An Open Letter To Glycine

Dear Glycine, 

Longtime fan, former (and frustrated) Airman owner.

Today I awoke to find an email announcing yet another product flush disguised as an opportunity to purchase a unique and historically important timepiece (at a rock bottom price).  

PLEASE do yourselves and your customers (previous, current and future) a favor and STOP sending your watches through the grey market to speed the clearance of product.  You have failed to understand three very important things:


1.  Your brand was originally built on highly functional, reasonably affordable watches.

2.  Over the past 6 - 7 years you steadily ratcheted up the prices, and over the last 2 - 3 years you failed to pay attention to your retailers (particularly here in the US) as they continued to struggle to shift the product that they already had.  You failed to take into account price sensitivity and our old friend supply and demand.  Moreover, there was little to no communication about the brand, product, etc. 

3.  With the sale of Glycine to Invicta, many purists out there poo-pooed and felt the sky was falling.  I, for one, did not.  I thought that the new owners would understand that the integrity of the brand (although not where it had been maybe 10 years earlier) was still there and could still be salvaged and built upon.  But as of right now it seems that there is a more assertive effort to shift units, and that has been borne out in the large numbers of Glycine watches finding their way to online discount sites.
There is a very, very big difference between watches and milk.  While I understand that overstock needs to be cleared to improve cash flow, I also know that when you slash and burn prices on product across the board and in a very public way, you lose the support that you once had, and it bears mentioning, that support has been getting thinner and thinner over the past few years.  There are subtler ways to clear overstock - methods that are a bit less drastic, respect the retail partner and current customer, and achieve the same goal.  But that would require Glycine to:

1.  Open their own online store
2.  Actually go out and cultivate the market, visit and engage with retail partners
3.  Reconnect with their community of fans and supporters
4.  Stop selling to the grey, and soft grey markets
5.  Stop trying to solve several years of poor sales in a hyper-paced drive to purge stock in as fast a manner as possible

You didn't get into this situation overnight.  You won't get out of it overnight either.

The long game is always challenging.  But several brands out there have managed to keep going by not abandoning what they were built on, paying attention to what is going on, and making the necessary adjustments as the situations have necessitated.  


For a brand looking to shift product quickly and instantly stimulate cash flow, the grey market is probably not unlike heroin.  That first experience can be amazing, but it never ends well.

Huh... part deux

I want to get it, want to understand it, but I just don't.

I suspect it is not new news to regular readers, but to be clear, I am no fan of Invicta.  And in fairness, I therefore do not cover them.

Having said that, many people had mixed emotions when Invicta purchased Glycine.  My feeling at the time was that Glycine was drowning and they needed oxygen (or more specifically, money), and that so long as Invicta was treating this as a purchase/investment and tried to help Glycine recover from the mess it was in, well then it would not necessarily be a bad thing.

But then some interesting things started happening - Glycine watches began to run fast and thick in the grey market and it was clear that the intention was to liquidate large portions of the previous collections.  While this might have quickly infused some much needed cash, it had two other consequences -

1.  Retail partners, you know the ones who you had been working with and encouraging to buy your watches?  They were really not happy and the current number of retail partners in the US appears to have thinned and reflects that sentiment.

2. Previous customers and Airman devotees felt that Glycine had simply abandoned them as they watched the resale value of their collections plummet.

Interesting to relate, new Glycine Airman models have popped up on the Glycine website and to put it gently, they are pretty underwhelming -

Courtesy of Glycine

And maybe, just maybe it might be necessary for Glycine to simply go bland.  Ultimately, it is a business, and they have to run it the way they see fit, but why in God's name would I, the consumer, would pay full price or even a modest discount when I can pick up a fire sale priced Airman from the light grey market?

https://www.massdrop.com/buy/glycine-airman-18-automatic-watch

https://www.touchofmodern.com/sales/glycine-15ff1e7e-5751-4d43-850d-3e0c5f9d659f#

Again, brands have to do what they have to do, but if they continue to slash and burn to clear stock at less than 30 cents on the dollar, they continue to do irreparable damage to themselves.  And what makes me really frustrated when I think about Glycine and other brands out there doing dumps in the light grey market?  They could simply open their own damn online shop, and offer the occasional special offer to ease overstock without simply dumping it and gutting their own market.  And in the process they would not only solve short-term cash flow problems, they would strengthen the bond between themselves and their customers who felt that they got a good deal, and that their loyalty was rewarded - not taken for granted.

