H. Moser & Cie might be the meteor which kills the luxury brand dinosaurs.

Did rebellious H. Moser & Cie just raise the bar for satirical guerilla marketing? I think maybe. Here’s why, and why it matters, even if you’re not into watches…

I think something amazing may have just happened. Even if you saw it, you probably didn’t really see it, because it may involve a subtle hoax that not everyone understands.

It may be a while before its full impact is felt. And I’m still trying to wrap my head around it enough to fully understand it. But if it is what I think it is, it may just be the most advanced act of satirical guerilla marketing ever committed.

And even if you don’t give a crap about the product involved – watches - the statement it makes transcends and crosses into just about every aspect of our daily lives in the modern, digitally-connected world.

For those not into watches, I’ll give a bit of background, then explain what happened, then try to make sense of it all.

Luxury ain’t what it used to be…

You’re probably familiar with the concept of “luxury brand” marketing, and like many people, there’s a good chance you’re “so over it”, for two good reasons.

First, the concept of “luxury” has largely become meaningless as the term gets applied to all sorts of affordable products and services, like $4 coffee and “premium” cable channels.

Secondly, as the disparity between the haves and have-nots continues to grow, the truly exclusive, ultra-expensive forms of luxury have become accessible to fewer and fewer people, leaving the rest of us to decide if we want to be jealous and angry about our implied unworthiness, or simply stop caring.

That’s what’s gone on in the Swiss watch industry, and within the market.

Changing the game by changing the terms…

The electronic age brought about the so-called “quartz crisis” of the late ‘70’s, requiring painful industry reforms, but there were two big ones which really saved the industry’s collective bacon.

The first was a deliberate move towards extreme specialization. 

Whereas watches were once made almost entirely from components produced under one roof (“in-house”, which has since become a dubious virtue, something watch-geeks like to argue over), the Swiss industry was split into companies which primarily produce components, and those which primarily do design and marketing of watches made with those components, the companies we know as brands. 

Specialization helped create efficiency, albeit at the cost of less transparency about the where, who, and how involved in watchmaking.

But the second and much more noticeable move was the shift from selling mechanical watches as reliable tools for telling time – i.e., a product for everyone - to heavily marketing them as luxury goods, an amalgam of old-world craftsmanship and wearable art.

And since the best way to communicate that a product is a luxury is through price, they started raising prices (a lot).

 

Source: Swiss Watch Federation's 2016 annual industry report

No longer just an object of consumption, they became worthy of curation. Suddenly telling time accurately became a secondary concern best left to the commoner (an inference which has made luxury marketing the butt of many jokes). 

 

Source: A Blog to Watch

Maintaining the allure of luxury branding requires demonstrating sophistication and elegance, by associating with celebrities and athletes, sponsoring sporting events, putting on red-carpet, black-tie affairs, and putting on a good show of supporting worthwhile causes.

“Accuracy” not only became relative, it was turned into a marginal side-show, a competition sport where increased accuracy came with increased cost and complexity – further reinforcing the idea of mechanical watches as “instruments”, rather than “tools”, something for highly-compensated professionals, not low-wage technicians.

More important than accuracy, which is simply a utilitarian function, were the intangibles, none more important than “heritage”, which sounds nicer than “an old company resting on its laurels, clinging to dwindling relevance”.

While there’s still a place for the avant garde in watchmaking, the bulk of luxury-brand sales come from designs which are over-glorified, retrospective retreads from a bygone era, marketed to paunchy executives with delusional visions of themselves engaged in some never-gonna-happen act of derring-do. 

  

They are tool watches re-wrought as luxury goods, as ironic as they are iconic, more likely to be stolen during vacation than broken on an excursion.

 

Something for me, nothing for you…

The Swiss luxury brands haven’t just been raising prices faster than the rate of inflation. That would be “normal” for most products and services, in order to keep up with rising prosperity in the developed world. They’ve been raising them faster than the rate of wage growth, making their products less and less affordable for more and more people.

 

Source, A Blog to Watch, "How and Why Rolex Prices have Increased over Time".

In fact, they’ve been raising prices even while outsourcing more of their production, mostly to Asia, and creating rules for the “Swiss Made” label which allow for most, if not all their parts to be made elsewhere, so that they could continue to trade on the perceived value of “Swiss” while decreasing the actual Swiss component of their products.

And that’s how it’s been, and what was working for the Swiss – right up until the bottom dropped out. 

