Vacheron Costantin- A Brand and Market study

A

B R A N D

A N D

M A R K E T

S T U D Y

GIOVANA GRANCHI, GRACE PATRICIA AND ZEYNEP DENIZ

T A B L E O F C O N T E N T S B R A N D A N A LY S I S HISTORY KNOW-HOW & ICONIC PRODUCTS PRODUCT PORTFOLIO & SEGMENTATION PRODUCT & STYLE TARGET IDENTITY PRISMA POSITIONING PRICING DISTRIBUITION COMMUNICATION

T A B L E O F C O N T E N T S THE EN V IRONMENT MARKET SIZE & SEGMENTATION LEADING PLAYERS & MARKET MAP GLOBAL WATCHES MANUFACTURES FRENCH MARKET CLOSE UP TRADE SHOWS DISTRIBUITION CONSUMPTION DRIVERS: ECONOMICS, CULTURAL AND TECHNOLOGY CONSUMER TRENDS: BEHAVIOR AND EXPECTATIONS HISTORY: KEY FACTS

ANATOMY OF A PRODUCT TYPE BY CATEGORY MATERIAL AND BENEFITS KEY FINISHING AND DETAILS INDENTIFICATION: LOGO AND LABEL CONCLUSION

B R A N D

A N A LY S I S

5

H I S T O R Y THE TIME LINE Founded by Jacques Barthelemi Brand symbol Jean-Marc Vacheron Vacheron takes over Was registered the manufactory.

1755 1810 1880

1785 Abraham Vacheron takes control

1819 Francois Constantin partnering with Vacheron Heirs

Reveals the Kallista (jewelry)

1910

1979

1996

Produced it’s first The brand belongs women’s watch to Richemont Group

K N O W

H O W

- Have maintained the highest quality - Polymers are not permitted for new materials - Shaped parts and supplies must be polished - Straight grained sides must be smoothed down - “Timeless Classicism�, balanced and refined designs - Built their product around the timepiece

I C O N I C P R O D U C T S MÉTIERS D’ART

- Decorative Techniques applied to watchmaking & jewelry - Inspiration from Art, History & Culture - Testify to creativity that is open to the world (from generation to generation)

PATRIMONY

- Epitome of stylistic pureness - Minimalist with a beautiful balance between the lines & curves - Asserts personality of elegance that is inspired by 1950s Vacheron Constantin models

MALTE

- The most prestigious watch mechanism - The watch component become Vacheron Constantin emblem - Inspired by encompasses timepieces featuring harmoniously pleasing lines

P R O D U C T P O R T F O L I O THE COLLECTION - For Men and Women - Stylistic pureness Minimalism - 50’s inspiration

PATRIMONY * Models: Perpetual calendar ultra thin and Manual Winding

- For Men and Women - Expression of tradition - Craftsmanship - Timeless

TRADITIONNELLE *Models: Tourbillion and Moon phase

FIFTYSIX *Model: Complete calendar

* Based on the catalog (2018-19)

- For Men - Cosmopolitan Retro - Contemporary Inspired by 56’s model

P R O D U C T P O R T F O L I O T H E CO L L EC T I O N - For Men and Women The Spirit of the travel - Casual elegance - Core product- 18th c.

OVERSEAS *Models: World time and Self- Winding

-

MALTE

For Men and Women Technical excellence Complex mechanism Malte curves

*Models: Moon phase and Manual Winding

HISTORIQUES *Model: Cornes de vache and Calendrier complet 1948

* Based on the catalog (2018-19)

- For Men and Women - Historic models with a contemporary twist - Sophisticated techniques

P R O D U C T P O R T F O L I O THE COLLECTION

HEURES CRÉATIVES

*Model: Heure Romantique

- For Men - Art, history and culture inspiration - Decorative arts and jewelry techniques

MÉTIERS D’ART *Models: Les Aérostiers

* Based on the catalog (2018-19)

- For Women - Art Deco, Art Nouveau and 70’s inspiration - Timeless diamonds

P R O D U C T P O R T F O L I O S P ECI A L O R D E R S - Custom made watches since 1755 - Only 30 orders per year - The style and the function are personalized - Philosophia* Special order : Based on the postulate that the mankind don’t need constantly to know the exact time.

- Famous clients: Czar Alexandre II and Henri Graves Jr.

