CHIASSO, Switzerland (Reuters) - As luxury watchmakers seek to keep increasing sales while preserving exclusivity, they are taking a leaf out of the haute couture book, making watches to order with anything from diamond stars to fully personalized shapes and decorations.
Big brands, such as Swatch Group’s Omega or Richemont’s Cartier, generate billions of dollars in sales, but as their timepieces grace ever more wrists, they lose their charm for some rich individualists.
And as the industry faces a slowdown after years of rampant growth, the super-rich - who can splash out on luxury even in tough times - become an even more coveted clientele, and personalization is one way to court them.
One jeweler, Buccellati, is going as far as allowing clients to customize everything - so they can have a heart-shaped watch engraved with their lover’s picture or a square one with their family mansion set in diamonds.
“We will offer a bespoke service where the customer has a say on everything: the material, the case, the dial, the hands,” said Thierry Andretta, president of the firm where prices for custom-made watches start at 100,000 Swiss francs ($113,000).
Established watch brands are also in on the game but, with their names and reputations on the line, insist on keeping the final say on the design of the customized piece.
Family-owned Chopard lets customers hand pick diamond-studded stars, horseshoes, hearts or crescent moons that will “float” on the dial of its Happy Sport watches, while Jaeger-LeCoultre fans can personalize the reversible side of the Reverso model through engraving, precious stones or enameling.
At Vacheron Constantin, which like Jaeger is owned by Richemont, customers can choose from a broad range of options on the Quai de l’Ile watch. About 1,000 combinations are possible.
“Buyers of expensive timepieces want to be seen as different from the crowd and customization of appearance is key,” Kepler Cheuvreux analyst Jon Cox said. “Customization and personalisation will be a key driver in the watch sector.”
Exane BNP Paribas analyst Luca Solca said that, while still small, the market for customized watches would certainly grow as it increased perceived exclusivity and supported price premiums.
BEAT THE SLOWDOWN
For other luxury goods, from handbags to luxury cars, customization is already common.
At fashion label Prada, for example, customers can order tailor-made suits and travel bags with their initials. And on just two days this week, shoppers can customize a pair of shoes from the heels to the fabric at one of its London stores.
But watchmakers have relied on limited editions to satisfy their clients’ taste for rare objects.
Now, however, they are cautiously entering the new segment, regarding customization as one way to overcome the most serious slowdown in sales since the 2008 financial crisis.
“Customers will pay more if they feel a stronger emotional link to the product,” said Bernstein analyst Mario Ortelli.
Swiss watch exports, the best indicator for the size of the market, rose 1.9 percent to 21.8 billion francs last year, markedly less than the double-digit increases of past years.
The deceleration was mainly due to a government crackdown on illicit gift-giving hitting sales in the Greater China region, which absorbs about a quarter of exports, but demand in Europe was also weak while there was a modest rise of just 2.4 percent in exports to the No.2. market, the United States.
The launch of Buccellati’s customized service at a watch fair in Basel this week is part of Andretta’s ambition to step up the Milan-based firm’s watchmaking. It now makes only 1,000 timepieces a year with a strong focus on jewelry watches.
“We have customers who are passionate about watches but find that the designs on offer just don’t match their tastes. Fine watchmaking today is very focused on technical aspects,” he said in an interview at the brand’s watchmaking unit in the Swiss town of Chiasso.
Buccellati, a century-old family business in which Italian fund Clessidra took a majority stake in 2013, pledges to create most custom-made watches within six months, using its know-how in high-end jewelry, where unique pieces are the standard.
“Uniqueness is a driver, it’s how luxury goods started: you went to your jeweler and told him exactly what you wanted,” said Andretta.
Analysts say mass customization - where customers choose from a number of predefined options - has huge potential, while truly tailor-made watches like those offered by Buccellati will remain a niche because brands want to keep the final say on designs.
Vacheron Constantin has created a bespoke service that makes 30-40 pieces per year to satisfy customers that want to go beyond its Quai de l’Ile mass customization offer. But to make sure that all custom-made watches “correspond perfectly with the values and traditions of Vacheron Constantin”, it has set up an “ethical committee” that can reject unsuitable projects.
Patek Philippe, another high-end brand, does not offer custom-made watches at all and insists that for all its unique pieces or limited series “the ideas and themes of the creations come from Patek Philippe and not from customers”.
So what if some sentimental millionaire actually asks for a watch with a picture of his mother on a pink dial?
Andretta is willing to take the risk.
“The only constraint we impose is that every watch has to be marked Buccellati. For everything else, the customer decides.”
($1 = 0.8843 Swiss francs)
Editing by Pravin Char
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