss watchmaking. And this vocation is about to gain momentum with the introduction of a self-winding, value-for-money movement already used by Swatch and manufactured in Switzerland – the Swissmatic. Thanks to it, the brand is able to offer one heck of a bargain. A watch in the EveryTime range, equipped with a Swissmatic calibre, a 316L steel case, a sapphire crystal cover, a mineral glass back and a black watchstrap, will sell for just under 400 dollars. In a subsequent phase, the movement will be incorporated into other ranges, most likely sports watches.
Industrial intelligence Despite these ambitions, the Swissmatic cuts no corners. Selfwinding, with the date, capable of a precision varying from -7 to +7 seconds a day and a power reserve up to 3 days, it performs much better than its direct rivals produced by the Japanese brands Miyota (a subsidiary of Citizen) and Seiko. This is typical of Tissot, which already offers the low-price, self-winding
Powermatic 80 movement, with a power reserve of 80 hours. Tissot achieves all of this because it is a part of that powerful industrial manufacturing system, the Swatch Group. “Tissot is lucky enough to belong to the Swatch Group. That gives us special access to ETA and the industrial modernisation tool that was created for the Swatch,” says François Thiébaud, president of Tissot Watches. As a matter of fact the Swissmatic is a slight evolution of the movement that was much talked about at the presentation of the Swatch Sistem51: the ETA C10.111.
But the Swissmatic also differs from its counterpart. Its oscillating weight is in metal, with sunray brushing, and engraved. Its heavier weight allows it to be smaller in size. The date disc is not made of plastic, and its barrel is semi-open. Lastly, its flat surfaces are a sober black, just the opposite of the interplay of colours typical of Swatch. “The movement will be traditional in appearance. Adding col-
Adoption of this new baby is important both for Tissot and for the watchmaking industry. For Tissot, it is a means of opening up a new front on the low-price mechanical watch market without nibbling away at quality and while still flying the Swiss-made flag. The high price of Swiss-made products is due largely to labour costs, a factor offset here by automation. For the watchmaking industry in general, the advent of this movement in a brand other than Swatch, one that is not known for throwaway watches, proves that the Swatch Group’s new, industrial-scale production methods are successful. And growing stronger. Because the assembly line set up in Boncourt is now capable of satisfying two players of large appetite, with needs that add up to several hundred thousand items a year. With these volumes and these prices, the end product has to be perfect. Fitting Swatches with a mechanical
Industrial volumes On the other hand, here is proof – if proof were needed – that Swiss watchmaking is not only traditional; that the methods used for making quartz calibres can be transposed to mechanical movements; and that there is an alternative to manual adjustment. In short, that the vision Swiss watchmaking has of itself, of perpetuated tradition, mountain landscapes and skilled jobs, is the stuff of picture postcards. Even that stronghold of quality and image, the mechanical movement, has entered into what the Swatch Group calls Industry 4.0.
A watch in the EveryTime range, equipped with a Swissmatic calibre, a 316L steel case, a sapphire crystal cover, a mineral glass back and a black watchstrap, will sell for just under 400 dollars.
Industrial design Like the ETA C10.111, the Swissmatic is assembled in an ETA factory in Boncourt in the Jura, in a semi-clean room, on a fully automated production line; it is soldered and riveted and comprises one single screw, and its regulating organ has no regulator, but is adjusted by laser, which modifies the behaviour of the balance to attain standard chronometric results. Also like the ETA C10.111, it is made mainly of ARCAP, a highly machinable alloy of copper, zinc and nickel, and plastic. Tissot already deploys several ETA calibres that incorporate critical moving parts in synthetic materials, from the lever to the escape wheel and bridges. This initiative was first launched by the Le Locle behemoth back in the 1970s, with the launch of its all-plastic watches – at that time the material of the future – called Idea 2001 and Astrolon.
calibre, however sophisticated and advanced it may be, is one thing: a Swatch Sistem51 cannot be opened and consequently cannot be repaired, as Europa Star demonstrated in its article ‘Stripping down the Sistem51’. It has to be exchanged. Incorporating it into a brand that is known for longevity is a different matter altogether. A Tissot watch is constructed in the conventional way. It has to allow easy access to its internal organs without leaving a scar. “Watches with a Swissmatic reflect Swiss expertise. They will always be repairable,” confirms François Thiébaud.
Tissot Everytime Swissmatic with a rose gold PVD coating – the dressiest.
This is opening up a whole new perspective for watches, one which is already omnipresent in other sectors, such as the automotive industry. “The car I bought last year was 30% cheaper than the equivalent one I bought ten years ago. It’s more powerful and better equipped. The automotive industry uses shared, modular platforms. That raises quality, performance and autonomy, and lowers prices, just like at Tissot,” concludes François Thiébaud. At the same time, the brand is planning a large-scale, international launch in line with its ambitions for this movement. Because the Tissot edifice is built on volume, volume and more volume.
