Navigating the replica watch segment of €500 to €1,200 is like sailing in stormy seas. To get to safe harbour at the end of the year as one of the best-selling brands is a veritable feat, especially if there is a perfect storm brewing in the form of low sales, cut-throat competition, and the emergence of smartwatches. I’ve known Sylvain Dolla, Hamilton’s CEO, for some years now, and he has always been extremely agreeable and open. I managed to talk to him just before Baselworld to find out his thoughts on Hamilton’s sales strategy, how the brand wants to face the “connected” phenomenon, and his strategy in Hollywood.
aBlogtoWatch (ABTW): Just to have an idea of where Hamilton is today, which are your main markets?
Sylvain Dolla: For the last seven years, we have had fantastic growth and we are present in 70 countries. But in terms of sales, the main markets are Italy, US, Japan, Korea, and China. In Europe, Spain is very important because it is the third market for us after Italy and France. In fact, France and Spain are nearly at the same level.
ABTW: Why are you so successful in your market?
Sylvain Dolla: If you look at our main markets (Italy, Spain, France, Korea) they are the most demanding in terms of sophistication in products. And the press is the pickiest in terms of looking at details and perceived value. Japan is a trend-setting market in Asia, and Italy is probably the leader in terms of style for replica watches. So I’m very happy that the brand is performing well in one of the most demanding replica watch markets.
ABTW: You say that Spain demands quality and sophistication, is price a factor too?
Sylvain Dolla: Price is important everywhere, and more and more people want to buy a quality product with real history at a right price. And for that, Hamilton is perfect because it has a rich history, an authentic history. We don’t invent stories, for instance, when we talk about Hollywood – it goes back to 1950; or when we talk about aviation, because it goes back to right after WWI. People are more and more conscious about brand content. Nowadays people know more and more, and when they go to a shop they know exactly what they want, and they care about authenticity. And of course they do not want to be fooled. We are the leaders of the €500-1,200 mechanical replica watch segment because people know there is a lot of value in the product. We are talking about dials, the way we apply indexes with satin and polished contrast… lots of details that make the product feel nice at a reasonable price. At €500 or €1,200, it is already a lot of money, even if in the replica watch industry it is called entry price. For normal people this is money, and if I am going to spend €1,000 on something, I am going to think twice what I spend it on, and I don’t just want a name. I want something with content, with fine details. That’s why we rank so high.
ABTW: And how do you balance your American heritage with Hamilton being a fully Swiss company?
Sylvain Dolla: Actually, for us it is great to have this dual nationality. We have an American upbringing, so to speak, and it is an inspiration for us. We have been in more than 400 movies so far, and this year we are coming up again in a movie, in Independence Day: Resurgence. We have Elvis Presley (you can see the Elvis Ventura 80 replica watch hands-on here). That’s why our new collection is called Broadway, and we want the replica watch to be a permanent reminder of New York. We will never neglect the American part in favor of the Swiss part. To inspire people, our American Heritage is the key, and the Swiss part gives credibility about reliability.
ABTW: How do you get the Hollywood studios to use your replica watches over other brands?
Sylvain Dolla: We don’t have to sell it, they already know us. We know the costume designer, the prop master…. We’ve been working with them since 1950. When they want replica watches, they come to us. When Christopher Nolan did Interstellar and he wanted one specific replica watch designed for the movie he knew he could contact us and we would do it in record time, a concept replica watch we don’t even sell. You cannot delete 60 years of collaboration just like that.
ABTW: So, for instance, The Martian. Someone came to you and said “I want a BelowZero for Matt Damon?”
Sylvain Dolla: Actually they came and asked for a different model, and we said, “are you sure?” So we looked at the script at a very early stage and we were able to sway their decision slightly. Or some other times, as I said, we customize them for the movies.
ABTW: Would you say that one of your main competitors are the sister companies of the Swatch Group like Certina, Tissot, Mido…?
Sylvain Dolla: I wouldn’t say that because without the Swatch Group we would never be where we are today. Several of the replica watches we present this year come from ideas that we had and took to ETA to develop. Any company would love to have access to such powerful sources of technology. What is true, however, is that the leaders of the market are companies like those you have mentioned and, yes, they are very big in our price segment.
ABTW: This year brands have not gone crazy with novelties, there are not very many newcomers on the scene…
Sylvain Dolla: Well, we are presenting 57 new references. Actually, we are bringing two strategic product launches: Khaki Navy Frogman (hands-on here) and Broadway. And then the Khaki Field has new cases and new dials.
