ZENITH: Comet-Like Luxury Brand

"Hello -" ZENITH's global president, Mr. NATAF, opened the door and approached the reporter with exaggerated and enthusiastic expressions of the Frenchman's. Both of his wrists exaggeratedly wore a ZENITH new men's watch. .

At the end of 2005, when ZENITH’s first flagship store in Beijing was completed, the president not only personally directed the entire catwalk, but also acted as a model in person.

It is this alternative "maverick" president of the international luxury watch industry that brought the soul of the ZENITH watch luxury brand founded in 1865 - the brand appeal.

In 2001 before the acquisition by the LVMH Group, ZENITH was more of a watchmaking factory in Switzerland. Although 90% of its movements were provided to well-known watchmakers like Rolex, few people left Switzerland and ZENITH knew very well. Technology and brilliant past. In the 1940s, its founder, GEORGES, traveled around the world with ZENITH and sold it to the beach at the time. But five years ago, ZENITH had few stores in other markets outside of Switzerland.

Recalling a classic watch factory that was almost an OEM to the world's top watches, ZENITH did not hide its pride: “ZENITH like sleeping beauty, LNMH kissed her. I am the prince.” He proudly pulled his black, elegant tie.

LVMH kisses the sleeping beauty

The world’s largest luxury goods group achieved a bumper harvest in 2005. The LVMH Group’s financial report, which was just released, shows that its revenue was 16.3 billion U.S. dollars and profits increased 16% to 3.3 billion U.S. dollars. The profits of the watch and jewels have actually multiplied fivefold to reach $45.7 million.

“The sales of Starsime, the ZENITH-branded female watch, have soared.” The LV MH Group is undoubtedly quite satisfied with the work of NATAF. Several other watches that are believed to contribute to the growth of profits are the Aquaracer, Link and other new watches of the LVMH Group's "Veteran" TAG Heuer, and Dior's Christal watches. Only ZENITH is a rookie.

“In fact, the average growth rate of the luxury watch market was 15% last year, but ZENITH's growth far exceeds this speed, reaching more than 2 times.”

In 2001, when NATAF entered ZENITH, it first established 25 offices around the world, and then gradually stopped supplying movements to other watch factories. It only provided movements for watch brands within the LVMH Group and expanded the production of ZENITH watches. "The movement is like an automobile engine. If you can build the fastest engine in the world, there is no reason not to create a world-class watch brand." Based on the high performance and high complexity of the ZENITH mechanical movement, the first three years of NATAF were Promote the ZENITH men's watch globally.

We established women's watches in 2003 after we established ourselves in the men's watch world.

Another major change in the operation of NATAF is to greatly increase the speed of the promotion of new watches. In the past five years, he has concurrently served as creative director and he has launched 150 new models to ensure the source of profits.

Of course, LVMH's huge capital background provided support for ZENITH. "We have added new equipment and abrasive tools for ZENITH. We use 7% of our profits for the movement's R&D. LVMH has made a lot of investments," NATAF said.

NATAF Marketing Tips

The LVMH Group’s brand appeal has created a glowing effect for ZENITH, but it is not easy for rich people to be proud of wearing ZENITH watches, or to have ZENITH enter the collection room of those watch players.

Even though the reporter repeatedly asked NATA what special marketing tips it had, NATAF's answer was very embarrassing: “This is my secret.” His voice went low, and he relied on the reporter here to say, “All my enemies I want to know this, so I'm sorry I can't tell you."

However, NATAF's efforts are still available.

First, he introduced the concept of modern brand chain management into ZENITH. Today, all 750 ZENITH retail stores around the world have the same logo, uniform decor and high level of consistency. All operations must be supervised by ZENITH.

In addition, based on its confidence in ZENITH's history and technology, the ZENITH table is priced between $30 million and $1 million. In August 2005, the oldest watch brand Patek Philippe's third store in the world and China's first store also settled in Shanghai, China, priced from 10,000 US dollars to millions of dollars. Obviously, ZENITH lowered the price of Patek Philippe from the “King of Tables” at a high price, and lowered it a lot more than Patek Philippe in the low price range. In this way, ZENITH has more guarantees in sales.

