Navigating the watch segment of €500 to €1,200 is like sailing in stormy seas. To get to safe harbour at the end of the year as one of the best-selling brands is a veritable feat, especially if there is a perfect storm brewing in the form of low sales, cut-throat competition, and the emergence of smartwatches. I've known Sylvain Dolla, Hamilton’s CEO, for some years now, and he has always been extremely agreeable and open. I managed to talk to him just before Baselworld to find out his thoughts on Hamilton's sales strategy, how the brand wants to face the "connected" phenomenon, and his strategy in Hollywood.
aBlogtoWatch (ABTW): Just to have an idea of where Hamilton is today, which are your main markets?
Sylvain Dolla: For the last seven years, we have had fantastic growth and we are present in 70 countries. But in terms of sales, the main markets are Italy, US, Japan, Korea, and China. In Europe, Spain is very important because it is the third market for us after Italy and France. In fact, France and Spain are nearly at the same level.
ABTW: Why are you so successful in your market?
Sylvain Dolla: If you look at our main markets (Italy, Spain, France, Korea) they are the most demanding in terms of sophistication in products. And the press is the pickiest in terms of looking at details and perceived value. Japan is a trend-setting market in Asia, and Italy is probably the leader in terms of style for watches. So I'm very happy that the brand is performing well in one of the most demanding watch markets.
ABTW: You say that Spain demands quality and sophistication, is price a factor too?
Sylvain Dolla: Price is important everywhere, and more and more people want to buy a quality product with real history at a right price. And for that, Hamilton is perfect because it has a rich history, an authentic history. We don't invent stories, for instance, when we talk about Hollywood - it goes back to 1950; or when we talk about aviation, because it goes back to right after WWI. People are more and more conscious about brand content. Nowadays people know more and more, and when they go to a shop they know exactly what they want, and they care about authenticity. And of course they do not want to be fooled. We are the leaders of the €500-1,200 mechanical watch segment because people know there is a lot of value in the product. We are talking about dials, the way we apply indexes with satin and polished contrast... lots of details that make the product feel nice at a reasonable price. At €500 or €1,200, it is already a lot of money, even if in the watch industry it is called entry price. For normal people this is money, and if I am going to spend €1,000 on something, I am going to think twice what I spend it on, and I don't just want a name. I want something with content, with fine details. That's why we rank so high.
ABTW: And how do you balance your American heritage with Hamilton being a fully Swiss company?
Sylvain Dolla: Actually, for us it is great to have this dual nationality. We have an American upbringing, so to speak, and it is an inspiration for us. We have been in more than 400 movies so far, and this year we are coming up again in a movie, in Independence Day: Resurgence. We have Elvis Presley (you can see the Elvis Ventura 80 watch hands-on here). That's why our new collection is called Broadway, and we want the watch to be a permanent reminder of New York. We will never neglect the American part in favor of the Swiss part. To inspire people, our American Heritage is the key, and the Swiss part gives credibility about reliability.
ABTW: How do you get the Hollywood studios to use your watches over other brands?
Sylvain Dolla: We don't have to sell it, they already know us. We know the costume designer, the prop master.... We've been working with them since 1950. When they want watches, they come to us. When Christopher Nolan did Interstellar and he wanted one specific watch designed for the movie he knew he could contact us and we would do it in record time, a concept watch we don't even sell. You cannot delete 60 years of collaboration just like that.
ABTW: So, for instance, The Martian. Someone came to you and said "I want a BelowZero for Matt Damon?"
Sylvain Dolla: Actually they came and asked for a different model, and we said, "are you sure?" So we looked at the script at a very early stage and we were able to sway their decision slightly. Or some other times, as I said, we customize them for the movies.
ABTW: Would you say that one of your main competitors are the sister companies of the Swatch Group like Certina, Tissot, Mido...?
Sylvain Dolla: I wouldn't say that because without the Swatch Group we would never be where we are today. Several of the watches we present this year come from ideas that we had and took to ETA to develop. Any company would love to have access to such powerful sources of technology. What is true, however, is that the leaders of the market are companies like those you have mentioned and, yes, they are very big in our price segment.
ABTW: This year brands have not gone crazy with novelties, there are not very many newcomers on the scene...
Sylvain Dolla: Well, we are presenting 57 new references. Actually, we are bringing two strategic product launches: Khaki Navy Frogman (hands-on here) and Broadway. And then the Khaki Field has new cases and new dials.
ABTW: Well congratulations, that is certainly not the tendency of the market these days because things are rough: costs are going up, sales are going down, January was a shock for everybody and...
Sylvain Dolla: They were excellent for Hamilton, and February was fantastic too.
ABTW: Well, congratulations again! But do you think brands will follow that path of being more cautious, of taking things more slowly?
Sylvain Dolla: Let me say first that if I look at Hamilton in the US and Japan, I have to say that the market is not bad at all. But coming back to your question, I think the day you stop being creative you die. If you only think about sales when you are developing your product, you will not last longer than a few years. If we start to restrict ourselves because there is a tough market situation, it would be a terrible mistake. For instance, this year we launched not one, but two limited editions, well out of the average Hamilton price range: one at €3,700 and the other at €5,000 - a solid-gold watch! We sell a gold watch every, I don't know, 10 years, because it is not our core business at all.
What I mean to say is that we need to continue being creative. It doesn't mean launching too many watches. We took the decision to launch between 50 and 60 references per year and not more. Because even when times are good, retailers do not have unlimited space. So it would be crazy to double that quantity. You have to be realistic in terms of size, not of the environment.