Swatch Group

Omega: “A little more time”


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September 2018

Omega: “A little more time”

The “elder brother” of the Swatch family and the world number two watch brand, Omega has multiplied initiatives under the energetic leadership of Raynald Aeschlimann. A new and much talked-about e-commerce site in the United States, a new production site in Biel, strong capitalisation on the taste for vintage watches in the more mature markets, numerous sales outlets in mainland China – we talked about Omega’s roadmap with the man behind it.


n the Baselworld issue of Europa Star, we invite you to meet two key figures of the Swatch Group. Incidentally, they both served in the Swiss army. That necessarily builds bonds. Today, they are both part of the top management of the world’s largest watchmaking group, where both have worked for a very long time.

Having ascertained from colonel Walter Von Känel who gives the orders at Longines over a tête de veau in St-Imier, we set off to meet officer Raynald Aeschlimann, 47, who pilots Omega from his new building in Biel. Inaugurated last year, it was designed by the reputed Japanese architect Shigeru Ban.

Omega has a strong presence in Asia, and even more so with the Olympic Games in Pyeongchang this year. And you’re continuing to put a huge effort into marketing there. Is that continent the brand’s “impassable horizon”?

You have to understand the demographics that are still operating in Asia. We’re only just starting to grow in China and Singapore, not to mention India…. In mainland China, we already have 200 sales outlets, including 30 of our own boutiques. Sociologically speaking, we’re destined to grow with the country!

On the more mature watch markets, in Europe, you’ve capitalised a lot on the taste for vintage watches, with the Speedmaster and promotions like Speedy Tuesday (ed.: the sale of 2,012 special Speedmaster models, which were sold in under 5 hours last year)...

The ‘1957 trilogy’ (Speedmaster, Seamaster, Railmaster) we launched last year at Baselworld was also well-received. People talk of ‘vintage’, but it’s not just a matter of copy-and-paste. Let’s say that we updated Omega products to suit the tastes of collectors in those countries. But we still need stronger emphasis on vintage models for women. We’re going to put that right next year.

Raynald Aeschlimann
Raynald Aeschlimann

We’re also wondering about your potential in the United States, the stronghold of your principal competitor. Your latest offensive has been to launch your own e-commerce platform.

The United States itself still has potential before it becomes a ‘mature’ watch market, and that should be to our advantage. Proof of that is that the average price in our own 28 boutiques is higher than in the other outlets in the country. There’s a real passion for the watch and its history in the United States, and that showed during the Speedy Tuesday operation. Americans were among the top three buyers. That prompted us to open an e-commerce site last autumn, our brand’s first.

Yes, that caused a lot of tongues to wag. It looked you were opening hostilities on the internet. After opening your own boutiques, now you’re into e-commerce – that’s not likely to reassure the retailers…

It’s not reassuring for the retailers who don’t believe in Omega any more, of course. But I’d remind you that we’ve cut the total number of our outlets worldwide from 7,000 to 2,500 today. And we’re going to keep those 2,500! They’re very proud to work with us and they earn a lot more thanks to Omega than with sales of other brands. They’ve succeeded in generating additional business thanks to our brand.

What was their reaction to the launch of your e-commerce site in the United States?

Let me state quite clearly: my view is that it isn’t ’killing’ the distribution chain. It’s a way of reasserting ourselves and strengthening our direct contact with the end customer. You have to face up to reality: some of our customers already buy online, because they’re dissatisfied with the distribution network as it now stands. It’s a question of creating a network over a vast territory. Some of our customers in the United States are 600 kilometres from the nearest Omega outlet.

It’s cultural too: maybe an American customer is more prone – today at least – to buying online than a European…

Yes, we took the decision after observing that traffic on our US website was huge. In the US, e-commerce in watches is now an important reality, because either for reasons of convenience or geographical remoteness it complements the distribution network.

What is the purpose of the e-commerce site in the United States? To serve as a test before being applied to the rest of the world?

It isn’t a simple ‘test’, because it’s set to last. The United States has been the first to benefit from it, because that’s where we saw the greatest potential and the highest demand. As regards complementarity between physical and virtual sales, a much talked-about subject on the market, there was a total vacuum there.

If that kind of complementarity is so important, why aren’t you present on an e-commerce platform like Tmall (a subsidiary of Alibaba) in China, your flagship market, like your Swatch Group brother-in-arms Longines?

We apply a simple rule: we are not present on sites like Amazon or Tmall. Despite migrating to the web, we’re not forgetting the brand’s experience and image. And at the moment, I don’t see how we can put Omega’s experience on those sites.

