It has been circulating on the internet for a few days. Since it is also of great interest to Italian enthusiasts, we provide the Italian translation of the brand ranking compiled by Business Montres & Joaillerie. We do not agree with all the comments of our colleague Gregory Pons, but the instrument is new and interesting.
Anyone with questions about this can leave a comment here on the blog.
THE TRUE VALUE OF BRANDS
First ranking of watch manufacturers according to their brand value: a marketing analysis tool unparalleled in the market.
To begin with, one must guard against misinterpretations of this InterMarques 50 ranking The value scale proposed here is not:
- a comparison of the international celebrity of watch brands...
- a ranking of their economic weight...
- an indicator of their market value (do not confuse 'value' and 'price')...
- an astral plane capable of predicting their economic future.
The calculation of the value of a brand takes into account several parameters recognised in the universe of marketing and financial analysis (see in particular the Interbrand or Brand Finance classifications, which are authoritative).
However, the classification proposed by Business Montres & Joaillerie is less oriented towards finance than towards marketing. A matter of personal expertise: I have not treated these financial evaluation models and techniques (often of Anglo-Saxon origin) with the same freedom as marketing concepts. Moreover, a very accurate 'financialisation' of the analysis of brands seems a bit pointless to me: almost all the watch manufacturers concerned by this ranking are not, as such, on the market and therefore do not require erudite exegesis to determine the hidden springs of their stock market potential...
On the other hand, the value of these brands is an excellent indicator of commercial and marketing reliability for suppliers, retailers and all partners of the company, insofar as the strength of a brand is a decisive strategic pivot.
It is also a question of editorial choice: as easy as it is to manipulate the data of 'open' industries on figures, it is equally risky to use these tools when the main participants in this market practise total opacity on the accounts of each brand and consolidate these data within aggregates that prevent - voluntarily? - any somewhat fine-grained analysis of their portfolios.
INTERMARQUES 50
How does it work?
Useful clarification: only European brands are dealt with here. This value, expressed in millions of euros, relates only to the watch market (outside jewellery, movements, shops, etc.), i.e. only the watch value of the brand (it goes without saying that Louis Vuitton or Chanel are worth infinitely more).
Watch sales are considered on the basis of Top 180 Marques revealed by Business Montres & Joaillerie (20 December 2006): this is the only comprehensive ranking ever published on Swiss watchmaking and is now a reference for specialist analysts. The errors, exaggerations and reductions noted since its publication have been corrected here.
Among the parameters examined was the value of an intact brand:
- Its commercial success in its various markets (turnover and market shares) and its market shares in its field of competition.
- The potential for its growth and its ability to generate profits over the next three to five years (data incorporating production, marketing and promotion costs).
- The size of its global distribution network, its base (retailers, single-brand shops, own shops), the loyalty of these and thus the brand's ability to cash in on regional economic crises.
- The reliability of its management team (strategic capacity, vision, competence, charisma).
- The creativity of its teams (product innovation, marketing, R&D, patent portfolio).
- The relevance of its collections and product offering (coherence, balance, attractiveness in an ultra-competitive framework).
- The intelligence of its communication (concepts, choice of ambassadors, media planning, power of the logo, etc.).
- The image consumers have of it (reputation, desirability, social status, asset value, 'felt' value, quality of before- and after-sales services, customer loyalty, resaleability, etc.).
The 2007-2008 trend aims to highlight a potential orientation for each brand. These figures are not to be considered as absolute values, but as comparative elements destined to evolve over time: this ranking will be the subject of an annual publication and will be enriched by comments and criticism from those who appreciate its scope.
- Each has its little secrets: the key to the breakdown of these parameters constitutes, for Business Montres & Joaillerie, a 'trade secret' that cannot be published.
Marks to you!
BM&J
A brand is, of course, a market reference (university definition), but there is also an economic asset. Beyond its simple name, loaded more or less with emotions, passions and convictions, a brand has the power to create a difference in the spirit of consumers and thus to influence their financial decisions. If a brand is, in itself, a system of values (nurtured and sustained by enormous communication budgets), it is thus a creator of surplus value, which gives it a measurable economic value: it can therefore be given a place on a scale of comparison.
It is this individual ranking of the value of brands - still never attempted in the watch press, nor in the watch industry - that is published here. Yet another first Business Montres & Joaillerie, which will, we are sure, cause ripples, ire and gnashing of teeth! As with our now-famous Top 180 Marques signal, it is a question of creating a basis for discussion: over the years, this ranking can then be refined and sensible developments determined.