Nothing can stay the same forever, but I will hang onto my Airman for now, and hope that more long-term planning will emerge from the Glycine/Invicta brain trust.

Evolution and Survival of the Fittest

So a guy I tend to listen to shared with me a slice of reality that I suspect a lot of independent reps and reps looking for new gigs probably are not sharing with their "employers to be".  And that is that per the Jewelers Board of Trade, 1,669 business in the jewelry segment closed in 2016.  Oh, and that is just here in the States.

Let's take a moment and let that sink in.

If we divide that number by 12 months, that means that 139 per month.

If we divide by 52 weeks?  Slightly more than 32 per week.

If we divide by 365 days?  4.57 per day.

If it hasn't become clear yet, it should be starting to.  The old way of buying and selling jewelry and watches has changed.  Moreover, the number of potential outlets in the traditional channels (watch and jewelry stores) is continuing to contract as stores close up and disappear like available seats in a game of musical chairs.

For brands thinking about coming in and fighting it out in this gladiator's ring, keep in mind that you will be going toe to toe with some very strong, very wealthy companies who have far more money to burn than you to get their product into the dwindling number of watch and jewelry stores.  And even if you do get in, it does not guarantee that you will sell through.

Maybe, just maybe it is time to seriously consider a different approach?

You know where to reach me -

Glycine is Now Owned by...

Invicta.  The official confirmation was just forwarded to me by DKSH about an hour ago.  So press release first, commentary to follow -

DKSH sells the Glycine watch company to the Invicta Watch Group 2016-08-11

DKSH sells its majority stake in Glycine Watch S.A. to the Invicta Watch Group, a US watch manufacturer.

Zurich, Switzerland, August 11, 2016 – DKSH (SIX: DKSH), the leading Market Expansion Services provider with a focus on Asia, sells Glycine Watch S.A. to the Florida-based watch manufacturer Invicta Watch Group. With this step, DKSH continues the restructuring of its luxury goods business which has made good progress since being announced in mid-2015. The parties have agreed not to disclose any financial details of the transaction. 

Dr. Joerg Wolle, President & CEO, DKSH, commented: “Selling Glycine to Invicta is a further important step in the ongoing restructuring of our luxury goods business. At the same time, we are convinced that the Glycine business is in good hands. The restructuring of the luxury goods business is well underway; we are delivering what we promised.” 

Invicta was founded in 1837 by Raphael Picard in La Chaux-de-Fonds, Switzerland. Glycine with its long heritage joins the Invicta Watch Group's other respected brands. Eyal Lalo, CEO of Invicta, stated: "I am very excited about Glycine joining the Invicta family. The synergy between the two brands will create growth for Glycine. It is our commitment to remain dedicated to preserving the quality and long history that made Glycine the respected brand that it is today. We will support Glycine while maintaining its independence and rich Swiss heritage."

Glycine was founded 102 years ago and since then has been producing premium watches at its factory in Biel, Switzerland. Lower demand in Asia, ongoing industry consolidation and the appreciation of the Swiss franc has led DKSH to restructure its luxury goods business – including the possibility to divest. 

Okay, let's discuss!

First and foremost, this is good news for everyone involved.  DKSH had not really been investing the funds needed to anything other than just keep the boat afloat.  And in these particularly treacherous times for the watch business, it is a recipe for disaster to simply keep the lights on.  It was common knowledge that Glycine needed to be sold, and although DKSH had really been working to sell Maurice Lacroix as well, this is at least one under performing asset off of their balance sheet. It also gives Invicta some actual legitimacy as a group, but one mid range brand, bundled with a bargain basement TV brand and an ailing fashion brand does not a "super group" make.  So although this is one acquisition, Invicta has truckloads of money and I suspect that they are circling other brands even now.  And say what you will about quality, customer service, etc.  for better or worse, the one thing that Invicta is good at is selling watches.  

