His dream, recently, became reality when he reached a ‘significant’ birthday. You can, I think, imagine the excitement when, after months of anticipation, he opened the luxurious display box for the first time. It was everything he had hoped for. He carefully lifts it out, sensing its weight in his hand, admires the perfection of its finish, then slips it proudly onto his wrist. For weeks he felt a frisson of pleasure every time it caught his eye. His wife later told me that it had reminded her of how she had felt, years earlier, when she put-on her engagement ring for the first time! Such is the allure of a luxury watch.
Surely, such emotional, almost romantic, behaviour towards a piece of inanimate technology is irrational even absurd. Yet human nature has a habit of confounding our logic and better judgement when it comes to affairs of the heart; and choosing a luxury watch is nothing less. After all, how rational is it to willingly spend the cost of a home-full of modern technology on a mechanical watch that relies on an antiquated spring mechanism to tell the time (with, at best, tolerable accurately – provided you remember to keep wearing or winding it)? By way of illustration, my friend could have bought a new top-of-the-range laptop computer, an iPad, an iPhone, a large screen HD TV (with blu-ray and surround-sound, etc.) a Playstation for the kids and, best of all, had a nice new Seiko Kinetic watch every year for the rest of his life… and still had change from what he spent on his Jaeger-LeCoultre Reverso. Not strictly a fair comparison, perhaps, but remember that every single one of these purchases would, in truth, have told him the time with greater accuracy than his Jaeger-LeCoultre! Add the fact that your new mechanical timepiece will need to be professionally serviced every couple of years, at a cost roughly similar to that of having your car serviced, and you have a product whose emotional attraction would have to be pretty fantastic to overcome any rational analysis. Which, of course, it is. The truth is that our relationships with brands, particularly luxury brands, and the emotional promises they make, is, and always will be, illogical, irrational and inherently indulgent.
Curious, then, that most of the luxury watch brands talk to us, above all, about the latest technological breakthroughs in their ‘precision instruments’ – as if these were why we were buying them. Read any of the beautifully-produced booklets of the major brands and you enter a timeless ‘miniature engineering’ bubble wherein the watch manufacturer will enthuse about revolutionary new, prolonged power-reserves, or remarkable co-axial escapements, breakthroughs in blue-steel (or ‘space-age’ silicon) hairsprings or impenetrable new water-proofing techniques for even deeper diving (as if many owners would dive with an object of this value strapped to their wrist!) or, perhaps, the addition of the ultimate technical marvel, a tourbillon (never mind that it is a 200 year-old invention and of no real practical benefit today!). Of course, there is a romantic twist to the idea of a luxury watch embodying such exquisite mechanical engineering… executed by a team of mythical craftsmen working inside a surreal time warp in an enchanted valley deep in the heart of Switzerland!
It is, however, this unique craftsmanship, rather than any technological claims, that is so compelling. After all, if the most advanced innovations and supreme performance capabilities were paramount, most buyers would already have been tempted away by one of the new generations of genuinely-revolutionary Japanese luxury watch designs; yet relatively few have. Indeed, how many owners have ever even seen what lies within within the polished case of their luxury Swiss timepiece? And, of those who have (usually because their watch has an exhibition back), how many could describe what they were looking at and would know how to judge its excellence? With all due respect, most buyers of luxury watches would be unable to tell if a $50 Asian movement had been substituted for their legendary Swiss calibre (unless, and until, it failed, of course!). In essence, they invest in and trust the brand and the integrity of its promise more than any theoretical specifications. So, when Jaeger-LeCoultre describes its Reverso model as having a 21-jewel movement oscillating at 21,600 beats/hour, it will generally be read as the technical reassurance that the buyer wants to hear to justify their choice. It is of little consequence that higher specification movements may be offered, for less money, by other brands. What matters, above all, is that this beautiful timepiece is a genuine Jaeger-LeCoultre Reverso with all the image associations, heritage and aspirations that this promises.
The brand promise, then, is paramount. To demonstrate this, imagine being shown two equally-attractive watches, both about the same price. The first offers a list of technical refinements, exotic materials and impressive-sounding claims, but it is from a brand you are not sure about. The retailer works hard to reassure you of its credentials, but it is hard to feel comfortable about spending this amount of money on a name that means relatively little to you. The second appears to offer comparatively few technical innovations, but it bears the name Rolex, Omega or, indeed, Jaeger-LeCoultre. It says all you need to know. Of course, the choice is rarely as stark as this. But any manufacturer with a weak, faded or unknown brand is unlikely to succeed by emphasising its technology without also focusing on, and projecting, a clear and engaging brand promise.
