BIEL, Switzerland — Omega, the powerhouse brand of Switzerland’s Swatch Group, is stepping up its challenge to arch rival Rolex with a sharper focus on Millennials, bigger plans online and a sparkling new factory.The push comes as president and chief executive officer Raynald Aeschlimann puts his stamp on the Swatch Group’s highest revenue brand 16 months after taking over from legendary Omega boss Stephan Urquart. Aeschlimann, at just 47, now occupies one of the most important and prominent jobs in Swiss watchmaking, previously held not just by Urquart but also the formidable Jean-Claude Biver.Boosting Omega’s appeal to younger buyers is Aeschlimann’s top priority. “It certainly has to involve technology, in particular social platforms, as this is the world Millennials have grown up in,” he argues.“But it’s vital that we don’t lose sight of our legacy, as Millennials will certainly change buying habits, but still seek out luxury. It’s just that they have redefined what luxury is. For Millennials, that tends to be something well-made, with substance and history, and I think we’ve always provided that,” he said in an interview.Celebrities and influencers will continue to be an important part, with the focus starting to switch to a younger generation. “Sure, we want to appeal to a younger generation. We are working alongside digital influencers and of course we now have two new friends of the brand, Cindy Crawford’s children, Kaia and Presley [Gerber], who speak very much to the emerging generation.”Aeschlimann notes that Omega’s teaser photo shoot with Kaia, 16, Presley, 18, and their parents in late September was not just a “one-off,” but a signal of the brand’s intention to work much more closely with the family.The lavish photo shoot coincided with Omega’s “Her Time” watch exhibition in Paris, with each family member wearing an appropriate model. But it also conveniently came just before Kaia Gerber’s outstanding reception as a runway model at Chanel’s Paris show. Gerber’s looks, personality and confidence attracted favorable comparisons to her mother — a Chanel runway regular in the Nineties — and predictions of a similarly stellar career.Omega’s links with the Gerbers date back to 1995, when Cindy Crawford became an early brand ambassador. Recently, both Kaia and Presley have accompanied their mother to brand events. Aeschlimann said “the time had now come” to welcome the next generation. “It was an optimal time to take on such a project. We intend to work further with the whole family,” he told WWD. “People look at these personalities who just personify a brand.”Aeschlimann predicated Kaia could play a much closer role at Omega over the years — including cooperating on watch models and adornments. Well-known for its constellation of Hollywood ambassadors, including George Clooney and Nicole Kidman, Omega has collaborated with stars on specific products. Daniel Craig, for example, advised on the special “Spectre” strap for the Omega Seamaster watch themed for the James Bond film of the same name.Dapper, charming and multilingual, Aeschlimann is a 21-year Omega veteran with a deep personal commitment to the brand. He calls Omega “his passion.” After joining in 1996 as sales and marketing project manager, he progressed to brand manager in Spain and then vice president and international director of sales, retail and distribution.“It’s an overused cliché, but for me, Omega is more like a family than a brand,” he said. “I work with a team of people who are incredibly passionate and committed, so I come to work every day knowing I’m going to be pleasantly surprised by the ideas put forward.“I’m also proudly Swiss, so although Omega is a global company, the brand and the fantastic reputation of Swiss watchmaking in general was something I grew up with. I’m thrilled to play a part in that very distinguished history, which has a truly unique DNA,” he added.True to Swatch Group style of putting the focus prominently on products, not corporate personalities, Aesclimann reveals little about himself or his private life. With Omega a global brand involved with everything from movies to sports, much of his Aeschlimann’s time is spent traveling.“Work consumes most of my time. I try not to do things by halves. I respect quality and I suppose I bring a certain intensity to everything I do. Not just work, but sports, friendships, every aspect of my life,” he said.His comments came as Omega opened its new factory at its historical home of Biel in northwestern Switzerland, an expansion that should take its competition with Rolex to a new level and help Aeschlimann stamp his mark on the brand.The $150 million facility in Biel, Omega’s home for the past 135 years, can house 350 workers and for the first time brings under one roof all assembly and testing facilities. The strikingly light and airy building boasts a vast, fully automated, three-story components store containing 30,000 boxes, with parts being whisked to relevant workshops on demand by concealed conveyors.The plant is the first of three big Swatch Group investments on a linked site. Next year will see the inauguration of a four-story building housing new Omega and Swatch brand museums, while 2019 will bring a futuristic new Swatch brand headquarters. All three projects are the work of Shigeru Ban, the award-winning Japanese architect best known for using recyclable materials like