The 'value' defined here is that of the brand, not that of the enterprise: it is obvious that Rolex would be worth infinitely more if the brand were to be put on the stock market. It is about the brand as an intangible asset of the enterprise and as an element of its global patrimony, in the same way as its groups, its factories, its shops, its museum or its patents.
The brand is considered here as an all the more strategic asset that can determine the future performance of the company and its ability to generate profits, in addition to market performance. It is the value of a brand that allows it to mitigate the gearing effects of a cycle and limit the consequences for its business. The higher the value of a brand, the more it is 'guaranteed' against the risks of economic life: this 'protection' also reassures the customer-investor about the perpetuity of his watchmaking assets. This brand-value is primarily of interest to retailers, for whom it is a 'contract of trust', as well as a promise of profits.
Whether or not companies are listed, potentially subject to takeover bids or potentially 'investable', their brand value is an indispensable reference for any economic reflection. One is surprised that such an analysis tool has never yet been proposed...
1
ROLEX
3.913 M€
(Hans Wilsdorf Foundation)
The world's leading reference for luxury watchmaking at the beginning of this century, Rolex is in order to remain so well into the next century. The industrial tool has been reorganised to guarantee logistical independence, uncompromising quality control and permanent innovation. The commercial and promotional instrument (ambassadors) has followed. Who could threaten this supremacy?
2
CARTIER
1.993 M€
(Richemont)
Thanks to the historic reputation of its brand and the solidity of its international distribution network, the flagship of the Richemont group has proved its ability to weather the worst storms. "The 'jeweller of kings, the king of jewellers', Cartier has lost none of its magic. However, the 'old European' style of its products and the conceptual weakness of its communication could hinder the brand in the new luxury markets.
3
PATEK PHILIPPE
1.206 M€
(Stern family)
The independence and prudence of family management have maintained the identity and desirability of a brand that can afford anything. In particular to market the most complicated watches on the market, while financing its innovations thanks to massive sales of fairly banal but ultra-profitable quartz watches. A 'cultural exception', generating an incredible rate of profit per unit...
4
TAG HEUER
1.192 M€
(LVMH)
A member of the club of 'flagship brands' within the LVMH group (entry fee: €100 million in annual profits), TAG Heuer has been able to become a fantastic 'cash machine' again, and smartly so. Potential stumbling blocks for the world's number one in elegant sports: the big gap between very different product lines and a glamour positioning that has not yet proven its worth, while Longines is the 'TAG Killer' (see page 3).
5
OMEGA
1.168 M€
(Swatch Group)
A major contributor to the Swatch Group's profits (to the tune of €190 million), Omega is repositioning itself at a fast pace on the watchmaking haut de gamme, where its legitimacy remains to be consolidated. The brand is everywhere, from Hollywood to the Olympic Games, with prestigious groups of ambassadors, but between rough edges and fine tuning, it always seems to be searching for a relevant identity and a coherent strategy.
6
CHOPARD
532 M€
(Scheufele family)
In the space of a few years, Karl-Friedrich Scheufele has managed to build up a genuine manufacture, a genuine brand and a genuine watchmaking reputation at the same time: the quality of his instrument impresses and his production capacity guarantees him enviable logistical independence. Too bad that marketing and design are still so timid...
7
FRANCK MULLER
505 M€
(Vartan Sirmakes et Franck Muller)
The idea was to build a group: done. The idea was to build a galaxy of specialised manufacturers to serve this group: done. The idea is now to perpetuate the brand that always claims 'Master of complications': it will be more difficult, especially with the prospect of going public in 2008.
8
BREITLING
479 M€
(Schneider family)
A spectacular straightening of the brand image, one of the best quality control desks in Switzerland, a successful repositioning in luxury thanks to Bentley, a communication that is tenaciously true to its legitimate values: the fundamentals are right and the future cloudless, even if the products evolve too little (except for the Bentley line).
9
AUDEMARS PIGUET
434 M€
(Audemars, Piguet and allied families)
The success story of Le Brassus combiers continues, in all family independence, but not without questions about the future of an exemplary brand. We see fewer ultra-complicated models in the collections, but more ultra-timely 'limited' series: logic of immediate profit or concern to meet the expectations of the century?
10
IWC
421 M€
(Richemont)
The brand draws its strength from its tireless manager, present on all fronts and always ready to ride the wave that pushes it further. Equipped with its own manufacture to make its own movements and complications, the favourite brand of American billionaires can now call the shots with the big names in haute horlogerie. Beware of air sickness!
11
PIAGET
409 M€
(Richemont)
An authentic manufacture of haute horlogerie, Piaget skilfully marries its two identities (watches and jewellery) to create an original and seductive symphony, albeit one that is too discreet for our entertainment society. A path without a flaw, the brand itself lacks a little audacity - perhaps a little chance - to gain a few places...
