#Resilience


“We are only at the beginning of business in China”

JULIEN TORNARE

Español
December 2019


“We are only at the beginning of business in China”

In our latest report about the transformation of the watch world, we selected six major issues which are having a profound impact on the industry’s present and also on its future and discussed them with about forty stakeholders of the industry. Here is the take of Julien Tornare, CEO of Zenith.

ENTRY-LEVEL
“Strong competition, but not all clients want a smart watch”

“I believe the low-end brands are definitely facing very strong competition with the Apple Watch, but I also believe that there will be a concentration of the strongest players and a decrease of the others. Not all clients want to have a cell phone on their wrist, even if they cannot afford an expensive brand. I am not too concerned, as connectivity will expand to more formats and the watch will be only one of many. And let’s not forget that a cell phone on your wrist does not differentiate you from your neighbour and also that a smartphone is obsolete when you buy it. A mechanical watch with a soul and emotion is eternal!”

POLARISATION
“It will change again in the near future”

“Some models became iconic and mean a lot to the buyers. But there has always been such a phenomenon in the past and things evolve constantly. I believe it will change again in the near future and other models and brands will also play a primary role.”

Julien Tornare, CEO of Zenith
Julien Tornare, CEO of Zenith

DISTRIBUTION
“Some important markets are missing strong retailers”

“Mono-brand boutiques are a great tool to build up brand image, awareness and desirability, but I also believe strongly in the retailers’ business model. We don’t sell shirts or shoes, we sell complicated products and many clients enjoy having the neutral advice of a multi-brand retailer when they don’t know what they really want, or they need information on the watches themselves. In a mono-brand boutique you will be told that the brand is the best in the world, of course!

However, some important markets are missing strong and dynamic retailers and that is why some brands decide to go with a boutique. This is a risk. E-commerce will improve, but gradually, as volumes today are still very small for the industry. Successful sales are often for special limited editions available only online. People going online are also looking for discounts and can end up on unofficial websites where they take the risk of buying a fake or poor-condition timepiece.”

"Some important markets are missing strong and dynamic retailers and that is why some brands decide to go with a boutique. This is a risk."

PRE-OWNED
“Good news for our industry”

“Pre-owned is good news for our industry and is natural in today’s world where we’re all talking about sustainability and second-hand products. This segment is getting stronger and brands should get ready and organise themselves to facilitate this and offer it as a service to their clients.”

OPPORTUNITIES
“We must not rely only on tourism, but develop locally”

“I don’t believe China has been conquered. Maybe from a European point of view. The country is huge and its middle class is growing, offering enormous potential. We are only at the beginning of our China business. Other countries will grow and more clients will emerge. One key is to work on local clientele as well and not only rely on tourism flows, as they represent a big risk when things go less well. Indonesia, Vietnam, India, Latin America and Africa are still to be developed, and let’s not forget that new clients are emerging everywhere as a new generation.”