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SEIKO HAS GRAND PLANS FOR THE FUTURE

January 2018


SEIKO HAS GRAND PLANS FOR THE FUTURE

This is the oldest Japanese watch brand, with more than a century of history. It has been in on every technological innovation. But 2017 will remain engraved as a major step in Seiko’s international development: the year when Grand Seiko gained its independence. And with it, watchmaking Japanese-style.

Seiko’s organisation is as complex as the Japanese tea ceremony! To cut a long story short, this oldest of Japanese watch brands is structured into three entities: Seiko Watch Corporation, which markets the watches and sources them on the one hand from Seiko Instruments, the flagship factory of which is located at Morioka in the north of Japan, and on the other from Seiko Epson, which is established in the region of Nagano.

We have our first appointment in Morioka at Seiko Instruments, where we are greeted by the local manager Ryoji Takahashi, who oversees the 700 employees there: “The Morioka factory opened in 2004 to reach the highest degree of manufacture and craftsmanship in Japan.” Why so far from Tokyo? Because of the fresh air, the streams, the calm and the small valleys somewhat reminiscent of Switzerland, where the watchmakers can really concentrate! Note that besides its two principal sites in Japan, Seiko also has factories in mainland China, Thailand, Malaysia and Singapore, notably for the production of quartz movements, with an output capacity of 10 million calibres a month, most of which are sold to third parties. It also operates fashion brands, such as Issey Miyake and Agnès B, as well as a handful of brands that are less well-known outside Japan and aimed at the local market.

SEIKO HAS GRAND PLANS FOR THE FUTURE

But very quickly, we come to the central issue which is currently taking up everyone’s energy at Seiko: the emphasis being placed on Grand Seiko as an independent brand, with its own international distribution network! “We train our watchmakers how to assemble Grand Seikos over a long period,” Ryoji Takahashi goes on. “A lot of people want to work in Morioka, but it’s not easy! Few horology graduates are able to join us…”

In particular, the Morioka factory produces Spron, an alloy which provides superior elasticity, great strength and high heat and corrosion resistance in the mainspring and the hairspring, developed jointly with the Metal Materials Laboratory of Tohoku University.

But to round off our tour of Seiko in Japan a trip further south is a must: to the province of Nagano and the Shiojiri factory, where we are welcomed by its manager, Hiroshi Kamijo. This is the very place where the first Grand Seiko was developed in 1960. And the first quartz wristwatch, in 1969...

What strikes visitors is precisely the diversity of its production, between quartz and Spring Drive. It’s a continuous oscillation between automation and the human hand. An impressive automated line works night and day, producing quartz movements. “We still use quartz for Grand Seiko watches for men – which might seem surprising – because we take the view that we produce the best quartz calibres in the world in terms of precision, power and durability,” explains Hiroshi Kamijo. “That’s also part of our heritage. Today, Grand Seiko production is divided between around one-third Spring Drive, one-third quartz and one-third mechanical movements.”

In the Micro Artist Studio, human hands take pride of place, beneath a portrait of the venerable Philippe Dufour which dominates the workshop. This artisan from Vaud canton came to Shiojiri in 2006 to teach them finishing, and even sent them a polishing tool in gentian wood, today produced in wood from Hokkaido... The studio does both the design, the R&D and the finishing: this is the most creative part of the factory, the place where new watches with complications are dreamed up.

Before, the studio used to focus on Credor (examples of note are the Sonnerie model of 2006 and the Minute Repeater of 2011), but today the accent is of course also placed on design of the Grand Seiko, including the award-winning 8-Days model of 2016. It is precisely these three models that take pride of place in the window of the Seiko flagship store in the chic Ginza district in the centre of Tokyo!

What about promoting them through auctions, like their Swiss counterparts? Kaz Fujimoto, a Japanese expert with Phillips, does not rule it out: “We don’t offer any Japanese watches for auction yet, but that might happen in the future… Because part of Seiko’s strategy of moving upmarket includes enhancing its value among collectors through auctions.”

To obtain more details about their independence and internationalisation strategy for Grand Seiko, we met Shuji Takahashi, the President and COO of Seiko Watch Corporation. Interview.

Shuji Takahashi, President and COO of Seiko Watch Corporation
Shuji Takahashi, President and COO of Seiko Watch Corporation

Europa Star: The big change of this year at Seiko is the independence acquired by Grand Seiko. Could you tell us more about the underlying strategy behind this split and what benefits you expect?

