Prestige company looks to logic for continued growth
As the luxury watch company Jaeger-LeCoultre marks its 180th anniversary, it says it wants to use the occasion to consolidate its position in China’s high-end market. “China is one of the most important markets for JaegerLeCoultre,” says Daniel Chang, Jaeger-LeCoultre Managing Director for China.
“Over the past 14 years we have continued to explore, innovate and bring amazement to watch fans and collectors in China. Rational and steady development is always our basic rule of business strategy.”
For a company that down the years has been at the forefront of time-keeping innovation, including coming up with the keyless watch in 1847, the world’s thinnest movement at the beginning of the 20th century and the first self-winding watch with alarm in 1956, the Swiss company’s entry into China was relatively late, in 1999.
That entry was premised on the country’s exploding business potential and, with deft marketing backed up by a solid reputation for quality, the brand has become well known in China. It is one of the most sought-after watch brands among the country’s rich.
Jaeger-LeCoultre has opened 12 boutiques and 43 wholesale points across China. To show its confidence in the market and to further enhance brand awareness, Chang says, his company will go into markets such as Chongqing and Chengdu, and open more boutiques in mature markets such as Beijing and Shanghai.
“Boutiques directly demonstrate our products, crafts and brand spirit to our customers,” Chang says. “We will continue to increase brand visibility in China.”
The Chinese market is much more sophisticated than many in the West give it credit for. Chinese people are a lot more wealthy, with a penchant for seeking out quality and individuality in the things they buy than is commonly believed, he says.
“Chinese customers have high standards of discretion and taste. They appreciate the Swiss fine watchmaking craftsmanship and the originality of design.”
They also care about the stories and history behind watches and are keen to know about technical details, he says.
“As for design, Chinese particularly like elegantly designed watches with round and ultrathin cases, and those with the moon phase function.”
The Chinese market is becoming more mature. People know more about foreign luxury brands. Buyers are becoming more discerning in what they buy, he says.
“What we offer customers is the tradition of watchmaking. For us it is good to know that when they look at watches they appreciate craftsmanship and technical beauty.”
Developing foreign brands for the Chinese market can be long and tortuous, Chang says. Anyone doing so needs to spend a lot of time and do a lot of research to become familiar with the country’s regions and the market conditions that apply in them.
“Customers in different regions have different tastes in watches.”
While Jaeger-LeCoultre, a subsidiary of Compagnie Financiere Richemont SA, one of the world’s largest luxury goods dealers, is doing well for itself in China after being in the country for 14 years, competition is intense and “we still need to increase our brand awareness”, Chang says.
In its 2012 annual report, Richemont says its profit was 1.54 billion euros ($2.07 billion), 43 percent more than the year before.
Worldwide sales were worth 8.87 billion euros, of which the Asia-Pacific region accounted for 42 percent.