Watch world: watches are making timely advances

After a couple of relatively dull seasons, the watch arena is perking up.

With new product offerings in the fashion category and more entries in the burgeoning bridge segment, watches should be a strong classification from fall through the crucial fourth quarter.

Besides obvious additions like an injection of color and more high tech functions, there is a notable turn toward seemingly disparate themes like retro, modern or feminine, fine jewelry looks. While this sudden broad array of product may initially overwhelm retailers, in the end, buyers have a unique opportunity now to reassess assortments and add some punch to their presentations.

Bridge is among the most important areas to focus on. There, vendors are banking on a scenario similar to what took place several years ago in jewelry: Sterling silver took off in stores and has now earned a permanent place in jewelry departments. With consumers upgrading the quality of their accessories purchases in general, fashion vendors are starting to place more focus on improved movements and original details and styling, rather than the stock cases, bezels and bracelets that were previously seen ad nauseum across many brands. The result is an influx of names with a fashion following, at a price point in an area known more for stodgy brands with little fashion impact.

“In our [Guess] Collection line, we’re filling a void for watches priced in the $115 to $300 range, that also offer a look not seen in fashion watches,” said Cindy Livingston, president of Callanen International, who pointed out the dearth, until recently, of any quality, branded watches between the fashion and fine areas.

“The reaction to unique details has resulted in such tremendous sell-throughs that we’re moving into an even wider assortment for the third quarter and beyond,” she said. “We will have bridge presentations in about 250 doors by the end of this year.”

At Ecclissi, the strategy is to maintain what is considered to be a leadership position in the bridge area, according to president Robert Elizondo, who recently moved most of his firm’s operations here from its longtime base in El Paso, Tex.

“There’s no question that we’re increasing our product development efforts,” said Elizondo. “We needed access to more talent and suppliers to maintain our status as one of the first with sterling silver and the broadest assortment. Stores need to be able to choose from a large number of sku’s, which we provide. Now, we’re trying to address a wider range of price points and give many buyers an opportunity [to carry the brand].”

Ecclissi’s wholesale price range has been broadened to $50-$200 from $100-$170. Elizondo said the new products should give retailers gains of “at least 10 percent.”

“We’re seeing gains of over 30 percent through a mix of same-store sales and an expanded number of doors,” he said.

Jewelry designer Alejandro Toussier is launching his first collection of watches this month, hoping to build on recognition garnered from his bridge jewelry line and satisfy a longtime passion.

“I’ve collected vintage watches for years,” said Toussier. “And when my [jewelry] customers started asking for watches, it gave me the push I needed to give them a try.

“But I wanted to offer strong design and quality for half the price, making pieces that were comparable to those retailing in the $800 to $2,000 range.”

Toussier’s debut collection features about 155 styles, some with a distinctively retro feeling, while others are clean and contemporary. All have Swiss movements and cases with Italian or French bracelets and straps. They retail from $350 to $850.

Vendors sounded a note of caution about the potential success of bridge watch departments, however. They stressed that stores must be committed to merchandising, display and especially professional sales staffing capable of selling better watches.

The concern is so great that some firms — like Alfex of Switzerland — are limiting their distribution while waiting to see how retailers handle bridge before getting too involved.

Alfex currently only sells to Neiman Marcus and Saks Fifth Avenue because they are among the few retailers that have demonstrated the ability to sell bridge watches, according to Dan Bogue, director of sales and marketing at Alfex.

Meanwhile, the fashion segment is getting behind novel bracelet treatments, smaller scale and more feminine looks and new takes on sport watches.

“There are a lot of sleek, contemporary influences coming out of Japan and Asia now, and silver looks are still a definite trend,” said Callanen’s Livingston, referring to straps that are half bracelet, half bangle and often paired with rose or mink-colored faces.

Besides Callanen’s Guess brand, these looks are available from numerous other resources and will be seen increasingly as the year goes on.

At Anne Klein II, vice president Tammy Bernstein said the firm sees “a big trend for a bit more dressed-up lifestyle,” presenting a big opportunity for the brands’ classic ladylike looks. In fact, the company will launch Anne Klein II Classics — a series of signature styles featuring small-scale, fine jewelry-looking watches — at the end of May.

Bernstein said while sporty looks remain strong for the firm, “chunky sport has peaked for us.”

“Women now want simpler, more refined details in cleaner looks,” she added.

CK Calvin Klein is building on the minimal line launched last November with evolutions of its initial styles, “very graphic, active and sleek pieces,” that aptly represent Klein’s minimalist view, according to a spokesman.

The new pieces feature rubber straps where the holes are hidden, except for the one punctured by the wearer for the correct tightness. The watches are unisex, and the rubber is similar to the material used on the stopper of the designer’s CK Be fragrance, sending a strong, consistent message to consumers about the CK brand.

Also focused on maintaining brand image with the right product is Genender, which has laid out distinct characterizations for its Perry Ellis, Levi’s and Dr. Martens lines.

“Many fashion watches have strayed from their brand soul in an effort to maximize distribution,” said Ken Genender, president and chief executive officer.

