← HODINKEE Podcasts![The Business of Watches [013] Norqain CEO Ben Küffer On The NHL Partnership And The Challenge Of Standing Out In A Crowded Market — HODINKEE Podcasts cover](https://image.simplecastcdn.com/images/56960b51-f6a1-4676-8305-8ed72486240a/711253ee-3ee2-498c-b41a-82c4cc391c75/3000x3000/podcast-20cover.jpg?aid=rss_feed)
HODINKEE Podcasts
The Business of Watches [013] Norqain CEO Ben Küffer On The NHL Partnership And The Challenge Of Standing Out In A Crowded Market
00:59:34
Plus TanTan Wang joins to talk about Oris's new Bullseye Big Crown Pointer Date, the sale of Baume & Mercier by Richemont, and Omega's 300M diver for Milano Cortina.
Loading summary
Transcript81 lines
- [00:01]
A
Welcome to the business of Watches, the Hodinkee podcast where horology and high finance converge. I'm your host, Andy Hoffman. This week we head to Knidow, Switzerland, to the headquarters of Norqain, a relatively young Swiss brand that's making an impact in the world of sport. We sit down with CEO Ben Khufer for a frank discussion about the strategy of tapping pro athletes as not only brand representatives, but but also investors and executives. Coover says the era of watch brands employing poster boys and girls is over and Norqain has a new model to get the word out on the field, the court and on the ice. It's just struck a deal to be the official luxury timepiece of the National Hockey League. But first I'm joined by my excellent colleague Tan Tan Wang to talk about some of the news and headlines in the watch world this week. 10 10. Thanks for being here. How are you?
- [01:12]
B
I am doing great, Andy. Thank you for having me on. Great start to the year.
- [01:16]
A
It is my pleasure. Excellent. So you are recently back from a trip, I think it was, in Colorado with Oris.
- [01:25]
B
That's right.
- [01:26]
A
And you wrote a great piece on the new Big Crown pointer date, what they called the Bullseye. I got to see this watch in person as well. What' take on this, you know, as a new offering from Oris and anything else from the brand that you saw and found interesting on that visit?
- [01:46]
B
Yeah, it was a great trip. This is my second time going to Vail with Oras. Oras likes to sort of do some ski, you know, and snow sport oriented kind of experiences in the beginning of the year. And it's a great way to kind of get, you know, different creators and media together to take a look at new watches. So definitely the focus of the visit was the launch of the Bullseye. And I gotta say, like, I love that watch. There are some designs where you're like, I don't need it. And yet I keep going back to think about it and that's very much it. I already have a Cueva Volante big crown pointer date. And you know, that model itself is I think one of Oris sort of classic, longest running designs in their lineup. And so for them to come out with a Bullseye, which they talk about referencing, you know, some original pocket watch styles, they sort of the early 20th century as inspiration. To me it's just sort of a timeless tuxedo watch. And I think that's good because it's been a few years since tuxedo sort of revivals were a thing I think, you know, and so now it's sufficiently sort of past trend where I think it's actually a really nice time for them to come out with the style. And it just feels really timeless. It's just a good watch, which I think, you know, my big call for, for brands in 2026 is like, let's make good timeless watches rather than sort of like hype driven trend designs. And I think this is a great, great step.
- [03:19]
A
Yeah, no, I would agree. I think it feels pretty timeless and pretty classic in its design. And it's also pretty approachable price point as well. And, and you know, along the lines of that same Aorus approachable price category. We got some news this week that Bo, the Richemont brand is being sold to an Italian luxury group. It's a big deal for one of the big groups to unload a brand. Have you had any time to react to this? Have you thought about it much?
- [03:49]
B
Tantan oh, man, this is. Well, you know, I'll be the first to admit when I'm going to be, you know, listening to this podcast, whenever this comes out, I don't feel like I don't want to hear my thoughts on this. I want to hear the thoughts from the senior business editor. So I'm going to flip this question back to you, Andy. What do you think about this?
- [04:09]
A
Well, you know, it's interesting. It's not a big deal financially. I don't think we're talking too much money here, but I think it's a very important transaction and occurrence here in that it is the first time in a long time we've seen one of the big brands actually make the decision to unload an asset or a watch brand that maybe isn't fitting into their overall culture or trajectory and to, you know, give someone else a chance to run it. I mean, Bonin Mercier is a great storied brand, almost 200 years old, once owned by Piaget and then later Cartier and now Richemont, and now we're going to see it owned by this Italian group. But I think it could be the kickoff to us seeing some of the other big groups, whether it be LVMH or Swatch Group, starting to look at unloading some of their underperforming brands. And that's what we heard from, you know, some of the analysts here in Switzerland, Oliver Mueller and Jean Philippe Bertie from Von Tobel. I mean, this could be the start of the great deconsolidation in the watch industry. So let's see, let's see and so, you know, speaking of famous brands and Italy, let's talk about the Olympics. The Omega Speedmaster 300 meter that the brand released for the upcoming Winter Games in Cortina. It's a bit of a wild one. You know, what do we need about this le and how Omega is talking about its role as the, you know, the timekeeper for the upcoming Winter Games.