12
BREGUET
392 M€
(Swatch Group)
Stimulated by its chairman, Nicolas Hayek, to whom the Swatch Group did not refuse any investment budget, the Breguet brand has returned to the best level in its category. Its communication policy remains expensive and its innovative capacity is delayed in generating definitively convincing references.
13
BULGARI
348 M€
(Trapani family)
The watchmaking division is old hat to Bulgari, which had invented a style (Bulgari-Bulgari) and aesthetic codes (aluminium-rubber). One looks in vain for logic in the latest collections and wonders whether the brand - which has the Daniel Roth and Gérald Genta manufactures - still has a watchmaking strategy worthy of its past.
14
CHANEL
334 M€
(Wertheimer family)
The meteoric success of the J 12 revealed to the world that Chanel is not just a haute couture brand. Very advantageous for this watchmaking aspect of its business, the brand now exists with strength and legitimacy as an all-round watch brand: it must now manage the maturity curve of its single-product J 12, and in particular convince the male market.
15
TISSOT
333 M€
(Swatch Group)
It is the calm brand of the Swatch group, subscribing to two million watches a year and capable of success that blazes the trail of innovation (T-Touch collection), but it is no longer the profit-making machine it was. Chinese competition is pushing a dangerous increase in the range, which could eventually shake up this pillar of the Swiss watch industry, whose international network deserves to be solidified.
16
JAEGER-LeCOULTRE
329 M€
(Richemont)
The Le Sentier manufacture is one of the industrial jewels of the Richemont group, which can only rejoice at having blown it under the noses of its competitors: the investment proved costly, but it paid off! Still weakly fashionable, the brand must now demonstrate that it can enhance its innovations and that its identity is not limited to a tirelessly declining Reverso...
17
GIRARD-PERREGAUX
309 M€
(Macaluso family)
The scarcity of industrial capacity boosts the value of 'small' manufactures, especially when they are backed by a splendid watchmaking heritage, never compromised in the economic slogans of the past. One wonders why Luigi Macaluso, who now has the means of his ambitions, still hesitates to take flight.
18
SWATCH
302 M€
(Swatch Group)
Born from the most successful watch communication coup of the 20th century (333 million watches sold), the brand is delaying entering adulthood. Blows from fashion labels (Guess) have eroded its magic. A creative line of strength is sought in the new collections, which are more defensive than offensive. The image remains strong, but the brand lacks a charismatic director.
19
LONGINES
294 M€
(Swatch Group)
Relaunched a few years ago on the glamorous watchmaking front ("Elégance is an attitude"), Longines - the most classic of the great Swiss Made references - seems to be moving towards a repositioning on elegant sport, certainly to occupy the ground uncovered by Omega's growth in the range. A hyper-crowded segment, but Longines applies a historical legitimacy to it that remains to be sustained with a new product strategy.
20
HERMÈS
289 M€
(Hermès family)
From its first watch collections in the 1930s, Hermès has made a flawless path to becoming a 'real' watch brand, soon equipped with its own movements thanks to its investment in the Vaucher manufacture. Profits are in line with volumes, which could be boosted by more eye catching products.
21
LOUIS VUITTON
267 M€
(LVMH)
The most famous luxury brand could have been content with a simple horological declination of its monogram and its aesthetic codes, but it has taken up the challenge, to the point of making Louis Vuitton watches an enviable reference, both in its concepts and in its manufacturing quality. Rather than making use of the brand, Louis Vuitton watches serve to widen its perimeter of legitimacy.
22
RADO
252 M€
(Swatch Group)
Like all Swiss mid-range brands, Rado faces terrible competition, while its technological (ceramics) and aesthetic (design) contents are no longer enough to create a real difference. It remains to be seen what mission the Swatch Group assigns to this brand, faced with the need for a change of generation, management and communication.
23
MONTBLANC
246 M€
(Richemont)
It is said to be the Richemont group's most strategic brand, the one on which all hopes of a new lever of growth 'à la Cartier' rest. From the point of view of watches, it is not there yet, but the brand has acquired unsuspected credibility since the annexation of the Minerva manufacture, guaranteeing an opening in the field of haute horlogerie.
24
VACHERON CONSTANTIN
237 M€
(Richemont)
Awakened by the celebrations of its 250th birthday, the Geneva-based manufacturer is conducting its adaptation to the new watchmaking century with dignified compunction: new dimensions and new movements, but still completely traditional.
