A version of this article first appeared in CNBC’s Inside Wealth newsletter with Robert Frank, a weekly guide for high-net-worth investors and consumers. Sign up to receive future editions delivered directly to your inbox. The CEO of renowned Swiss watch brand Audemars Piguet says the company is tearing down marketing barriers between men’s and women’s watches as women become the biggest growth driver of luxury watch sales. Audemars Piguet no longer markets its watches specifically to men or women, and no longer refers to “men’s” or “women’s” watches in its boutiques or in its marketing. “I’m changing the narrative and the architecture of the brand,” said Audemars Piguet CEO Ilaria Resta. “I no longer define watches as men’s watches or women’s watches. I think the company is, to some extent, It’s wrong to predefine the buyer. We shouldn’t be telling women, ‘This is your watch.’” The move reflects a surge in demand among women for high-priced mechanical watches traditionally made for men, as well as luxury products. The lines are getting blurry. It also marks a highly symbolic change for AP – joining Patek Philippe and Vacheron Constantin as part of the Swiss watch “holy trinity” – that could have repercussions in an industry undergoing rapid transformation. Resta, who took over AP a year ago, is one of the first female CEOs of a top Swiss watch brand. Her appointment appears to formally highlight the importance of women to the $100 billion-a-year luxury watch industry. The women’s watch market alone is expected to reach $35 billion by 2032, up from $28 billion in 2023, according to Market Research Future. As the luxury watch business enters its third year of decline, attracting women and younger buyers will be crucial to restoring growth. Rystad cited research predicting that by 2030, 45% of women will buy a mechanical watch. She said that in the past two years, the number of American women entering Audemars Piguet stores to buy watches for themselves has increased by 11%. Lesta said that among the top 50 Audemars Piguet watch collectors in the world, several are women. With women expected to receive nearly half of the massive $100 trillion wealth transfer as spouses and offspring, their spending power on watches will only continue to grow. Conventional wisdom in the luxury watch industry is that women prefer more feminine versions of watches, which are typically smaller, more colorful, more likely to be set with diamonds or jewels, and have fewer complications. However, the trend toward unisex luxury, including unisex clothing, accessories, fragrances and jewelry, is also reshaping watches. “Women love diamonds just as much as men do, and they increasingly love complications,” Resta said. “And vice versa. We launched the Flamingo, a 34 mm watch with a pink dial, and a lot of men were interested in us. We are just reflecting society.” In addition to eliminating gender differences, the AP is also involved in many activities and marketing, including an event last December at Art Basel Miami with Serena Williams, Simone Biles and leading female entrepreneurs and executives. Given AP’s prominence, Rystad’s move would have huge ramifications in the luxury world. In an industry where most watch brands are declining, AP’s sales will grow to $2.7 billion in 2023, according to a Morgan Stanley report. Audemars Piguet doesn’t reveal any financial or production figures, but analysts estimate the company only produces 50,000 watches a year, compared with Rolex’s more than 1.2 million. Limited supply means purchasing an AP is a challenge, even for those who can afford the $25,000 to over $250,000 price tag. Audemars Piguet is also one of the few luxury watch manufacturers to remain independent and family-owned since the 1800s. Most luxury watch brands are consumed by LVMH, Richemont and other large luxury goods groups. Family business owners often place more emphasis on long-term brand reputation and craftsmanship than on sales growth, which means output often grows only slightly each year. Meanwhile, AP has become a popular wristband among top athletes, celebrities and young collectors, making them superstars on Instagram and other social media platforms. Last month, Tom Brady’s customized Audemars Piguet Royal Oak Flying Tourbillon watch sold at auction for $720,000. AP’s scarcity is one reason the brand continues to shine even as much of the industry has been in decline for more than two years. Swiss watch exports fell 3% in the year to November from a year earlier as China’s economic slowdown and weakness in Europe and other parts of the world hit demand for new and second-hand luxury watches. Prices for used Rolex watches are down about 30% from their peak, according to the Bloomberg Subdial Index. Like the slowdown in the broader luxury goods industry, the decline in luxury watches has created a new divide between those companies that are more mass-market-oriented and are currently experiencing the biggest declines, and those that remain highly exclusive and are less affected. Although considered an unlikely choice to run one of the crown jewels of Swiss watchmaking, Lesta is moving quickly to adapt to a more competitive landscape. One of her first goals is to push Audemars Piguet further into the high-end market, focusing on developing the most complex and expensive watches. The goal, she says, is not higher profits but a return to AP’s roots, allowing its most skilled watchmakers to dream up more refined and innovative creations that set the brand apart from its competitors. “Our mission is really to move from real volume to high-end,” she said. “We will grow organically, but we will also increase the complexity of our watches. We were born to be a highly complex watch, so we will go back to where we started.” Resta also uses innovation to attract young and future collectors home – including a new center for developing advanced materials such as forged carbon and new finishes – as well as a new yet-to-be-announced new retail experience. While Resta declined to go into details, she said the new store or pseudo-museum would complement the company’s AP Houses — luxury residential-style lounges in top cities around the world that are popular with top clients. “My passion and belief is that we also have a responsibility to spread the culture of watchmaking and its glorious history of serving humanity,” she said. “We are trying to adopt a new retail model to open the door for people who cannot buy and are just interested in watchmaking to at least be exposed to the brand.” In the end, Resta said that no matter how strong or large the luxury market is, Weak, selling five- and six-figure watches is all about creating emotion. Wealthy watch buyers need to feel a sense of belonging and connection when buying ultra-luxury watches, she said. It goes back to the company’s roots in the Jura Mountains, the miniature marvels created by generations of master watchmakers, and the meticulous care that goes into each watch, regardless of owner, for generations. “Yes, the watches we sell are extremely precious and extremely complex to sell. But what we are really selling is an emotion, we are selling interaction, we are selling an intimacy with the customer,” she said. “When you hear the story of how they made this watch, and how it ended up on your wrist, you can’t help but think of your watch as a gift filled with love, respect, and obsession with detail. A gift from someone who has spent months or years making this watch.
A version of this article first appeared in CNBC’s Inside Wealth newsletter with Robert Frank, a weekly guide for high-net-worth investors and consumers. Sign up Receive future editions delivered directly to your inbox.
The CEO of renowned Swiss watch brand Audemars Piguet says the company is tearing down marketing barriers between men’s and women’s watches as women become the biggest growth driver of luxury watch sales.
