From ‘Barbie’ to Formula 1, Tag Heuer gaining in luxury watch market

TAG Heuer is enjoying a wave of marketing successes and new launches to grow its market share in the world of luxury watches, according to its CEO.

the company he owns LVMH, opened a flagship store on Fifth Avenue in Manhattan on Wednesday as part of its rapid expansion in the United States. It plans to double its US stores to 50 by 2026, according to Tag Heuer CEO Frédéric Arnault.

Besides increasing sales, boutiques give the brand more direct relationships with their customers rather than relying on third-party retailers or supermarkets.

“This is a significant turnaround in the past five years and will continue in the next five to 10 years,” said Arnault, the 28-year-old son of LVMH CEO and Chairman Bernard Arnault. “Having self-branded stores combined with e-commerce allows us to enhance direct customer relationships.”

These customers have been growing rapidly since Frédéric Arnault took over as CEO of Tag Heuer in 2020. Under his rule, the company has leaned on its legacy in motor racing, especially Formula 1, which has grown in popularity since the Covid-19 pandemic. As the Official Partners and Time Keeper of the Oracle Red Bull Racing Team, they are worn by top-rated driver Max Verstappen and teammate Sergio Perez.

Arnault said TAG Heuer is making great strides in part due to marketing gains and new products, such as the new Tag Heuer Monaco Chronograph With a skeleton disc worn by Verstappen, which works out to more than $10,000.

The company’s top models are so popular that waiting lists for Tag Heuer are now up to 18 months long.

“The demand is much stronger than we expected,” said Frédéric Arnault. “That’s what creates the queue as well. And so we can’t ramp up that speed. Of course, if we want to double production in the next 18 months, we can, but we’re not going to do that. We also want to ensure that the value of the hours is preserved over the long term.” .

Tag Heuer’s growth is part of LVMH’s goal to become the world leader in every luxury category, from fashion and leather goods to wines and spirits, watches and jewellery. Besides Tag Heuer, LVMH owns the watch brands Hublot, Zenith, and Fred and has increased sales of Louis Vuitton and Bulgari watches. The French company’s jewelry and watch division reported sales growth of 11% in the first quarter from the previous year, to €2.6 billion.

Arnault said the recent correction in the prices of previously owned collectible watches has been good for the market. After skyrocketing in prices for trophy watches like the Rolex Daytona, Audemars Piguet Royal Oak, and Patek Philippe Nautilus during the pandemic, they have since fallen 20% or more as the supply of watches for sale online grows.

“After Covid, there has been a very strong acceleration in growth, especially in hours,” Arnault said. “We’ve seen a massive uptick in the flea markets, due to speculation as resale prices have been increasing. That has changed in the last six to eight months in the flea market and now it’s normal again. I think it’s much healthier and we’ll continue to see some solid growth For sale directly from the store.

Tag Heuer may also get a lift from a file partnership With actor Ryan Gosling. Gosling was wearing a 36mm Tag Heuer Carrera watch with a sparkly pink dial as part of his promotion for the new “Barbie” movie. Arnault said Barbie fans can expect to see other TAG Heuer watches in the movie as well.

“We made sure to have the right hours in the movie,” said Arnault. “Ryan will be wearing some iconic timepieces that fit in well with this universe. Our customers have already called this 36mm Carrera pink watch a ‘Barbie watch.'”