Posted by: hagerwatches | April 13, 2014

Luxury, “Accessible Luxury,” Marketing and Watch Brands

What is luxury

 

luxury1

There’s a lot of discussion about what constitutes “luxury” or “affordable /accessible luxury” as it relates to brands all over forums that I’m a member of on LinkedIN, and in the watchworld these conversations happen all the time.  So what constitutes “luxury” or “affordable luxury”? Sure, the quality of the product has a lot to do with it but the majority of it has to do more with how a company markets their product/brand.  Daymond John, founder the FUBU clothing line and Shark Tank personality known as a branding genius, defines branding as “a tag that somebody puts on you”.

Branding Fubu

For example, in the watch world, the entire Swiss watchmaking industry (as an entity) was near death in the 1970’s but succeeded in making watches “fashionable” by shifting the idea of a watch from a necessary item to a status symbol, a luxury product that appeals to the emotions of the buyer. The watch you’re wearing on your wrists today doesn’t just show your “status,” it’s a symbol, rather than the tool it was fifty years ago. A symbol of who you are or perhaps, who you want to become. It’s a way to express your style, and your character.   The key element of this perception shift is marketing.  Brilliant marketing campaigns have changed the perception of the watch to become an emotional and aspirational product rather than just a tool. In essence you’ve been “tagged”.

Breitling Beckham

 

 

 

 

 

 

 

 

 

 

The watch industry has been ingenious in reshaping consumer perceptions and making luxury timepieces a collector’s item, a long-term investment that will pay dividends and a status symbol.    The watch industry is a $45 Billion dollar a year industry with 99% of the luxury market (approximately $25 billion) controlled by 3-4 Swiss conglomerates who own 6-12 brands each.  Switzerland exported 6.89 million mechanical watches last year, the most since 1982, amounting to $16.6 billion.  Exports have grown at an average annual rate of 7.2% over the last ten years, with more than 95% of production exported focused on global competition.  2.2 million Swiss watches are imported a year with a value of $2.8 billion dollars in the US.   The watch industry is Switzerland’s 3rd largest sector and accounts for 20% of Switzerland’s GDP.   Twenty-four companies employ 52,803 people.

Swiss Made

In a business worth $25 billion, image and reputation are everything. The “Swiss Made” label has proven immensely valuable as a seal of quality and marketing.  Regardless of who makes the cases, components, movements, and how they are manufactured, a watch with “Swiss Made” on it will be 100% made in Switzerland right, “haute horlogerie”? Ummm…well…no.   In 2012, the watch industry imported $2.4 billion dollars worth of watch parts from the Far East. China and Hong Kong delivered mainly cases, and Thailand, surprisingly, delivered movements, considering the “Swissness” regulations. What’s that? “Swissness”? We’ll get to that in a second. Back to the movements in Thailand for a second. Various watch companies have set up shop in Thailand and import parts and movements into Switzerland and assembled there. What? Again with the what’s. Why would they do that? The main reason parts are imported from abroad is that the production costs associated with the components is lower. Up until recently, the criteria for labeling a watch as “Swiss Made” was stipulated as having half the watch 50% (by value) made in Switzerland.   In June 2013 that figure went up to 60% (the cost of manufacturing) with the passage of the “Swissness” bill. Under the new “Swissness” criteria a Swiss watch must also have its movement assembled, cased and inspected in Switzerland. However, as prices in production continue to rise and Swiss immigration reform impacts the watch trade (Last month, 50.3 per cent of Swiss voters decided to void a pact giving equal footing to European Union citizens in the Swiss watch market), more non-Swiss parts can be used thus allowing the continued use of the “Swiss Made” label. For some I know this is surprising, it’s nothing new for those of us who know that the Swiss industry balances cost-saving production against brand image. Since quartz technology and disposable watches almost destroyed the mechanical watch industry, the Swiss redefined the purposes of owning a mechanical watch and that purpose was a savvy business sense wrapped up in luxury and emotion that appeals to almost any buyer. As Martin Green from Revolution magazine observed: “You can build the greatest, most magnificent watches in the world, but the bottom line is that the watch industry is still a profit sector, and money needs to be made in order to survive and continue to create great and magnificent watches. One way of doing that is to let the general public know how great and magnificent the watches that you make actually are. Advertising in selective newspapers and magazines have always been one of the favorite ways in which watch brands deliver this message.” In a recent study by Deloitte consulting revealed that 86% of watch brand CEO surveyed see social media as important for the watch industry. Many companies are actively participating on popular social networks as well as interacting with watch forums and providing access and samples to popular watch bloggers. In order to be considered as luxury, a watch needs a brand that is recognized and considered by everybody as belonging to the world of luxury. Therefore, a new brand entering the market is compelled to invest in huge advertising campaigns in order to gain recognition (image) from the public. A product possesses the title of exceptional and luxury only if everybody knows the brand and accepts it as a luxury object. Finally, recognition can also be a guarantee for quality. In fact, very few people would pay thousands of dollars for an unknown brand or a brand that imports its components from the Far East