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Dissecting the “brilliantly simple” Swissmatic As we did in 2014 with its forebear, the Swatch Sistem51, we dissected Tissot’s Swissmatic in order to gain a better understanding of what’s “under the hood”, and what technological developments it offers compared with the Sistem51. Denis Asch armed himself with his scientific understanding, his measuring instruments and his watchmakers’ toolkit. Par Pierre Maillard et Denis Asch, horloger
Let’s see how the Swissmatic runs The watch is handsome to look at, with a classic, understated, almost vintage-looking dial and slender hands. It is light and comfortable to wear, although the clasp of the metal bracelet is fairly basic and not easy to manipulate with one hand. Another point: at 12 mm, the case seems rather deep, given the vaunted simplicity of the movement. But at that price point, it’s probably unrealistic to expect more. The movement has no stop-seconds mechanism, which means the second hand quivers rather alarmingly when the time is adjusted.
We're keen to open it up and see what secrets it conceals inside. Before we do that, however, we use a Lepsi device to assess how the watch runs, fully wound, with the hands set at 12 o’clock. Depending on the watch’s position, the amplitude is rather unstable, but it is unusually low in vertical orientations, varying from 210° to 240° (approaching the minimum tolerance, after 24 hours). As far as keeping time is concerned, performance is perfectly satisfactory – good, even – varying between -4 and +2.5 sec./day depending on position, with an average of -2 sec./day. This gives a delta of 6.5 seconds, not far off the COSC standard. Denis is visibly impressed. “It’s actually quite scary,” he admits. “If you can get results like this with a watch entirely produced and assembled by robots, where does that leave traditional watchmaking?”
The single bridge serving as both barrel bridge and gear bridge
We lay it on the operating table and prepare to crack it open. This proves to be far from simple, as there are no notches, but we eventually succeed. On opening the back we discover a special encasing ring made of plastic, the metal rotor and the single screw we were promised in the centre. We unscrew it, lift off the rotor, which is mounted on ball bearings, and discover a single bridge serving as both barrel bridge and gear bridge, made of brass with a black coating. The crown comes away easily and we turn the watch over to remove the hands. “They are very straight, polished, clean and wellfinished, even under a loupe,” Denis notes. Next, the dial. Since it is supported simply on two feet resting directly on the encasing ring, it is easily removed (the dial is firmly held in place when the watch is fully cased up). We then try to remove the hightech synthetic encasing ring. But this is easier said than done, and Denis runs into difficulties. There are no screws, but maybe there’s some kind of catch. Or maybe you just need to have the knack. We end up forcing the ring out of its seating, to discover it is soldered to the movement. “Brute force and ignorance,” notes Denis, who has spent 15 minutes or more on this manoeuvre.
The movement is finally laid bare, and we immediately see that the dial-train bridge is exactly the same as the one in the Sistem51. So it’s clearly a direct descendant. Looking at the gears, it’s immediately obvious that there are in fact no screws. The bridges, which are pretty slim, are apparently soldered on three small feet. Faced with a “normal” movement, at this point Denis would disengage the pawl from the barrel to access the workings behind. But here there is no way of doing that. So we try a different method, and manage to remove what looks like a balance-cock without causing too much damage. But here the balancecock and pallet bridge are in one piece, as are the pallet, pallet-wheel and balance wheel. And also the gear train bridge and balance bridge. As in the Sistem51, the balance spring stud is soldered to the baseplate, and the balance wheel is inverted and also connected to the baseplate.
The encasing ring
Mineral back glass The metal rotor
The single screw
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The pallet fork and escape wheel are made of a high-tech synthetic plastic, and the traditional ruby pallets are absent. Fine adjustment of the escapement is done by laser. The fluttering seconds hand phenomenon is due to the absence of a stop-seconds mechanism.
On removing the horseshoe-shaped central bridge, we discover the central gear train and intermediate wheel. The gear train bridge comes away easily; although a little thicker than the others, it is held just by small feet.
High-tech synthetic escapement
Then we come to the barrel, which is also rather rudimentary. Its cover also functions as the gear that connects it to the automatic winding mechanism, which is how the barrel is wound. “Technically, it’s pretty clever,” observes Denis. “It’s an eminently logical way of reducing the number of moving parts to the absolute minimum.” We then remove the dial train, which is dismantled from the gear side, while usually the motion-work comes away from the dial side. But here – and this is one of the most striking things about this movement – everything is inverted and grouped together to minimise the number of interventions. We also note in passing that the barrel axle is a simple pivot hammered into the baseplate. As for the balance wheel, given that it is also inverted, the balance-cock side, complete with Incabloc or equivalent, is of a piece with a bridge riveted onto the baseplate.