 

Source: Swiss Watch Federation's 2016 annual industry report

Gross revenues (total sales figures) were on the rise for years, helping to mask the underlying problem – fewer units being sold, leading to today’s rampant talk of “over-production.” It’s not “over-production” that’s killing the industry, it’s simply over-pricing.

 

Source: Swiss Watch Federation's 2016 annual industry report

Those of us who haven’t been able to keep up with the runaway price hikes – and that’s most of us – have stopped buying, out of necessity.

We’ve switched to lower-cost quartz watches, more affordable mechanical watches from Asia (or the new crop of “micro-brands”, like mine), or worse – we’ve stopped wearing watches, instead relying on our mobile devices.

The irony with mobile technology is that now, of course, it’s given rise to the smartwatch, an ironic and ultimate “f**k you” to the increasingly out-of-touch elitists running most of the Swiss watch industry right into the ground. 

The smartwatch is more mobile device than time-telling device, yet it’s meant to occupy the same limited real estate, displacing the watch from the wrist, if there was even a watch there to begin with (and for many people, there wasn’t, because why wear a watch when your phone has the time?).

Hitting rock-bottom…

The Swiss industry has been feeling the pain of declining profits for at least half a decade now, as the economy has slowed, even in the hot spots.

 

Source: Swiss Watch Federation's 2016 annual industry report

Fewer people are buying luxury goods, and those people who are buying are increasingly interested in only the most expensive goods from the most exclusive brands, leaving all the other once A-list companies to scratch their heads and wonder what happened.

You’d think they’d realize what’s happened, and take dramatic action. We’ve seen some drama, for sure, but it’s been more train-wrecks than course corrections. 

Admitting there’s a problem is the first, yet often most difficult step in fixing things, and it often starts with an inner voice, initially ignored, yet inevitably impossible to deny.

That inner voice seems to be coming from an unlikely source, the “maison” of extreme-luxury, “haute-horology” watch brand H. Moser & Cie.

Can you hear me now?

I said at the start this isn’t just about watches, and it isn’t. The fact is that many companies are out of touch with the real desires of their customers. In far too many cases, they couldn’t care less, and like the Swiss, they won’t, until they feel the pain. 

They’ll continue to take far too many liberties, like technology companies using our devices to track our movements and life experiences, and listen in on our conversations, or fast-food restaurants doing away with smaller drink sizes, in order to addict us and our children to sugar.

The companies aren’t likely to be stopped by regulators. They’re just too powerful, and the regulations haven’t kept up with the times. We’re talking about moral and ethical offenses, not legal ones.

Likewise, it’s unlikely we’ll see real change brought about by market forces alone, because the market doesn’t speak with a single voice, and its actions are often subtle, only able to be seen at a macro-level, and only in retrospect. By the time an industry recognizes a trend, it’s often too late to do anything about it.

Enter Moser…

About a year ago, H. Moser & Cie made two public announcements. In late 2016, they announced they’d remove the words “Swiss Made” from their watches, as a means of protesting the ever-increasing use of non-Swiss components in watches bearing that label, and the ever-decreasing level of transparency about that label, and within the industry which tortures the language in their own self-policing documents.

As statements go, that one was received about as well as a loud fart during a quiet pause in the sermon.

But that statement was almost immediately followed by one which was either extremely bizarre, or savagely satirical, depending on your interpretation - they announced a one-of-a-kind $1 Million “Swiss Made” watch, made of genuine Swiss cheese.

 

It was clearly satirical, directed squarely at the Swiss watch establishment, and meant to drive their point home with all the subtlety of a sledgehammer. You’d be excused for not realizing they weren’t serious, given how far into the realm of the ridiculous the industry has veered.

You see, I believe HMC intuitively understands that most people, even most hardcore watch enthusiasts, really aren’t paying attention to anything the luxury brands are doing these days, because we can’t afford their products, and we stopped caring about what I've come to think of as "the jealousy industry".

Therefore, we were likely to completely miss their declaration about the weakening of the Swiss Made label, and since most of the industry – to include the industry press - is complicit in the crime, the statement required a bit of emphatic punctuation.

Hence, the $1 Million one-of-one Swiss CHEESE watch. 

Nothing says “luxury” more than spending seven figures to own something truly unique. Nothing is more “cheesy” than actual cheese. HMC’s initial statement calling bullshit on the industry suddenly became integral to the explanation of the cheese watch, a story which became viral, picked up by several news outlets, not just talked about in hushed tones, within the plush salons of the continent.