Swiss Made1

 

 

Branding

In the world of luxury, the principal tool to compete between brands is the intensive use of advertising. Brand recognition is tightly tied to marketing. Luxury watchmaking relies heavily on differentiation strategies that require lots of investments in advertising and public relation (PR) events. Objectively, the product is, from a design point of view, very similar from one brand to another even though most companies claim their product is unique. It would be more correct to say that the brand and its communication bring life to the product, give it its identity and maybe has the potential to make it unique. A product is something that is made in a factory; a brand is something that is bought by a customer. A product can be copied by a competitor; a brand is unique. A product can be quickly outdated, a successful brand is timeless.  In 2012 ( 2013 data hasn’t come out yet), Watch brands spent more on U.S. advertising in 2012 than ever before creating brand identities. Total spending reached $399.74 million (check out the million dollar club and how much they spent here http://www.watchtime.com/wristwatch-industry-news/industry/million-dollar-club-2012-watch-advertising-all-time-high/)

 

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To sum up, brands are emotional products and emotional products are about a message– a strong, exciting, distinct, authentic message that tells people who you are and what you are and the premium you are willing to pay.  It is no longer a utilitarian product that shows the time but a piece of time that incarnates a lifestyle. Therefore, the brand is an inestimable intangible asset in this industry; it is very costly and it takes time to be established. Marketing and communication, brand equity, is undoubtedly the main differentiator between brands. Does this mean that a product is made any better, or is a better value than a competitor? Not necessarily, in most cases it just means they are better at communicating their brands message. The more uniqueness a company can build into the positioning of their product, the more they can control the price. If companies can make the product both desirable and unique, the customer, (which is you) is more likely to pay the price since you cannot get the same product image anywhere else. Or so you think. In my next post I’m going to tell you why you should pre-order the Hager Commando or the GMT Traveler.  In case you missed it you can check out the Pre-order here http://www.hagerwatches.com/PREORDER%20DETAILS/page18.html

Hager GMT Stainless Steel

Whether you’re walking down the plush carpeted exhibition halls of Basel World or sitting at home reading about watches, I’m here to tell you that the wait for what you are looking for is finally over.  While I say this somewhat tongue in cheek, the time has finally come for watch enthusiasts and lovers of great design to have the opportunity to pre-purchase the Hager Commando Professional Series.  If you’re looking for affordability and a re-imagined classic inspired by the past but built for the future, then look no further.  Prices start at $450 USD.   The Professional Series Commando and GMT are great value alternatives to some of the bigger Swiss brands out on the market.  Did I mention they won’t strain your wallet?

Hager GMT Stainless Steel

We’ve made some changes from the original designs that we feel makes the Professional Series more accessible but yet doesn’t cut corners in terms of quality, movement, and design.   A few things have changed as we realized producing custom made movements, and a custom bezel made out of ceramic and a liquid lume clear coat might price some people out of owning our watches.  The biggest change you’ll notice is the price (an Amazing $450 for the Commando Professional model), and while we’ve lowered the prices we haven’t lowered the materials we use in bringing you quality affordable automatic watches.   Get all of the details here:  PRE-ORDER LINK

 

The Pre-Order Period is scheduled to be opened from March 28 – April 28, 2014.  Again, there will only be 40 slots available for pre-order per watch and yes you may choose your very own number (Sorry numbers 001 and 007 are already reserved).  Additionally, the professional series will feature a limited edition case back design that will be developed in conjunction with those who pre-order as well as a Scuba Tank watch Case.