- [05:51]
B
This one's a funky one for those who aren't necessarily familiar or following around Omega's, you know, very specific releases for the Games. This is sort of a round out of a trilogy of limited editions. They started with sort of this, in my opinion, gorgeous 37mm vintage inspired Seamaster, you know, much more timeless and sort of not Ellie looking, if you will or not, Olympics looking. Followed it up with a 38 millimeter sort of speedy reduce in that sort of like slightly chunky but compact still case size. And then now we have sort of the biggest one of the bunch. This one's a 43.5 millimeter diameter white ceramic and titanium seamaster. Right. So this one is sort of the least subtle of all of them, if you will. But you know, what's interesting is, you know, this is certainly not the first time Omega's done a bunch of Olympics themed releases. And as far, and you know, I think given the sort of reaction from seems the general public, this seems like a hot take at this point to make. But as far as Olympics editions goes, this one's way subtler than I would have thought they would do considering that it's a white ceramic kind of large diver. I, I actually personally think the 43.5 millimeter standard version that Omega does in black ceramic and titanium is like one of the most slept on seamast. No one really talks about it, but it's a really cool sort of like very, very stealthy take. And yet this one, when flipped around and sort of inverted, feels a bit different. It's certainly a lot more fun, but I don't know, it's really interesting, right, because these releases certainly in my opinion don't strike, you know, the heartstrings of watch collectors and the watch enthusiast community. Like these feel very much like commercial releases, right? Like I'm expecting to see this on the wrist of athletes. You know, when I tune in and watch the games on tv, I'm people that are going and feel the desire to drop $10,000 on a souvenir rather than maybe a fridge magnet might be going for this watch.
- [07:59]
A
It's a serious souvenir. Yeah, absolutely.
- [08:02]
B
It's A serious souvenir. And I think that's sort of the question where, listen, Omega very much is, you know, I think they've done a good job in terms of what they've done as sort of the timekeeper and getting their brand, you know, tied with the games. But these are always so interesting to me because, you know, obviously this one is not strict, a limited edition. So I think they can quietly discontinue this at any time. We won't really know quantities. Right. I mean, in the past, we've seen additions that have been pretty generous in size, and you kind of see them at retailer shelves years down the road. This one, I think, is a little different. So it might be also them trying to change up the strategy, just making this as a kind of time limited series. But I'm curious to really know. That's actually a big question I have is what sort of the sales are for stuff like this. It could get people that don't care about watches in the door, you know, if they had an amazing time or are really tied to these sports, to kind of think about watches in a different way. You know, I'm not blaming a brand for trying, certainly.
- [09:05]
A
Absolutely. Well, I'm glad I let you cook there. Tan, Tan. That was good. I enjoyed that. Thank you for joining me. That was a lot of fun. So let's go to our conversation with Ben Khufer, the CEO of Norqain. Good morning. I'm in needow with Ben Khufur, the CEO of Norqain, which is a young, exciting, interesting Swiss brand. And Ben, thank you very much for joining us on the podcast.
- [09:44]
C
Thank you very much, Andy. Excited to be with you.
- [09:46]
A
Excellent. So let's start off with actually some breaking news. You know, you're a brand that has long been associated with sports, and you have plenty of sports stars who are investors and interested in the company and play a role here. But you've got some major news in terms of sports partnerships. Tell us about him.
- [10:12]
C
Yeah, we're very excited. Since we started Norqain in 2019, my business partner and co founder Mark Stright is a former NHL star. He won the cup with the Pittsburgh Penguins in 2017. And I told him about my dream of building this mechanical sports watch specialist brand. And of course, in sports, ice hockey is one of those robust games. And Mark has been a big part of Norqain since we started. He started, you know, doing first business trips with me, but in the meantime, he developed into really a business developer. He's traveling to the US Six times A year to really boost the Norqain brand. And we're very happy now to announce the partnership with the NHL. So Mark's literally giving a comeback with the league, meaning that Norqain will be the official luxury watch of the NHL starting January 1st. A multi year nationwide deal, global deal. And we're very excited about that and
- [11:11]
A
how, you know, what's the process to come to a deal like this. Because the NHL is one of the premier sporting leagues in the world. You're a smallish Swiss watch brand with association with plenty of former and current NHL players. But how does a deal like this come about?
- [11:32]
C
Ice hockey has been, you know, part of the brand since day one. Of course, everything you're passionate about is always very authentic. So when we started the Norcain brand Wiz Mark, we were all about, you know, sports and ice hockey was a big part. We partnered with the Spengler cup in Davos, which is a big tournament. We had a partnership with the NHLPA from 2020 onwards where we were always present at the All Star Games. And I think what then came was, you know, with Sidney Crosby joining our brand as a shareholder. This for me it was really the moment I realized what's happening with our brand because as you said, We're a young 7 year old Swiss watch brand. We're humble enough to know where we're coming from. And for us it's really a dream come true to now associate ourselves with the NHL. I think everybody knows how big of a sport it is in North America. The US is our number one market. And also it's a clear sign from us also to show how much we still believe in our brand in North America, America and the market. And I was there in, in summer and we had an event in New York and I really felt, you know, the mood and spirit of all the collectors in New York. And yeah, I'm just really happy to show a strong signal back that we are here and that we want to, you know, continue to grow in the U.S. absolutely.
- [12:55]
A
And what does it mean? I mean, you know, why has the brand sort of chosen to associate itself and to promote itself and to have sports figures deeply involved, if not shareholders, certainly ambassadors for the brand. What does those sporting partnerships, that active lifestyle, that competitive spirit, how does it align with Norqain and its values?