Horseshoe-shaped central bridge
We turn the watch over to the dial side and remove the date disc. As we have seen elsewhere, everything is soldered or riveted. Once the disc is removed we see that the barrel axle, which has to rotate freely, can be easily dismantled.
Hour wheel pinion Barrel and its axle Part of the dial train
High-tech synthetic escape wheel Gear train bridge
Second wheel and third wheel Rapid date adjustment Centre wheel
Dial train bridge
And we’re done. All the components that comprise the Swissmatic movement have been taken apart and are now spread out in front of us. “When Tissot states that this watch is ‘repairable’, that’s only a manner of speaking. Yes: unlike the Sistem51, you can open the caseback. But repairing the movement is another matter altogether, because as we have seen you have to bend some of the pieces, damage them slightly, in order to remove them.” ‘Repairable’ should be understood here in the sense of ‘interchangeable’ – you can remove a malfunctioning movement and replace it with a new one! The price of the watch is probably less a reflection of the movement than of the case and finishing.
But Denis Asch is still quite impressed. “It’s brilliantly simple!” he exclaims. “Many of the parts are assembled back-to-front, in traditional watchmaking terms. It’s very clever, very ergonomic. And it works. There’s no reason why movements should not have been designed like this, pre-robotisation. They’ve found the best way of creating an integrated movement. From the outside it looks the same, but because the systems have been inverted, assembly is significantly simplified. And the regulation is relatively good considering how integrated it is. Only the Swatch Group, with all its industrial firepower, could succeed in creating such a rudimentary system – in a good way. You can see how a system like this could be applied to
more refined movements, and how it could incorporate other complications, not just the date. It’s just a matter of gearing, but in theory it would be possible to develop a perpetual calendar on this principle, or an annual calendar. Why not? Or a chronograph, or any other complication. This Swissmatic opens up interesting possibilities, and asks some very important questions. It’s slightly worrying for traditional watchmaking,” he repeats. “It could upset some people. Because the end client couldn’t care less about amplitude. He just wants a watch that keeps good time. Having said that, however, we’ll have to see how it runs over the long term.” And that, only time will tell.
Date adjustment disc
Balance wheel and its support
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Unexpected links between watches and spits Today, watchmakers are striving at all costs to acquire the services, customers and image of the world’s greatest chefs. But which was the first mechanical device to make its debut in the kitchen? The answer is the roasting spit – well before the cooking timer... But these two worlds have several surprising points in common. Find out all about them here. by
expert at the fondation de la haute horlogerie,
Clocks and mechanical roasting spits have always borne a definite family resemblance, sharing numerous similarities. Technically speaking, both have cogwheels with regulators powered by a driving weight, the inventors and place of origin of which are unknown. As for the secret of their respective longevity, this resides in the numerous improvements made to both.
Clockmakers apply themselves to the roasting spit
Cooking on a roasting spit By definition, the roasting spit, or roasting jack, is a device designed to cook an animal whole or partly cut (poultry, mutton, pork, beef, game) on a revolving skewer. The skewer is either turned manually by means of a crank, or by an animal turning a wheel, or by a clockwork mechanism driven by a weight, a spring or hot air, or a hydraulic bucket wheel or, today, an electric motor. Whatever the case, the spit must turn neither too slowly nor too fast, and as regularly as possible to cook the meat evenly. The oldest references to roasting spits figure in Le Viandier, one of the first cookbooks, written in the fourteenth century by Guillaume Tirel, chief cook to the French kings Charles V and Charles VI and better known by the name of Taillevent. The cover page of one of the original editions bears the illustration of a device consisting of a horizontal skewer with a crank at one end and a cogwheel linked to a vertical rod at the other. At the end of this rod are spheres that seem to act as a centrifugal governor, the principle of which had already been set out in a codex by Francesco di Giorgio Martini.