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What else has changed apart from the price?  We’ve made the bezel of the Commando Professional all ceramic, and changed the movement from a custom made movement to the Miyota Calibre 9015, a very reliable movement, and high in the value department. The 9015 is the closest competitor to the ETA-2824 and is an ever-growing favorite alternative to the 2824.   We’ve also changed the movement of the GMT Traveler which is at a very.  Instead of a using a custom made movement,  we will be using modified ETA 2836 ébauche movements assembled and finished to our standard.  These are not “step down” changes in terms of quality, but changes that were made to enable us to bring these watches to market at an affordable price.  We believe in the quality of our watches so much we’ve also extended the warranty to a 2 year limited warranty.  And since we are going to be hand assembling and building these in Hagerstown, MD, we’ve also added Hagerstown, Maryland at the bottom of the dial as we take pride in building an American made product.

 

Hager Scuba Tank

THE DETAILS:

Pre-order Parameters and Conditions:* Pre-order Price: Professional Stainless Steel $450 plus S&H on bracelet (MSRP $600 plus S&H) ; Professional DLC (black model) $550 (plus S&H on bracelet (MSRP $700 plus S&H); GMT Traveler Stainless Steel  $550 plus S&H on bracelet (MSRP $700 plus S&H); GMT Traveler DLC (black model) $650 plus S&H on bracelet (MSRP $800 plus S&H).

Pre-pay a deposit of $225 for the Professional Stainless, $275 for the Professional DLC, $$275 for the GMT Stainless Steel Traveler and $325 for the GMT Traveler DLC, and pay the remaining balance due plus shipping charges owed upon our receipt of your watch before shipping.  We accept Paypal, Visa, MC, AMEX, Discover and Debit Cards.  You can also finance your purchase through Paypal’s Bill Me Later option when you checkout with PayPal.  It’s a simple process that gives you flexibility and buying power.  Enter your information, accept the terms, and get a decision in seconds.  Once you’ve been approved, you can enjoy No Payments and No Interest if paid in full in 6 months.

Posted by: hagerwatches | March 14, 2014

The Hager Triton

So I know it’s been a long wait and we’ve been getting a lot of emails regarding the Triton project after people read THE TIME BUM’s interview with me.  So we thought we would post the idea that we started with until after the sneak peak of the Triton at the Baltimore Washington GTG March 15 with other WatchUSeek forum members at the Rams Head Tavern Savage Mills Rams Head Tavern | Savage Mill    8600 Foundry St, Savage, MD 20763

Come see me  and  all our watches in person and start St. Patrick’s day off with a bang before St. Patty’s day.  We’d love to chat with you.

Here’s the link for those that are interested in showing up http://forums.watchuseek.com/f2/baltimore-washington-gtg-march-15-2014-1pm-til-981632.html

When: Saturday, March 15th from 1-3 PM or however long we want to hang out
Where: Rams Head Tavern Savage Mills Rams Head Tavern | Savage Mill
Hager Triton

Posted by: hagerwatches | January 31, 2014

Hanging out with The TIME BUM, avid watch enthusiast and blogger

Recently, I had the opportunity to sit down with another watch  enthusiast who just happens to be a blogger to discuss all things watches,  and of course the Hager brand.  He calls himself THE TIME BUM, an unrepentant cheapskate, who brings others reviews, photos, and assorted horological musings within the watch world.   His focus is to inform readers about watch brands that  that sell for under $1,000, which is truly needed as most of the major magazines rarely cover micro-brands such as ours or others here in the U.S. and abroad.   He has written a lot of articles about many different watch brands that I’m sure some people will find interesting and will even drive some of you to increase the size of  your collections.  I had a wonderful time chatting with him and I hope we can do it again sometime.   Without boring you to death with my ramblings here’s the interview with THE TIME BUM.

