For Tag Heuer, smartwatch is ‘extra business’ beyond core

Bloomberg

As major events were getting cancelled across the US, and New York was banning gatherings of 500 or more on March 12, the Swiss luxury watchmaker Tag Heuer hosted a final shindig in honour of its new Connected Watch.
At the Caldwell Factory in New York’s trendy West Chelsea district, guests played with the new smart timepiece, which comes in four variations to retail from $1,800 to a steep $2,350—making it one of the most expensive, serially produced, connected watches on the market.
“The new Connected Watch combines high-performance digital experiences with our new TAG Heuer Sports App
and fine watchmaking,” says Frédéric Arnault, the company’s chief strategy officer and digital officer. “With the steel bracelet and interchangeable straps, the dynamic dial designs that are inspired by our mechanical watches, and the case design, especially with the ceramic bezel, it looks like you are wearing a mechanical watch.”
The Connected Watch—crafted in stainless steel or titanium—features a ceramic bezel that improves the communication for the sensors underneath to align with the app. In previous generations, a steel bezel interfered with the sensors, so the watch construction was a bit bulkier. The new watches are thinner and lighter in weight, as well as more ergonomically designed to fit the wrist.
They are also highly intuitive for the user because instead of being a total touch-screen device, functional crown and chronograph pushers are installed on the case side. They can be used to start and stop programmes, return to original menu screens, and more.
Tag Heuer, still a traditional watchmaking company focussed on mechanical watches, views the connected business as a new revenue stream, not a replacement for existing categories. “We continue to invest heavily in the mechanical watch space; it is what we stand for, and our core values are in the mechanical watch world,” says the 24-year-old Arnault, whose father Bernard is chairman of Tag’s parent company, LVMH. “The smart watch is additional business, and it increases our consumer base.” In fact, the connected watch business nourishes the mechanical business, according to Arnault: Some people who start with a smart watch go on to buy mechanical Tag Heuer watches.
While the Covid-19 coronavirus pandemic could slow initial sales as people delay big-ticket purchases, the Tag Heuer Connected Watch is a multipurpose purchase, especially with the Sports App that tracks not just walking, but jogging, running, and even golf. (A separate digital team was created in Paris to work on this app, created over the course of 18 months.)