- [13:24]
C
I think it's a great opportunity to explain what actually the strategy is from the beginning. I think that Norqain is a family owned independent brand and we started this brand from zero in 2019. Of course, when we started. One of the points we realized quite quickly is that we will never have the marketing budget to compete with the industry. And what's actually already, you know, many very established brands, but we definitely have the passion, we have the challenger spirit in ourselves to bring something to the market that will be different. But how are we going to make sure that people know about this and when? Of course, one of my first discussions was with Mark Stride at the time time we started to discuss and we said, you know, for me I prefer to have people on board who are really generally connected to the Norqain brand. I'm not looking for ambassadors. I feel like the era of poster boys is over and poster girls. I really think it's about actually actively developing the brand with us. And that's what we built. We built a brand and I think it's pretty unique in the watch industry where I said I would look for people who suit our values, who have the same challenger spirit and help us promote the brand globally. So today, you know, I think we have a fantastic setup with people like Stanislaus Varimka or Sidney Crosby. Gianluigi Buffon for those who like football, for more the European markets, Gary Neville for the UK market. So it's really clearly a strategy where we build different parts of the world with partners who really believe in the brand. And why sports? Since the beginning I knew that if we go with a totally new brand and we don't purchase a sleeping brand, we want to write our own story. Right, to write your own story. I think being authentic, being yourself, living really what you are doing is very important. I love sports. Mark loves sports. And it was for us clear we need to do a fantastic sports watch. That's our mission. We have to bring something new to the market. And you learn. I think 2019 was not the best version. As usual, we started from scratch. We had a great lineup. A first, I would say solid lineup, a base, but also so when you start a brand, you get a lot of influence from outside. My first discussions were a lot with retailers. What would we have to do so you give us a chance in your store. And I think the first version I had of Norqaint gradually changed a bit over the time and those discussions. And at the end it was maybe a more commercial version of what I initially thought of. But then Covid came. That's also when I met you for the first time. And that's where I started to change my strategy. And I said, you know what, this is bad. All in. I'm going to Listen to my gut feeling. I feel like we're the young Challenger brand. And in terms of branding, I feel that people had already understood that message. Our branding was really clear because it was authentic. It's who we are. We're family owned, we're independent, we're about sports and Switzerland. And that branding felt very authentic from the beginning. In terms of product, I wanted that product to also change and become more like the brand that we've built, more challenging.
- [16:40]
A
How did you talk specifically about the product and how you think it changed and came to embody that idea, that spirit?
- [16:47]
C
I was working on it, honestly, already at the end of 2019, I started to work on it. We had this independence line we just launched and people were giving us great feedback. But in our communication, the independence was always limited. So it was like we would drop an independence a year. And I felt that that, that resonated in terms of design with a lot of people. And at the same time, the message that we were having was limiting the potential of probably our strongest collection. Because being an independent brand, there's a lot of beautiful independent brands, but they're all in the higher price segment or a lot of them. So us offering a brand at the entry price, which is a very difficult game to play because that's where you need the marketing budget, that's where you need to really be able to push sales. I said we need to find a way to really resonate with the customers. And for me, that was pretty clear after my analysis at the end of 2020, that it will have to be a more unique product, it will have to be a louder product, it will have to be a more from 3 meters. I look and that's an Orcane product. So that was really my analysis. And then, lucky for me, Covid, two weeks in, I got the email from John Cole Beaver, who I had never personally met, but of course is a legend of our industry.
- [18:05]
A
Legendary watch executive and towering figure in the watch industry. Indeed. Jean Claude Biver.
- [18:12]
C
Absolutely. And huge passion. So I was lucky enough that he came to visit me during COVID The offices were closed, it was in April, just after Easter. And he told me that he had heard great things about the way we were working and how passionate we were, and that we were all young and that he had been doing so much in the industry that he felt like now was his time to give back. And if there's anything that he could do to support us or me in this time, he would be here to give us some inputs. And we had an Amazing talk. And at the end of that first meeting, he said to me, you know the brand, I really like the name, I really like your logo, I like the spirit. I think you need to go for an all in product. And since I was already working on that without having solutions yet, I opened up to him and I said, listen, I'm really happy you say that. I've been having some doubts lately and I'm in line, but I can't really, you know, make ends meet. It's super expensive. We're now in a crisis. I know that innovation is, is like a second budget, right? You have to make it happen. And, and he said to me, we'll find, we'll find solutions, we'll find solutions. And what I need from you is to think about it and tell me tomorrow if we're going to make a super cool ultimate high performance sports watch. So I didn't wait till tomorrow. I just, when I got home I wrote, hey, Jean Claude, don't need 24 hours. I'm in. Let's see what this means for. Right, that was the start of the Wild One.
- [19:39]
A
So yes, I mean what we're talking about here is the Wild One, which is basically your signature watch. I mean it is the watch that certainly makes Norqain stand out from its competitors. Talk about what the Wild One is and I'd like to hear more about how the idea of that watch developed with Jean Claude Bivert and here internally and how it came about and then we'll talk about where it's going and how it's evolving.
- [20:06]
C
The Wild One was one of those moments that I very quickly realized, okay, this is going to be game changing in either direction, to be honest. Because of course, working with Jean Claude very quickly we had that first meeting with Pascal Burkar at Biwee, one of the best suppliers in the watch industry. And I realized that I had brought together people and a team that the expectations will be extremely high for this product. And Jean Claude, of course, having done so many products in his life, he continued to raise the bar. And for me it was about one year into the Wild One. So we started and then we were about summer 21 and we started to have a clear direction, very clear direction, that this would be shock absorbing. People would be wearing it to do sports. And we have a ultralight material that will be our own, a property material, but a lot of it was, you know, writing good product briefs. We didn't have. We were working on materials, we were working, but we didn't really make progress. We had the problem of having always a bit the same issue with the cages, that they were not thick enough to hold, you know, the pressure of the shocks.
- [21:18]
A
I see.
- [21:19]
C
So that was one of the problems. Or the material was just not good enough yet at the time. And then it was about at the end of 21. We made huge progress on the material, which was really the game changer. We could go back to the initial plan of the case shapes and also the thickness of the top plate and lower plate, which is now working like a shock absorbing element for the whole construction. So the wild one, there was a lot of ups and downs. I would say. The key moment where I realized this is all in was really when we looked at the tooling list. The tooling list in watch production is literally normally it's not that of a subject because if you're doing a standard watch, you will end up with three toolings and you'll have a tooling for the case. You might have a tooling for the dial if it's something special. But toolings are extremely costly because means you're doing something outside of standard.
