Baselworld rights its wrongs

When Baselworld opens on Thursday, it will be with a little over 500 exhibitors. That’s 150 fewer than in 2018. The scale of the decline becomes clear knowing that at its highest point in 2011, the fair packed in some 1,900 booths. Managing director since July 2018, Michel Loris-Melikoff had just a few months to rethink the concept for the show, which is evolving from a commercial event aimed at bringing in orders into a place for exchanging, discovery and communication. Among the new features unveiled this week are an exhibition, a Show Plaza events space, a Central Plaza for relaxing and dining, the Les Ateliers showcase for independents, and an Incubator for start-ups. While these cosmetic changes are certainly welcome, the real convincing needs to be done in another area: cost. Many of the brands deserting the show have cited extortionate costs and price gouging as the reason. Their complaints didn’t fall on deaf ears: one of the first measures from the new boss was to reduce exhibitor fees and sign a “code of good conduct” with local hotels.

So what happened? In July last year, Nick Hayek dealt a seismic blow when he declared that Swatch Group, the world’s largest watch group, was pulling out of Baselworld with immediate effect (Longines and Tissot had been part of the event since the very first edition in 1917). In the wake of this bombshell, news of further defections came down the wire into autumn. Following on from the dozens of brands that had already decamped in 2018 (including Louis Erard, Ebel, Movado, Eberhard, Dior, Fendi, Swarovski and Festina), Corum, Raymond Weil and Maurice Lacroix announced that they too were jumping ship. In among the announcements came news that René Kamm, CEO of MCH Group which owns the exhibition site and the show, was also resigning, just months after Sylvie Ritter had stood down from her role as Baselworld’s managing director.

Partnership with hotels

The task facing Michel Loris-Melikoff, who was called in from his position as director of MCH Beaulieu Lausanne, was daunting to say the least. He faced the twofold challenge of radically transforming the event to make it compatible with the digital age, and regaining the confidence of exhibitors who were tired of having their voices drowned out. Ever the communications professional, he was quick to repent: “All the exhibitors who left Baselworld did so for the same reasons and we know what those reasons are: cost per square metre, dissatisfaction with booth location, and the high cost of hotels and other services. We’ve reviewed these issues and are now working on bringing exhibitors back. However, this isn’t something we can achieve in one edition.”

One of the new director’s first initiatives was to negotiate a deal with hotels. Forty local hotels, representing two-thirds of the hotel capacity in Basel, have agreed to a maximum price per room category and are dropping the minimum stay requirement as well as the obligation to purchase additional services such as food and beverages. The fair is putting its own house in order, too. It has reviewed the cost of renting space and services, and revised contract terms. “We’ve reviewed our price structure and the length of contracts. Exhibitors are no longer prepared to commit to three or five years. They want to decide from year to year whether they take part.” These are sweeping changes, for which Michel Loris-Melikoff personally met with the interested parties. Already the new measures appear to be paying off: whereas last year’s show had no exhibitors from the sector supplying watch and jewellery brands, there are fifteen this year.

Independents welcome

This will be the first Baselworld to include a selection of watch industry start-ups. These smaller names previously set up shop in neighbouring hotels, or simply couldn’t afford to be in Basel during that week. Now they have their own Incubator; nothing fancy but designed to be accessible to young brands. Next-door is Les Ateliers, an area for smaller independent brands, further proof that Baselworld is rolling out the red carpet for this particular fringe of watchmaking whose dynamic outlook makes up for its limited production. This is all part of a plan to make the fair more attractive, and Michel Loris-Melikoff has stressed the importance of providing a more “personalised offering”. The new Show Plaza is another example. Located on the second floor of the main hall, it features clusters of seating around a stage where brands can show off their latest products. The possibility is of particular interest to the jewellery brands, several of which are organising catwalk shows during the week.

This changes nothing of the fact that the watch industry’s business model has changed significantly over the past ten years. Brands no longer wait for the big industry gatherings in spring to present their new products, preferring instead to roll out novelties throughout the year, helped by social media. Even so, Michel Loris-Melikoff is convinced of one thing: “If you want to meet an entire profession in one place, that place will always be a trade fair. The retailers and wholesalers I talk to all tell me they don’t have time to attend a different event every weekend. If all the brands start [organising their own event], the situation will become unmanageable. We have the unique advantage that we can bring everyone together in one place.”