PARIS — Tackling the challenge of melding digital and physical worlds, Swiss luxury watch label Tag Heuer is launching a new generation of connected watches, a project spearheaded by chief strategy and digital officer Frédéric Arnault.
“It’s a very important launch for the brand,” said Arnault, who brought on expertise in software engineering for the project and, in start-up fashion, has expanded his team of two initially to around 30 people in his short time at the company.
It is also an important step in the budding career of the 25-year-old, who has a background in mathematics and computer science and is the youngest son of luxury magnate Bernard Arnault to join the executive ranks of brands belonging to LVMH Moët Hennessy Louis Vuitton. He joined the brand in 2017 as head of connected technologies before moving to his current position a year and a half ago.
The launch comes amid an extremely challenging environment for the Swiss watch industry. Disruption from coronavirus, particularly in Asia, has delivered another blow to an industry already struggling from the rise of the Apple Watch. According to Strategy Analytics, the tech giant sold 31 million Apple Watches in 2019, far outpacing the 21.1 million units sold by Swiss watch brands.
Tag Heuer, which marks its 160th anniversary this year, was the first Swiss luxury watch label to jump into the connected timepiece business, launching its debut model in 2015, the same year as the first Apple Watch, a move orchestrated by industry veteran Jean-Claude Biver, who headed the group’s watch division until 2018.
The category has served as an entry point to the brand, with prices starting under $2,000, lower than the average price tag for Tag Heuer watches, which is closer to $3,000. They have sold well and bring a younger, tech-savvy influence to the label, executives say.
“Here we’re coming with a number of improvements and a slightly different vision for the product,” said the younger Arnault.
The new generation of watches, which are priced between $1,800 and $2,350, focuses on sports performance while drawing on traditional watchmaking codes. They are made of stainless steel or titanium, with pushers on both sides of the central crown and faces in digital or mechanical Tag Heuer watch styles. An interchangeable bracelet system allows users to swap bright orange or red rubber straps for black or steel versions.
“Above all, it’s a good-looking watch,” he said, noting attention to details like the ceramic bezel, that had been affixed just-so, in order to maximize the visibility of the screen. The timepieces carry Google’s Wear OS operating system, which includes services like weather, maps and Google Assistant.
While previous versions had copied the look of mechanical watches more directly, design teams this time took more liberty in reinterpreting the designs for the digital realm, which expanded possibilities, explained Arnault.
“It’s a great opportunity — and with this product we have a software and service approach that entails launching our own sports ecosystem: Tag Heuer Sport,” he added.
Arnault embraced the sporty direction early on, and launched a connected golf watch last year. That launch helped the label build up a base of user data — thanks in part to the accompanying application which can be used independently of the watch, available on Google’s Android and Apple’s IOS, and counts 100,000 users.
“We continue to invest in this area and now we have a whole sports series — running, cycling and fitness — that we’re launching with a great watch experience and a companion application that allows you to review all the activities you’ve done with the watch,” Arnault said.
It is also a way to introduce new consumers to the brand.
“A lot of people don’t wear watches, but once they’ve bought one, we’ve seen that in the two to three years that follow, many are interested in purchasing a mechanical watch. We are targeting a clientele that we may be able to interest with our core watchmaking expertise at a later stage,” he added.
The brand chose New York for its launch event, scheduled for Thursday evening, and expects to draw a celebrity-packed crowd to a Chelsea neighborhood for hands-on experiences in natural and urban set ups. Organizers chose the city not only in a nod to the launch of the brand’s first connected watch, also held in New York, but because the U.S. is its largest market.
“It also is the market that has the most potential for this product because there’s an extremely high penetration rate for connected watches — studies show that already a quarter of 15- to 35-year-olds wear connected watches,” noted Arnault.
The biggest challenge developing the watch was amassing expertise that the brand, and even the LVMH group, was lacking, the executive recounted. The complexity of the project required specialists in software engineering and development.
“It was fairly complex technologically, because we built it with a number of sensors, GPS antennas, WiFi — in a restricted space,” he noted.
“The challenge was to pack in a sufficient amount of high-performance technology while taking into account ergonomics, volumes, design — it was all about the balance between mechanical and electronic aspects,” he said.
Attaching the ceramic bezel, for example, called for external expertise, while specialized engineers were recruited to tackle the challenge of energy use.
It was essential the watch remain charged for an entire day, even days involving rigorous exercise, so an energy-optimizing mode was developed to allow for activities like a golfing outing or running a marathon.
To gather fresh expertise, Arnault said he activated his network.
A graduate in applied mathematics and computer science at the prestigious French university Ecole Polytechnique — which his father also famously attended — he gained further experience as a research intern at Facebook, focusing on artificial intelligence.
“People are very receptive when you contact them for help — that’s how it was done, little by little,” he said, describing the process of building up his team, which operates in Paris and La Chaux-de-Fonds, Switzerland.
“You also have to find the right designers with the right level of creativity, who manage to interpret the brand, understand its historical expertise and transcribe it for the digital world,” he said.