Julien Tornare: Zenith’s Ambition to Penetrate China Market with Its Robust Products and Strategy

The increased focus on its luxury watch business by LVMH Group has undoubtedly been one of the most watched moves in recent years. Among its watch brands portfolio, each with their distinctiveness, manufacturing technology, and upscale positioning, Zenith – the Swiss watch brand born in 1865 with numerous acclaims and awards, possesses the most prestigious heritage, exceptional craftsmanship while maintaining a relatively low profile. Aside from seasoned watch enthusiasts who can appreciate Zenith brand value, the average consumers in China are with very limited knowledge about the brand, even lesser known to the younger generations who are often bombarded by "top-tier" watch brands like Rolex, Jaeger-LeCoultre, and Patek Philippe, brands trending on social media and pop culture.

 

The LVMH Group seeks to bolster the competitive strength of its watch fleet. With Mainland China once again emerging as the second-largest global market for Swiss timepieces after the United States, given the unexpectedly robust first-quarter GDP growth indicating China's economic resurgence, Zenith has recognized the imperative of transforming its old-fashion market strategy and vigorously engaging in the battle for Chinese consumers.

 

This late April, following the annual WWG event, President & CEO of Zenith Mr. Julien Tornare, embarked on a visit to China. On April 20th, ConCall conducted an in-depth conversation with Julien Tornare in Shanghai.

 

 

ConCall: After appointing Xiao Zhan as the brand ambassador in 2021, Zenith's visibility in the Chinese market saw a significant boost. However, it's undeniable that Zenith still has substantial room for growth in China. In your perspective, what are Zenith's real competitive advantages here?

 

Julien Tornare: Indeed, we do have considerable room for growth. Our hope is that every Chinese consumer becomes acquainted with Zenith and understands our distinct brand values, rich heritage, and unwavering commitment to product quality. These are the key message we aim to convey to our consumers.

 

While Mr. Xiao Zhan has helped us establish a more youthful brand image and broader recognition in China, we mustn't overlook the fact that our products remain our core focus. We insist on telling Zenith's story in the most authentic manner possible. For instance, our commitment to using exclusively in-house produced movements is crucial for the brand. Simultaneously, we recognize the changing times, so we've adopted a product strategy that blends tradition with innovation, allowing people to experience the blend of traditional craftsmanship and innovative pioneering spirit.

 

 

ConCall: What makes China's market so strategically significant for Zenith?

 

Julien Tornare: China market is of utmost importance for Zenith, not only in terms of sales performance but also due to the unique characteristics of the market and consumers. Many Chinese consumers have a strong affinity for luxury watches, and they are increasingly delving into watch culture. While consumers in Japan and the United States have more mature watch consumptions, Chinese consumers excel in appreciating the technical beauty of timepieces, and they value watch quality highly. This is a positive signal for Zenith because we have always been committed to creating high-quality watch pieces.

 

Chinese consumers weigh as much heritage as innovation, which is closely aligned with Zenith’s values. We draw inspiration from our past while creating for the future. This is why we receive such positive feedback from Chinese consumers, as Zenith possesses genuine heritage and committed drive for innovation. We have experienced rapid growth in China market regardless of the challenges posed by the pandemic of recent.

 

 

ConCall: What are Zenith's key priorities in China market development going forward? Will the brand continue to rely on celebrity endorsements in its marketing strategy?

 

Julien Tornare: Celebrities do hold significance to be fair; they can help a brand create more market buzz, enhancing brand’s recognizability. However, what's more important is for brand to communicate our products uniqueness and brand distinct culture to our Chinese consumers. This cannot be achieved merely by opening boutique stores or collaborating with celebrities in marketing events. In future, Zenith will expand its presence to more cities, conduct more trade shows and events, putting our products and brand experiences to direct contact with a wider range of Chinese audiences. This will be Zenith's key focus in China market for the next 3 to 5 years.