The Perry Ellis line has an almost Fifties sensibility, with classical styling; Levi’s and its Silver Tab line are distinctly American and individualistic, with a Sixties flair, and Dr. Martens is the edgier, metal-trimmed street line.

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The Guess watch line is reaping benefits from its new link with Timex

Callanen Group Inc, which produces Guess brand wristwatches, is becoming a force in the fashion watch world. The Guess line is one of the three most popular watch brands in US department stores and contributes 85% to Callanen’s sales volume. Wholesale volume is expected to be over $70 million in 1992, an increase of 33%. Timex Corp acquired Callanen, contributing technical expertise to improve watch quality and production capacity, although Callanen operates as a separate unit. Timex is also helping to fulfill Callanen’s desire to expand the scale of its overseas distribution.

The Guess brand name is getting as well known on the wrist as it is on then rear.

The licensed fashion watch line, produced by Callanen Group Inc., has turned into a powerhouse, generating sales upwards of $60 million wholesale this year.

Eight years ago Mickey Callanen, who was an executive at Monet Jewelers, decided to start a watch firm and launched the Guess collection. Since then, Guess has emerged as one of the three leading watch brands in department stores (the other two being Swatch and Fossil.)

The success of Guess watches has captured the attention of many, including Timex Enterprises. Timex purchased Callanen Group, Inc., the firm holding the license for Guess watches, last October.

Callanen, who continues as president of Callanen Group, said the firm’s volume will be over $70 million wholesale in 1992, a 33 percent volume gain. He said 85 percent of the volume is done with Guess and 15 percent with the two-year-old licensed Monet watch line.

While Callanen continues to operate independently from Timex, it’s already gaining benefits from Timex’s experience.

It was propitious timing when Timex expressed interest in Callanen Group, because, Callanen said, he was exploring the international market for distribution.

“It’s very hard to find good distributors overseas,” said Callanen, “and with Timex’s strong relationships around the world, I felt they could do nothing but help us.”

While he would not disclose the terms of the acquisition agreement, he said: “Timex paid a lot of money.” In the agreement, Callanen has a contract that keeps him in charge of the company for eight more years. His partner, Bud Polley, remains vice president, sales.

In addition to helping Callanen establish relationships with distributors overseas, Timex is improving the quality of Callanen’s watches. Callanen said when his new manufacturing facility opened in Hong Kong, Timex sent its engineers over to improve quality, and they brought the production capacity up 38 percent.

“Other than that, though, it’s like Timex is not around,” said Callanen.

Michael Jacobi, executive vice president and chief operating officer of Timex, said his firm was not looking to manage another company, but to acquire a firm with a strong existing management team.

“We are a lean corporate organization that can’t absorb companies within our management structure,” he said. “We kept Callanen’s management and company culture the same.”

Jacobi said his firm has been considering acquiring several watch firms because it wanted to strengthen its distribution in department stores. Including the Callanen brands, Timex has 11 watch brands.

Now that Callanen has Timex’s connections, the firm is aggressively going after international distribution.

“Huge growth will come from overseas business,” said Callanen. “It could be 35 percent of our business in one to two years.”

Callanen started its international distribution nearly two years ago in Australia through a Sydney-based distributor. Callanen said the firm will sell 100,000 units of Guess watches there in 1992.

A year ago, he started selling Singapore, Malaysia, Hong Kong and Korea, and last month shipped to Canada, England, Portugal, France and Germany.

“I don’t see any stores overseas that devote the kind of space to fashion watches that U.S. retailers do, with the exception of Galleries Lafayette,” said Callanen. “There’s a big business out there.”

Paul Marciano, senior vice president of Guess Inc. said Callanen does more volume with Guess label than any of his other licensees, which include fragrance, shoes and legwear among others.

“It’s Mickey’s devotion, personality and energy that has helped make this line a success,” said Marciano.

Callanen attributed a lot of the success of Guess watches to the fact that new merchandise is continually introduced. But he also said he is just in a good business.

“The consumer sees fashion watches as wonderful value for their money,” said Callanen. “In addition to being fashionable, watches are a commodity.”

Joanne Hart, fashion director for Macy’s East, said, “Guess has been phenomenal for us. The name is very recognizable and the styling is great.” She noted the chronograph, scuba and animal-print strap watches are among the top sellers.

Callanen is based in Norwalk, Conn., and all production is done in Hong Kong, where the company employes 17 designers.

The Monet watch line has been slower getting off the ground, Callanen noted, because it’s a narrower focus featuring mostly chain looks.

He said the biggest direction in watches is sport.

“Sport watches are moving the average unit sale up in the fashion watch department,” he said, noting the average Guess watch had sold for $52 retail last year and now it’s $68,

Callanen said he would consider adding more watch brands, “if they made sense with our mix and did not conflict with existing lines.”

He is as enthusiastic about the business as ever and has no plans to leave the company that he started out of his garage. “I am having too much fun to leave. I can’t imagine doing anything else but this.”

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