P R O D U C T & S T Y L E -

-

-

Wrist and Pocket watches For men and Women Collection and Custom made The style is defined by the collection and it could have different influences The brand offers different types of watches based in it’s functions: Complication, Automatic watches, Chronograph, Jewelry watches, Manual winding, Moon phase watches, Tourbillon Materials: Bracelet: Leather, metal, Rubber and Satin Case: Platinum, white gold, pink gold, yellow gold, Steel, two tones.

Details: Diamonds Movements: Manual, Automatic and Quartz.

Restoration in specialized centers

T A R G E T - Men and Women - 30-55 years old - Well successful Upper and Upper Upper class - Connoisseurs - Interested in arts and design

I D E N T I T Y P R I S M Physique Timeless style products Patrimony watch Classic emblem : Golden color and a Maltese cross as a symbol

Personality Legendary Classic and modern Reliable Elegant Arty Culture

Relationship: Individualization “Making the wildest dreams come alive” Reflection Well successful elite Connoisseurs

Self- Image Masterpiece Luxury Social status

Swiss heritage and quality Artistic inspiration Innovation Craftsmanship and Custom made Authentic design

P O S I T I O N I N G Heritage

Arty

P R I C I N G Patrimony

14.400

Métiers D’art

On Request

D I S T R I B U I T I O N Vacheron Constantin’s distribution network now comprises 75 dedicated boutiques in capitals around the world, complemented by retail partnerships. Such as, Asia Pacific, Middle East, Europe and North America. In addition to this Vacheron Constantin does not place any restriction on the resale of its watches through e commerce websites but has strict importation restrictions on its watches, since it is illegal to import or export a watch into or out of Switzerland.

Vacheron Constantin Store in Switzerland

D I S T R I B U T I O N

M I D D L E E A S T

N O R T H A M E R I C A

5% 9%

E U R O P E

23% E U R O P E

63% A S I A P A C I F I C

A S I A P A C I F I C

N O R T H A M E R I C A M I D D L E E A S T

C O M M U N I C A T I O N -

Online - Offline Online catalog in website They use the Instagram actively Vacheron Constantin collaborates with artists such as designer, photographer, musician, song writer using them as another source of communication.

Ora Ito - Designer (Mamo Art) VACHERON CONSTANTIN

Cory Richards - Photographer and Explorer VACHERON CONSTANTIN

C O M M U N I C A T I O N

James Bay VACHERON CONSTANTIN #Fiftysix

Benjamin Clementine at Abbey Road Studios VACHERON CONSTANTIN Eternity song

T H E

E N V I R O N M E N T

M A R K E T

S I Z E

OVERVIEW - Revenue in the Luxury Watches segment 2018: US$43,246m - Trends: Grow annually by 0.8% (CAGR 2018-2022).

- The Conglomerates: The Swatch group is the market leader owning 34.1% of global market, other important groups are Kering, Rolex, Richemont, LVMH. - Geographic: China is the biggest market for watches with a US$5,603 m revenue in 2018

Source The Statista, 2018. Courtesy

M A R K E T

S I Z E

Global consumer interested for luxury watches

GERMANY: 7.04% - 9.25%

UK: 10.04% + 3.12%

RUSSIA: 1.59 % + 20.43%

ITALY: 5.61% + 8.85% FRANCE: 5.92% - 3.42%

USA: 20.69% - 7.90%

MEXICO: 1.58% - 9.32%

SPAIN: 1.98% - 16.24%

BRAZIL: 2.14% - 2.91%

JAPAN: 9.01 % - 5.54%

QUATAR: 0.24% - 17.26%

CHINA: 23.25 % + 59.43%

SWITZERLAND: 1.82% - 11.87%

SAUDI ARABIA: 0.54% - 9.18%

THAILAND: UNITED ARAB 2.17%% EMIRATES: - 8.6% 0.87% - 8.70% INDIA: 3.03% + 12.05% SINGAPORE: 1.64% - 8.45%

Digital Luxury Group, 2014. Courtesy

TAIWAN: 0.76% + 4.02% HONG KONG: 1.20% - 4.40%

S E G M E N T A T I O N

- By product type: Manual, automatic and Quartz.

- Gender: the market has been segmented into women’s luxury watches and men’s luxury watches.

