Corum obliged to move up-market

February 2003

Corum is doing well, but at a price – it finds itself forced to move up-market. This is one of the unexpected, if logical, effects of the current economic crisis. In his usual straight-talking manner, Severin Wunderman tells us what is happening at Corum.

Contrary to most heads of watch companies, Severin Wunderman says it like it is and is not afraid to clearly communicate Corum's numbers and his feelings about what is happening in the industry. He does not hide the fact that 2002 was a difficult year. “With a lot of pain and effort,” he declares, “we managed to achieve the same results as 2001. But our profits are feeling it. To reach this level, we had to do much more in terms of communication and we had to produce less pieces, but more expensive ones.”

Converted into numbers, the brand's turnover is around CHF 100 million for a production of 35,000 pieces. “Concretely, the slowdown that we experienced in 2002, and that has all the signs of continuing into 2003, forces me to rethink my goals. While earlier I had given myself 5 years to reach a turnover of CHF 200 million, it will now take 7 years.”

Consequences of fake copies
Certain phenomena have also come together to put the brakes on the brand's planned development. “The slowdown in the Bubble model, especially in Europe,” explains Wunderman, “is largely due to counterfeit copies, whose quality is becoming more and more surprising. In Milan, for example, the police showed our agent seven Bubbles, asking if they were real or fake. Our representatives were not able to tell at first glance! It was only by opening them and examining the movement that they could determine that these pieces were indeed fakes. The problem of improved quality in fakes is doubled by the very real problem of such large quantities. In only one factory in China, some 245,000 dials of fake Bubbles were discovered! You can imagine what that number means in comparison to the 35,000 pieces we make each year… A sapphire crystal for a Bubble alone costs CHF 280, or many times the cost of a fake watch. Counterfeiting does not only affect us indirectly, but also directly because we have to spend a fortune, more than a million francs a year, trying to combat it.”

Increase in average price
The economic situation has also pushed Severin Wunderman to produce higher-priced pieces and thus to move up-market. “Fake copies are upsetting the natural curve of our sales,” he states. “We have thus been obliged to move up in range to preserve our position. Doing this, we have also succeeded in reaching a new clientele and a fringe of collectors that gets increasingly larger in size, often young people or new collectors. With this mind, this year at Basel, we are presenting many exceptional pieces, in limited series, as well as hand-painted pieces that are unique.”

In his manner, also unique, Severin Wunderman is carrying on the grand tradition of Corum, a brand always known for its great stylistic creativity. “How can a small independent brand such as Corum compete against the large groups and combat the strong pressures that are in the marketplace?” he asks with feint naivety, then answers his own question, “By bringing a breath of fresh air, difference, creativity… and a better discount for retailers.”

The year of the Admiral's Cup
Another one of the great 'classics' of Corum has been replaced at the heart of the product offer of the 'new brand'. Entirely redesigned and brought up to date, the Admiral's Cup collection was re-introduced at Basel last year. It soon became the driving force behind the brand. “The new Admiral's Cup took off very strongly everywhere we are present,” smiles Wunderman, “whether it was our premier market, the USA, in Italy, in France, in Asia or in the countries of the Middle East.”

With the addition this year of the Diver Professional and a ladies' model, the Admiral's Cup collection is now complete. “We profit enormously from the confusion between the words 'Admiral's Cup' and 'America's Cup'…” he admits. “And, we are fully participating in the current popular trend for nautical sports. This summer we are going to sponsor two of the four races of the Admiral's Cup of which we are also the official timers.”

“One of our advantages in relation to those brands under the law of the large groups,” continues Severin Wunderman who takes pride in designing the watches himself, “is our reactivity. Here, it is one person who decides. We are therefore able to bring out a new model in three to six months. But, to be able to do so, we need to trust our suppliers, which we do entirely. We prefer not to spread ourselves too thin, but rather to establish strong relationships with a selected few suppliers and sub-contractors.”

Asked about the recent controversy surrounding ETA, Wunderman quickly interjects. “I have absolutely no problem with ETA,” he declares, “no problem for deliveries or for deadlines. I know how to plan and I take the time necessary to receive my orders. I have never had a reason to complain about my relationship with the Swatch Group.”

Re-launching haute horlogerie
The success brought by Corum's Classique collection and by complicated movements (the exclusive Marées movement, the Flyback, GMT, Grande Date and Power Reserve) has led Wunderman to take the brand more strongly into the quality niche segment. With no intentions of becoming a purely haute horlogerie brand, Corum is nonetheless going to re-launch a certain number of watchmaking specialties, which in the past have made it its reputation.

We will have to wait for the re-introduction of the 'Golden Bridge', revisited and redesigned according to the most contemporary canons of style. We will also have to wait for the update of the famous Tourbillon under a sapphire bridge that Christophe Claret developed for the brand a few years ago.

“Our activity in the haute horlogerie sector pushes us to review some of our internal operations. We also have to think about assuring the prestige of the brand by being able to assemble complicated movements as well as being capable of designing and realizing the most advanced specialty products.” In doing this, Corum is responding to the needs of the market as well as its sales network, which is “conservative and which expects from a serious brand worthy of the name, a particular quality in watchmaking that we are now ready to offer.”

The latest Corum products will be displayed at Basel in a “totally redesigned stand whose windows will reveal many surprises that will astonish more than one,” promises Severin Wunderman. The rendezvous is at hand.