25
HUBLOT
221 M€
(Crocco family)
Jean-Claude Biver's passionate kiss has woken the sleeping beauty, who had forgotten that he had launched the rubber fashion in 1980 with his Big Bang, the brand is now making up for lost time and ground, to the point of having quadrupled its sales over the last three years. Straw fire or (re)birth of a star of the first dimension?
26
ROGER DUBUIS
209 M€
(Carlos Dias)
Ten years will have been enough for Carlos Dias to create a brand, a style and an industrial benchmark in the universe of haute horlogerie. Here, the brand proves to be stronger than the financial windfalls, misinformation and sulphur dioxide that have accompanied its journey. Although Carlos Dias sometimes put the cart before the horse, he proved that he had a vision, which he must now share.
27
PANERAI WORKSHOPS
206 M€
(Richemont)
Branding magic: since its entry into the Richemont group ten years ago, Panerai has sold a thousand times as many watches as during the previous half-century. Promoted as an object of passion, even by women, can the watch of Italian dive commanders go any further in its conquest of international markets? A lever of growth has been found with Ferrari, but the marketing of rarity is a demanding and complicated art
28
A. LANGE & SÖHNE
191 M€
(Richemont)
The Saxon watchmaking tradition is no more than a century and a half old, but the small town of Glashütte has established itself as one of the world's watch capitals. In less than twenty years, the A. Lange & Söhne has been able to give a style to this tradition: can ostentatious austerity and mechanical rigour seduce beyond the circle of European purists? The future of one of Europe's strongest haute horlogerie potentials rests on this question.
29
RAYMOND WEIL
175 M€
(famille Weil/Bernheim)
One of the best examples of successful repositioning: volumes were almost divided by three, while average prices tripled. The network was downsized and the collections revised. Raymond Weil now flirts credibly with the universe of haute horlogerie, but faces massive competition in this segment from luxury groups, ruthless with independents.
30
ZENITH
161 M€
(LVMH)
The industrial manufacture in Le Locle has become a dream factory, where the El Primero movement - watchmaking's grail - is no longer a pretext for amazing variations on the theme of high-tech neo-glamour. The brand draws its strength from the emotional power of its watches, but Thierry Nataf has become so identified with this image that one wonders what would remain of this equation if he were to withdraw his personal factor...
31
BAUME & MERCIER
148 M€
(Richemont)
After a serious downturn, the Richemont group's ill-fated brand is breathing at its own pace - without shying away from following others - and reaffirming its aesthetic codes, a free translation of watchmaking trends. The collection changes are on the right track, as is the consolidation of the international network. All that is missing is a little time...
32
RICHARD MILES
133 M€
(Richard Mille)
In terms of volume/value ratio, it is certainly the most beautiful brand in the watchmaking landscape. You will get the true measure of the exploit when you know that it is also the newest product on this list and probably one of those that will be valued the most in the years to come. Richard Mille can afford everything, in all directions, except a failure of creativity.
33
BLANCPAIN
117 M€
(Swatch Group)
Although "from 1735... ", the brand is not yet thirty years old, but its reputation among enthusiasts surpasses that of many historic manufactures. All the ingredients of a Breguet recipe are on the table and Marc Hayek has no lack of skill to create a sauce that could nevertheless be bolder and more flavoured.
34
ULYSSE NARDIN
109 M€
(Rolf Schnyder)
Discreetly but stubbornly, the Ulysse Nardin manufacture secures its place on the high complication market, where it multiplies its innovations. It still lacks a magic wand for everything related to marketing and communication.
35
EBEL
108 M€
(Movado Group)
Five years ago, Ebel was no longer worth much, as the LVMH group failed to resuscitate this legendary brand that had become very weak. The rebirth is nothing less than spectacular. By finding the right tone to create a new act for the brand, the Movado group has re-circulated the necessary energy: Ebel is back, with a large part of its old brand strength.
36
FESTINA
121 M€
(Festina Group)
37
GUCCI
115 M€
(OSR)
38
GLASHÜTTE ORIGINAL
111 M€
(Swatch Group)
39
GUESS
103 M€
(Timex Group)
40
BREIL
101 M€
(Binda group)
41
HARRY WINSTON
86 M€
(Aber Diamond Corp.)
42
VICTORINOX
77 M€
(family)
43
TUDOR
73 M€
(Rolex Group)
44
MAURICE LACROIX
68 M€
(group)
45
CHAUMET
65 M€
(LVMH)
46
CORUM
65 M€
(Wunderman family)
47
MOVADO
62 M€
(Movado Group)
48
TECHNOMARINE
54 M€
(Franck Dubarry)
49
DIOR
52 M€
(LVMH)
50
CHARRIOL
48 M€
(Philippe Charriol)
Gregory Pons
Business Montres & Joaillerie