- [22:06]
A
Yes.
- [22:07]
C
And you're developing your own tooling, which can be anything between, you know, 30,000 to more with of course, 100,000 per tooling. And so you try to avoid that as much as possible when you're building a watch to keep it commercial. But since Nortech was a new material that we've never used before, everything was clear. Yeah. But everything we do with Nortech will be its own tooling. Because you can't use a tooling.
- [22:30]
A
Nortech is basically a kind of carbon, your own proprietary.
- [22:35]
C
Again, in a list of. In a world where there's so many watches, you would say, oh, I've seen that before. But our difficulty was that we wanted to color the carbon composite. So world premiere, because we actually do it in the mass. The carbon composite of norcaine is produced in the mass. In the mass means we dye every single carbon fiber to get it colored. And that's never been done. That was a world premiere when we launched it in 2022 and Pascal Burka Rabiwi allowed us to find this method. And so the difficulty for us was really to somehow, somehow find a way to get those toolings. We ended up with 13 of them.
- [23:12]
A
Okay.
- [23:12]
C
And that's the list I saw. Right. So that we didn't launch the watch at that moment. That's when you receive a list and people explain to you, hey, this is what's going to happen in terms of tooling. We have a tooling for top plate, lower plate. We have a tooling for everything that's concerned with the container we had. We had toolings everywhere. And John was all happy. He looked at me and said, yeah, this is great. You know, we can imagine. This really underlines how much innovation is in there. I said, yeah, that's going to be a big part of our storytelling to make people understand what we're actually doing here. That we really started the watch from scratch. We did not take anything that was existing. We built it from scratch. Like if we were building with a new LEGO house with some kind of instruction. And that was really the moment when the first time I saw the price of the development.
- [24:01]
A
Right. Talk about that.
- [24:02]
C
Yeah.
- [24:03]
A
So could it be profitable? Could you have any margin producing a watch with so many tools?
- [24:10]
C
So it was not only the moment that I saw the price, but it was also the moment for me to have the guts to say, go, right? And yeah, of course I went home. I told everybody, I will, you know, give an email by Monday. I went home. I thought about it, but I knew there was no other way than to go all in on this. But I also realized that my ownership at norcain was, you know, at stake. I mean, literally, if this product would fail, then we would have to raise money for sure and a lot, because that's just the situation. And as a founder, Norqain's my baby. I've been building it since day one. It was a scary moment, right, to take that much. But I believed in that product. I looked at it the whole weekend. I kept on saying, but that's something new that's now ultralight. You can say, okay, there's other ultralight watches. Yes, not at that price point. It's super robust, it's high quality. We have the canesy movement in there. It's something that's not in the market. And if it fails, then I want to fail like that. Because then I did something where. And that was it. Monday I sent out the email. Everybody was super happy. And of course it meant further investment on. On our side. And then we. We kicked off production and of course on the way with a new product, you have some problems. We were hoping to present something in April that didn't happen.
- [25:34]
A
This is in 2022.
- [25:35]
C
Yeah. So we were at. In autumn 21 where we gave green lights. And then we're hoping to show something not finalized product, but some possible not ready. And at the end, suddenly we had that September, which was our goal to launch the wild one. In Zermatt in September 2022. And we managed, and I will never forget that moment because of course you're there after, you know, two and a half years of hard work and finally. And you know, you're going to get the feedback from, from everybody around the world. We had all the media there. I was on stage with Jean Claude, which for me, you know, is a childhood dream come true. I have my whole family there, my, my wife, my kids. So it was really, really special. And yeah, I was just waiting to go and read the whole evening. People who were speaking to me were like, hey, are you okay? You know, are you happy? I said, I'm super happy, but I want to go and read what's going on in the Internet, what people are saying.
- [26:30]
A
Right, right, right. And, and can you talk about, I mean, you know, give us a ballpark figure, I mean, how much it cost to develop, create and launch an innovative new watch like that. I mean we're talking, are we talking millions?
- [26:47]
C
I presume it was a lot of money, but not millions. I won't go more into detail, but what I can say is that in our plans, you asked before about break even. It was like at the stage we were selling at the time, it would have been three years to just somehow get into a land where you can say now we're slowly there that we could. And of course when you're in a sitting at the time, Norcaine was five years old, that's a lot, right? And you're actually trying to make money anyway. So you're developing a new product that's actually going to make you lose money for some time. But that's I think the beauty of independent brands and family owned brands. Like I remember the board meeting where we looked at, we had a whole budget just for Wild One and I showed and I said on the, the long term, and that's what we're doing, the long term investment, this is 100% the right direction and I stand 100% behind this decision to do it. And not one person didn't agree. Everybody was happy and they said that's what we're going to do. And we understand the risks, but we're going to go with this development. So I think that was really the moment for Norcam where a lot that I had in me, I think, and in 2018 already when I started, I think you need a lot of courage to start a new watch brand. But then it's normal, you start. And the first fair, I always talk about that. But the first Fair was awful, right? We went to Basel. Everybody told us, who needs a new watch brand? And you guys are going to have a tough time, which I knew. But of course it's tough when you hear it from the retailers and from the trade and even some media that said then really I don't think it's the right time to launch a new brand. But then things develop and at the end, I think think the version that we brought out in 29 was still a solid, good offering and I think that's what we needed at that time also. But you have to develop and I'm just very happy to see where Norcan is now standing in 2025. I think the brand has developed a lot. I think we've have a lot of new edges. We have a strong character both in brand and product and I think people are starting to notice it. And I'm starting to get a lot more messages also on Instagram and people saying, hey, really the direction you guys are taking because they see it's different.