The interesting thing in all of this is the "doom and gloom" being spouted by the various watch forums by fans - not necessarily customers by the way, but watch fans.  The logical presumption is that Invicta could not possibly be a good steward for Glycine.  But that is a wonderfully short-sighted view.  Invicta, in fairness, does have some baggage.  But it's important to understand what Invitcta's role here really is - financier.  Invicta has stated that they will leave Glycine as it is.  While that might be true in terms of staffing for the immediate future, it may likely change by BaselWorld next March.

But what I do feel likely will happen as soon as the ink is dry and the notary has signed off is a fairly aggressive push to clear inventory and bring in cash.  And it is therefore quite likely that Glycine watches might be found on one or more of the "shop at home" television programs in the months leading up to the end of the year.  Because for better or worse, Invicta has oftentimes turned to the short term, quick sale solution.  It is good for sales overall, gets watches purchased and lots of exposure.  On the other hand, it makes it challenging to drive actual retail partners or direct sales through a company website when you are constantly discounting your own products on TV.  It raises the inevitable question of - what is this watch actually really worth?  Glycine at present does not have much of a retail presence in North America, so there are really only so many people you could upset with his strategy. Fortis was dumping watches at less than keystone about a month ago on TV, so maybe this is just what has to happen to clear through the inventory.  Unfortunately, it then conditions future customers to expect the watch to be 70 - 40% of what the actual retail price is.  It is a slippery slope, and one that is not easily reversed one it has started.

From that point on, who knows?  But as is often the case in these situations, time will tell.

Yes, No, Maybe...

So news has reached the North Shore along with pretty much every corner of the watchosphere that perhaps, maybe, it is possible, that Invicta has purchased Glycine from DKSH.  Then again, maybe not.

Requests for comment/confirmation from both Glycine and Invicta have returned a somewhat deafening silence, so we will wait, and we will see.

If/when there is confirmation, we will let you know.  Stay tuned!

Heroes and Villains - Wrapping up 2014

So we've managed to do it again, 364 days marked off the calendar and it's the day where some of us ask ourselves what we learned?  Who went above and beyond, who disappointed?

Well let's start with the "Heroes" -

Omega - yes, you read that correctly.  Although their US marketing side can hold a grudge like the day is long, they were heroes on a few fronts -

Courtesy of OMEGA

The Seamaster 300 is THE BOMB!  There have been plenty of "re-imaginations" in the past few years, some have been good - this one is great.  Well done.

Courtesy of NOMOS

The NOMOS Metro.  Hats off to NOMOS for breaking the "sapphire crystal" ceiling with their new "Swing System" the NOMOS in-house escapement.  A refresher in "soft skills" from the folks in marketing and PR and who knows, they could become a brand to love again.

Courtesy of A. Manzoni & Fils

Although not here in the US yet, the Canopus from A. Manzoni & Fils is something sort of exciting not just in terms of the design, but the return of Oliver Ike to the big leagues.  I for one am looking forward to what is in store.

Courtesy of Ressence

And to round out the metal bound heroes, another gem from Ressence.

But what's a "nice" list without a "naughty" one?  And for those of you more sensitive readers - the "s" word is going to be trotted out a fair bit -

INVICTA getting a formal investigation into its business practices in the state of Florida was welcomed on many fronts - not necessarily from a gleeful sense of schadenfreude  but because it is a brand that for better or worse has built up an enormous fan base and has been seen by many to have betrayed that trust.

The Tag Heuer debacle - if I am telling it like I see it, the way that this was handled was bush-league and shit-canning so many people so suddenly was some pretty shameful shit.  To cap it off with the CEO falling on his sword to take one for the team, and the coach essentially claiming he had "no idea" of a potential exit is about as likely as the man who "accidentally, violently cut off his own head while shaving".  I'm sorry, but this is a grown-up business - let's act like grown-ups.  Don't get me wrong, sometimes hard decisions have to be made, and sometimes your ass is the one getting caught by the door on the way out - but there are many right ways to do this, and this was not one of them.

