Last week, news broke that Audemars Piguet was parting ways with their CEO, Philippe Merk and replacing him (supposedly in interim) with François-Henry Bennahmias, formerly head of AP North America.

AP is my favorite “big” brand.  In fact, the watch I wear most often is an AP.  They have great products, great history, and many great people who work there.  They have the resources to do some amazing things.  So I couldn’t help but think: if they hired me to replace Francois, what would I do?

First, I would listen to the chime of the minute repeater that I made them give me as a signing bonus.  Then I would get down to serious business.

My focus would be on service and value.  The two are intricately related.  I would push them to finally take the jump into online sales and create a technology platform that offered the best user/customer experience in the business.  I would invest heavily in the US service center to the point that NO SERVICE SHOULD TAKE MORE THAN 4 WEEKS, with the eventual goal to turn out routine services and minor fixes in less than 2 weeks.

I would promote transparency and open dialogue.  I, myself, would be available continuously through social media and email and also empower other employees to be as well.  I would answer the tough questions honestly and make my positions very clear.  I would be swift in rectifying any and all instances of poor service from us or our partners.  Any customer willing to spend $10k+ on an archaic instrument deserves to be treated with utmost respect – not propitiation but true fairness.  This has to be hammered into the culture from the top down.

Chris Dixon, tech entrepreneur and investor, posted a great piece over the weekend on how people are now focused on experience rather than product.  Luxury brands have known this for a while, but have lost their way.  They see people tire of the experience, and think they have to focus harder on selling the product.  That’s why you see all sorts of BS claims on materials, movements, complications, etc.  What they’re missing is that the experience is still what’s important, they are simply selling the wrong experience.  The typical arrogance and elitism of luxury is not as effective anymore.  What people want is a company that is committed to doing things in the best possible way, with the utmost integrity, and that treats its fans and customers like family, not suckers.

There are plenty of other things to do, but I believe that if someone were to truly implement these few points with passion and integrity, the brand would rise head and shoulders above the rest and set a fantastic example for the industry as a whole.  The US is different from the rest of the world.  Customers are very savvy, status is much less important, etc.  No watch company has gotten the message right here yet.  It’s not hard, but it can’t be faked and there is no shortcut.

For a nominal (7 figure) salary and a brownstone in the West Village, I’d be happy to do it for them without breaking a sweat.  But do you think they’d make me learn French?

Next week in Geneva, SIHH marks the real beginning of a new year for the watch industry.  This will be my first year for a while not attending the shows.  As someone who is now on the outside looking in, I have a new perspective – and can also be more candid.  During my time in the industry, I gained a ton of respect for a few people, including my former team at MB&F.  Mostly, however, I was left disillusioned by the vast majority of the industry.

I believe the watch industry is in a condition of serious danger.  Ten years of incredible sales brought on by what we now know to be a completely artificial boom here in the US and now economic growth in Asia have made it too easy to think for the short term at the detriment of the long without realizing the effects.  Brands have not paid the proper amount of attention and respect to their collectors, their products or their business models.  Here is a short list of what I would like to see change for the health of the industry as a hole.

1. Pricing is out of control.  We ALL know this to be true.  Walk into a retail store and try to buy a nice watch for less than $9000 retail.  It is incredibly difficult.  Watches that were in production 10 years ago now routinely cost double for the same piece.  10 years ago, a Patek perpetual chrono cost about $35,000.  Now $135,000.  Most of the interesting stuff starts at around $100,000.  This is insanity.  Brands need to control their costs better and maybe stop lining their pockets so thickly.  This can only continue for so long before a critical mass of collectors realize things have gotten out of control.
2. Explore new sales channels.  The internet is the most power sales tool in history.  Sorry for my retailer friends, but why are retailers getting the same margins they were before that marketing and sales channel existed?  In many cases, why are they even necessary?  Want to cut costs to bring pricing back to earth?  Here’s a great place to start.  The sales pipeline is stuck in the past.  The answer is not just to open up fancy brand boutiques and keep the margin, the answer is to streamline and cut prices.
3. Create products with soul.  Aside from a few independents and the occasional big brand release, most new watches have no soul.  A mechanical watch either has to be art or extremely practical.  If it’s over about $10,000 you can toss practical aside.  So what we have is an industry trying to make art, but 95% of the artists are untalented dilettantes who in most cases don’t even understand what art is and that it is their job to make it.  To make a watch for $200,000 where things flip around and at precisely 8am it shoots water in the wearers eye and says “I love you” is not art.  To make something just “because it’s cool” is not art except for a very very small number of true tastemakers who have such a solid grasp of the product that it works.   I’m sorry, but most of this stuff is shit.  The product people in the industry need to take a hard look at why mechanical watches exist and what they can truly offer of value – not repetition or novelty.