- [29:09]
A
And that NHL deal obviously was certainly going to raise the profile with that major sports league. But what I find these days, if people in 2018 were saying to you, who needs another watch brand? We've got too many. Well, it's a very different situation today because there are even more watch brands. So how much of your thinking and your strategy is about standing out and getting that attention for your product? And yeah, having people pay attention to Narcane and what you're doing.
- [29:45]
C
I think it's very important because there's. You're right, a large, large offering of brands and you're also, it's true even more today. I think it's very important to have a strong character. I don't think nobody needs another brand that doesn't stand for something unique and different. And I believe that Norqain, we really managed to develop ourselves into a brand that we are in a space. We're in the sports watch space and we have our position there. And we're also in the space of a challenger brand that's innovating. And I think what we're also doing is because we're family owned and because we can sometimes break rules when we feel like it, we can also have fun and launch an ice cream watch like we did this summer, which was
- [30:27]
A
a very colorful sort of pastel version of, you know, it's somewhat traditional looking chronograph, but certainly the feel of that watch and the sense of it was new and different and quite fun.
- [30:41]
C
Yeah, I think there's a lot happening on this planet. And last year we were working on the new developments for 2025. And I told the team, I want something fun. Not yet clear in what, but I said, we need to bring some fun into it. I think there's a lot happening and I think it's good sometimes when you remind people of positive messages. And I just more or less gave that slogan, enjoy Life. That was like, imagine Enjoy life. What would happen then? And then it developed. And at the end we had the ice cream. And the ice cream was, of course, we started with a lot of colors and eventually one of those color codes we said, that looks exactly like an ice cream. And I said, hey, that's a message. Because if you look at childhood and happiness and when I see my three kids, you know how happy they mostly are. It's also because they are free. They are things thinking. And I just felt like that ice cream moment when you were a kid, how happy are you then? And how much does that symbolize Enjoy Life? And also just being positive. And I spoke to two, three parents and friends, as I usually do, not telling them what I'm doing, but trying to find out a bit how they feel about that. That's oh, it's so cool. Ice cream is so positive. And that was it. I said, okay, this year we're launching the Enjoy Life ice cream edition. Fun part of it is, as usual. I presented it to our markets in February. So it's freezing cold in Switzerland.
- [32:03]
A
Not the time for ice cream necessarily.
- [32:05]
C
Not at all. It's freezing. We're in Zurich and I have this screen and I'm putting all the novelties and suddenly this ice cream watch comes up and I could just see the room like, what is this? But the great part of it is there was no campaign, not yet. It's winter. And the feedback. Feedback was good on the way it looks, but not really on what's the meaning of the ice cream. And the Enjoy Life story was not there. So I was. It had the logo on the back, but. And then we, of course, worked on the story till June and on June we launched it. And yeah, biggest success this year is the Enjoy Life edition that we launched this summer. It's been a huge, huge hit. And I'm super happy to see that, you know, people understood the 20th twink of the eye that we're giving.
- [32:53]
A
Yes.
- [32:53]
C
Because it's really about. I wanted something positive. I wanted something to be. And I think as. As nor came. We're a young brand, we can do some things that are fun and to collectors mean more than, you know, just the watch. It also meant, hey, this is different, this is fun. And we had collectors in New York or in. In in other cities in the the United States that told me, hey, my usual collection is, you know, in the highest price range. And I bought your. Your Enjoy Life because I just think it's super cool. I'm going to keep it for my kids. That's fantastic. And it's what we should do.
- [33:24]
A
And it's. Yeah, I mean, you know, it's not easy to emote and transmit an emotion through a mechanical object. But of course, that is the, you know, you. I think you would agree that's the secret to sort of standing out and connecting with clients and customers.
- [33:42]
C
Yeah, I think every second executive interview says it right. It's about emotions on the wrist, of course, but you said it even better. I find it's very difficult to create that because at the end, yeah, it's true. A mechanical watch can stay with you with generations. It can tell a story, but yeah, it's about you to write that story with it. Now, if a brand wants to be relevant in a very, very crowded market, I think it's their responsibility to carve out spaces where they can emotionally connect with their customers and find a way. Because in my opinion, you can reduce the list to five brands if you just want to keep it simple. There is a reason for the other brands for being there, and it's an emotional reason. That's 100% sure.
- [34:29]
A
Absolutely. And so you talked about the development and the creation and the risk sort of taking you were doing with the Wild One. How has that particular model developed then, since launch and what are you trying to do with that and how much of your business is the Wild One? Tell me about how you're sort of organizing your product in terms of what you want to sell or what you think you could sell to customers.
- [35:00]
C
Yeah, it's a great question. So in 2019, I said the independence was one model limited once a year. And today we completely switched that around. And the independence is 60% of our business as a collection. The Independence includes the Wild one. So the Independence is actually the base collection and the Wild One is the Wild Independence. It's the same case shape. For those who don't know the Norqaine collection that well yet. So we did not want to make a completely new K shape. We said we want to keep the independent DNA because John Clau really liked the K shape, but of course rebuild it totally innovative and ultra. Robust and ultra light. So the wild one in that collection of course is very relevant. But we also launched last year in New York we launched the new independent skeleton Chrono 8K, our first flyback chronograph movement, where we developed the movement with amt. So it's a really, really nice movement, the flyback chronograph at very exciting price. I think we managed to really price it aggressively in the market and it's a big success. We really are selling a lot of the titanium watches, both titanium and steel. So that's definitely a collection also to keep an eye on. It's becoming more and more relevant also in terms of part of the cake
- [36:17]
A
and then looking forward and based on what you hear from clients and customers, we hear a lot from people about pricing and about inflation and about they think that the prices for luxury watches or premium watches, whatever we want to call them, have gone too high. And how have you dealt with. Because obviously we're here in Switzerland, there's a strong Swiss franc. The price of materials has increased, the price of labor has increased. And you have marketed yourself and created yourself as a value focus, premium product brand, basically under 10,000 francs. So how have you dealt with those pressures? And is and should we still think about Norqaine in that price segment going forward? Is that where you want to be and stay?