John Mayer's lament - Okay this is a bit of schadenfreude but there is nothing more satisfying than seeing a self-proclaimed expert get caught with his loupe down.  Mr. Mayer has a lot of knowledge and by all accounts an outstanding collection.  But then again, so does a certain car dealer in the Pacific Northwest.  I guess my point is this, were Mr. Mayer not Mr. Mayer, very few people would give two shits what he thinks.  It stinks that he got hosed on some of his watch purchases, don't get me wrong I wouldn't wish that on anyone.  But it is ironic when someone who goes on record as being an expert was actually relying on another "expert" for the watches that validated his (Mr. Mayer's) expertise.  Were he not so quick in the past to scoff at and ridicule those he perceived to be less knowledgeable than himself, I wouldn't even bat an eyelash.  But as I said before - pride can hurt you.

Kering re-shuffling the deck yet again - and this time losing perhaps one of the best hopes that they had to finally put Girard-Perregaux in the league it belongs.  Mr. Sofisti deserved better.  Having said that, let's see what 2015 holds.

Enjoy what's left of 2014 - see you next year.

The Other Shoe Dropping - Redux

Okay, this had originally gone up in a slightly different format on Sunday, and because I wanted a bit more verification, I took it down for a bit, but today I was in communication with the nice folks at the Florida Attorney General's Office and feel that now there is sufficient fact that has sufficiently been checked.

So let's try this again, but with a few modifications.

Things used to be different.  It used to be that watches were made one at a time, by people who really cared about what they were doing.  And this was not down just to the watch maker.  People were fiercely proud of the watch brand that they worked for.  They IDENTIFIED with the company that they worked for, and it was downright shameful if the brand's reputation took a hit.

But it goes deeper than that - there used to be a deeper commitment - a stronger sense of responsibility to the CUSTOMER.  Someone who owns a pretty amazing jewelry store here in California whose opinion I hold quite highly was recounting a series of visits he made to Switzerland and the various factory tours to some of the most celebrated houses in the game.  It was always magical, exciting - a living press release.  Until they came to the after service department which nine times out of ten was a mere afterthought.  While a virtual army worked in R & D, haute horology, gem-setting, etc, after service was usually manned by one or two people, mountains of watches awaiting service - not unlike the shoemaker of the old children's story who was only saved by the elves who came in the middle of the night to complete his work.  I will not try to quote him because he is far more eloquent that I can hope to be, but the gist was:

"Stop worrying about and chasing after the customers you don't have.  Start worrying about taking care of the customers that YOU DO HAVE NOW!".

So back to my previous post and let's talk about YOU - let's talk about the CUSTOMER, let's talk about the way that things should be, and in many instances, sadly, the way that they are.

I'm going to reverse Clint Eastwood's title and we'll call this section the ugly, the bad - and we'll then talk about the good.

The Ugly & Bad (because in my eye they might as well be the same) - I'm sorry, but given the feedback I received today, Invicta - you are in the dog house.  That part is simply my opinion.  And personal opinion is barely worth the price of admission.  So I want to provide a simple, singular piece of  fact -

Invicta is currently under investigation by the Florida Attorney General's Office.  That is a pretty serious thing.  And without giving away too many details, let me boil down what the main thrust of the complaints are - on several documented occasions it is asserted by several consumers that Invicta delivered a defective product and then required their customers to not only pay to return the defective watch, but then made the customer wait what can only be considered unforgivable amounts of time for repairs to be completed.

Only going by what can be read online, and through some of the information I was provided with, I can say that at best Invicta is guilty of producing a sometimes poorly made watch.  But more and more it seemed to go much deeper than that.  Poor after sales support, customers chided, treated badly, hung up on, dismissed or ignored.  Repairs taking half of a year?  Repair costs exceeding the original purchase price of a watch?  And let's be clear, we are not talking about restoring a vintage Vacheron with parts needing to be fabricated, we are talking about large scale production of items of which we can assume hundreds, if not thousands were made and sold.


