Sunday, September 11, 2016

Less Could be More

This is a quick idea, and one that could:

1.  Save a lot of money in terms of over-supply product dumping

2.  Make a lot of money in sales

A multi-year product life cycle for watches.  Now there are several brands who have mastered this basic idea.  Rolex, and lately Panerai come to mind.  Quite simply, do not feel the need to keep churning out the latest update of a product or product family.  Simply continue it for a two, three or even four year period.  The interesting thing about watch brands is that many of the shot callers forgot some basic truths in their mad scramble to be the next Hayek or Biver - that although fashion is exciting and sexy, it operates in very different retail realities than the watch business.

Consider some simple realities - If you can buy a designer shirt at 75% off of full retail price from a retail store (not the factory outlet, mind you), then it becomes obvious that the margins are completely different.  And given that, it makes it possible to continually crank out brand new products at a break-neck pace.  But watches are, for better or worse, durable goods.  The lead time, man power and expense to develop, market and sell through a new product are much slower than in the fashion industry.  And frankly, they should be.  But the fundamental difference between brands like Panerai and Rolex and the others that would like to be them is actually pretty fundamental.  Rolex and Panerai have established their language, their design vocabulary, their product grammar.  It is consistent, it is steady.  And because of the time that has been put into a consistent product line, it is easier to achieve a steady desire and appreciation for the product offering - even when it is something new, it is not so new that it is dramatically different.  It is easily understood and appreciated.

What does this mean?  In the short term it means that hundreds of thousands of marketing dollars don't need to be reinvested into a semi-annual marketing blitz to introduce new products.

So consider this as an idea - a two to three year product cycle.  It would:

1.  Help create a consistent identity and desire for a model.  If the model remains consistent, it is easier to market, easier to promote, easier for both the retail partner and the customer to understand.

2.  SAVE a lot of money!  Consider how much money it takes to promote and hype a new model?  Add to that the expense of product knowledge and training?   The travel costs alone are staggering.

And then the expense of blowing out the model because you are rolling out the next version?  And the later expense of the product's perceived loss of value?

And then the merry-go-round spins again.

It might not be as exciting and sexy as 10 new versions every year, but Rolex, and lately Panerai have proven that consistency will see you through the good times and the bad times as well.

Designers and PR firms might protest, but ultimately, the bigger picture is what is important.  And when very large brands, brands that cranked out new products as regularly as the sun rose in the east and set in the west, are laying off significant portions of their workforce?  Well I think we all can appreciate that maybe it is time to scale back.

Less, in fact, could be more.

1 comment:

  1. Another concept -apparently foreign to many watchmakers- is to name their models with distinct classic names.

    Everyone will praise you if you got an Airman SST or a Submariner or a Nautical Cricket, but how am I supposed to get excited over the new 1234.987.ABCD.17-MT?