20. time-business


Longines, an empire in China

CASE STUDY

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février 2018


Longines, an empire in China

Like a cruise ship, moving forward slowly but surely, the world’s fourth-largest brand - underexposed in the Western media in comparison with its real market value – got a very early start in the Far East and has never deviated one iota from its strategy of a ordable ultra-traditionalism.

W

hile rifling through 90 years of Europa Star archives, you notice three names that have come up again and again since the 1920s: Rolex, Zenith and Longines. Walter von Känel, the CEO of Longines, who has a direct speaking style (all the be er, but all too rare!) joined the company more than 40 years ago. The St-Imier-based brand celebrated its 185th anniversary in 2017. It was a pioneer on the Chinese market, where it has been present for 150 years. And the Chinese are, by far, its largest clientèle. What could be more natural, then, than to celebrate the anniversary in Beijing? Europa Star was there.

When arriving at the airport of the Chinese capital, it’s fun to see which watch brand your eyes will rst settle on. The answer: Longines. The brand is omnipresent here. Boutiques selling the brand are located at what seem to be 100-metre intervals along the shopping thoroughfare of the city centre. Meanwhile, in Switzerland, the brand is relatively low-profile, while its more modest competitors (since, for several years, Longines has surpassed the level of one billion Swiss francs in annual turnover) roll out the heavy artillery for the slightest innovation, and even more so if the novelty reveals stylistic exuberance.

Profitable conservatism?

Since the style of Longines has remained ultra-traditional, it is a strong reference for a ‘first ne watch’. However, its direct competitors have endlessly changed track – for better and for worse – over the last ten years. Today, TAG Heuer and Montblanc o er not only smartwatches, but also various tourbillon models, extending their ranges both upwards and downwards, while Longines has retained a strict price position at between 1,500 to 3,000 francs. In the case of Maurice Lacroix, moving up the market meant losing a great deal of ground on its historical German market. Frédérique Constant, a challenger in the ultra-traditionalist market of ‘a ordable luxury’, is currently being integrated into the Citizen group.

So is Longines conservative? “I don’t consider myself conservative, but rather consistent,” points out the CEO Walter von Känel when questioned on this aspect. The term might have negative connotations. So... traditional?

Longines, an empire in China

Entering Chinese e-commerce

The Chinese do remain enthusiastic about mechanical watches, the head of Longines reminds us: these represent 90% of the brand’s sales in the country. They also adore models sold as ‘pairs’, which represent 60% of sales.

“Our brand is perceived as offering the best quality for money in the 1,500 to 3,000 franc segment; it is recognised as a legitimate brand and not a passing trend; and it is appreciated for its classical style and elegance,” continues the un appable von Känel. The well-balanced brand is also equitable in terms of models available to women as opposed to men: in China, more than 50% of its sales are in women’s watches.

Historically well-rooted in the Middle Kingdom, the brand has always maintained particularly good relations with the central government to ensure its longevity. The clientèle of China is ge ing younger. In order to win over these new generations, in addition to appointing brand ambassadors, the watchmaker has just joined the gigantic Chinese e-commerce platform T-Mall. “They are truly e cient in establishing the pro les of their consumers using the data that they gather,” states Walter von Känel. “They could teach the secret services a thing or two in terms of information analysis!”