Time Bum

Hager Watches CEO

Towards the end of our leisurely lunch, two waiters approached our table. “Hey,” said one, “we were just wondering, what’s with the case?”  He was eying the big orange box in the middle of the table. It had remained mysteriously closed throughout our long lunch, but now it was open and brimming with watches, and they were curious. Who was this guy I was sitting with? Was he selling me a watch? His whole collection?  We explained that this was not a sales transaction, but that these were indeed samples of watches that are for sale. One of the waiters was a bit of a watch aficionado himself, and he asked my lunch companion what his favorite watch company was. He chuckled, “I guess I should really say my own.”

TO CONTINUE READING  THE ARTICLE THAT HAS LOTS OF PICTURES  CLICK HERE
SIgnature

Hi all, as 2013 came to an end we were pleasantly surprised to make AskMen.Com’s Best American Watches available list.  AskMen.com is the the internet’s leading men’s lifestyle web site and attracts more than 12 million unique visitors a month.  They have a very unique history similar to our own.  You can read about it here .   Without further ado here’s the article about us.   The next post will be about the Hager Triton, a watch that we’ve been working on for the last eight months that we believe people will embrace.  All the best Pete.

ASK MENLocavore Watches1

SERE

Hager SERE

Screen Shot 2014-01-20 at 9.47.43 PM

Hager Watches CEOWe haven’t posted in awhile because we’ve been busy working on new models that we hope to introduce this year and working with someone  to manufacture a main plate and other parts here in the U.S.  The main plate is the first step for us though.  This hasn’t been an easy process for us because we don’t have millions of dollars to throw at the project and just make it happen as many have aptly alluded to in posts on different watch forums  There’s a capital requirement in this business from manufacturing to marketing.  From the U.S. perspective not many companies that don’t have the capital are just going to start cranking out movements here in the U.S.   Most companies start out building their brand by using stock movements and cases from different suppliers whether they be Swiss or Chinese and then building the business from there until they can acquire the equipment and parts that they need in order to start in-house manufacturing.  One of the most important aspects in this process of building the business to even get to that point is marketing.  A brand entering this market is compelled to invest in huge advertising campaigns in order to be identified by the public.  Very few people are going to spend hundreds of dollars on a watch if they haven’t heard of your company. I’ll expound on how important this point later.  Marketing and communication is undoubtedly the main differentiators between brands.  There are 60 watch brands that spend more than $1 million dollars in advertising. 

Because we are a small company we have to pace ourselves and sometimes that can be tough in today’s competitive marketplace, so we have to take a much more strategic approach.  At one point we thought we were going to be able to move forward at a much quicker pace because we were in discussion with a well known brand who we thought really wanted to work with us as they had reached out to us and wanted to “cross collaborate” and develop a “strategic partnership”.  However what we discovered was that they only wanted our narrative, our story for their own, our marketing strategy and any other ideas we were working on that might resonate with the American watch aficionados.   We even discussed with them a strategy to where their parent investor should start selling watches with Swiss movements to compete with some of the other brands out there (to which they are doing it now).   Numerous emails and telephone calls amounted to seeing our story and our vision wind up being appropriated by them.   They even went so far as to use a variation of a company precept that we had in our pitchdeck,  “We are an American watch brand dedicated to the resurgence of American Watch Manufacturing”, as a prominent tagline for their website. While this does happen in business  a lot and we should consider it a cost of doing business as it’s inevitable that a lot of people will take the free advice and run with it, we want everyone to know we believed in the idea of making things here in America long before it became fashionable, gimmicky and “profitable”  to have products “Made in America”.    Remember what I said about marketing above,  this company has done that.  One of the things that we discussed was how to sell a product to Americans without having a recognizable name or history, what we imparted to them was this axiom that we believe and the direction we to take our company,    “We believe we can be a change maker as we have the vision, the passion and the dedication to make this a successful endeavor as well as an economic driver for not only a small town, but for U.S. manufacturing in general.  We are not selling a consumer product or even a branded product.  We are selling an emotional product. We aren’t just offering a style, we are offering a message.  Ultimately, we are not just offering watches, we are offering our personal culture.  This is about all of us, the re-industrialization of American manufacturing and the resurgence of the American watch industry”.  It was a message that they thought would be a powerful marketing message that would resonate with consumers, and as we discovered they used it and made it their own, not for honorable purposes but to make money.    If anything we learned a powerful lesson for this, don’t do business with those whom you cannot trust!  Or at least get them to sign a mutual non-disclosure agreement.

