'This is the Year of Ebel's Rebirth'

Ebel, one of the best known Swiss luxury watches, is celebrating its 90th anniversary this year by reinventing itself. The company is aiming to recapture lost prestige, create a sharply focused global brand image, and build more sales among young, affluent adults, especially men.

"2001 is the year of rebirth and renewal for Ebel," declares Guillaume Brochard, managing director of Ebel SA, headquartered in La Chaux-de-Fonds, Switzerland. That renewal includes a new signature collection called Classic Wave (replacing Ebel's Sport Classic); upgrading of prices; reorganization of its global organization and distribution; elimination of its longtime logo; a new global ad campaign; and—next year—more redesigned watch lines.

In the United States, Ebel's long-term goals are to establish itself with luxury watch buyers as the equal of Cartier and Rolex, and to increase its jewelry store accounts by 10%.

Growth and change. Ebel was established in 1911 by watchmaker Eugene Blum et Levy (whose initials provide the brand's name) and his wife, Alice. Their stylish, technically innovative timepieces became popular throughout Europe. His grandson, Pierre-Alain Blum, promoted them beyond Europe, and in 1979, Ebel entered the U.S. market with its popular Sport Classic, created in 1977 by Blum. In 1994, Ebel was bought by Investcorp, a global investment firm based in Bahrain; in 1999, it was sold to LVMH, the French luxury goods conglomerate whose other upscale watch brands include TAG Heuer, Christian Dior, Zenith, Benedom, and Fred Joailler. In February 2000, Guillaume Brochard, an energetic young Frenchman who was marketing and sales director of TAG Heuer in Asia, was named Ebel's new managing director. Dennis Phillips, formerly president of Rado Watch and one-time director of sales for Citizen Watch of America, became president of Ebel USA in 1999.

Brochard's twofold goal, he told JCK, is to redesign and revitalize Ebel's brand strategy and to reorganize the company, especially in the area of distribution.

During the 1990s, Ebel's brand strategy, marketing, and product development "lacked focus and direction, and because of that, there was a dilution of image [which] affected every aspect of business," he says. The company launched too many products in existing categories rather than as replacements or new lines. It sponsored all sorts of events around the world, from art shows to horse racing, and "marketed everywhere to everyone, men and women, of all ages," without plan or discrimination. The result, says recent worldwide market research by Ebel, is that consumers "have no clear image of what Ebel represents. Some think of us as a jewelry watch, others as a sports watch or aren't sure," he says, noting that pricing varied, too.

Now, Brochard says, "We want to create a clear brand image worldwide for Ebel, so that customers in the United States, London, or Tokyo will each have the same perception: an experienced luxury watchmaker known for innovative but 'timeless' styling and designs."

Reorganizing. During 2000, Brochard and his staff significantly reorganized Ebel's worldwide operations.

• Ebel regained control of its widespread and disconnected distribution from licensees, especially in Europe and Asia. Today, Ebel has 10 subsidiaries worldwide, including those already existing in the United States, Germany, and Switzerland, which directly oversee 85% of its business. "It gives us tighter control over business, reduces the 'gray market' (unauthorized transshipping and sales by unauthorized vendors), and brings us closer to our retailers and consumers," says Brochard.
• Ebel launched a new, transitory ad campaign that focused on the watches, rather than on celebrity endorsements, and used fewer watch models. The company also initiated market research in seven major markets, including the United States, and designed new products and marketing strategies.
• Product offerings have been reduced and concentrated, from nine collections with 2,700 models in 1999 to about 300 in four collections—Sport Classic, Beluga, 1911, and E Type—at the end of last year. Brochard sees that shrinking even further, to about 250 models, to ensure sharper focus by consumers and retailers.
• Ebel is altering its product mix somewhat. It has long been known primarily as a "woman's brand," and 70% of its business is with women. Brochard wants to change that figure to 60% and broaden Ebel's market among men. "While the brand will retain its feminine values, we want Ebel to be for both women and men," he tells JCK. In the next three years, Ebel will add new watch models designed specifically for men. "We aren't simply making their watches bigger," he says. "We are reworking designs and sizes to appeal to men."

