On January 16 this year Bloomberg, the American journal, paid attention to Cartier, the jewellery maison owned by the Groupe Richemont. In an article by Dermot Doherty, Bernard Fornas, CEO of Cartier, is cited as stating that Cartier is gaining a lot of market share because bigger watches are losing a bit of ground and customers are buying more discrete timepieces such as models of the Ballon Blue collection (introduced in 2007). In uncertain times people go to the authentic brands and not to fashion brands.
And Cartier is authentic: Louis-François Cartier started his jewellery workshop in 1847 and Cartier was one of the first to make a wristwatch, for aviator Alberto Santos-Dumont in 1904. Also important: Cartier hasn’t diluted the brand by expanding into areas outside jewellery and watches.
Cartier may open 20 to 30 boutiques this year, adding to a network of 310 outlets. Fornas also said that about 5% of the watches sold are returned within the warranty period, below the industry average of 10-15%, but Cartier is aiming to reduce that to about 3%. He doesn’t want Cartier to be slowed down because of a lack of movements and a new plant is planned in Neuchâtel (Cartier has production facilities in Geneva and La Chaux-de-Fonds).
Rene Weber, an analyst at Bank Vontobel in Zurich, estimates that Cartier is responsible for almost half of Richemont’s sales and about 70% of earnings. Weber also estimates that about 45% of Cartier’s sales may come from watches, 35% from jewellery and the rest from accessories.
It is difficult to predict how the industry will fare in 2012, but Cartier is well-positioned to deal with bad periods in the luxury-goods industry and will benefit whatever happens, according to Bernard Fornas.
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