It stirred conversation, for a while, but even the giant Goliath wasn’t killed with a single stone. No, the stone only caused him to stumble, giving David the opportunity to deal the death-blow. 

And so it was that most of the industry, and the market, continued to stumble along, perhaps a little dazed, but alive. Unchanged, but not unfazed.

Goliath stumbles…

This past week, H. Moser & Cie seems to be taking another step forward, like David closing in for the kill.

With great fanfare (and a brutally savage video), they announced a new one-of-a-kind model to be auctioned off at SIHH later this month, the “Swiss Icons”.

It's an improbable mash-up of six of the best-known luxury watch brand’s most characteristic design cues, which is to say they created a Frankenstein-worthy monstrosity by combining the industry giants’ most over-used, least-creative features, the ones most closely-associated with those brands (Rolex, Audemars Piguet, Panerai, Patek Philippe, Hublot, and Girard-Perregaux).

I'm not saying it's the world's ugliest luxury watch. That would be too obvious. 

The stroke of genius here is that the they made a big, serious-sounding announcement about a new release, and shared a bunch of very real-looking images, of something which has all the most "iconic" elements of the most well-known designs, presented in a way the industry has conditioned us to think of as "tasteful".

It's as if they're daring us to criticize it.

And in fact, many people didn't criticize it. Many people in fact loved it. Many people have not yet realized Moser was most likely goofing on everyone in the industry, and all the sheep in the market. There are people online talking about why "it failed", as if it was meant to "succeed".

 

It just plays so deliciously well on so many levels.

The luxury brands have been churning out the same-old-same for years, diluting the mix with incremental changes and marginally different “limited editions”, all with throwback designs, all minimally distinguishable from the originals (at best), or (at worst), horrid, overly ostentatious caricatures of once-elegant classics, with exaggerated proportions and ludicrous complexity.

That’s when they’re not stealing each other’s ideas and raiding each other’s design departments. The journey of most industry-insiders mirrors the evolution of luxury-brand design – it’s all circular, and leads nowhere (for a lucky few, however, it’s more like pricing, where it’s always up, up, up, never weighed down by a lack of value or merit).

The industry press took immediate notice. The timing was perfect. The ultra-exclusive SIHH industry event takes place in mid-late January, so all the bloggers are on high alert for news out of the big luxury brands, which tend to use SIHH as the insiders-only, behind-the-velvet-rope pre-party to the bigger Baselworld event in March.

By “they took notice”, what I mean is it’s all they’ve talked about this week, and even if you’re a watch geek who doesn’t care what the luxury brands do, you’ve no doubt seen it, and heard the buzz.

But then, just days after their Icons announcement, HMC issued a retraction, saying they would not present the watch at SIHH...

Never mind?

HMC’s official statement reads as reverently apologetic in its tone, and yet their explanation seems demonstrably false, logically, given the clear jabs they took in their video, and their previously stated intent.

That's to say nothing of their history of turning the big-league industry events and surrounding press in on themselves, transforming what has always been a ridiculous spectacle of the lavish into their own personal theater of the perversely absurd.

I don’t believe they’re sorry at all. I think they got exactly the reaction they wanted, from the industry, the press, and from all of us.

Like many watch-geeks who can’t afford extreme luxury, the name of H. Moser & Cie is only memorable for me because they’ve become the ironic bourgeoisie hero of the proletariat, like rich suburbanites playing raucous punk rock.

They’ve earned my respect and admiration not for being watchmakers, but for being troublemakers!

And therein may lie the true genius of what they’ve done, for the fact remains that they are watchmakers, selling a product, with a brand name virtually unknown outside the world of haute horology, certainly nowhere near as well known as the brands they’ve lampooned.

While few of us may ever be able to afford, and may not even aspire to own an H. Moser & Cie, we all desire fair value in the products and services we buy, as well as appreciation and respect from the companies we buy from. 

HMC has perpetrated an act which combines capitalist self-promotion with civil disobedience, through self-referencing ("meta") social satire. 

They turned luxury marketing, the key instrument in the industry’s long downhill slide, against the industry itself, to stir debate, and bring about reform, while simultaneously improving their own prospects for commercial success in the act.

No, many of us will never own an H. Moser & Cie, but if the day comes that the industry reforms itself, and we all benefit from fair pricing, we’ll share in the fruits of HMC’s act of defiance.

And for that, we thank them.

Chris Vail is the founder, majority owner and lead designer for NTH and Lew & Huey, affordable watches which are not made of cheese.