America Tuesday, October 18th 2011
Mexico City was the venue for the 5th Salón Internacional Alta Relojería fine watch fair, where an enthusiastic public, more exhibitors, and widespread press coverage proved that Latin America is a force to be reckoned with in global luxury.
This year, 27 CEOs were here to represent their brand © Manuel Palos
When Christian Selmoni, Vacheron Constantin's artistic director, said it would be "a big mistake to focus only on Chinese customers," he was speaking for many of the executives at the 5th Salón Internacional Alta Relojería (SIAR) in early October. For many brands, the fair is an open door into Latin America, and the American market as a whole. "I don't think even Las Vegas is this impressive!" Giuliano Mazzuoli confessed. The Italian designer of the curious Manometro and Contagiri watches came to the SIAR with the aim of launching his brand on the Latin American market.
Joining Mazzuoli in Mexico were independent brands including Ladoire, Ellicot, Bell & Ross, Cyrus and De Bethune, together with established names such as Cartier, Audemars Piguet, Montblanc, Piaget, Baume & Mercier, TAG Heuer, Zenith and Hublot, who also took advantage of the event to launch products or simply present their new models to a Mexican audience and, by extension, the entire continent.
Latin America outshines the slowdown
"We've already made contacts with a number of retailers in the region, which we weren't expecting. Our aim was to consolidate our presence in Mexico, but I think we'll achieve a lot more than that," Charris Yadigaroglou, head of communication at MB&F, declared. This new name in Swiss fine watches chose the SIAR for the world premiere of its Legacy Machine N°1, launched in parallel with the Singapore watch fair that was held over the same dates. Mexico is the region's biggest market, but brands have their sights on the entire continent, particularly as Europe struggles through a sovereign debt crisis, political polarisation in the United States becomes stronger, and China feels the weight of inflation and comes under pressure from the European and American central banks to revalue the yuan.
To add fuel to the flames, over recent months gold prices have reached an all-time high, and the Swiss National Bank was forced to intervene to rein in a strong franc which was affecting the country's exports. In these circumstances, companies need to act fast, sell, and diversify. "I'm a very moderate entrepreneur," confessed Richard Mille, who was also in Mexico. "I try to balance sales evenly per region: 30% in Asia, 30% in Europe, 30% in America. It would be a big risk to rely too heavily on the one market. Were I so inclined, I could sell every watch I produce to Asia, but that wouldn't be a smart move."
A growing number of reports also point to the continent's continued growth in the years to come. The 41st World Economic Forum in Davos confirmed this view and announced that the region should soon offer a sound alternative to the Asian powerhouse. Figures point in this direction too: the International Monetary Fund forecasts that the region's GDP will gain 4.5% in 2011 and 4% in 2012.
François-Henry Bennahmias, President of Audemars Piguet North America, views the situation from the standpoint of a brand with considerable experience of the region. "For years, there's been a tendency to underestimate the Latin American market. Brands came late to these countries. Only in the past two to three years have they started to realise the potential here. This may be why Audemars Piguet is a leader in the LatAm luxury market. This year we've sold close to 1,500 watches in China… and 3,000 in Latin America!"
A hedonistic consumer
Interest in the event among both the public – attendance topped 2,500 – and the media (369 accredited journalists) boosted the number of exhibitors at this 5th fair. Latin Americans are, it would seem, watch-crazy. "Latin America has a different history to Asia. There has been no successful Maoist revolution. The Latin American consumer is a pleasure-seeker. The president of Mexico, Porfirio Diaz, owned one of the most stunning watches by Girard-Perregaux, the Esmeralda, a tourbillon under three gold bridges from the late nineteenth century," explained Carlos Alonso, director of the SIAR and founder of Tiempo de Relojes, a pioneering Latin American watch magazine. "Vacheron Constantin opened subsidiaries in Sao Paulo and Buenos Aires before London. Now history is repeating itself. The mature markets are in the doldrums, and consumers in Europe and the United States are no longer investing as readily in luxury as the Latin Americans are."
Latin America's political stability over the past two decades, the rise of democracy in virtually every country, and economic adjustment have largely contributed to this glowing state of affairs. Says Carlos Alonso, who has over 20 years' experience in journalism and business in Mexico: "This year, 27 CEOs were here to represent their brand. They couldn't dream of a better showcase for their products. They all agree that after the SIHH in Geneva and Baselworld, the SIAR is the foremost regional event. Another advantage of Latin America is that, unlike Asia, wealth has been around for a long time and the affluent classes adore fine watches. Families are accustomed to travel and to purchasing from the finest jewellers. Remember that in America, seeds quickly take root." Which for watchmakers brings the promise of excellent harvests to come. ■