Let's talk about why.   As frequent readers will know (all 12 of you) I've worked just about every side of the counter in the watch game - retail, distribution, etc.  I've enjoyed the sweet aromatic pleasures of the roses of success, and I've choked on the stench emanating from the underbelly of underachievement and excuse making.  And I learned one important thing.  Taking care of your customers is not a question of winning or losing - although sadly many folks in the industry at the high end and the low end think that way.  It is not a question of winning or losing.  Want to know why?

As soon as you have an unhappy customer - you have lost.  Period.  End film, roll credits.

But you haven't COMPLETELY lost...

Now enter the good.  Jean-Claude Biver taught a MASTER CLASS on sales, marketing and public relations this past week - and he did it with ONE single online post on a watch forum.  In a post on a watch forum that took him maybe five minutes to write and post, he not only ensured that his customer was taken care of and satisfied, he ensured that anyone coming within a mile of that customer, or anyone else who read the post would know about it.  It is the rule of 3/33.  Have a great experience, you'll tell 3 friends about it.  Have a terrible experience - you'll tell 33.  Let's just say that my assumption is that a thousand more people know about this customer's bad experience.  But in fact, Hublot won the war!

How?

Simple.  Customer said he was unhappy, Mr. Biver got online and without asking for:
1.  Retailer
2.  Date of purchase
3.  Blood type

simply said - I will take care of this.  You have my word.  You can BANK ON IT.  And in this instance, Mr. Biver proved that in losing - having a customer complain - you could actually WIN.  Hublot now has a customer for life, and moreover they have proven that they care and will do whatever it takes.

I would love to tell you that I am rich, powerful, and could own any watch I desired.  That would be the worst sort of prevarication.  By day I work in a university, making sure your kids have the funds they need to complete their college education.  By night and very early morning I write about watches and the people who make them.  One thing I do to make a living, one thing I do because I really enjoy it.  I will (unless the elves come in one night with a LOTTO ticket with the right 6 numbers) never own an Hublot.  And this didn't used to concern me.  But in all honestly now I'd really like to own one.  And it is not because the watch is made from "unobtainium".  It is not because the dial was varnished with the tears of "Arcadian nymphs".  It is because Mr. Biver has said that he will stand behind it, and I have his word on it.  That used to mean something.   Let's hope we get back to a time where it will again.


Enjoy your watches.

Big Baller

According to the Urban Dictionary:

Originating from a term referring to a very talented basketball player, typically a pro or from "street ball", who lives lavishly--this phrase is commonly used to refer now to anyone who likes to "live large".

And in fairness, we are still living through the hangover of the big ballers of the past 20 years in the watch industry.  And when we think about big ballers, we often let our minds wander to a sexy machine - like a Ferarri.  So it would seem natural, that if we like watches, and we like sexy sports cars, why wouldn't we want a Ferrari watch?!?  

As we are now more firmly into the "Post Biver" era of Hublot, the Hublot/Ferrari partnership rolls onward.We are all familiar with all of the arguments for such partnerships - prestige, the VALUE of the BRAND identity of Ferrari, and of course my favorite - CHINA! They're trying to push more firmly into the Chinese market!  Of course, this little partnership will solve EVERYTHING!

Or not…

First and foremost, it is not exactly a formula that has worked too well for other brands, most recently a tiny little firm - Panerai.  The Ferrari / watch partnership has not been an unqualified success for the watch partners involved.

But it's about exclusivity!  Really?  When we take this into consideration - i.e the "exclusivity" - why, oh why does Movado have a licensing/partnership deal of their own with Ferrari?  Maybe they could also have one with Timex?  Oh, wait, I know, how about Invicta - I mean seeing as we want it to be "EXCLUSIVE" and all, I am sure that exclusivity will really shine through once it hits SHOP NBC!

Here's the thing, I am not denying in any way, shape or form that Ferrari is seductive.  They make beautiful cars, have a storied tradition and if we're very honest, Magnum PI would not have been nearly the same if he drove a Porsche - and certainly not a Corvette ; )

But if you're going to be exclusive...

Invicta...

Is clearly Kryptonite to common sense.  Why do so many seemingly bright people keep throwing their money away on this?