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April 9 sees Hermès’ “most important launch” of a women’s watch line in more than a decade, according to Laurent Dordet, chief executive of Hermès Horloger. The Hermès Cut, being unveiled at the Watches and Wonders show in Geneva, is the French luxury house’s first mainstream women’s line with an in-house movement and, as a daily steel sporty watch, fills a gap in its range.
The brand hopes The Cut will replicate the success of its first sports watch, the H08, launched in 2021. Dordet calls that Hermès’ first “volume success” for a watch targeted at men. The design, by Philippe Delhotal, creative director of Hermès’ watch division, combines a circular face with an almost square case.
The model is “very recognisable”, says Oliver Müller, founder of watch industry consultancy LuxeConsult. “The H08 is going to make it as one of their iconic watches that will grow the volumes at quite a high average price, and that will push up the rest of the watch collection.” Until now, however, there has not been an equivalently strong product on the women’s side, he points out.
Delhotal has played with geometry again for the new watch case by creating what the brand describes as “a circle within a round shape”. There are four Cut designs: steel or two-tone steel and rose gold, each with or without 56 natural diamonds on the bezel.
Historically, the majority of Hermès’ watch customers have been women, although Dordet says the balance is shifting towards a more equal gender split. Women account for about 20 per cent of H08 buyers.
“We definitely wanted to propose a smaller-diameter watch on the same functional segment [to the H08] . . . to talk to this category of feminine clientele that are looking for that kind of watch,” he explains.
The launch comes on the back of sustained growth for Hermès’ watch division and is part of a long-term strategy of pursuing mechanical watchmaking.
Sales, excluding Apple Watch bracelets, increased 23.2 per cent at constant exchange rates to €611mn in 2023, according to the company’s latest annual report. The watch division’s sales overtook those for perfume and beauty products in 2022.
Last year, Hermès ranked 16th among Swiss watchmakers by sales, according to the annual industry report by Morgan Stanley and LuxeConsult, ahead of brands including Tudor and Panerai. The research found Hermès’ 13.8 per cent increase in sales, in Swiss francs, in 2023 outperformed the wider Swiss industry, which achieved a 7.7 per cent rise in exports in the 12-month period.
The report attributed Hermès’ growth to factors such as increased desirability of the brand and watches providing “a gateway” to its sought-after bags, including the Birkin. Customers spent on non-leather goods to boost their chances of being among the first in line to buy a bag.
Hermès’ annual report hailed the H08 as a “great success” but, while that line helped increase sales, Dordet also cites the return of travel retail and the “growing confidence” of in-store staff to convey the “technical and emotional” messages of its watches.
The house acquired a 25 per cent stake in movement manufacturer Vaucher Manufacture Fleurier in 2006, introducing the mechanical movements H1912 (used in the Hermès Cut) and the H1837 (in the H08) in 2012, which has allowed it to produce more technical pieces.
Part of the “daily fight” is building Hermès’ reputation as a watchmaker, says Dordet, who has led the watch division since 2015 but has been with the company in other departments since 1995. Watches are one of the house’s 16 product categories, and it has participated in Watches and Wonders since 2018. Its booth this year features an installation by American artist Erin O’Keefe inspired by the Cut, with colourful sculptures that aim to challenge perceptions of shape, time and space.
Among the brand’s higher-price launches at the fair are two new limited series white gold Arceau Chorus Stellarum designs including champlevé dials with engraved and hand-painted appliqué inspired by a scarf from the Hermès AW22 collection. Müller says the brand has been focusing on high-end watches featuring special handcrafted dials. “That’s a good way to differentiate yourself,” he says. “It wouldn’t make any sense trying to compete with the established watchmakers. Hermès has to differentiate itself by doing watchmaking the way it does everything else: it’s chic, understated, discreet, but you recognise it’s Hermès.”
Hermès makes fewer than 80,000 watches a year. Dordet says a potential barrier to growth is that a watch is not typically a product someone buys every year, so it will “have to recruit a lot of new customers”. He says, however, that Hermès’ investment in its distribution network and the expansion of existing stores means there is more space for watches. The company reopened a renovated and expanded shop in Kuala Lumpur last month.
But how far can Hermès Horloger climb? Can it become one of the top 10 Swiss watchmakers by sales? “I think the question is when,” says Dordet. “We are not arrogant . . . But, yes, we have potential. Is it top 12, top 10, top whatever? I don’t know.”
Müller expects the brand to double its sales within a decade or so. It is “not impossible” Hermès can join the top 10, he adds — although he thinks it will be tough because other watchmakers are also performing well. “But [Hermès is] growing fast,” he says. “We’ll see.”