- [37:11]
C
It's a very good question and obviously I think it's the biggest danger for the Swiss watch industry at the moment. If you, if you look at the volumes, we went from 26 million watches exported to now 15 million. So yes, you can say we're also doing record results on value because the value is going up. I always prefer wrist. I always prefer more people being passionate. And I think it's our role, the brands that are, you know, below $10,000 to really make sure that we can get in contact with the customers, continue to spread the passion for mechanical watches. Luckily, Instagram is helping a lot. I think it's never been so vis. So the decrease in volumes does not reflect actually what's happening in social media. So it's really important to have attractive offerings in a price range where. And there are some beautiful brands already very clearly positioned in that price segment. And we Norqain, we will also stay there. And I think that's our role. It's to innovate, to bring fun pieces in that price segment. And I will leave it to my friends at Moser and MB and F and wherever those independents who do the higher price priced collections.
- [38:25]
A
Exactly. And how do you manage that though, because as I say, inflation is real and there are competitors in this space from other countries now who are getting better and better at producing high quality watches. How does Switzerland keep its place as a producer of reasonably priced premium watches? What does Switzerland as a producer, producer and manufacturer have to do to remain competitive?
- [38:56]
C
We think in Switzerland, the Swiss mechanical watch is part of our culture and we have a very strong supplier, Jura and other places where of course this has to function. And for them to keep prices competitive, that's the start. For that they need volumes. If they don't have volumes. And that's what's happening now, those prices go up because they need to put the price up to be able to pay the people working at the factories. And then this reflects in a second contra productive situation where of course the end consumer finds higher prices while actually there are less end consumers in the market. Not ideal. So what we need to do is we need to continue to push and really make sure that we are competitive, that we can have watches priced in this price segment. So I said it in 2019 that it's our mission to, you know, be in the entry price segment and act activate. Our mission would be much bigger today because I think that the brands like Norqain, like Tudor Oris, great brands like that, we need to make sure that we can get to the young customers. And I think that's something that's key and I think that's something that could help the volumes. We will play a small part in that of course, you know how I mean it. But I think that's really key and I'm a bit worried that we have a second problem that is of course the Swiss Frank when it then gets exported. Because I've had really good discussions with the suppliers and I feel like they're ready and they're willing to support and they understand the situation, that prices can't go up. That's my speech the whole year now in every meeting. But the problem is when you look at the US dollar versus the Swiss franc especially. Yeah, it's difficult to imagine what else can you do then to increase the prices. Right. And I think that's really a second key problem where hopefully the situation will stabilize and hopefully also the economy will somehow be so performing so well that maybe, hopefully that inflation, that's real now and we haven't even spoken about tariffs can somehow be absorbed.
- [41:10]
A
Absolutely. And you know, are you, and as you say, I mean, when I think of Narcane, I think of, you know, your major Markets being the US obviously you're big here in Switzerland, you're in the UK in some places Japan is a big market for you. With this situation with the tariffs and obviously the US economy continues to do well and it seems like people are still buying watches but there's a lot of uncertainty. We are where we are with tariffs at the moment. Who knows, it might change tomorrow. But are you rethinking the markets that you're targeting and trying to be less exposed to the us? Obviously the NHL deal would suggest otherwise and so yeah. Are you rethinking your regional and geographic targets for the product?
- [41:56]
C
Not rethinking, but of course norqain is still developing. So this year we had a big moment where we finally really entered the UK market market. We hired a great director, Martin Jenkins, who has a lot of market experience who will be now running the uk. We found great partners like Beaver Brooks and some independent family owned companies, Fraserhart and we're building that market. So that's a normal. I would say that has nothing to do with the situation in the us. I think the NHL deal shows clearly how much we believe in the US And I also have to say for me personally how things thankful I am to the US market because when I started the Norcame brand I remember the first moments being yeah, quite tough. Of course before going to the Watch Fair in Basel already I had like seven retailers in Switzerland. But then I decided to go to the US because I know in the US startups dreaming, it's part of the culture and I got so much energy over there. And also first retailers that just said let's do it at like a Ben Simon Windsor Jewelers in Charlotte. I remember just talking to him and said Ben, I'll give you a chance, you know, you deserve it. Cool brand and let's try it. And that spirit, you find it in America. And I think that's from the beginning when we came with NORCAINE to the U.S. adventure, freedom, independence, it resonates. And so I feel like it's now our role. Even if, you know, if this goes on and the next month years will not be very profitable or probably worse, I will still support it. And with the NHL deal it's a clear signal we will be there. And I will not give the tariffs on to the end consumer because I think that's something that's really we will not be able to completely absorb. But you will not see us just putting the tariffs on the end consumer. I think that's now also something we're family owned, independent. We're going to have to find solutions. We're profitable company so voila. If we cannot help in a situation to pay back, then we're not in the right game.
- [43:56]
A
You know, it's interesting you're a family owned company company. Let's talk briefly though about you know, the ownership structure of this company and I'm quite interested in how you, you know, with your investors and spokespersons and ambassadors from the sporting world what you are providing those sports figures with in terms of, you know, exposure to a business and them thinking about what they do next with their lives when they are no longer professional athletes. I mean y Marinka's near the end of his career. Sidney Crosby I've, you know, in my entire life he's been one of the greatest hockey players in the world. But yeah, he's not going to be able to do that forever. So talk about that relationship you have with them.