- Social: Upper Class/ Upper Upper class - Style and inspiration - Distribution channel: Online retail channel and offline retail channel (Brand’s boutique, Departmental stores, Specialist retailers)

L E A D I N G

P L AY E R S

BREITLING

ROLEX 15% 32%

OMEGA

17%

12% 24% TAG Heuer

CARTIER

M A R K E T

M A P

G L O B A L W A T C H M A N U F A C T U R E S

F R E N C H M A R K E T C L O S E U P - The high end continues to bounce back - Luxury players expand more affordable brand ranges - Mid watches suffers from the rise of fast fashion and poor purchasing power

Monthly Search Volume

French Monthly Search Volume by Brand

Rolex Source: Watch and Billion 2017

Cartier

Omega Breitling

Tag Heuer

T H E “ M A D E I N F R A N C E � I S B A C K Here are three brands that claim their specificities and fiercely defend the renewed colors of

Depancel,

MW&Co

crowdfunding and

French conception,

reasoned prices

disruptive design and exclusive French touch

French watchmaking savoir-faire.

Phenomen Design excellence, technicality and pleasure of the senses

T R A D E

S H O W S

Baselworld: It’s the most important event for watches and jewelry sector.

Location: Basel, Switzerland Next Date: March 21- 26, 2019 Baselworld 2015

Grand Prix D’horlogerie de Genève: Watches’s concours that select the best watches in the world, according with designated categories.

(Complication, chronograph, mechanical, sports.. etc.)

Location: Genèva, Hong Kong, Venice, Singapore, Vienna (Based in 2018’s edition)

Grand prix D’horlogerie de Genève 2014

Date: September to November Hong Kong Watch & Clock Fair: It is organized by the Hong Kong Trade Development Council (HKTDC) and exhibits local and international labels

Hong Kong Watch & Clock Fair 2015

Location: Hong Kong Next Date: September 3-7, 2019

D I S T R I B U I T I O N CH A NN E LS - Online: Online Boutiques, Online Retailers and Resale channels - Offline: Brand boutique, Departmental stores, Specialist retailers)

T O P 3 P L AY E R S - N U M B E R O F P H Y S I C A L S T O R E S WORLDW IDE CARTIER - South America - Asia - Europe - Africa - Switzerland - North America - Oceania -

26% 41%

34% BREITLING - Africa - Asia - Central America & Caribbean - Europe - Middle East - North America - Oceania - South America

Source: Brand’s website

ROLEX - Africa - Asia - Central America - Europe - Middle East - North America - Oceania - South America - Central Asia - Australia

C O N S U M P T I O N Global Swiss Watch Export January-November 2017 (In millions Swiss Francs)

- After 2 years of decreasing the consumption of Swiss watches are up.

- The projection for exports in 2018 is 20 billion, showing a market recover.


Rank

Country

Value

% Change

1

Hong Kong

2288.7

5,3%

2

USA

1888.1

-4%

3

China

1379.8

19,6%

4

UK

1196.9

7,9%

5

Japan

1123.6

-3,4%

6

Italy

1098.3

0,6%

7

Singapore

1018.0

10,6%

8

Germany

1001.2

-16%

9

France

895.2

-1,4%

10

UAE

802.4

-4,1%

Source: Federation of the Swiss Watch Industry

D R I V E R S : E C O N O M Y , C U LT U R E A N D T E C H N O L O G Y - The consumer and retail research analysts are: - Increasing fashion consciousness Rising popularity of smart watches Growing demand for luxury watches - Demand for pre-owned luxury watches - Launch of innovative wristwatch models - Demand for sport watches among fitness enthusiasts

Apple Shipped more watches than Switzerland in Q4 2017

Source: Canalys, Federation of the Swiss Watch industry

C O N S U M E R T R E N D S : CONSUMER BEHAVIOR - To have their own luxury watches - Demand something that is vintage but also classic modern - To have a sport watches for the fitness enthusiasts EXPECTATION OF PRODUCT - Demand good products, service and message - Looking on heritage, finishing, crafts and mechanical details - Expect an enthusiast, expert, or a collector, and a unique vision of time - Something that is aesthetically stunning

H I S T O R Y : K E Y F A C T O R S THE TIME LINE Leonardo Da Vinci The balance spring Invention of the first Sketches a fusee for a was invented, what Wrist watch by Patek clock. increased the accuracy Phillipe