My friend was fortunate in having identified the marque and model that fitted his aspirations and which made a distinctive statement about his personal taste and style. But many (perhaps even the majority) of luxury watch buyers who do not have such a clear sense of what they are looking for. They are confronted with a dazzling array of brands, a few familiar names stand-out, but most simply blur into the background. What do they do? Predictably, they invest in a brand that they know feel they can trust: TAG Heuer, Omega, Breitling, Rolex, perhaps a Patek Philippe. It is hardly surprising, then, that these are consistently among the best-selling brands in their respective categories – particularly through outlets where customers are relatively unengaged with the world of luxury watches, such as airports and department stores.
So the challenge to watch brands is to invest more in developing a unique and truly differentiated brand promise, rather than simply focusing on technology then churning-out the usual cliché watch advertising (black background, wide-angle, close-up of watch with sports car or yacht in the background; or perhaps a celebrity face looking over your left shoulder into the middle distance with the watch prominently on view…) which simply becomes part of the ‘noise’ rather than truly resonating in a potential buyers mind. As if to prove how weak brand differentiation is in this market, there are now ‘watch matchmaker’ websites whose aim it is to capitalise on the confusion by profiling the watch-buyer’s lifestyle then uniting him or her with their supposed perfect horological partner! That such a service even exists is an indication that watch brands have some to go in developing distinctive, relevant and consistent brands that leave buyers in no doubt about what they stand for.
Can you imagine paying a ‘car matchmaker’ to help you choose a sports car (even if you can’t decide between a Porsche, Maserati or Aston Martin, it is unlikely to be because you don’t know what they are promising!).
Get it right and there will be many more keen, motivated and loyal watch buyers like my friend… who is, incidentally, already enthusiastically researching his next purchase, but don’t tell his wife!
When we hear “made in Switzerland” a host of images spring to mind, among the most prominent is likely to be a classical Swiss watch. Not just any watch, a superior, high-quality, mechanical watch. Explore a little deeper and we enter a world of luxury, privilege and sophistication. Brands like Patek Philippe, Rolex, Omega, Jaeger-LeCoultre and Zenith shimmer alluringly in our minds.
￼ ￼A recent international survey ranked Switzerland highest in the world as a country of origin associated with quality (ahead of Japan and Germany). Another study showed that consumers all over the world strongly associated Swiss products with ”high quality”, “reliability” and “luxury”. But, curiously, the same people also rated Swiss poorly when it came to “price competitiveness” and “innovation”. For the luxury watch industry, “price competitiveness” hardly matters, after all pricing is always relative and when your competitors are also Swiss the collective impact can actually be quite positive as it reinforces the cost of entry and perceived prestige of ownership. But what about innovation? It seems that many iconic Swiss watch brands seem to regard innovation as a core strength, they proclaim it in their advertising, on their websites, in their brochures and through their spokespeople. Here, for example, are some quotes from three luxury watch brochures:
“…ground breaking technological development that provides better long-term accuracy”
“…a new chapter of horological history for a new millennium”
“…futuristic, daring, high-tech and cutting edge… superior technical solutions”
It would appear then that there is either a growing anomaly between what the industry wants its audiences to think and what their audiences actually believe, or the Swiss national brand no longer reflects the industry with which it has been intrinsically-linked for the last two-and-a-half centuries.
￼Interestingly, there was a time, a few generations ago, when there would have been no such discrepancy. Watches might be regarded as the first high-tech gadgets in history and Switzerland‘s burgeoning watch brands lead the world in technical innovation. The development curve for the mechanical watch design actually began in the 18th century and by 1800 most of the cleverest innovations (including the chronograph, the self-winding mechanism and, most notably, the tourbillon) had already been invented, with Breguet, the premium-priced technological leader, firmly positioned as the Apple of its generation. By the end of the 19th century most of the major watch brands had established themselves and their biggest challenge was to manufacture these high-tech gadgets in ever greater numbers and at more affordable prices to meet growing international demand. It was in so doing that Switzerland’s legendary watch-making was consolidated and, as its products reached wider audiences, they had a profound and lasting effect on the national reputation. It would not be unfair to say that for much of the last century the basic architecture of the mechanical watch has remained largely unchanged. There have, of course, been significant advances made in the manufacturing processes (finer tolerances providing more consistent quality) and in the application of new high-performance materials, but these are comparatively minor to the average consumer most of whom have long given-up on the Swiss watch for daily timekeeping anyway and for whom a Swiss watch is primarily a luxury accessory.
