You have just inaugurated your watch exterior component manufacturing facility, and you also held an open day at your movement manufacturing facility for selected VIPs. What benefits do you derive from this vertical integration ?
The creation of our watch exterior component division actually corresponds to a strategy of vertical integration undertaken a decade ago, because Bvlgari has been manufacturing its cases, dials and movements for years. Our production units were spread over five sites and called for a certain amount of rationalization. We have already merged our watchmaking expertise center in La Chaux-de-Fonds with our movement production site in Le Sentier, by building a multi-purpose movement center enabling far greater flexibility and responsiveness. This makes it possible to produce what is requested and not only what is planned, thus avoiding building up stocks and enabling huge gains, since our replenishment times have been cut from eight months to three months. Our assemblers thus move seamlessly from a simple time-only three-hand watch to more complicated models with or without a tourbillon. Grande Sonnerie models naturally remain the exclusive preserve of three expert master watchmakers. The same applies to our new watch exterior component division, since there are also synergies in the production of dials and cases, such as polishing or machining, even though these two professions were created independently at Bvlgari. This is doubly positive in that it benefits not only clients, but also employees whose expertise thus evolves and gives them access to broader potential career options, which is not always the case in a medium-sized company.
Are the five world records in thinness achieved by Bvlgari within just a few years beginning to bear fruit in terms of enhancing the brand image among final customers ?
This is clearly evident, as confirmed by our retailers who show us greater consideration, as well as increased demand for our men’s watches. At the same time, this recognition of watchmaking expertise also reinforces interest in our ladies’ watches. Customers appreciate having a watch designed for them by a real high-end watch brand, which explains why Bvlgari is able to grow despite the difficulties currently facing the market.
Your Bvlgari hotel in Dubai is hosting an LVMH watch event in July ; is this important for you ?
Traditionally at this time of year, we have been accustomed to meeting with the international press and our clients in Geneva on the sidelines of the SIHH to present our new products so that they could plan their year. Since the watch shows have been switched to the end of April/beginning of May, in order not to lose four months on our 2019 momentum, our LVMH January encounter in Dubai puts us in touch with the best watchmaking journalists on the planet and the best retailers of the Bvlgari, Hublot, TAG Heuer and Zenith brands in order to achieve a significant part of the 2020 turnover. All this while many other brands will still have to wait several months. Hosting visitors in a Bvlgari hotel provides a context of very high-quality hospitality, far more conducive to building partnerships than at watch fairs. This Dubai event therefore replaces our old Geneva Days, perhaps even Baselworld in the future, we are not yet sure.
“Bvlgari is pursuing its development despite the current market difficulties.”
Bvlgari has just taken part in the Dubai Watch Week ; what was the purpose of that ?
We participate through our retailer Seddiqi, which handles Bvlgari in the region, and has created an excellent platform in terms of visibility, especially for male customers. The Dubai Watch Week is a golden opportunity to showcase our expertise in men’s watches with our five world records and our awards at the Grand Prix d’Horlogerie de Genève over the years. Bvlgari should emerge positively in the eyes of visitors and of the Seddiqi clients attending our dinners.
Bvlgari watches are currently enjoying a healthy dynamic ; what is the outlook for 2020 ?
With the tensions in Hong Kong, which according to official figures is the leading export market for watches, the sector is declining significantly and this is likely to affect the first months of 2020 as well. The sharp drop in tourist arrivals in Hong Kong is not offset by transfers to other destinations. Even if the Hong Kong and Beijing governments find a solution, mistrust will linger for several months, as was the case with the yellow vest movement in France, thereby penalizing watchmaking. Fortunately, just as during the 2014 slowdown, Bvlgari is starting the year with a new collection whose positive effects should last 18 to 24 months and enable us to post growth above the market average. Seduttori ladies’ watches were created for more everyday use and reach a new clientele. In addition, the Lvcea Skeleton model is becoming an unexpected bestseller whose success we will interpret in various ways, and we will unveil at our Dubai event Octo models that continue to prove very interesting.
How is the high-end market doing on both feminine and masculine levels ?
Bvlgari is achieving healthy sales with the Octo Tourbillon Saphir models, of which customers sometimes also request versions in jade or other precious stones, at prices amounting to CHF 400,000 or CHF 500,000. The success of very high-end watchmaking also applies to Haute Joaillerie ladies’ watches with small complications such as the tourbillon. This segment is already an important part of the market, but there is room for progress if I look at what is happening with other brands.