There is a wonderful symmetry to the headline statistics that Ice-Watch presented at this year’s BaselWorld, with the huge figure of four million being a recurring theme. Four million fans on the brand’s Facebook page, four million visits to the company website, over four million watches sold (4.3 million, to be precise) and—multiplied by a factor of 100—a turnover of €400 million generated by some 12,000 stores around the world that carry the brand’s watches. Those unit sales mean that Ice-Watch is selling an average of eight watches per minute, 24 hours a day and 365 days a year. Even taking a relatively low return rate of just a couple of per cent, that still means that thousands of Ice-Watches are transiting between stores and after-sales service centres at any given time. So how does the company cope with this volume?
A system born of necessity
Pascale Istace is the man with the answers. He helped to develop Ice-Watch’s Repair Tracker system, together with Eric Imhauser. It is currently available in two versions: a “light” version that connects an after-sales service provider with the repair centre in Hong Kong, and a “full” version that connects the Hong Kong repair centre, the after-sales service provider, the retailer and even the end customer. “Two years ago, we were selling 400,000 watches in Belgium,” he says, “so even at a return rate of below five per cent, you can imagine the volumes we had to deal with for customer service. We used to handle the enquiries by telephone but we decided to develop our own IT system. The big advantage is the sharing of information, because once the tracking starts, everyone has access to the same information.” Although the system has to cope with a huge amount of data, it does not have to contend with the traffic loads of a conventional website. “If you count an average of around 15 different steps for each claim and consider the fact that we are currently running at tens of thousands of claims since the start,” says Imhauser, “that’s well over a million individual steps recorded in the system. That is with around 2,000 users. But it’s not like a website, because the audience is nowhere near as big and not everyone is using the system at the same time.”
Whether a retailer wants to send his Ice-Watches directly to the repair centre in Hong Kong, whether a country wants to handle all its own repairs (as is the case in Germany), or whether it wants the flexibility to choose, the Repair Tracker takes all of these different usage scenarios into account and can handle all customer service enquiries for Ice-Watch.
The process starts when a customer returns their watch to a store. Using the full version of the system, the sales staff at the store enter a “claim” in the secure Repair Tracker website, indicate whether it is a repair under guarantee (Ice-Watch had discovered instances where stores were charging for repairs under guarantee) and select a diagnosis for the problem from a drop-down list. The Repair Tracker then generates a unique claim number and access code that is printed on to a detachable coupon. The customer is given one half of the coupon and the other half, which has a barcode identifying the individual claim, accompanies the watch on its onward journey. From this point on, the customer can check the status of the repair by logging into the website www.ice-repair.com with the claim number and access code on their coupon. Once the watch arrives at the repair centre responsible (either an authorised after-sales service centre or the Ice-Watch repair centre in Hong Kong) it is examined in order to validate the claim or refuse the repair with the indication of a reason. If the watch is sent on to Hong Kong for repair by an authorised after-sales service centre, the system prints a label to accompany the watch. The system automatically sends an e-mail to the retailer, either to indicate the refusal of the repair, with the reason, or confirm the repair with a price estimate and a link that the retailer can click on to approve the quote. From this moment, a deadline is given for the repair that is based on the cumulative average deadlines for the individual stages in the repair workflow. But this deadline is flexible and will be adapted automatically by the system according to how quickly each of these stages is completed. At each stage of the process, anyone with a user account for the Repair Tracker and the access code for the repair can see at a glance the status of the repair, with all completed stages surrounded by a red border and the person who validated the stage visible in each case. For all claims, the reference number of the watch is checked and the factory where the watch was produced is selected (each of the six different symbols on the case-back corresponds to one of the Ice-Watch assembly factories), which allows the brand to monitor quality levels at each factory. Based on the reference number and the fault diagnosis, a picking list is automatically generated for the spare parts warehouse, where the corresponding parts will be picked manually. Once repaired, the watch then goes through three different tests before being returned to the distributor or retailer. The recipient must confirm receipt in the system, at which point the end customer is automatically notified that the watch is ready for collection.
Cutting turnaround time
“We have reduced turnaround times from around one and a half months before the system was implemented to around three weeks now,” beams Mr Istace. “That’s from and back to the end consumer. We are very proud of this performance because most prestige watch brands have turnaround times of over one month.” The system has numerous other benefits, as its developer Eric Imhauser explains, “Another important point is knowledge management. The knowledge is now inside the system rather than in people’s heads. When we moved the customer service centre from Brussels to Bastogne, it took just one day. All we had to do was change the address and inform our logistics company.” Added to this is the possibility to generate comprehensive statistics on the claims being handled by the system according to their different statuses and to list these by month, by retailer or any number of other criteria. The system will even flag retailers who have the system but who are not using it to enter claims. It is so powerful that even third-party customer service providers have expressed an interest in it. Furthermore, its utility for Ice-Watch is not simply restricted to customer service, as Pascale Istace explains, “We also integrated a checkout system for our flagship stores. Since we want our flagship stores to have the most complete collection, we have configured the system to send an order automatically as soon as a particular reference falls below its ideal stock level.” This is the first such system that Europa Star has had the opportunity to see in action for our Service, Please! column. The attention to detail and ease of use for retailers and end customers are a model for the industry and one which other brands would do well to take note of.
The problem of counterfeits
It may sound surprising that Ice-Watch has to reject repair claims because some of the watches it receives are counterfeit but, as with any successful brand, counterfeiters will go to great lengths not only to reproduce the original product as best as they can but also to recreate the online selling environment to further dupe the potential customer. Ice-Watch estimated the number of counterfeit Ice-Watch models on the market in 2012 to be around 5 million, which is more than the actual amount of genuine Ice-Watches sold in the same year! The brand therefore takes the fight against counterfeit watches seriously, working to educate customs officials on how to identify fakes, using the IPM online system of the World Customs Organisation to exchange information and working together with the anti-counterfeiting network REACT to seize and destroy counterfeit watches. In 2012, 2,150 such seizures were made and 130,278 counterfeit watches were destroyed as a result. The fact that this represents just 2-3 per cent of the counterfeit watches estimated to be in circulation shows the enormity of the task that Ice-Watch faces.
Source: Europa Star June - July 2013 Magazine Issue