The Movado Group and Calvin Klein have signed a licensing deal for watches and jewelry. This follows the unexpected October announcement that Calvin Klein and the Swatch Group had ended a long-term partnership that had endured for more than two decades.
Calvin Klein has signed on with Movado for a minimum five-year term with the option to renew thereafter. Currently, the Movado Group attributes 50 percent of its business to licensed goods — producing branded watches for companies including Coach, Tommy Hilfiger and Hugo Boss, among others. The watch company is scheduled to release its second-quarter earnings report today.
Calvin Klein Inc. chief executive officer Cheryl Abel-Hodges said of the brand’s new license in a statement: “The watch and jewelry categories are important businesses for Calvin Klein and we are optimistic about the potential growth the category holds. Movado Group does an outstanding job brand-building in the timepiece and jewelry space and we are confident that they are the best partner to translate and uphold the Calvin Klein aesthetic. We look forward to leveraging their expertise to drive innovation and expansion in the category.”
The deal is a coup for the Movado Group, particularly in this challenged economic climate. The company had restructured a portion of its staff at the coronavirus’ onset, and Movado Group chairman and chief executive officer Efraim Grinberg sees the deal with Calvin Klein as a way to ensure financial stability for his company and its employees in this time.
“We have an opportunity to take a fresh look at the brand — working with the Calvin Klein management team and design teams to be able to come out with really exciting products. We are scheduled to [release them] in January 2022, so our teams will start designing very soon. It’s a tremendous brand, we see it locally having a lot of traction and internationally the brand presents itself strongly in Asia and Europe. [The Movado Group] is strong in the Middle East and Latin America, where we distribute other licensed brands and we think it can grow there, too,” Grinberg said of Calvin Klein’s global potential in the watch and jewelry sectors.
He added: “We still have to think about how we are going to grow. The current climate is an opportunity, even though there are obvious challenges. We want to keep all of our employees safe, but business will return — we are seeing it return already.”
Grinberg said that it is too early to speak on specific aesthetic changes to Calvin Klein watches, as designers have yet to meet with Calvin Klein about the watches’ overall direction. He remained confident, however, that the company would take the license in a positive new direction.
“This is not the first time we have done this, we previously did this with brands like Lacoste and Hugo Boss that had been in the market. We will feel our way through this along with our design team. While Calvin Klein has a minimalist aesthetic, that too evolves. We will modernize it and bring it into the current design direction of the Calvin Klein leadership,” Grinberg said.
In reviewing the events of the last few months, Grinberg thinks that the coronavirus’ toll on retail and workplace culture will have an irreversible effect. “I do believe that certain trends that were expected to take 10 years to happen, are now happening over the course of a year. That is true about the use of digital and even people working from home. I don’t know if we will ever go back to having 100 percent of the workforce in the office five days a week — it’s not necessary anymore,” he said.
That said, he feels that watches have an important place in the new virtual conference call economy. “Watches are a fashion statement and are really appropriate on a Zoom call. We do a lot of video calls and have seen consumers still gravitating toward watches. Wearing a watch makes the day start and end when you take it off. It’s highly appropriate in a virtual environment when you are on video calls all the time — we see as having a significant opportunity,” said Grinberg.