 

 

ConCall: What changes and characteristics have you noticed that has taken place in Chinese consumers’ behaviors toward luxury watches, and in China market overall?

 

Julien Tornare: Chinese consumers are becoming increasingly knowledgeable about luxury goods industry and high-end watches. As their understanding deepens, they develop a stronger connection with the brands they purchase from. In other words, they look beyond the brand's popularity. Some consumers begin to seek out relatively "niche" brands to express their unique tastes, especially when everyone else is wearing the same watch. I've observed that many Chinese consumers, after acquiring their first watch, start exploring various brands.

 

The consumption philosophy of the younger generation has left a profound impression on me. Their approach to luxury consumption has shifted beyond mere flaunting; they value the cultural experience it provides. This evolution in consumer behavior is a vital discovery.

 

 

ConCall: What are the brand's expectations for the Chinese market in the future?

 

Julien Tornare: I believe that in the next few years, China market will become the largest consumer market for watch. I've already witnessed this trend during my short visit, as many high-end shopping centers are willingly reserving high prime locations for us. Therefore, our most critical objective is to maintain our current strong growth momentum, consistently convey our brand story and manufacturing prowess to our growing number of Chinese consumers.

 

Moreover, because we exclusively use in-house parts and movements, our production capacity is somewhat limited, particularly for a market as vast as China, with its substantial consumer base. Therefore, we plan to gradually increase our production capacity. 

 

Simultaneously, we will expand the number of physical retail stores, continue investing in wholesale channels, and further develop our e-commerce channels. Zenith is not in a hurry to expand. We understand that some Chinese consumers may not initially consider Zenith as their first piece of watch in their lives, but as more educated consumers become more sophisticated and attuned to personalized demands, they will turn to a specialized watch brands with character like us. This is where Zenith will predominantly focus to develop its efforts in the coming years.

 

 

ConCall: What are the standout features of Zenith's latest offerings at this year's WWG?

 

Julien Tornare: At this year's WWG, we introduced new all-black ceramic versions of the Defy Skyline and Defy Skyline Skeleton watches. The ceramic material we use is exceptionally durable, paired with Zenith's in-house El Primero 3620 high-frequency automatic movement, these watches will deliver outstanding performance.

 

We also unveiled a new generation of Zenith Pilot watches at this event. This collection draws inspiration from Zenith's pioneering pilot watches from over a century ago during the early days of aviation. We have reimagined these watches with a modern touch. The automatic chronograph models in this series also feature the El Primero 3620 high-frequency movement, while the instant-jumping big date flyback chronograph models are equipped with the new El Primero 3652 high-frequency automatic chronograph movement.

 

 

Additionally, we launched the Defy Revival Shadow, a reinterpretation of the original Defy watch from 1969. It features a dark and muted design with deep tones and a transparent sapphire case back with a water resistance of up to 300 meters, housing the Zenith home-made 670 automatic movement.

 

 

These are the highlights of our latest product lineup, we have received many positive feedbacks from the market so far, which brings us great joy.

 

ConCall:

 

In the year 2021, Zenith boldly appointed Xiao Zhan as its brand ambassador, marking the inception of a more contemporary and youthful brand image within the Chinese market. In terms of product strategy, Zenith artfully balanced the preservation of tradition with the infusion of avant-garde and modern design elements, thereby softening the often "intrinsic" characteristics associated with high-end timepiece brands. Simultaneously, the brand ventured into the e-commerce landscape early on, solidifying its presence among the vanguard of watchmakers embracing online retail channels.

 

This harmonious equilibrium between tradition and innovation in product offerings, the strategic use of celebrity endorsements in their marketing endeavors, and their comprehensive approach to retail expansion have propelled Zenith into an accelerated phase of growth within the Chinese market. Consequently, the measures adopted by the brand and their ensuing results have the potential to serve as a quintessential case study illustrating the business acumen within the realm of high-end timepieces.