Tag Heuer is using a wave of selling successes and new launches to develop its marketplace proportion within the luxurious watch international, consistent with its CEO.
The corporate, which is owned by means of LVMH, opened a flagship boutique on Long island’s 5th Road on Wednesday as a part of a fast enlargement within the U.S. It plans to greater than double its boutiques within the U.S. to 50 by means of 2026, consistent with Tag Heuer CEO Frédéric Arnault.
At the side of expanding gross sales, the boutiques give the logo extra direct relationships with its shoppers moderately than depending on third-party outlets or division retail outlets.
“This can be a giant shift within the remaining 5 years and that can proceed within the subsequent 5 to ten years,” mentioned Arnault, the 28-year-old son of LVMH CEO and Chairman Bernard Arnault. “Getting branded retail outlets that we perform ourselves in conjunction with e-commerce lets in us to nurture direct buyer relationships.”
Frédéric Arnault, CEO of Tag Heuer.
CNBC
The ones shoppers had been rising speedy since Frédéric Arnault took over as Tag Heuer’s CEO in 2020. Beneath his reign, the corporate has leaned into its legacy in auto racing, particularly Method 1, which has surged in reputation for the reason that Covid-19 pandemic. Because the reputable companions and timekeeper of the Oracle Pink Bull Racing staff, its watches are worn by means of top-ranked motive force Max Verstappen and his teammate Sergio Perez.
Arnault mentioned Tag Heuer is making strides due partially to advertising and marketing wins and new merchandise, comparable to the brand new Tag Heuer Monaco Chronograph with a skeleton dial worn by means of Verstappen, which clocks in at greater than $10,000.
The corporate’s peak fashions are so fashionable that Tag Heuer ready lists at the moment are as much as 18 months lengthy.
“Call for is so much more potent than what we had projected,” Frédéric Arnault mentioned. “So that is what creates the wait listing as smartly. And so we can’t ramp up that speedy. In fact, if we need to double manufacturing within the subsequent 18 months we will be able to, however we will be able to no longer do this. We additionally need to make certain that the worth of the watches are maintained over the longer term.”
Tag Heuer’s expansion is all a part of LVMH’s objective of changing into the arena chief in each and every luxurious class, from style and leather-based items to wine and spirits and watches and jewellery. At the side of Tag Heuer, LVMH owns the Hublot, Zenith and Fred watch manufacturers and it’s been expanding gross sales of its Louis Vuitton and Bulgari watches. The French-based corporate’s jewellery and watch department reported gross sales expansion of eleven% within the first quarter from the 12 months prior, to achieve 2.6 billion euros.
Arnault mentioned a contemporary correction in costs for pre-owned collectible watches has been wholesome for the marketplace. After costs for trophy watches such because the Rolex Daytona, Audemars Piguet Royal Oak and Patek Philippe Nautilus surged all the way through the pandemic, they have got since fallen 20% or extra as the provision of watches on the market on-line grows.
“After Covid, there was once an excessively sturdy expansion acceleration, particularly in watches,” Arnault mentioned. “We noticed an enormous surge in secondhand markets, due additionally to hypothesis with many resale costs that had been expanding. And this has modified prior to now six to 8 months within the secondhand marketplace and now it has normalized once more. I believe it is fitter and we will be able to proceed to peer some cast expansion promoting at once from the shop.”
Tag Heuer might also get a boost from its partnership with actor Ryan Gosling. Gosling has been wearing a 36mm Tag Heuer Carrera with a shiny purple dial as a part of his promotion of the brand new “Barbie” film. Arnault mentioned “Barbie” enthusiasts can be expecting to peer different Tag Heuer watches within the movie as smartly.
“We made positive that there was once the correct watches provide within the film, ” Arnault mentioned. “Ryan can be dressed in some iconic watches that have compatibility smartly on this universe. The Carrera 36mm in purple has already been nicknamed the ‘Barbie watch’ by means of our shoppers.”