Reborn in the USA. There also has been a dramatic shakeout of Ebel's 2,000 retail outlets in 65 countries. Some 400 were dropped last year, including more than 170 in France and 40% of Hong Kong's. Though the network eventually will grow to 2,000 again, says Brochard, Ebel will "reduce its presence in some markets while strengthening it in others."

In the United States, for example, which provides 25% of Ebel's watch business, "We don't have enough [outlets] and could use a few more," Brochard says. Ebel's U.S. network comprises about 300 accounts in 400 stores, says Phillips. The goal, he says, is to increase U.S. numbers by 10% and have about 330 accounts and 450 stores by 2003. Ebel is re-evaluating its U.S. accounts but is generally pleased with them, says Phillips, noting that only a few are likely to be dropped.

Ebel USA's long-range plan is "build our image here and become one of the top three popular luxury brands, along with Cartier and Rolex, in [terms of] image, consumer awareness, and turnover. We will work closely with retailers to strengthen our partnerships, [and] invest at the store level in displays and wall units, and in key advertising."

Overall, Ebel is targeting affluent young adults, 30 to 40 years old, whom Phillips calls "the new sophisticates," and who are, according to Brochard, independent, self-aware, and self-confident.

New Wave. Annual production won't change, but pricing will. Ebel makes about 100,000 timepieces a year in Le Chaux-de-Fonds. New owner LVMH is investing in modernizing its operations and installing new equipment. In addition, Brochard says, "We benefit from LVMH's expertise in marketing luxury goods." The annual volume will stay about the same, says Brochard, to maintain the brand's exclusivity.

However, in line with that, the average retail price of Ebel watches will increase. As it relaunches each of its major lines (Sport Wave, 1911, Beluga, E Type) with new designs, higher-quality materials, and watch technology, the entry price will rise about 10% to reflect those added assets and "position us with other popular luxury brands" such as Cartier and Rolex, says Brochard.

First up is Ebel's redesigned signature line, now called Classic Wave. Unveiled in March at Basel 2001, the world's largest watch trade show, it will be in U.S. stores May 1 and make its official U.S. debut at The JCK Show in Las Vegas (June 1-5).

Classic Wave is the 21st-century version of Ebel's innovative signature line, Sport Classic—launched in 1977 with flowing lines and integrated case and bracelet—which it redefines and replaces. A "younger, more sensual" watch, in Phillips' words, the Classic Wave is Ebel's bid to reach a new century of youthful clientele.

The new Wave blends Sport Classic concepts (distinctive waves on the bracelet, the monocase, wearer comfort, signature five screws) with Italian design savvy (the creators are brothers Renato and Marco Scarinzi) and Swiss micro-mechanical engineering. It comes in gold and steel, as well as all-steel, with a choice of dials, and in Mini, Lady, and (for men) Senior sizes. Its entry price will be about $1,320, 10% more than Sport Classic.

No Logo. Other Ebel announcements at Basel 2001 included new dials for its 1911 watch and a new silky strap with deployment buckle for its formerly all-steel Beluga Manchette. Both will be in U.S. stores later this year.

Classic Wave will be introduced to the U.S. public in a major print advertising campaign in May and June. But some familiar features will be missing: Gone are Ebel's longtime logo (back-to-back curved 'E's' over the Ebel name) and tagline, "Architects of Time." The logo also will be absent from the Classic Wave's dial. In addition, the campaign will feature a new font type for "Ebel," as well as new corporate colors—silver, white, and orange.

"The 'E's' made the logo too complex, and the tagline was unnecessary," says Brochard. "A luxury brand should have confidence in the strength of its own name, which should be self-explanatory to customers."