Many are wondering what we have been doing in order to make watches here in the US, well we haven’t been sitting on our hands if that’s what you’re thinking.  As I said at the beginning of the post we are working with someone who is trying to manufacture a main plate and other parts here in the U.S. (I’ll keep everyone updated as we move along in the process).  We’ve been out talking with different people, potential investors ( I even pitched a potential investor from Fiumicino – Leonardo da Vinci airport in Rome all the way back to Washington, D.C. at the end of last year).  We even participated in Pitch Across Maryland (Maryland Start-up) initiative in September, even though we knew going into it that it was more of a “feel good” initiative for  elected officials rather than finding real solutions for start-ups here in Maryland.  Hagerstown Magazine wrote a nice article about Pitch Across Maryland’s bus stop (Hagerstown had more participants than any other Maryland county).

Read the article here Hagerstown Magazine Article  Hagerstown Magazine Cover

For the past year I tried dialoguing with the elected officials here only to find myself talking to, well myself.   I know watchmaking is a great way to create jobs because if it wasn’t 59K people wouldn’t be employed by the Swiss Watch industry (for a really great article check out TheJournal’s article on “Who’s behind the success of Swiss watchmaking” ), however the people with whom I’ve been dialoguing with have no interest in creating manufacturing opportunities or job creation, only whether or not you can contribute or impact their re-election .   In early January the Washington Post wrote a great article on the state of manufacturing and job creation in Maryland  titled “Hagerstown ice cream plant revival attracts hundreds of desperate job seekers“.  One of the poignant points of the article I found was the following statistics:

“The country lost 6 million factory jobs between 2000 and 2009, and in Maryland, the job losses have been catastrophic. There were about 172,000 manufacturing jobs in the state in 2000, according to the Bureau of Labor Statistics; today there are about 104,000, a nearly 40 percent drop. In the Hagerstown area, which once produced airplanes, pipe organs and leather car seats, there were roughly 14,000 factory jobs in 2000. Today: about 8,000.”

I also found the following to be quite funny given that our Governor should have been paying attention his entire two terms not just now as he’s on his way out the door as if it’s an after thought (but then again Western Maryland is an after thought to many who live in Annapolis and near the National Capitol Region).

“The staggering job losses have the attention — finally, some workers say — of Maryland Gov. Martin O’Malley (D), who has revived the dormant Maryland Advisory Commission on Manufacturing Competitiveness.”

So where am I going with all of this, one word

per·se·ver·ance

ˌpərsəˈvi(ə)rəns/

We are going to continue to charge ahead in this new year despite the difficulties that challenge any business.  We will continue to offer automatic watches at affordable prices and we will continue to surge ahead with our vision, undaunted.

119_Inf_Rgt_DUI

Dont take this post as a negative one because it’s not meant to be as we had a very successful year and some very good positive feedback from our customers, but I wish we could do more in terms of manufacturing here in the US.   Regarding our customers  I think at some point I’ll start posting those for others to read who may be interested in our brand and would like to know what people who actually own our watches think of them as many people are starting to take notice of our small company.  As 2013 ended we were given some surprising unsolicited praise from ASKMEN ASK MEN which I’ll share with you in the next post and in the post after that we plan on unveiling our new project that we’ve been working on the past 8 months called the Hager Trition. Thanks for everyone’s continued support and all the best in this new year.  Pete

Posted by: hagerwatches | December 8, 2013

Finding the Right Gift Can Be Hard. We are Making it Easy For You.

Here at Hager Watches we know finding the right gift can be hard. So we are making it easy for you. Don’t miss the last day to order at a great price. Click on the picture below.

 

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Posted by: hagerwatches | November 27, 2013

Just in Time for the Holidays. Pre-Order for the Hager MK V

Debuting the Hager MK V for the holidays.  The Perfect Gift to Place Under the Tree

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Click on the picture to learn more

Just in time for the holidays. Look no further for that special gift you are seeking. Pre-order the Hager MK V now until 08 December 2013 and have it delivered before Christmas. The MK V comes with a split leather case to hold your watch while traveling.   The Mark V is an instant classic with retro aesthetics and makes a bold statement. It’s understated, not trendy, and you can comfortably wear the Mark V in any decade. And best of all, it won’t break your wallet.  The pre-order price is $380 USD.  An automatic watch at this price level and quality is unheard of.  Check out the details and a video of the MK V by clicking on the picture above.