Shuji Takahashi: Back in 2010, we committed ourselves to greater international development with Grand Seiko. Until then, it had been a Seiko line reserved for collectors. Now we’re establishing it as a brand in its own right and hope to make it popular with a broader audience. The Astron, Prospex and Presage have already enjoyed strong international growth.

Grand Seiko is now on sale in Seiko boutiques all over the world and at luxury retailers’. The initial response has been good. Grand Seiko first of all attracted truly passionate watch lovers, then the media, and finally caught the distributors’ attention. The award won at the Grand Prix d’Horlogerie de Genève in 2014, the Petite Aiguille, was very satisfying from that point of view. Now, Grand Seiko is a brand in its own right.

As a part of this strategy, are you going to launch more complications in the Grand Seiko brand, for example a tourbillon? You already manage these capacities with the Credor brand; will you transfer them to the Grand Seiko brand?

What I can say is that we’re in the process of developing into the luxury watch market at the moment and in the future we’ll no doubt develop into high-end complications. But you have to be aware of the fact that the entire Grand Seiko philosophy is based on exceptional readability, elegant design and accuracy. We’re concentrating first of all on the quality of the details rather than launching new complications. The Grand Seiko 8-Days is the best illustration of this philosophy.

“We want to maintain our particularity as a Japanese watchmaker. Our customers are sensitive to the delicateness of Japanese quality.”

What are the main comparative advantages that you would like to emphasise compared to Swiss brands active in the same price point, in order to seduce collectors but also a wider audience?

My philosophy is that every luxury brand has to fight first of all for its own character and identity. How to express it in a unique way? The Swiss brands have a large slice of the market because they’ve developed strong identities. We’re also developing a distinct identity through the three features cited above: accuracy, readability and beauty. We will carry through this philosophy to the very end. We want to maintain our particularity as a Japanese watchmaker. Our customers are sensitive to the delicateness of Japanese quality and the sense of detail we put into the design of our watches. One good example is the Snowflake dial. It’s as if snow is falling onto the dial, blown by the wind. It might seem very subtle, but we’re always being inspired by details of nature. It’s the same sensitivity as you find in clothing, architecture or Japanese gardens.

Grand Seiko SBGR309: the watch has a maximum 3-day power reserve and combines the latest in hairspring technology with an escapement developed through the MEMS technology to achieve high accuracy and stability when worn.
Grand Seiko SBGR309: the watch has a maximum 3-day power reserve and combines the latest in hairspring technology with an escapement developed through the MEMS technology to achieve high accuracy and stability when worn.

Grand Seiko still has the Seiko label in its name (versus Tudor and Rolex for instance). It might be seen as a pitfall to the autonomy of Grand Seiko and its perception as a separate brand from Seiko. What is your strategy to surpass this potential pitfall?

I perfectly grasp that from the purely branding and marketing perspective the two brands ought to be separate. If it was a new brand, we would have called it something else. But we fully assume our heritage. We figure among the top five brands perceived as luxury brands in Japan, even though several labels co-exist under the Seiko appellation. We believe that the term ‘Grand’ embodies the idea of luxury. And after the international launch of this new strategy, I believe even more strongly that Grand Seiko is the right name. We mustn’t change its identity, its nature, at any cost! It’s the same thing for you, with Europa Star: it isn’t a name that automatically calls watchmaking to mind, yet you have a heritage in the industry that goes back 90 years. Don’t lose your identity, it’s your most valuable asset!

Japan is a ‘brand’ in itself today, famous for its very elaborate culture and arts all around the world. Would you envision incorporating a more Japanese ‘touch’ into the design of the watches, for instance adding more typical patterns and craftsmanship on the dial of the Grand Seiko, which is very minimalist for the moment?

It’s true that starting in 2000, high-range watchmaking became more extravagant and we’ve seen many Swiss brands following that trend. Watches are no longer simply an instrument for telling the time, they’re fashion objects and subject to trends. It’s a very complicated subject for a brand like Seiko to follow. We keep an eye on the ‘megatrends’, but how do we keep our identity?

We want to maintain a delicate balance. If we’re going to start competing more on the international markets, we’re going to have to differentiate – while staying ourselves.

We’re not a Swiss brand and we’re not going to follow the megatrends. I still can’t talk of future developments but I can tell you that we’re always trying to give our watches more of a Japanese ‘flavour’, through the lacquer or the enamel, for example. But it’s very subtle, a tacit statement. The Swiss are more showy, and the customers know the value of it. The Japanese have to explain more about the watch and what makes it special.

For the moment, we still sell more Grand Seikos in Japan than on the international market. But we want to go on the offensive and there’s a still a large share of the market to conquer. Maybe it’s a brand philosophy we still need to explain more.