Will we see this at SIHH next week?  Of course not.  And so I wish my friends – the good guys – good luck at the show, and I will enjoy reading about it from Los Angeles.

If you missed my post Thursday, Jack Forster is doing a series on why NOT to buy a mechanical watch.  I’m commenting here.  Today is part 2: Watch designers have painted themselves into a corner and run out of things to say.

Well isn’t this a meaty topic.  I will direct the conversation by first modifying the premise: *SOME* watch designers have run out of things to say.  With that modification comes my biggest complaint with Jack’s point and that is he is arguing this is a product of the industry and watchmaking in general.  I would argue that this is because there are very few really good product people in the industry.

First, going back to my somewhat provocative recent post (Chronometry, who gives a sh!t?) I think a vast portion of the industry is missing a basic understanding of WHY they are doing what they’re doing and what a mechanical watch is in 2011.  Then you add risk aversion, design by committee, focus on sales and marketing rather than product, and a whole slew of other depressing corporate issues and you’re left with uninspired and confused watches.

There are some genuinely talented and passionate designers in the industry.  They have a very clear raison d’etre.  For them, ideas are a dime a dozen.  They have genius products lined up for years.

Unfortunately, most consumers are not that well educated.  The bad sells as well or better than the good in most cases.  This gives the wrong feedback to the people in charge.  If we educate customers and make them more thoughtful purchasers so that the junk dies and the cream comes to the top, you’ll see tons of amazing products for years to come.  In the meantime, I will continue to cringe a lot.

For those of you who do not know Jack, he is truly one of the most eloquent and deep thinking watch writers in the world.  He has just posted a new series on Revolution Online to play devil’s advocate.  Five Days, Five Reasons to NOT Buy A Mechanical Watch.

I like this idea a lot.  I’m going to follow his series here and post some comments as he goes.

The first reason is “They are bloody expensive”.

A fitting place to start.  Most of my friends are not into watches and not fabulously wealthy.  I generally recommend they don’t even bother with a mechanical watch under $3000 or so – and at that you’re really looking at vintage to get good value.  The pieces I find to be particularly worthwhile are all in the yearly salary range.

So yes, this is a very fair criticism.  The way I deal with this personally is to always remember that in general, these are ridiculous purchases.  Therefore, in order to justify their merit, they have to be something really special.  That is why the general tone of my posts is to focus on intangibles, historical significance, etc.  Some pieces, upon close analysis, seem to be bargains even at very high prices.  Others fall completely flat.

This also brings up one of my biggest gripes with the watch media (see Jack, I praise and then I taketh away ).  Who is looking out for us and holding these brands accountable?  Why are there watches that cost 100% more for the exact same watch now than they did 6 years ago?  Why is the media so shy to question where the value is in these things?  I see the tremendous amount of work, risk, and skill that goes into creating pieces at MB&F and even at the high prices they seem like a bargain (no one is getting rich off of MB&F, unfortunately).  There are other watches I see at the same price points that are just silly – offering no value at all.  I do believe the watch media has completely dropped the ball on educating the public as to which is which.

Let’s see what Jack has up his sleeve for Reason Number 2…

EDIT: As clarified in the comments below.  I use MB&F as an example not to say that they’re the only brand making good watches, but simply because I get to see the entire process there so I can be 100% certain in my assessment