What is currently Omega’s fastest growing market?

Switzerland is performing incredibly, it’s in the top three in Europe. After that, I’d say the United States, given its strong growth since last year, especially online. And we shouldn’t forget Macao, which is a real rising star in Asia and has turned into a holiday El Dorado for Chinese families.

What do you need now to reach the top of the podium?

Time! The fact that we’re the world number two is thanks to the huge amount of work we’ve already put in. And we have this legitimacy of tradition: this year, we’re celebrating the 70th anniversary of the Seamaster.

Omega Seamaster Diver 300m
Omega Seamaster Diver 300m

While we’re on the subject of legitimacy of tradition, how do you explain that two brands – Rolex and Patek Philippe – monopolise the top rankings at watch auctions, which have really boomed in recent years, even though Omega has a long heritage too?

Personally, I find that watch auctions are becoming far too much a place of speculation rather than passion... Our day will come! By contrast, I see far more sincere passion where pre-owned watches – which are very popular with the younger generations – are concerned, and the prices aren’t skyrocketing there.

We support the pre-owned market, and we’re one of the only brands in the world to do so in our price segment. For example, we never refuse to restore a watch. We return all the changed components, even if people intend to personalise their watch that way. And nearly ten years ago, we were precursors when we opened our first Omega Vintage Boutique at Somlo in London. We’re thinking very seriously about making that theme an integral part of our strategy.

What collections are you going to be promoting this year?

The two big themes until autumn are going to be the Seamaster 300, on the occasion of the anniversary we’ll be celebrating, but also the De Ville. Omega also has a young customer base who want a higher-end, elegant watch with diamonds. This strong demand has prompted us to create a ladies’ watch, which I would situate between the Constellation and the Seamaster.

You succeed in building strong expectations around certain limited Speedmaster editions for a limited time, like on Speedy Tuesday. Are the times when all the innovations were showcased at Baselworld well and truly over – and might that also explain the discussions about the future of the trade fair?

The world has changed, it’s more impatient and it also forgets faster. So we have to take care to reveal information at the right time, to take advantage of the emotion at that moment. We can’t achieve everything at Baselworld any more, we have to spread out introductions intelligently. That also sets us a rhythm in-house.

Improving time-to-market – that’s what my priority has been since I arrived. My ultimate dream! The case of Speedy Tuesday highlights both the passion and the impatience of our customers. Yes, we have to go faster, but no, we’re not robots. The human dimension is still important. It might be a limiting factor as far as time-to- market is concerned, but it’s essential. On the other hand, we have the very good fortune that the Swatch Group is vertically integrated. Most of our suppliers are in-house, which gives us faster response times.

Collection Trésor
Collection Trésor

On that subject, you inaugurated your new production site in Biel last year. What are the actual advantages of that?

It raised productivity – and the morale of our workforce. That’s a crucial point, because they work in a setting they’re proud of, where they feel at ease, and where the atmosphere is excellent. Having everything under the same roof, that’s the factory of the future. That will help us grow faster.

As you said, the Swatch Group is a vertically integrated industrial power. It’s also at the cutting edge of innovation in terms of automated mechanical watch production, with the Sistem51 by Swatch and the Swissmatic by Tissot. Is Omega going to benefit from that too?

Wait, let me emphasise one thing: today, we use automation for quality control and for analysing the finishes of our watches, but absolutely not to replace the employees who produce our watches. The act of creating a mechanical watch in our price range will remain the work of humans.

How do you function in relation to R&D?

The Swatch Group is very much vertically integrated and we’ve created research units at every level. But we’re not averse to joint research with the entire sector – look at the development of silicon components, which was conducted at CSEM (Centre suisse d’électronique et de microtechnique) with resources from the Swatch Group and other major industry players.

The industry seems to be multiplying watch personalisation initiatives. And that’s also creating huge logistical challenges. What’s your approach at Omega?

One of our main efforts is focused on the choice of strap. You’ll see it this year, especially with the NATO strap, which is very much in vogue. Personalisation has its good points, but let’s not forget that the success of a company operating in the luxury market also depends on a certain brand image. The stronger that is, the less personalisation will be necessary, if it’s possible at all.

What is the average price today at Omega?

It’s 6,000 francs and we’re a leader in the 3,000 to 8,000-franc segment. It’s in that category that our history, our legitimacy, our strength, lies. We command a huge share of that market and that’s where our ‘comfort zone’ is. You won’t see us trying to push any higher, or developing smartwatches anytime soon. In fact, I call them smart instruments, because they have no soul!