On the other hand, ZENITH also strives to find high-end customers. NATAF drew a “pyramid” shape in the air: “Most of the luxury goods are provided to the rich. But you may not know that the luxury goods industry also has market segments, and a small part of luxury goods is provided to those top customers. ."

In the past five years, NATAF has launched three "Traveller" watches worth more than RMB 4 million each year. There are currently 17 customers who own this watch.

Limited sales practices are not all.

The NATAF showed reporters photos of a party event they held at the Palace of Versailles in Paris not long ago. The reporter noticed that he hugged shoulders with celebrities and celebrities. Superb social skills and expressive expression under the spotlight are undoubtedly a good way to attract market attention to ZENITH. Is there anything better than let Hollywood "Black Pearl" Halle Berry automatically choose to buy ZENITH better promotional methods? NATAF certainly understands this. In the luxury sector, the social penetration of a luxury brand leader is sometimes closely related to the brand's ability to penetrate.

ZENITH China: Accumulate

Due to entering China in March 2005, the late ZENITH plans to increase its retail store in China from the current 13 to 30 this year, and will open a second flagship store in Shanghai. This year is undoubtedly ZENITH's "Chinese Year." A 60-second television short film has just been produced and will soon be played simultaneously at ZENITH's global stores. NATAF allowed his carefully selected male models to appear under the walls of the Great Wall and the Imperial Palace.

Wan Hao, a very young Chinese girl, is now ZENITH's new China Marketing Manager. She felt that the burden on her shoulders was significantly increased. Although the domestic ZENITH Chinese website has a click rate of more than 1 million times a year, ZENITH’s brand recognition in China is obviously not enough compared to the old luxury watches such as Patek Philippe, Vacheron Constantin, and Rolex and Radar.

However, Wan Hao expressed his confidence to reporters. Of the 17 customers who purchased “traveler” watches in the past five years, three were Chinese compatriots who were ten thousand. "China is a unique market," she said.

In fact, China is ZENITH's fastest growing region in the world. Last year's growth rate has reached three digits.

At present, some foreign luxury goods giants have strengthened their control over the Chinese market - sole proprietorship or the recovery of proxy rights. ZENITH said that there is no such consideration and will continue to develop domestic channels through the distribution capabilities of its partner Xinyu Hengli (3398.HK).

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In 2005, the share price of Richemont, the holding company of Cartier, gained nearly 50% of its return rate. If it holds 5 years (from 2001 to the end of 2005), the share price rose by 322%. Similarly, the LVMH Group’s share price, which is owned by Louis Vuitton, the luxury goods leader, rose by 34%, which is an increase of 3 times that of Intel.

In September last year, Merrill Lynch launched the fourth series of reports on the “buy-in” luxury goods industry. In December, Dresdner Allianz Group researched German agencies’ statistics on the industries that performed best last year and found that in 2005, when the Dow Jones Industrial Average fell In the 0.6%, the Philadelphia Semiconductor Index rose 10.66%. The S&P 500, which represents large-scale industrial blue chips, rose 3% for the full year, while the S&P luxury index rose 45%! In other words, the increase in the luxury index is four times that of the semiconductor index and 15 times that of the blue chip industry stocks!

The rise of emerging markets, the formation of a new rich class is one of the main reasons to promote this round of the growth of the luxury goods industry. Especially in Asian markets dominated by China and India.

According to the World Bank, the economic growth rate of developing countries reached 6.6% in 2004, the highest in the past 30 years. The Merrill Lynch report estimates: “The wealth of HNWIs can increase at a compound annual growth rate of 6.5%, while the wealth growth rate of HNWIs in the Asia-Pacific region is higher than this average, and will increase by 6.9% annually to reach 10.1 in 2009. Trillion dollars."

Merrill Lynch also estimated that the sales volume of the global luxury goods market will increase at a compound annual growth rate of 6.3% by 2014, but China will increase at a maximum rate of 14.8%, followed by India’s 14%. 8.8% in the Middle East and 7.6% in Russia. Taking Louis Vuitton as an example, in 1992, China entered its first store in China for the past 16 years. No one-year revenue growth rate was below 50%.