The Rise of the Boutique

The Rise of the Boutique

by Ken Kessler

One of the delightful palliatives that watch manufacturers offer retailers is that every time a ‘monobrand’ boutique opens, the independent retailers in the same city benefit with increased sales. Clearly, this only applies to major capitals, or ultra-luxurious resorts, because watch brands only open dedicated boutiques in locations where there is a high concentration of likely customers. Independents in small urban areas are safe from the competition of manufacturer-owned sales outlets.

Richard Mille Boutique

Richard Mille Boutique

Their argument, as they explain to the independent retailers who served them for years with a clearly defined territory and a regional monopoly, is that the arrival of a boutique can only raise awareness of the brand. They seem to stop short of declaring to the independent, ‘Think of it as a free advertising campaign.’

Some retailers do not believe this patently self-serving justification, while the argument is unnecessary if, as in many cases, the boutique is a joint venture between the brand and a local retailer. But one true story – the retailer and brand shall remain anonymous, as shall the city – illustrates how a slighted agent might feel about a factory-sanctioned boutique on its doorstep.

Roughly a decade ago, as the move toward monobrand boutiques accelerated, one of the world’s most prestigious manufacturers decided to open its own premises, directly across the street from a retailer/distributor that had supported it tirelessly. It was done without warning. Unfortunately for the brand, the distributor it was slighting had pockets deep enough to fight back. On the day the boutique opened, the retailer filled his windows with current stock, all at huge discounts.

How long it took the boutique to recover from this backlash is uncertain, but the schadenfreude experienced by the angry retailer was palpable, and even his rivals cheered him for such chutzpah. Years later, the boutique is firmly established, the independent retailer has moved on to costlier fare … but the brand owning the boutique lost a worthwhile ally.

Whether or not manufacturers even need monobrand boutiques is debatable, though none can argue the wisdom – in logical, capitalist terms – of keeping every margin between manufacturing and the final sale for one’s self. And undeniably, the main benefit for the consumer is the sense of security imparted by making the purchase from the manufacturer, with no independent interloper in-between.

Blancpain Boutique

Blancpain Boutique

For the independent retailer, however, it’s a slap in the face – especially one who has supported a brand for decades. What many brands do, to add insult to injury, is provide their boutiques with limited editions, models not available elsewhere. Whatever the argument they wish to present to justify this, it’s hard not feeling sorry for the retailer who invested in the brand, only to be denied the most interesting (and often costliest) pieces. And if you don’t happen to live in a country with that brand’s boutique, you have to go to great lengths to secure that limited edition.

Of course, the brand that opens the boutique can argue that, because the boutique sells only that brand, the staff will know the products intimately, the selection will be wider than that stocked by an independent retailer, there’s a direct line to the service department, etc, etc. Perhaps a better case that one can support is the business model of a monobrand boutique that only advises the customer and does not actually sell watches, instead referring the client to the nearest dealer.

That, however, is the key phrase: ‘nearest dealer.’ If a company only makes two or three hundred watches a year, and can only support a dozen outlets on a global basis, AND the watches are desirable (and expensive) enough to justify the investment in standalone boutiques, then perhaps a case can be made for small brands only selling through their own boutiques.

It makes sense for a lot of reasons, not least being that any major capital’s watch sales can equal the rest of the entire country’s, so why bother with anything other than carefully targeted locations? With all due respect, a watch lover in Boise, Idaho, or the wilds of Siberia, or Tierra de Fuego, can hardly expect to find every brand available locally. And again, with due respect, the kind of people who regularly buy high-end watches probably don’t live out in the sticks.

Jaeger LeCoultre - Las Vegas Store

Jaeger LeCoultre – Las Vegas Store

Small brand or large, it takes a certain level of hubris to open a single-brand boutique. I for one have no reservations about deservedly great houses like Cartier, Patek Philippe, Rolex, Jaeger-LeCoultre and others who enjoy their levels of prestige preferring their own boutiques. But – and I shall not name them – it must be regarded as conceit or arrogance for some brands who are opening boutiques as if they had earned the same mix of privilege and respect.

Perhaps the only brand I can name that isn’t of the stature of those cited in the preceding paragraph that can, unreservedly, justify its own boutiques is Swatch: when you have as many models as they do, and sheer unit sales rather than margins determine the brand’s health, and the average price wouldn’t pay for a new pair of jeans, then there is every reason to behave like the McDonald’s of watches.

Swatch Megastore in Paris

Swatch Megastore in Paris

Swatch, and for that matter Fossil, IceWatch, ToyWatch, Casio and a few dozen other makers of affordable watches probably do much better with boutiques than in being part of a massive display of like-priced models. And when you look at the size of their catalogues, it would take a rare sort of independent retailer who could stock the brand in-depth.

But back to the high-end boutiques. If it’s perfectly acceptable for brands like Mercedes-Benz or Apple to support their own stores, then why not watches? I suppose that the difference is this: watches, in the post-mobile phone era, are an absolute luxury, redundant as far as their main function is concerned. They are now objects of desire rather than necessity.

Strip them of their mystery and allure, and package and offer them in a corporate, homogenised milieu, and there is the danger that they will be seen merely as expensive commodities presented in whatever pre-fabricated outpost you happen to be near. Inescapably, a boutique in Hong Kong will be virtually indistinguishable from the Moscow branch, the Manhattan premises identical to the one in Milan.

On the other hand, maybe these boutiques keep the independents on their toes. Which might be the reason the manufacturers have boutiques in the first place, as they are so costly to run. Because, as anyone who’s ever been in retail can tell you: it’s also a major pain in the arse.

    Author Bio

    Articles by Ken Kessler


    Ken Kessler has been involved with watches for over 35 years, initially as a collector, then as a dealer in vintage pieces. He has been writing about watches since the mid-1990s, his articles having appeared in Wall Street Journal, GQ, Men’s Health, Top Gear, Esquire, Financial Times, FT How To Spend It, The Telegraph, The Times, QP, International Wristwatch (USA), Status (USA), Hour Glass (Australia), Playboy, Brummell, City AM, Your London, Spear’s, Motorsport, Mail On Sunday and many other titles. Also a renowned expert in high-end audio, Ken is the author and co-author of four hi-fi histories. His weaknesses include chronographs, military watches and diving watches, while other pursuits include music, literature and wine.