1. INTERVIEW
June 02 : Issue 66
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purchase
's Managing Director Michael Fankhauser speaks out on the
market for luxury watches.
Why the desire to distribute in America now, for a company that didn't
venture here for several decades?
Bucherer has been a small family-owned business. They originally sold their
SWISS BEATS
New York
Carl F. Bucherer
If we're to go by celebrities' choices in timepieces and by aspirational consumers
increasingly purchasing status watches of the Cartier and Rolex variety, luxury
watches, more than ever, is one of the most exciting accessories categories. And
why shouldn't it be? Any wise fashionista knows that a good watch, a good bag,
and good shoes are the key requirements of a quality look. Fashion accessorizing
aside, recently it came to our attention that Carl F. Bucherer, the purveyor of
haute Swiss timepieces, have taken their business stateside. For such a legendary
watchmaker deciding now to enter the American market, and having only recently
begun to sell outside of Switzerland, our interest was piqued as to how the label
views the luxury market for timepieces. Managing Director Michael Fankhauser
spoke to Jason Campbell about Carl F. Bucherer's rarified history, the face of the
new watch consumer, and how white guys should keep it simple.
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2. watches from their own Switzerland-based store. The strategy to move into other
countries first took place in 2001, and we started with Hong Kong, then moved to
other locations like Thailand and Kuwait, which were very successful. And last year
the US. We don't have the capacity to produce more, so we do market by market to
grow.
How do you view the current climate for luxury watches in the US?
The climate is very good. Consumers are affluent and are brand-savvy, and
quality — that has its price — is of the essence. There is "popular" luxury (Gucci,
Armani, Cartier) and there is "authentic" luxury: family tradition, handcrafted
timepieces, limited production, and exclusive distribution, which is Carl F.
Bucherer. It's expensive and only available in top jewelry stores.
Who is the new luxury watch consumer? Do you see the luxury watch
customer getting younger?
Today's 25- to 40-year-old luxury consumer has traveled overseas. Younger
people read international newspapers and magazines. Professionals and managers,
but also independent entrepreneurs, make more money today than 20 years ago on
Wall Street, or with tech companies, as top/midlevel managers of Fortune 100
companies, and also as successful media managers, designers, musicians, and
sports stars.
Americans, especially men, are starting to get interested in mechanical watches —
both automatic and hand-wound movement, no battery (quartz), and the
mechanically complicated. Cars, watches — mechanics in general interest the
American male consumer more and more. He traveled to Europe and wants an
international brand and a Swiss watch; he wants to know about watches to make a
personal statement: Your watch says a lot about yourself and about your style and
position. Status-aware alpha consumers — the ones looking for the true luxury
watches defined not by an advertised image but by quality — are looking for the
unique and truly exclusive brands, and they are willing today to pay more for a
watch and at an earlier stage in life.
Are consumers making sacrifices to acquire watches? Are watches, in effect,
the new status accessory?
The only accessory that a white guy should wear is a nice watch. Maybe
Brazilians or Italians can wear golden bracelets and necklaces.... There are watches
for every budget: luxury watch brands also offer entry-price models. Ours is at
$1,700 for a ladies' steel watch and $2,200 for a men's automatic watch in steel.
There are people like me who would make a sacrifice for a nice and unique watch
that not everybody has. I would keep the car a year longer, but never ask for credit.
Others have enough green to buy a watch at any price. Our top models for men that
are limited and complicated go for $40,000. It's important that you pay a fair
price; many of the top luxury brands are overpriced. Luxury image is often solely
built through advertising, not through quality of the watch. Only people in the know
— our target — can really appreciate the value of an expensive watch like ours.
How do diamonds fit into the total story?
Ladies, especially American ladies, like glamour and precision. They buy
diamond watches with quartz movements for the look and sparkle. The quality of
the diamonds is key. Bucherer is the finest jeweler in Switzerland, and the way we
set our Carl F. Bucherer watches with diamonds is unique in the industry. Bucherer
also creates jewelry collections and has its own diamond trading license in
Amsterdam. We started to put these top-notch, Top Wesselton, VVS quality
diamonds also on some men's pieces: sporty, sturdy watches paired with diamonds
are popular in sports and hip-hop circles, but also Latin consumers like the "bling."
We only offer very few men's watches with diamonds, mostly on special request:
We do a lot of customized diamond setting for top clients of our retailers.
What about the celebrity association with watches that's now de rigeur in
promotion, like the partnership between Jay-Z and Audemars Piquet? Any such
plans?
Audemars also has the Terminator. What is the message here? The celebrity
should match the marketing strategy and the image of a certain brand. It is
important in the US for a brand to be chosen by celebrities, with emphasis on
chosen. Our watches are too precious to be given away and we only have very
limited inventory in the US; we want the celebrity to understand the philosophy of
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3. our brand, the uniqueness and rarity, the quality and the people behind it, then we
will work with the celebrity to get her/him the watch for a very good price. If a
celebrity has to buy a watch he will talk about us and his watch and becomes an
important brand ambassador who proudly wears his Carl F. Bucherer watch in
public. This definitely helps to build a brand in a new market and we already have
placed some watches in Hollywood (Anne Heche, Jeremy Piven, and Wayne
Gretzky), but never for free. However, our market is not the mass market who will
buy what his favorite soap opera star endorses.
Tell us about the limited production of the line.
The Patravi "Tribute to Fritz Brun" is a self-winding chronograph with
perpetual date (the movement "knows" the 30th or 31st of every month and the
leap years until 2100) and comes with moon phase indication, in solid gold. Only
125 were built for the world — 50 in white gold, and 75 in rose gold, to celebrate
the 125th birthday of Fritz Brun, a legendary composer who lived in Lucerne,
Switzerland, which is also the location of our headquarters. Brun was a friend of
founder Carl F. Bucherer. The watch retails around $39,000. We have limited
editions for very precious diamond watches for ladies: The Pathos Diva comes in
various full-diamond settings and blue sapphires or red rubies. Only 25 of every
Pathos Diva limited edition will be built — we only have five of each for the US The
quality of the stones and setting are unmatched. There is also a new Alacria Diva
"high jewelry" collection with blue and orange sapphires retailing at $53,000 —
also only five are available in the US.
Cartier and Rolex, for example, two very popular brands, are so entrenched
in the fashion space. How do you plan to compete?
We are not about fashion, but about style and quality. You pay a lot for our
watches, but they last for generations and will never be out of fashion.
Tell us about the Travel Tec watch that's just debuting.
This big watch — over 46 millimeters — is a "boy's toy" — a mechanical world
novelty developed in-house by our management in Lucerne, combining a
chronograph and three time zone indications for world travelers. It is beautiful,
useful, and high-tech. The Travel Tec will arrive early in 2006, first in steel, then in
rose gold, and will be very limited.
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Photos: Bucherer watches
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