- [44:43]
C
I think it's really key for us because as I said before, we really want to build partnerships and in this moment I ask myself also what do we need? And Stan is a great example. Stan Marinka. Because when we started to talk we already talked about the post career. Not that it was close, but more like I said what Mark was doing and Stan said, you know, for him he's starting to now think about that not for tomorrow but of course it's in his mind and he wants to choose a couple of projects where he will really support. As soon as he said that, I knew that that was going to be a great, great guy who could join the brand. And I told him about a possibility of investing into the Norain company which I didn't mention in any discussions before. And the deck came in like any deck for a sponsoring by his management, that part of it and but we knew Stan, Mark knew him quite well and told me he's a great guy and huge challenge spirit, a fighter, he would suit this brand a lot. So when I spoke with Stan I really felt that spirit and I think that's what's fun about Norcain is it's from the outside you can say, oh, it looks like marketing. It is, you're right, we don't have the budgets so we had to be innovative and we said, hey, let's give this an extra, you know, level of when we have news, we can boost it but at the same time it's free, fully authentic, they are fully involved, they are helping, they are celebrating. When I called him for a new partnership, when we called Sid said Hey, we have a surprise. Are you sitting? You know, then we tell him about the NHL, that. That we got it. Yeah. He knew we were talking, of course.
- [46:15]
A
What was his reaction?
- [46:16]
C
Well, he helped us get it. So of course he was also involved. That's the cool part. Everybody's pushing, but when we told him it's done, that's the cool moment, you know, and you celebrate. And I think for. For athletes it's probably nice also. And I can't speak for Sid, but I can talk about Mark or Stan. Mark told me it's tough when usually your highlight of a life is to score a goal in front of 20,000 spectators in overtime and everybody's jumping on you. And then you get into life after your career and there are great moments. You become maybe you're a father. So there are moments that are even more rewarding but. But that there's that adrenaline that you don't get that. That you know, that am I going to score? Am I going to miss? Am I? But he told me a nice thing. He said that with Noren. He's had a few of those moments now, you know, both in negative realizing. I mean, the news on Wednesday of the fair this year when the tariffs hit. Sure, I was with him at the fair. He looked like a guy who had just lost the Stanley Cup Final. I did too. But also the next emotions. Signing a deal now like the NHL. And for him it's really. I'm so happy for Mark because he really worked hard on this deal. And for him I can feel it. It's like him going back. He's talking to the same people. And it's such a rewarding moment for him after his career to now with Norqain and the brand where he's a partner since the beginning. And it's a great moment.
- [47:43]
A
Yeah, indeed. And that's team and you get to share those victories, but also those lows together. And obviously working as team is generally a better way to do it and
- [47:55]
C
it wouldn't be possible without. I think that's also something that's super important for me. Since the beginning. I'm hugely passionate about watches. I'm lucky. My father was the entrepreneur in the company and my grandfather was also in the watch industry. But on the production side he was in the sapphire crystals. So really producing and not yet an entrepreneur, but working in the industry. Then my father was working in industry and in the quartz crisis became an entrepreneur because nobody believed in watches anymore. He did. So it was easy for him to take over a company with no sales at the time. And he passed that on to me in, I'm sure, the love for the industry and the passion for the watches, which I'm really thankful. And also what he gave me is the team spirit. And I think something that's for me really key is I could have never done Norqain by myself. And I think I was always clear about that. And when people, people ask me about, you know, what's the strategy? I said, we built a watch brand from zero. You can't do it alone. And I knew that you can't travel the world alone. You can't. So I, from the beginning had the strategy to surround myself with great people who have the same values and who will. We will lift each other up in bad moments and we will celebrate victories together, like you said. And I will never regret that, that we did it this way because it's a much more fun way. And I don't care if I have 100% or 35%. What I wanted was to build a, that people will be, you know, one day proud of and say, this is a great. Has turned into something great.
- [49:26]
A
Indeed, indeed. Looking forward, I mean, what is your biggest challenge at the moment? Is it keeping the brand in the public consciousness? Is it, you know, keeping costs in line? Is it maintaining relationships with retailers or finding new retailers? Or is it rethinking your retail strategy? What is, what is your number one sort of goal and objective or pressure on the business side at the moment?
- [49:55]
C
For me, there's two things that started, you know, after the Wild One. So you're running around the world and going to every country talking about the wild one in 2023 and we had great sales and it's end of 23 and I started to feel something that was making me a bit nervous, a bit unhappy. And I was trying to figure out what it is. And it's the problem when you grow quickly. There were two things things at risk. One is the internal culture when you're hiring a lot of new people. And I was not there to see really what's going on because I'm traveling. And the second is the vision of the future when you're only talking about a product that's now or even already a bit in the past because it was one year later, I was still traveling, talking about the wide one. I started to realize, hey, where's your vision? What's coming Next? And in 24, I did something that I'm going to do every year now and I would recommend to everybody to do that. Once in a while I went one week by myself somewhere and I just thought about everything and I realized that I cannot do this alone again. So I cannot travel and be in charge of looking at the culture. And I came back from that week, I took my brother Toby for lunch and we spoke and I said, Toby, I'm going to really need you. He was already very important doing all the distribution as a sales, international sales director. But I told him, I need you to move up to vice president and your family and you're the second spokesperson. And we're going to divide the work of, you know, traveling the world because it's family owned. I want that. But we need to be realistic. We also need to control our company and who we are hiring, what is our culture, what are our values. And it was a big decision. Of course at that time we did it, it felt super logical. Within a week it was so, so long. But I had to take a week out to, to realize that. And then after that I spent more time again back in and I really think that's key. I'm spending much more time again on the product. So I spent only time on product between 20 to 22. But after the launch, I would say the 23 year was pretty low product time on my end because I was traveling all the time. And now it's again the way I love it. I'm doing a lot of product thinking about the future. So the two big risks were really losing your vision for the next thing when you do something big and that's always dangerous because one day you have to make sure that you are again innovating again, showing that you are the Challenger brand and not you were once a Challenger brand. And the second, the culture and that I'm still working on. It's challenging. It's really challenging. I have a great team, we have great people, but it's growing quickly. We're now if we take all our subsidiaries and the HQ, around 90 people. 90 people, that's.
