The chief executive officer at IWC is Richemont’s oldest CEO: he has held the position for the past 12 years.
Aficionado got to sit down with Mr. Kern during his visit to Dubai for the Dubai Film Festival. The CEO discusssed a number of pressing matters within the industry and, as the year comes to an end, he spoke of his overview of 2015 and his outlook for the next year.
You support the Dubai Film Festival along with other international film festivals in London, Zurich and other cities around the world. Explain the relation.
Film tells stories and luxury products tell stories too. You don’t buy a product for $50,000 to read time, but you buy into the dreams and emotions that come with it. I think there is no rationale behind buying luxury goods. We try to sell dreams and Hollywood is a dream factory.
What is the value of the Middle East to IWC?
Asia is our strongest market, followed by Europe, which has been growing because of the drop in the euro. So, I would say the Middle East is the third-biggest region for us.
What is your overview of 2015 as it comes to an end? Are there any markets that performed better than others?
The reality now is that we live in a totally transparent and mobile world, so we need to offer the same level of pricing across the utiard. This is something the watch industry is not used to yet. Our client is constantly travelling, so we should no longer think in countries or regions anymore, but rather in consumer categories: a Chinese, French, American and Middle Eastern client are all similar if they have the same levels of education and income.
Sixty per cent of our consumers buy watches outside their home countries and we don’t mind if they buy at home or abroad, as long as they buy IWC.
Beyond the habits of today’s consumers, were you affected by the numerous incidents, both economic and geopolitical, that unfolded over the course of 2015? How did you deal with these?
We wake up every morning to a new problem, whether an environmental issue, a terrorist attack, some economic drama or a crash in one of the markets. But I always ask myself if we really have more crises today or we’re just talking about them more, given today’s level of communication.
At the end of the day, we need to be flexible and active in a world of uncertainty and instability, where you have a huge volatility in everything.
You’ve previously said that luxury brands need to be offering products that are more accessible to the upper middle-class. Having said that, how can a high-end brand strike a balance between being exclusive yet available?
I agree that this is a very thin line, but it is feasible. Look at Mercedes, for example: you can buy an A-Class or an S-Class, each of these products must have impeccable quality in their own terms and should reflect the quality of the brand.
We are doing this through our distribution. We work through boutiques in order to provide an exclusive and experiential environment. IWC only has 950 doors around the world, less than many other companies, so you still have to look for us to find us; it is always a question of balance.
Many people from the luxury industry are already worried about 2016. Are you? Please explain.
I think the market will be concentrating on fewer brands, only those that are trusted by the consumers. Yes, we were surfing a wave and growing with the industry, but the industry is growing at a slower pace, so we turn to getting market shares from each other in order to grow and this leaves some out of the game.