Julien Tornare took over the reigns at Zenith in May 2017. It was widely accepted that the brand, which was one of the most powerful in the watchmaking universe in the 1960s, had become rooted in its past and lacked a future direction. Three years on and a clearer picture is emerging. Zenith will be more exclusive, more inventive and much better aligned with the business needs of its retailers as WatchPro’s Rob Corder discovered during an interview at Baselworld this year.
Three years into the tenure of Julien Tornare as chief executive of Zenith, the turnaround strategy is starting to show results. The LVMH-owned brand notched a double-digit rise in sales last year, despite shrinking its network of retailers from 841 doors to 620 world-wide, Mr Tornare told WatchPro in conversation during Baselworld in March. “And we are going to go further down to 500 accounts,” he adds.
The direction since Mr Tornare took over as CEO in 2017 has been to streamline the business and focus on its bestsellers with clearer product development and story lines. As well as reducing the number of retailers it works with, Zenith has also trimmed the number of watch styles it makes. “We shrunk the SKUs from 178 to close to 100 now,” he reveals.
Most welcome for remaining retail partners is Zenith’s approach to sales. Gone are the days when the only number that mattered to the board was the value of watches selling into retail. Now the company obsesses about what is selling through to consumers.
“We have a system that fully aligns sell-in and sell-out,” Mr Tornare claims. “That is a big deal because the industry disease of the past has been to focus only on sell-in to retailers, meaning that we produced, we sold, we delivered [to retailers], we were done. That was wrong. Now, we produce and start delivering and we monitor what is happening with sales at the retailer. If things go wrong or sales are slower than expected, we shrink down because nobody can afford to carry sleeping stock. That is the past. I no longer want to say: look, I did my numbers as a brand with sell-in, but 60% has sold-out. I need sell-out to be 100% of sell-in,” he adds.
Zenith had become a slave to its past when Mr Tornare took control. Now it uses its historic successes to shape future product development and the stories behind them.
“One difference from a year ago is that we want to build on what we call the brand platform. We have been digging into the history of the brand: our key achievements, who are the big figures that have been part of the brand for the past century and a half. We found out that at all stages Zenith had been very innovative and creative, right back to the founder who was in his 20s when he started the business. He was an amazing guy,” he describes. “We want to bring that creative dynamism to the brand today because it had not been so obvious over the past few years,” he adds.
Arguably the most creative and inventive move on the watchmaking front was the launch of the Zenith Defy Lab, which used a completely new architecture to keep time.
However, there were complaints at the time that the movement was little more than a prototype that was not transforming commercial collections. The unveiling this year of the Defy Inventor was an effort to change that. Beating at the extremely high frequency of 18 Hz, compared to the usual 4 Hz, Defy Inventor uses the single-piece Zenith Oscillator developed and patented by the maison and introduced in the Defy Lab.
The launch provided an excuse for the biggest party at this year’s Baselworld, with over 600 guests invited to the Zenith High Frequency rave to enjoy sets from superstar DJs and of international music celebrities Eve, Tanja La Croix.
The High Frequency event concept is now going on the road, touching down in Hong Kong, Japan and the United States this year.
Baselworld gave a graphic illustration of the new Zenith. Inside the exhibition hall, the company focused on its history with the launch of an anniversary El Primero Legacy collection that celebrates the launch of its El Primero automatic chronograph movement 50 years ago in 1969. Next door to the exhibition, the futuristic banging party was in full roar and Mr Tornare took to the stage.
The 1969 El Primero movement was a big deal for the industry, and the trio of El Primero Legacy watches launched in March was a fitting tribute. They look almost identical to the El Primero watches that first housed the chronograph movement, and come in limited editions of 50 pieces each for models made in yellow gold, white gold and rose gold.
To reinforce the value of these watches, they all come with a 50 year warranty. “This has never been done,” reveals Mr Tornare. “It means the warranty will expire when we celebrate the 100th anniversary of El Primero. That is a real statement,” he adds.
Marketing and communications has also been sharpened since Mr Tornare became CEO. The star that is part of Zenith’s logo is being used consistently across the brand’s advertising as a pathfinder to the future. “We want to put the star back on stage, which is why you see images with the star at the top lighting our watches. Different watches will have different visuals, but we will always have the star at the top. We stand for dreams — not dreamers, but achievers,” Mr Tornare describes.
Focus on limited editions will also increase as a way of making Zenith watches rarer and more special. “We want to create buzz and demand to buy these pieces. We want people to be concerned that they might miss out on a watch they really desire. That creates a good spirit around the brand for retailers and for customers. Clients know that our watches are rare and they cannot find them easily,” Mr Tornare explains.
Like most high end brands, Zenith is dabbling with selling direct to consumers through its own boutiques, but has only eight in the world today and is more likely to open future monobrand boutiques in partnership with authorised retailers. As well as our eight owned boutiques, we have 12 franchised boutiques. Franchising is interesting because it creates a Zenith boutique, which clients like, but we are sharing the risk with our retail partners. We will continue to develop that, definitely,” he reveals.
WatchPro’s conversation with Mr Tornare took place at Baselworld, and talk inevitably turned to the future of the exhibition. The Zenith boss is a member of a 12-person committee of watchmakers that are working closely with Baselworld’s organisers to reshape the event and he remains a supporter.
“I believe these shows are important. They are a meeting point where everybody gathers at a certain time. The only thing is that they are very costly, and we are entering a time when people are not prepared to spend that much money on events that are purely B2B or B2P (business to press). We can do press meetings at our headquarters or in a nice hotel in your home city. We do not need to spend the amount we do at Baselworld to do that. It is very expensive. Even our retail partners tell us, you do not need to impress us with the size of your stands; they would rather see us spend this sort of money in their markets where they need to capture new wrists,” Mr Tornare suggests.
Since we spoke, LVMH has confirmed that all its brands will return to Baselworld in 2020 using their current exhibition stands at the entrance to the show. Discussions are underway about changes from 2021 onwards, but Mr Tornare appears keen to find a way of participating if the price is right.
“If they do not get the concept and cost right, you will see more brands saying that for one-fifth of the cost they can have a nice event that does the same amount of business,” he concludes.
50 YEARS OF THE EL PRIMERO
It is 50 years since Zenith first unveiled its El Primero chronograph movement, and the company is marking the occasion with the launch of an anniversary box set containing three chronographs, the first of which looks just like the 1969 Chronomaster El Primero that first used the calibre.
It is the first time that Zenith has returned faithfully to the 1969 original design, which introduced the three-colored subdial layout: light grey for seconds, blue for minutes and anthracite for hours.
Along with the El Primero Chronograph, the box contains two of its direct descendants, a Zenith Chronomaster 2 and a piece from the recently launched Defy El Primero 21 with its 1/100th of a second chronograph.
Enticingly, there is space for a fourth watch in the anniversary box set, which will be filled when Zenith introduces a model using a 1/1000th of a second chronograph. In an era when it is often impossible to secure the newest, hottest, limited production models, this fourth watch could be a clincher for collectors.
Only 50 of the anniversary box set are being made priced at the equivalent of £50,000.