- [52:46]
A
Wow, that's not insignificant. Yeah, I mean, talk briefly about that structure. And we're here in Needao at the
- [52:53]
C
headquarters at the HQ. And then we have about 40 people in the seven subs that we have around the world. So US, Japan, UK and then we have two boutiques, one in Zurich, one in Zermatt and the Singapore boutique. So those of course are all. And to make sure that everybody understands what are we doing. Yeah, so I try to really make sure that that DNA is, is there and tell them, hey, we're the Challenger brand. We're positive. When you have a challenge, challenge, bring solutions. Don't, you know, just be negative behind the scenes, go and proactively talk about it. I'm trying to keep that success formula that I think the first 20 people at Norikain we had when we launched the brand and now we're working hard to make sure that when we're 100 people that DNA stays in the company. So that's my biggest wish and that's what will make me most proud, is that if we can keep this culture in our company.
- [53:52]
A
But it sounds like, I mean, obviously it sounds like you delegated assigned responsibility for certain things to others and that's a big part of leadership and not trying to do everything yourself. Have you found a better work life balance since then or is that still an ongoing challenge?
- [54:12]
C
Still an ongoing challenge. But hey, I'm still young, my wife supports me so it's really good. I think the traveling, definitely on that end, I think that was also tough for me to not see the kids. So that's something that I'm happy that we managed to change. But yeah, it's always busy, but that's the way it should be. And of course, you know, at, at the end of the day, I think if you're passionate about something, you love doing it. And that's what I still have. I feel full of energy, like in 18, sometimes even more to be honest, because it's really tough when you're in that first, first and second year of a startup. I'm sure everybody knows who's been there. It's, it's just, it's tough and just holding that face and trying to show everybody that you're, you're strong and things are, it's really tough. But I think now, now I am, I'm just in a happy place. I'm proud of what we've built. So it gives me a lot of energy and I'm really excited to everything that's going to come.
- [55:09]
A
And last thing, I mean, you know, tell me what you can, just for our knowledge where you are on production, if you can, if you can disclose how many watches you're making, generally how you're doing in sales, are you able to grow? Sales is a very challenging market right now obviously. And, and how you're doing on the product profitability sign.
- [55:31]
C
We don't disclose the production numbers but it's going well. Despite the market. We're growing double digit growth this year, which I think in this market is a very, very, very good positive sign. Sellout Also positive, especially again US is very good. Switzerland very good. A bit slower this year in some markets in Asia. I think that's something that we read a lot but no, very happy with the development. But also I think it's pretty been a year where you all the brands had have to be a bit more careful. So we also, you know, we redid our budget I think three times this year because the tariff impact, because there are different impacts also in terms of marketing. I think it's the year where you can really, you know, focus on building the brand in healthy ways and hopefully our industry will come back strong. I feel like it's not far away. I feel, feel like 26 could be another not great year. But I'm very positive that a lot of brands are innovating. I see a lot of new things coming. I think the brands are also realizing we really have to level up the game and we'll do the same and hopefully people will love what we bring out in the next years.
- [56:45]
A
Yeah, very good. I mean you said you redid the budget three times. I mean I'm right to presume because certainly lots of brands that I've talked to, I mean it's lower production this year. You've reduced production, I presume.
- [56:55]
C
Yeah, I mean, I mean generally when we started the year, you know, every year we're growing at we had 50%, 40%, 30%. Those were all the years lately. So you assume that for production we're not there. So not in line with our budget but super positive, happy. I think that's what I mean. We're still a flexible company. So that's also strengths when you're a speedboat. I always say we're not this big boat yet. So that's speedboat which allowed us to adapt our costs a bit and will be a good year. But of course we're really hoping for some good news in the US and if not we'll adapt. We'll see how we plan and we're very excited because it's actually our 26th will be our last year before the anniversary. So we're going towards the 10 year anniversary. So yeah, we really have a great lineup for next year. And then of course 2728 is where
- [57:50]
A
we're lighting the fireworks with the product and news. Okay, interesting. So you really are working towards that 10 year anniversary.
- [57:58]
C
28 is planned, it's done. So yeah, that was also part of that vision game. Right. When you realize you're not talking about the future. I managed to really take myself out and we managed to do a whole plan till 28 and also you know with, with with Jean Claude who who luckily said I'm staying till 28 at least. So that's fantastic for us. And there were some important discussions to be held and they were done in 24 and allowed us then really to carve out the vision for, for 28 and there'll be some really exciting things coming coming from from Lorcaine.
- [58:31]
A
Fantastic. Well, thank you Ben Kufer and we wish you the best of luck and we thank you for your time.
- [58:38]
C
Thank you Andy. Great to be here and thanks to all of you for, for your support. Appreciate it.
- [58:47]
A
And that's the business of watches for this episode. We hope you enjoyed. Please head on over to Hodinky.com where you can join the discussion and leave any comments or questions about this episode or the business of watches in general. Who knows, we might even answer your question on a future episode. Thanks for listening and see you next time. Sam.