1485

1657

1504 Peter Henlein Created the first pocket watch

1868

1780

Greenwich in England Was officially named the zero Meridian

1884

1876

Invention of the Cheaper materials Manual winding allowed the mass Movement by production of watches Abraham L. Perrelet

1921 Invention of the Quartz technology

A N A T O M Y O F P R O D U C T

A

W R I S T W AT C H LUGS

DIAL

HOUR MAKER HAND

SUBDIAL

CROWN

CASE

MOVEMENT ROTOR

PUSHER STRAPS

EXHIBITION CASE BLACK

C R Y S TA L

* Credit: Tourneau- Watch education

T Y P E B Y C A T E G O R Y MOVEMENTS - Oldest type of watch movement  - It requires daily winding in order to work - Found in: Conservative, expensive and collectable watches

MANUAL Manual watch mechanism

- Mechanical movement - The arm movement turns the rotor - Works without battery for indeterminate time

AUTOMATIC Automatic watch mechanism

QUARTZ Quartz watch mechanism

- Uses a battery for its power source - The Quartz crystal provides the most precise reference signal to regulate the watches - Price range can varies from a dozen to million euros.

T Y P E B Y C A T E G O R Y C O M P L I C AT I O N : It’s any function that exist in addition to telling the time as Calendars, alarms etc - Chronograph is a complication that allows to measure intervals of time.

CHRONOGRAPH * Chronograph- Vacheron Constantin

- The Moon-phase shows the lunar cycle (from the new moon to new moon).

MOONPHASE * Cellini- Rolex

TOURBILLON * Marine Tourbillion- Ulisse Nardin

- The Tourbillon improves the balance of the watch, eliminating timekeeping errors caused by gravity The Tourbillon is extremely rare and requires

T Y P E B Y C A T E G O R Y STYLE AND FUNCTION: - Reflects the popular style of today - Guide the trends - Expression of personality

FASHION * Rock and Roll inspiration- Versus

- Designed with precious materials, just like a jewelry

JEWELRY * Traditionnelle High Jewelry- Vacheron Constantin

SPORTIVE *Model: Fernando Alonso special edition- Viceroy

- Designed to meeting the athletes demands - Special functions: GPS, heart hate monitors and etc.

T Y P E B Y C A T E G O R Y STYLE AND FUNCTION: DIGITAL/SMART WATCHES * Quartz digital watch- Cassio & Apple Watch

- Digital: The hour and minutes are indicated by digits - Smart Watch: is a portable device which have a touchscreen and apps as a cellphone

M A T E R I A L S B E N E F I T S

&

MATERIALS - Gold, White Gold, Pink Gold, Yellow Gold, Diamond, Steel - Components made of polymers are not permitted.

- For new materials, the technical committee of the Hallmark of Geneva reserves the right to adapt at any time the criteria according to technical innovations in this field.

BENEFITS - Warranty for a period of 24 months from the date of purchase - Repaired or replaced free of charge - Limited warranty that can extend beyond the period of 24 months from date of purchase - Limited solely and exclusively to repair or replace as stated herein

K E Y

F I N I S H I N G D E T A I L S

&

Key finishing means decoration of a movement. It ranges from simple, machine-performed engraving on rotors, for example, to hand-engraved balance bridges.

-

Hand Engraving Côtes de Genève Perlage (or stippling) Bevelling Blued Screws

K E Y

F I N I S H I N G D E T A I L S

&

I D E N T I F I C A T I O N LOGO Logo Engraving

Logo imprint

Superimposed Dial

Photo Dial

Personal Logo on side of case

Spirit

Personal Logo on

Personal Logo on

Personal Logo on case back

Signature

Rotor Engraving

Sapphire glass

I D E N T I F I C A T I O N LABEL

EACH PACKAGE COMES WITH: • An international warranty card • An instruction book (chronograph movement only)

Cube Small

Deluxe Box Black

Black Box

Wooden Box

Black Deluxe Cube

Individual Logo Printing

C O N C L U S I O N S PRODUCT -

Demand for modern watches with a classic twist still strong Sportive watches are also an important demand nowadays The smart watches are rising in popularity The increasing of fashion consciousness in the clients made them look for products that represent their lifestyles

MARKET AND ENVIRONMENT - This market is showing a recover in the last 2 years - Resale is an important distribution channel - Its important to give emphasis for the top 3 Markets in exportation demand: Hong Kong, USA and China

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