A dog’s life... Use of the rotating spit developed towards the end of the Middle Ages. However, as a costly device it remained an instrument of prestige during the sixteenth and seventeenth centuries, which the nobility would show off to their guests as they would their portrait gallery. For this same reason, non-
rope with a driving weight at the end. The rope is wound around a drum with a ratchet wheel at one end; this drives an escape wheel by means of pinions, wheels and an endless screw. Using a system of pulleys and transmission chains, the device turns one or several roasting spits, depending on the model. In many cases, an automatic alarm signalled when it was time to rewind the weight. Inaccurately referred to as “smoke jacks”, the hot-air roasting spit consisted of a pallet wheel which turned a skewer by means of various transmission bodies and gears. Set in the chimney, the wheel was turned at a fairly regular pace by the ascending air heated by the fire. However, the smoke fouled the mechanism and the weak air current did not allow large pieces of meat to be cooked by this means.
clockwork systems endured into the mid-nineteenth century. One example, a hanging or dangle jack, is reminiscent of the torsion pendulum of the “400-day clock”. It consists of a rope or chain from which the meat is slung on a hook. Suspended from the mantelpiece, it is weighted down with a stone which acts like a flywheel. Twisting the rope and stone creates motion in the opposite direction, which is quickly exhausted and requires frequent re-twisting, to the detriment of cooking quality. This system was replaced by child or dog-power. The children, referred to as “spit boys” or “spit jacks” in mediaeval times, turned the spit by hand. Turnspit dogs – a specific breed – carried out their stressful mission by running interminably in a squirrel cage wheel built to the same design as the earliest lifting cranes. This gave rise to the expression “a dog’s life”.
Automation similar to watch mechanisms It was during the Renaissance, when a passion arose for all things mechanical, that people began dreaming of automating roasting spits. In The Journal of Montaigne’s Travels in Italy: By Way of Switzerland and Germany, on passing through the Tyrolian village of Brixen in 1580 the writer describes two kinds of rotisserie: one derived from the weight-driven clock and regulated by a flywheel, and the other driven by hot air. These two principles correspond to the diagrams in the Codex Atlanticus (folio 21) written by Leonardo da Vinci one century earlier. Similar in design to the ringing mechanism of tower clocks, the clockwork roasting spit consists of a
From the sixteenth century onward, the manufacture of roasting spits entered the domain of the clockmakers. Although their speciality was manufacturing tower clocks, the clockmakers of Nuremberg included spits in their coats-of-arms – evidence that thence came the bulk of their income. In addition to rotisseries powered by weights or hot air, there were also those powered by a spring and fusee, used from the second half of the fifteenth century. This – given the period – horological prowess was later precisely illustrated in the work by the chef Bartolomeo Scappi, entitled Opera and published in Venice in 1570. From the sixteenth century, there was little evolution in roasting spit designs; transmission and gear ratios were improved to perfect regularity and raise cooking capacity both in terms of the weight of the meat and the number of pieces. Lastly, they were equipped with automated basting systems. In 1792, the American John Baley obtained a patent for a steam roasting spit similar to that described in 1551 by the Turkish scientist, Taqi al-Din. That same year, the Count of Rumford, an American physician, developed a rotisserie suitable for large, communal kitchens which saved more than 75 percent of the wood for cooking. In 1803, a certain Mr. Couteau patented a roasting spit powered by a small steam engine, which rapidly found use in numerous European kitchens. In 1867, a Parisian named Benard created a hydraulic roasting spit, the principle of which had been described back in 1705. As for the butter churns
used for making butter for home consumption, they were driven by a spit mechanism from 1837.
The golden age of the roasting spit and the master clockmakers Roasting spits made their entry into the kitchens of the lower middle classes and into the meat-smoking rooms of affluent farmers in the late eighteenth century. Those in iron were forged by the most skilful village blacksmiths, while those in wood were the work of clockmakers specialised in wood-turning. The Journal de Paris issue of 24 December 1790 relates that Jean Bernard-Henri Wagner was one of those who perfected the roasting spit and generalised the use of those made of iron or copper. This Parisian clockmaker was none other than the founder of Maison Wagner, about whom the rapporteur of the 1884 Industrial Exposition in Paris wrote: “The name of Wagner is to large-scale horology what the names of Berthoud and Breguet are to precision horology”. The company was taken over in 1852 by Armand-François Collin, who continued to develop it. He opened a production site in the French Jura to benefit from the clockmaking know-how of local labour, which was cheaper than in Paris. This factory manufactured on an industrial scale everything related to time-keeping, as well as weight and springdriven roasting spits, dumbwaiters and other mechanical allurements. A company catalogue dating from the 1870s with accompanying engravings showcases an entire series of hot-air, weight and spring-driven roasting spits and their accessories.
From mechanical to electronic timers In the early twentieth century, rotisseries were ousted from kitchens when open fireplaces gave way to wood or coal-fired stoves. The clockwork timer, a derivative of the countdown alarm clock successfully patented by clockmaker Antoine Redier in 1847, provided a lasting means of controlling cooking times. Gradually, cooking hobs, rotisseries and ovens gained their own timers, first electric, then electronic. Of the ancient time-keepers, all that remains is the hourglass, which seems to have appeared in kitchens in the nineteenth century and which is still used today, on occasions, to master the delicate task of timing boiled eggs.
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Published on Nov 1, 2017