Breitling CEO on 'crazy' growth in watch market; why Rolex-Bucherer deal isn't a threat

Breitling Watches, the nearly 140-year-old Swiss watch brand, is still ticking and looking for more growth. The company’s sales are up, and revenue is rising for its private equity owners, the Partners Group.

Last night, the company unveiled its new Navitimer watches in smaller 36mm and 32mm sizes, a move that could be just at the right time with female watch collectors on the rise. And the new Navitimer campaigns feature Breitling ambassadors actor Charlize Theron and dancer Misty Copeland, likely increasing appeal to those female fans and new watch connoisseurs.

Hand in hand with that growth is the expansion of physical retail, good old brick-and-mortar. It seems watch aficionados want to hold these expensive items in their hands and buy in person — as opposed to buying online — especially in locations that seem more like clubhouses and traditional showrooms.

One of the big differentiators with Breitling and the luxury watch industry in general is the Swiss brand will have new watches available the day they are revealed, instead of months or even a year in most cases for other luxury competitors. The new Navitimer 36 and 32 are available online and in stores now.

Speaking of where to buy, Breitling unveiled its latest NYC boutique in the trendy meatpacking district of New York, replete with its own espresso bar, clubhouse area, and old school stand-up arcade consoles. We caught up with CEO Georges Kern from Breitling’s newest location here in New York City, in an exclusive interview ahead of Wednesday night’s big launch.

Here are some edited excerpts from our conversation:

Q: Talk to me about Breitling, the story. You guys are growing, sales are up. What's going on there?

A: So we have been doing very well. The valuation has been increasing. The brand has been growing tremendously over the last five to six years. And yeah, we're very happy about the results and the development of this company.

Q: Breitling is now in the top 10 of Swiss watches in terms of exports. And the company is expanding its retail footprint here in New York City. Why is physical retail so important for the brand?

A: So it's true. We have 230 boutiques around the world, we have roughly 25 boutiques in the US, we even have four boutiques in New York. People want to live the experience; people want to have the “360” of the brand. They want to talk to our great colleagues here; they want to understand the brand — they want to see the whole collection.

And in particular, young people want to see it. And it's still a physical purchase. So it's not about e-commerce. You get the information on our website or the web, and then you buy physically in boutiques. [Editor's note: Breitling offers most of its watches for sale online as well.]

Q: You're wearing a special watch right now that sort speaks to the ethos of the brand. Tell us about it.

A: So this is Top Time, which we do in collaboration with Deus Ex Machina, which is a motorbike and surfer brand from from Australia. It's very cool, and it reflects exactly our design philosophy, which is modern retro. So we don't want to be vintage, we are a modern brand. Our movements are top notch. But we have this little vibe of retro, which you see in these kind of collaborations, which you perfectly see in this boutique and with other partnerships like, for instance, Triumph motorbikes.

Q: Let’s talk more about retail … Rolex, the biggest player in the luxury watch space right now, recently bought European watch retailer Bucherer, which also owns Tourneau here in the US. What does that mean for Breitling, which has its own retail locations, but also works with Bucherer as well?

A: We love our collaboration with Bucherer; we have been working with them [for] many years. Rolex is a great company. They have the best behavior in the industry; they respect all the other brands, and I'm very happy about this acquisition. And as far as I understand, nothing will change for us and for Bucherer in this relationship.

Q: Let’s broaden out and talk big picture about the luxury watch industry. We're seeing some softness in the secondary market for used watches. What’s your take on that, and will that weakness affect the market for new watches?

A: So, first of all, the analog watch industry has been booming for the last few years and will continue to grow like crazy because we're nowhere still in China, in Indonesia, in India, in many, many countries, where the industry is just starting. The last two years in particular, we had this post-COVID situation of revenge buying. And today I think the market is just normalizing, but it's still growing and yes, normalizing, but still at the very high level.

Q: Do you think that post-COVID bump has sort of changed watch consumption behavior? People want to buy more watches, they want to take pictures and put them on Instagram, etc. Have you seen that with your customers?

A: I think we live also in an age of overkill of digitalization. And having an analog watch, a very traditional watch, handmade, which you actually, intellectually can understand because it's like a LEGO product. When you look at a movement, you can understand how it works. I think it's something very human, and people like that.

In this age where you have catastrophes, where you have bad news every morning… [watches are] an emotional product in this digital age, which people like to buy. And therefore, this market, in particular, with young people is tremendously growing.

Q: Last question for you. You're a big fan of famed investor Warren Buffett. What are some of the things that he's taught you or what have you learned from him that you appreciate?

A: I don't know where you got that info, but it's true. It's true. [Laughs.] I admire Warren Buffett because he's such a no-nonsense guy. He's so modest. He's so sharp. I watch all the YouTube videos. I love his quotes; I use them in my own presentations. If there's one person I would like to meet one day, it's Warren Buffett.

Pras Subramanian is a reporter for Yahoo Finance. You can follow him on Twitter and on Instagram.

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