￼As if to prove the point, a recent advertisement for the Cartier Santos (the wristwatch created by Cartier for the early aviator Santos-Dumont) simply takes the headline: “Since 1904”. Ironically, you could purchase the same timepiece used by Santos-Dumont to time his record-breaking 21-second flight from the airport boutique before you jet-off on a 14 hour flight across the globe!
It was, of course, the arrival of the quartz watch in the 1970s that changed everything. In terms of scientific innovation the world had moved-on and, by rational analysis, the Swiss watch industry suddenly looked about as outmoded as the record player would look on the arrival of the CD a decade later. But, for similar reasons, its appeal was re-born. It was no longer a rational product to be assessed scientifically, rather it became a subjectively-satisfying product with which buyers connect emotionally, creatively, intuitively. The luxury Swiss watch was reborn as an exquisite, hand-crafted indulgence whose functional capabilities are patently not the primary motivation for purchase. It is, today, a lovingly-crafted piece of functioning jewellery, an object of fascination and desire.
From a scientific/technological perspective, it is fair to say that the gadget innovation baton has now been seized by Japan and the USA (the national brands that rank highest in public perception for ‘innovation’). Products like Seiko’s revolutionary ‘Eco-drive‘ and ‘Ananto‘ and Citizen’s ‘Kinetic‘ models have accelerated the performance expectations of the wristwatch into a new dimension. But then, their customers’ motivations are as different from the Swiss luxury watch buyer as those of the latest Panasonic digital audio system’s are from the specialist hi-fi chosen by the audiophile buyer.
As with any market, it is vital that the brand owners understand their customers’ motivation. Clarity of positioning is essential and, with the best will in the world, no amount of window dressing about cutting edge technology is going to sell a piece of precious time-keeping jewellery even to the most technically-minded customer. While even the very finest Swiss watch mechanisms have now been eclipsed by newer technologies, this is immaterial to the appeal of the brands whose beautifully crafted products and breathtaking intricacy continue to enchant their privileged owners.
It is the brand promise and pride of ownership that will increasingly enable Swiss luxury watch brands to stand-out and thrive in the luxury marketplace. Their ability to deliver a distinctive, relevant and consistent experience will maintain their appeal and customer loyalty over time. It may well be that the key to future success in the luxury watch business will be ever less associated with the mechanism and ‘technology’ within the watch and increasingly with the sense of style, finish, quality of materials and personality that the watch exemplifies as a luxury accessory.
Although it might sound like contentious sacrilege today, is there really any reason why we should not, in future, see a luxury Swiss watch brand with a Seiko ‘Ananta’ or Citizen ‘Kinetic’ mechanism concealed within its stylish gold case? Just as Aston Martin has been dipping its toe in the water with its Cygnet concept car (a genuine Aston Martin luxury experience beneath which is a mechanically unmodified Toyota iQ city car), perhaps the future direction for all luxury brands will be to define, own and express their own authentic, emotional brand experience. Then, to determine the best way to deliver this via the most appropriate technologies currently available. This is, after all, the business model used so successfully by Apple Corporation – spiritual successors of those pioneering 18th century trailblazers, Breguet.
Watch Your Brand
A look at the luxury watch market from a brand perspective.
This was prompted by the observation that so many illustrious brands in the Swiss watch industry seem to have become curiously inward-looking, locked within an affluent bubble that is losing touch with the hearts and minds of the world outside. Many of the industry’s ‘hero’ products are now beyond the financial reach (and, more importantly, the aspirations) of the next generation of luxury watch buyers. There a real danger that some of these brands could be losing their relevance.
Maintaining a healthy interest in, and desire for, these legendary luxury brands is, I suggest, vital to the future prosperity of the industry. After all, a major motivation for owning your first Rolex is that it is the fulfilment of a long-held dream. Finally wearing one celebrates a sense of achievement to yourself and to the world around you. Without the long-held dream what would there be to fulfil?
My comments are not aimed at any brands in particular (least of all the ones with whom I have been working over the past few years), I would encourage you to look and draw your own conclusions from the marketplace. My aim is to invigorate the strategic thinking among some of these wonderfully evocative, global brands so that they, and not just their products, will be a legacy for the next generation.Part 1: An extravagance that defies logic… Part 2: Intimate appeal, some brands have it… Part 3. Start with the brand and the rest will follow…