Posted by: hagerwatches | October 21, 2013

What’s New? The Mark V Aviator

So it’s been since June since I last posted. Lots of things have been happening here.  We were invited to a pitch session with Maryland Start-up and were super excited to meet all the people who were interested in helping us become successful.  Warren Buffett wasn’t there but that’s ok maybe he’ll call one day soon.  So what have we really been up to lately in terms of watches?   Well we’ve been designing the next generation of affordable Hager Watches.  We are trying to stick to our roots of keeping our watches in the affordable range and our quality high, which is something that a lot of people are concerned about in the watch world with other companies.   Most companies are selling a  cool-looking case and a dynamite marketing plan and high prices.  Not here, why pay $500  or more for quartz watch or $1500 for an off the shelf ETA or Miyota.  The first watch we are releasing is a dress watch.  We’ve been getting a lot of emails to make one so we sat down and discussed what we would we wear that would look retro, and would go with a suit and a pair of Khakis on the weekend.

The Mark V was made for those who appreciate subtlety. There was a time when watches were small, simple, and designed to lurk quietly on the wrist. Somewhere along the line, though, they became a barometer of status and grew even bigger, thicker and more complicated. In a world governed by the latest trends and hottest watch fashions and fickleness, the Mark V is an instant classic with retro aesthetics and makes a bold statement. Watches say something about the people we are. They are statements about who we are, our hobbies, our lifestyles. The term classic is defined by enduring appeal and relevance over the ages. The Mark V is a classic because it is a watch that will last forever and never be out of fashion, because it doesn’t belong to fashion. The Mark V is understated, not trendy, and you can comfortably wear the Mark V in any decade.

Creating a timeless classic like the Mark V that offers affordability and lasting value is not merely a matter of copying a design, it involves the subtle art of reinterpretation and creating a balance. Today’s prevailing mood calls for something altogether more discreet, less crowded, less complicated and can be worn all around. And most of all it’s affordable. The new Hager MK V it makes a bold statement.  If you don’t believe it see for yourself (video quality will depend on your computer).  Pre-order will begin soon.  Details to follow shortly.

 

Posted by: hagerwatches | June 10, 2013

Hager CEO Gets a New Look

 

Warby Parker

It’s been an interesting couple of months for us here. A few weeks ago I decided I needed a change.  I shaved my goatee and then I decided to get some new specs as I had been wearing my Oakley’s for as long as I could remember.   They were great to wear when I served overseas but now that I’m permanently back “in the world”, I needed something that worked well with suits again.  Tactical was out and nerdy business/Clark Kent was back in. I needed to look and feel like I was the head of a small, very small watch company.  LOL    So,  I went to my optometrist, received my yearly check-up and looked at the frames they had available.  Needless to say they were either too expensive or they just didn’t look right.  So I decided to look online After searching all over the web I found Warby Parker.  Warby Parker offers stylish yet affordable eyewear online. $95 for frames and lenses.  How can you beat that?  I went on their website, looked around and settled on a pair.  Warby had a try-in home service where they ship you five (5) frames of your choice for you to try in your home.  I didn’t want to do that so I decided to google the frames and see the reviews written by others as well as how they fit.  After much internal debate I decided to throw caution to the wind and buy the Miles.  Filling out the prescription information was easy.  They even followed up with an email to make sure everything was correct.  Too easy.  Most others want to verify the information with your doctor or have you fax over the prescription sheet.  This was easy.

A new concept in eyewear

“Warby Parker was founded with a rebellious spirit and a lofty objective: to create boutique-quality, classically crafted eyewear at a revolutionary price point.”

miles220-face-zoom_1_1The glasses came within five days and were packaged in a heavy box with a retro cool case that reminded me of my childhood.  Needless to say I’m happy with my purchase and will be picking up a pair of shades for the summer pool.   For $95 it’s a steal.   You’re probably wondering how they do it.  To find out read their story here http://www.warbyparker.com/our-story

Hager Watches CEO

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