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By Emiko Terazono |
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The interesting aspect of our industry is that there is nobody else in the Swiss watch industry who carries the name of a brand," says Jack Heuer. The silver-haired Mr Heuer is the brand ambassador and honorary chairman of TAG Heuer, the 143-year-old watch brand now owned by luxury fashion group LVMH. The watchmaker is one of the few brands that has a member of the founding family to call on to act as steward. While many European luxury brand names pride themselves on their history, and extol the virtues of tradition and continuity, very few maintain ties with the founding families. Back in the 1960s and 1970s, Mr Heuer was head of a company that had been started by Edouard Heuer, his great-grandfather, and run by his family for three generations in a town in the Swiss Jura mountains. Jack Heuer built up the business from a small operation of 35 people into a company of more than 300 employees. But in 1982 he sold the group to Piaget and left Heuer to work in the electronics industry. The watchmaker was then sold to Techniques d'Avant-Garde (TAG), owned by the Saudi billionaire Ojjeh family, who sold it on to LVMH in 1999. The following year, 70-year-old Mr Heuer was invited by Jean-Christophe Babin, the watch group's chief executive, to come back in an advisory role. As ambassador for the brand, Mr Heuer hobnobs with managers of the TAG Heuer group and schmoozes the retailers who carry the brand. Mr Heuer carries out his task with charm and conveys a genuine love for the brand - something a celebrity endorser may not possess. "I'm always so overwhelmed by country managers who are fascinated by the presence of somebody that is part of the family, who knows the history. Clients are also delighted," he says. Cynics may claim that the role is just a marketing ploy, but he is also on the new product committee, making sure new watches are in line with the brand's traditional spirit. And, as one of the strengths of a company with a long history is having the ability to relaunch classics, Mr Heuer oversees the re-creation of old styles. "Business is not a science but business is not just passion," says Mr Babin. "You need analysis and experience. Jack Heuer built our roots. He connects our past and our future, knowing what we stand for and where we are going. It's an important role and he plays it very well. I'm only the sixth CEO in the 143 years of the company. You can't buy experience. It takes time. You need to suffer, learn, listen and observe." Things have not always run smoothly for TAG Heuer. By the time the Ojjeh family, whose assets then ranged from Paraguay's second largest ranch to the McLaren Formula One racing team, bought the company, it was on the verge of bankruptcy, suffering from the recession caused by the oil crisis and cheap electronic watches from the Far East. The company was known for its sturdy sports watches but lacked a marketing strategy. TAG pumped money into the company, revitalising it into one of the leading luxury watchmakers. TAG built on the watches' sports heritage. LVMH has continued this marketing strategy with tie-ups with David Coulthard, the McLaren Mercedes driver, and, last year, a sponsorship of Tiger Woods, in an attempt to attract golfers. In fact, Tiger Woods does not wear a watch when playing and the television advertisement he stars in has been slated by the advertising cognoscenti. Nevertheless, the watch group increased its marketing spend by 35 per cent and Mr Babin says margins had a double-digit increase. Although Mr Heuer claims to be a "product man" who would rather see money spent on innovation than on marketing ("If I had operational responsibility I would say No to a lot of marketing," he says) he realises that we live in an age where precision and timekeeping are is taken for granted and that brand image and marketing are essential in the upmarket watch business. And he sees that his presence within the business provides added value in terms of brand image. "The difference between luxury and prestige brands is that luxury is created relative to other products and brands. You can create a luxury brand by putting diamonds in things but a prestige brand is continuous, developed, backed by quality. It gets that additional element. TAG Heuer is prestige. Many others haven't got the history," he says. And Heuer definitely does have history. He cites the family's links with sports. As early as 1882, the company introduced pocket chronographs with split-second features that were used for horseracing. Jack's grandfather, Charles, obtained the patent in 1895 for the first waterproof pocket-watch case. Heuer (as the company was then called) chronographs were used for timekeeping in the Olympics in Paris in 1924 and in Amsterdam in 1928. Jack Heuer's love of sports inspired him to invent various timing devices, including one for Formula One cars. When Ferrari had difficulty with timing long-duration races, a deal with Heuer resulted. Ferrari would use the Heuer devices and, in return, Ferrari put the Heuer logo on every Formula One racing car. The car racing ties led to Steve McQueen's wearing the company's Monaco-brand watch. TAG Heuer currently has a relationship with McLaren as its official timekeeper. Mr Heuer lets slip his nostalgia for the days when the watchmaker was close to Ferrari. "Ferrari was such an icon. Even when
Ferrari came in fourth or fifth, it would always get big
coverage in the press and so would we. Now, even if McLaren
wins, there are times it hardly gets mentioned."
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