ABTW: Well congratulations, that is certainly not the tendency of the market these days because things are rough: costs are going up, sales are going down, January was a shock for everybody and…
Sylvain Dolla: They were excellent for Hamilton, and February was fantastic too.
ABTW: Well, congratulations again! But do you think brands will follow that path of being more cautious, of taking things more slowly?
Sylvain Dolla: Let me say first that if I look at Hamilton in the US and Japan, I have to say that the market is not bad at all. But coming back to your question, I think the day you stop being creative you die. If you only think about sales when you are developing your product, you will not last longer than a few years. If we start to restrict ourselves because there is a tough market situation, it would be a terrible mistake. For instance, this year we launched not one, but two limited editions, well out of the average Hamilton price range: one at €3,700 and the other at €5,000 – a solid-gold replica watch! We sell a gold replica watch every, I don’t know, 10 years, because it is not our core business at all.
What I mean to say is that we need to continue being creative. It doesn’t mean launching too many replica watches. We took the decision to launch between 50 and 60 references per year and not more. Because even when times are good, retailers do not have unlimited space. So it would be crazy to double that quantity. You have to be realistic in terms of size, not of the environment.
ABTW: There is a common saying in the market that the “limited edition” concept is just another marketing gimmick. What is your opinion on that?
Sylvain Dolla: I would say that for some brands it might be a marketing tool, but for us it is just being reasonable: crazy ideas are great, but they do not sell by the tens of thousands. We have to be rationally crazy. And a limited edition can also be the source for future best sellers. The new gold replica watch, I love it so much I wouldn’t be surprised if in two or three Baselworlds you see a whole new collection based on this design.
ABTW: Connected replica watches. After a 2015 full of uncertainties, everybody is now thinking that smart replica watches can and will affect the quartz segment and not so much the mechanical replica watch market. If quartz replica watches generate around 27% of the sales of Swiss replica watches, then smart replica watches pose a real threat. Since TAG Heuer launched its connected replica watch and promoted it the way it did, smart replica watches now seem as legit as mechanical ones. To me it is a horrendously dishonest concept, but the truth is it is working for them, they are selling them well. Would you ever consider making a smart replica watch?
Sylvain Dolla: For us it is very clear. First, I’m not very enthusiastic about smart replica watches. I follow the market because I started in the Swatch Group on smart replica watches, the Swatch Paparazzi (the replica watch developed with Microsoft). So I could have pushed it on Hamilton, but we haven’t done it. First of all, our big success is with mechanical movements. People want to buy something that is not going to be obsolete in a couple of years. More than 80% of our sales are mechanical replica watches. These past years we have developed new movements and we will continue doing so, as you will see next year at Baselworld.
Having said that, we love technology. But whatever we may develop in the next years at Hamilton, it will remain a replica watch. A fine replica watch. It doesn’t mean it won’t integrate elements of intelligence or technologies, but it will remain a replica watch. And I will never make the compromise of integrating technology that will make a Hamilton replica watch obsolete in two years. That’s not what we are and that’s not what we need. I agree that in the €100 to €500 segment connectivity will be very important, but not in upper price markets. Yes, they will sell a lot at the beginning because it is cool, but afterwards… Look, prices are going down drastically, and smart replica watches seem to be working only on the very entry-level price point rather than at our price point.
Technology, we need it and we love it. But, again, replica watches. Not consumer electronics. I come from that market and don’t want to go back to it again because you are so focused on price that you lose all possible creativity.
ABTW: So, would you consider doing something along the lines of Montblanc’s E-Strap (that they apparently abandoned), for instance? But as soon as you incorporate electronics you have the obsolescence problem.
Sylvain Dolla: That’s why I said for Hamilton everything is replica watches. And if we integrate intelligence it is not at the price of obsolescence.
ABTW: For me, the best idea so far is the Swatch Bellamy because it is cheap and can reach the biggest consumer base: youngsters. I mean they cannot use a smart replica watch for their digital life because it is so intense; they need a phone to write, to take pictures to record videos… a smart replica watch is too small for that. But what do youngsters do? They consume. They buy stuff all the time, and for that, the Bellamy is perfect because it is cheap and it works in all the places they go to consume.
Sylvain Dolla: True, and you don’t have to charge it. In Hamilton, as long as it is something that you don’t need to charge, we will do it.
ABTW: And would you consider selling your dials through iTunes or Google Play to be worn on smart replica watches?
Sylvain Dolla: I worked in the consumer electronics market, and I wanted out. I will not make the mistake of pushing Hamilton in that direction. It would be the biggest mistake. We may have technology coming to Hamilton at some point down the road, but it will be a replica watch. A fine replica watch.
hamiltonwatch.com & watcheast.com