Cartier And The Future Of Luxury
Two years ago luxury brands were aiming at the masses and Dana Thomas wrote an entire book on how luxury was losing its luster. With these sobering economic times, will luxury get some of its "luster" back? That seem to be the message from Cartier CEO Bernard Fornas who told Reuters at the SIHH watchfair that " the real, true luxury is back" and that consumers are being tougher with their choice of brands.
His words come as Cartier parent company, Richemont posted at 12 percent drop in third-quarter sales and announced that 180 out of around 200 staff making watch casings at a Cartier plant in Switzerland would be put on part-time work starting next month. Richemont's statement included the grim forecast that :"given the current economic climate and the uncertainties facing us, we see no cause for optimism."
Swiss watch exports have fallen and Richemont has seen demand for their brands including Cartier, Montblanc, Piaget, IWC, Baume & Mercier and others sink over the past year especially in the United States. Bernard Fornas found hope at the Geneva watchfair, saying that it was better than expected. As my colleague Ariel Adams recently mentioned, Cartier is refining and adding to its classic lines introducing a new Cartier Tank Americaine Tourbillon Volant Watch to tempt watch buyers.
It seems that some brands are facing a new crossroads: either come up with lower priced goods to tempt the customers they spent the last few years acquiring or retreat, slow production, cut jobs and focus on the smaller, wealthier customers who will continue to spend, albeit a bit more carefully.