wood, cardboard and paper in construction, and whose projects includes the Aspen Museum. Ban’s association with Swatch Group dates back a decade to the company’s flagship in Tokyo’s Ginza shopping district.The new plant comes just as Rolex itself has been spending heavily on new facilities at its headquarters in Geneva and in Biel, where its movements are made.Aeschlimann remained unspecific about Omega’s ambitions to catch up with and, perhaps one day, overtake Rolex in sales. But it is clear the new factory is part of a multifaceted, long-term strategy. Neither company reveals any figures, but widespread estimates put Rolex’s unit production around 20-25 percent higher than Omega’s.Like most Swiss counterparts, he remains tight-lipped about financial and production data. But he revealed the six-story (including basement) factory would boost output of the group’s certified men’s Master Chronometer automatic models to 400,000-450,000 a year.“We can now unite all assembly and testing processes under one roof. That will enable a comprehensive consolidation of workflows, which will help Omega become even more productive and efficient than before,” he added.He denies beating Rolex is an obsession. But he sees strong potential to expand sales, notably in the U.S., where Omega can still make up ground against its bigger competitor.“America is already a strong market for Omega and the opportunities for growth are staggering,” he said. “We don’t really face unique challenges in the U.S. market, apart from perhaps the scale of the logistics, as it’s a huge country. But, as always, it’s important that we create exceptional products that are relevant in the modern world, especially in a market like the U.S., which has such vast consumer choice.”The increasingly close sparring between the two heavyweight Swiss brands reflects a long-term strategy to boost Omega’s exclusivity. In recent years, the brand has launched technical innovations like silicon springs and coaxial escapements, reduced the number of its points of sale to 3,000 from 7,000 over the past 15 years, and tripled average prices over the same period.A key aspect of gaining prestige has been to increase the brand’s production of its own movements, rather than purchasing them from Swatch Group industrial subsidiaries. More recently, that has been reinforced by certifying its movements for accuracy and magnetic resistance, working with the Swiss government agency responsible for precise measurement.Aeschlimann revealed certified automatic movements now accounted for about 65-70 percent of Omega’s output for men and about 30 percent for women. Separately, staff said the new plant had a notional capacity of about 700,000 watches a year at its absolute peak.Coming against the background of continuing difficulties for Switzerland’s watchmakers, the new factory marks a sign of confidence by Swatch Group. Nick Hayek, group chief executive, told the 130 guests at the factory opening that his company remained fully committed to production and research and development in Switzerland, despite its very high costs and overvalued currency.“It’s the moment to invest. The business is very strong. Demand is rising every week, every month,” opined the ever-optimistic Hayek.In spite of currency woes, previous severe overstocking in Asia and China’s crackdown on ostentatious gift-giving, Aeschlimann confirmed recent industry data suggesting Swiss watch exports were recovering after two years of steady falls.Swiss watch exports remain far below their boom-era peak. Customs data — the only aggregate industry data available — show sales in the first nine months of 2017 were 8.9 percent below the equivalent period in 2015. But the 2017 figures were 1.5 percent above those for the first nine months of 2016. And September 2017 represented the sixth consecutive month of rising monthly foreign sales, with exports 3.7 percent higher than the same month last year.Omega had seen “double-digit sales growth” in its own boutiques for almost a year, said Aeschlimann. “We have so much demand we have a lot of people who are waiting.” The increased demand had been “widely spread,” with Omega’s Constellation model proving “a success story” in China and the new Speedmaster Cappuccino ladies’ watch selling particularly well in Europe. Strong demand has even prompted extra hours, including Saturday shifts at factories.The brand’s attempts to reach out to Millennials have included developing a tentative online sales strategy. Selling products online is seen as very risky by many prestige watchmakers, especially those, like Omega, that have invested heavily in their own brick-and-mortar stores.The brand’s efforts have so far been limited to its Speedy Tuesday experiment, when a community of collectors, who meet online via Instagram every Tuesday, was invited on one-hour’s notice to buy a limited number of special-edition Speedmaster watches. The 2,012 units — reflecting the year the Instagram community was formed — sold out in just over four hours.“E-commerce is certainly no taboo subject at Omega. But we must combine it with emotion,” said Aeschlimann, forecasting an imminent expansion of its online sales plans. He declines to disclose where the next move will be, but industry observers expect a further initiative, most probably in the U.S., to come very soon.
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