Another day, another new watch brand – only this one’s interesting

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The company behind Cartier, IWC and Panerai has just launched a new watch brand – is it the solution to Switzerland’s problems?

Meet new watch brand Baume. No, not Baume et Mercier (although there is a link – more of that in a minute), one of the old guard of the Swiss watch industry. Just Baume, launched in LA at 8am Pacific Time today (May 15), 4pm ours. What is it? In short, it’s an entry-level luxury watch brand aimed at a cash-poor generation of urbanites who want their swag sustainable and customisable. Only two base models have been announced at launch, one quartz and one mechanical, but with 2,000 possible combinations, ubiquitous up-cycling and prices starting from £430, there’s a Baume for all you trendy young things out there…

Or at least, that’s the idea.

Now, some of this is new-ish for the Swiss, some less so. TAG Heuer and Vacheron Constantin have both made watches you can pimp out any which way you like. There have been sightings of sustainable materials, too. Straps by Oris and Larsson & Jennings come to mind in mid-market. Apple – and given the price point we’re in with Baume the tech giant more than merits a mention – has rewritten the rulebook on making watches for the digital generation with its Watch

But Baume is different. Or rather, the story behind it is. For starters, it’s owned by Richemont, the luxury group behind some of the world’s most venerated watch houses, among them Cartier, Vacheron Constantin, Piaget, Panerai, IWC, Jaeger-LeCoultre, Montblanc and, yes, Baume et Mercier. Note Richemont did not create a single brand it owns – it’s a conglomerate that has eaten up a raft of once-dying old companies and turned them into global superbrands.

But Baume is Richemont’s own creation, and far and away its most accessible watch brand. What does this mean?

Well, this is the surest sign yet that the Swiss are rattled by smartwatches, and by the glut of new brands that have popped up in the mid-market sector over the last 10 years or so. For its part, Apple has – knowingly – made a mockery of the intractable Swiss way of doing things, introducing a wristwatch (of sorts) with a variety of case sizes and metals, a choice of internal specs, and straps and displays you can fiddle with at your leisure.

Even if Apple did publish sales figures for Watch (Canalys estimates Apple sold 18 million units last year), it would still be hard to work out exactly what kind of chunk it’s taken out of the Swiss market. But there’s reason to believe it’s been big. While the correlation between the two can’t strictly be proved, in 2016, the first full year of sales of Apple Watch, 2 billion francs, or 10 per cent, was wiped off the value of the Swiss watch export market (according to the Federation of the Swiss Watch Industry). There were other factors in the decline, but still, a coincidence?

Almost certainly not. Reading further into the data, Switzerland has a volume problem. Last year it exported fewer watches than in any year since 2009, an industry annus horribilis in its own right that followed the global financial crisis. Last year’s big drop-off was not in high-end pieces (exports of which actually went up in 2017), but at the other end of the spectrum – exports of quartz volume pieces were down 7.4 per cent. Watches valued at 200 francs at export (you can double that for retail) declined by 8.5 per cent in volume. In one year. Ouch.

Switzerland’s problems aren’t limited to its output. They’re compounded by how slowly the brands can react. The watch industry is the oil tanker to the tech companies’ speedboats. It can take years and years to change tack, and to develop new products, strategies and ideas and the infrastructure to deliver them. And then there’s cost. The price of luxury watches has gone into orbit over the last 20 years, and as we all know, incomes – particularly in traditional Western markets – have stagnated. That’s at least one generation priced out of the market. Richemont, for its part, has until now had next to nothing to offer a consumer that has less than £1,500 to spend. A few Baume et Mercier quartz pieces. And that’s it.

So what does it do faced with a generation of consumers who can’t afford its stuff, who are more socially and environmentally conscious and, increasingly, don’t own anything?

In recent years, we’ve seen small reactions by the industry to its predicament. For example, lots of brands now make straps and bracelets you can easily switch and adjust at home, à la Apple Watch. That started with lower-end brands, but even luminaries Cartier and Vacheron Constantin have now embraced the do-it-yourself approach. The sustainability message is gathering pace. And we’ve seen some Swiss brands, but not so many you need to count your toes as well as your fingers, introduce smartwatches. Not with universal success – some have tried and aborted the strategy already (IWC, for one).

And now comes Baume, named, the company says, to absorb some of Baume et Mercier’s brand equity (which is just confusing). Will it work? Or is it too little, too late?

If there’s a crumb of comfort for the Swiss watch industry, it’s in its own history. It’s survived massive setbacks in the past, not least the advent of mass-produced quartz watches in the 1970s, and has a habit of thinking of new ways to make us want what it makes. At the heart of that is the romance created by heritage, quality and the lustre of an exclusive dial name (hence Baume, I guess), and as exports of pricier pieces suggest, that’s still going ok. But whether Baume, a brand no one had heard of until a few minutes ago, is the magic bullet that will suck in the next generation and lock down the industry’s future, or even Richemont’s, I’m not so sure.

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