India needs more shopping malls, high streets for luxury brands: Omega CEO

Raynald Aeschlimann, president and CEO of Omega and member of Swatch Group's management board has been with the group in a variety of roles for close to three decades. The 7.3 billion Swiss Franc group whose brand portfolio includes brands such as Swatch to prestige brands such as Breguet, Longines and Rado has seen sales and revenue jump in recent months. Omega was the official timekeeper for the Winter Olympics in Beijing earlier this year. Officials say, regionally, the strongest growth in the second half of the year 2022 is expected in America, Asia and Mainland China. Aeschlimann who spoke with Fortune India exclusively at group headquarters in Bienne, Switzerland details the challenges the industry has encountered over the pandemic years, the uptick in recent months and why Omega doesn't believe in long waiting lists for customers.

Edited Excerpts

The audience is getting younger - millennials and digital media consumers are now the demographic, so how has that changed how you sell?

We are lucky that the younger audiences are more exposed to luxury and are actually more passionate about brands and luxury and are also very in tune with buying products that are high end and created with a certain heritage. They want to know how products have been created and are more curious. Younger buyers are also better informed and don't forget that based on reports these new generations are wealthier than ever before. The Snoopy Speedmaster which is a serious watch with a sense of humour has been received well with younger generations. I recently met a guy who was under 30-years of age who came here to buy his second one for example, and also just because he wanted to check out the Omega museum again.

Last two years have been challenging for all watch-makers - how was it for you?

That came as yet another problem because for me as a CEO of a large company there were already three challenges on three levels: first in opening stores and new subsidiaries. Remember, globally we have 160 stores, with 20 affiliates from India to Korea and elsewhere. We had to be caring about every single country and that took a lot of energy and time but we had to be consistent with our values. Second it was about continuing to create watches, keep production going and the third was about juggling it because some markets were open then some were closed, then some were opening and closing. So the business became a different business model everyday but overall we had to continue to give different markets the ability to sell the watches. So production, distribution and sales was the focus but all of it came back to values. We are truly Swiss-made and what that meant was as a company we were able to continue production. In this building (in Bienne) we have our people working in incredible working conditions so much so that we have almost no issues with COVID-19. Ultimately, it was about agility, courage and going back to our DNA. You can't wake up one morning as a CEO and say now we will become an agile company. Either it is part of who you are or it is not.

How has watch-buying changed of late, what are the trends you see and your big challenge?

We see vintage watch buying has totally changed and we have been supporting that for a long time in terms of service and all. We have been pioneers in supporting Somlo – a vintage watch store that retails a lot of Omega watches in London. It's a small world and our expectation for opening would be high. But there is a big opportunity there, however, it has to be linked with a lot of capacity in the collectors' world, high knowledge levels and a presence of technical expertise. But why not?

On the other hand, If I look at the evolution of the Swatch Group and Omega we see a lot of growth in our overall figures for the last 12 months now and that's despite less store traffic. India has under Covid times seen even more development in the world of watches and we see more requests for store openings, increasing their collections and so on. Our big challenge for India is infrastructure - we still need to have more big shopping malls, high streets and what all luxury brands want in the same way as in the West.

What's your stance on waiting lists that some watch brands have for their timepieces?

We were the first to get into doing direct-to-customer e-commerce so for me there is definitely a value for watches that are so searched for and so waited for that it's in high demand. However, there is no defined strategy in creating a wait list at Omega. On the other hand, customer-centricity is the focus for us so there is no value in making a customer wait so long that he or she feels they are not important. That's not what we are about as a brand, and we can't block deliveries to make them higher on some secondary or grey channel market that we don't like in any case. We do have some references (watches) that are made in small volumes and are not always available but we have worked with partners to ensure that even those are deliverable within three to six months and not years or decades.

Swiss watches are generally a male bastion. While you have had global celebrities Cindy Crawford and Nicole Kidman representing the brand, is Omega also driving more change there?

There are a lot of ladies who don't mind wearing large watches which are 40 or 42 mm dials. That being said, we have been creating a lot of watches that have colored dials and are fashionable like the Tresor and the Mini Tresor. Also, we just brought actress and singer Zoe Kravitz on board.

Conversations around ESG and sustainability and diversity are getting louder in board-rooms. How do you see that impacting the way Omega works?

Our entire corporate office in Bienne here is made of Swiss teak and we have solar panels. There are two ways of looking at this and when we talk about Swiss-made, a mechanical steel watch is one of the most sustainable products made given that they can go on for over 50 years. Amongst many other initiatives Omega joined the RJC ( responsible jewellery council) in 2015 to ensure ethical standards throughout that supply chain. When you have watches and collections called Seamaster and Planet Ocean we make sure that we are investing heavily in worlds that we can constantly support to be better and for the long term.

Omega has a large reservoir, perhaps the largest of vintage models that include the Flightmaster, the Dynamic, The Soccer Time, the Chronostop and others that can easily be tweaked and relaunched. Your plans for that?

One can be bringing back icons to the level that they deserve and recreate the watches that have made history but sometimes one has to decide to introduce models that remain coherent in tandem with the other lines we have. So for example Omega has four lines of watches (Speedmaster, Seamaster, De Ville and Constellation) and to evolve those four lines itself is very difficult. Not unlike the car industry where it's also not easy to create new cars but is easier than the watch business, despite incredible product lines and heritage and success in the past, it has to have customer resonance as well. That of course doesn't mean we can't launch new versions of older successes and examples are the Pro Plof (divers watch) which used to be an entire line and the Omega Military watch. So we will work on our legacy and create new products but not just create models only for museums or collectors.

What were your key launches and how were they received in the last two years?

We launched a special edition of the iconic Speedmaster which was the Silver Snoopy Award 50th Anniversary, a commemorative watch that also made people smile and the reference was one the most searched watches worldwide in the industry. Then there was the Moonwatch in smaller sizes. The year 2021 was an incredible year for the latest Seamaster in titanium because of the latest James Bond movie which was finally released. We still have back-orders for that. We actually had Commander Bond played by Daniel Craig come in and help with the production and design of the watch without us knowing exactly what the movie was all about. We knew what Commander Bond needed in this era and that's what we used to work on delivering it. The DeVille family of watches dropped a little because that's a strong seller in the Asian markets and movement to be honest in duty-free markets and airports, was slower. However, in the last six months for every single month we have made some of the best sales in history despite China and mall-shopping still not back to hundred percent so I think we can continue to grow market share while remaining in touch with consumers.