The Man Who Transformed Breitling
The Man Who Transformed Breitling

In less than seven years as CEO, Georges Kern has transformed Breitling from a cumbersome, heritage-bound also-ran into one of the world's most successful and valued watch brands 

Georges Kern is one of the greats of the modern Swiss watch industry. After spending nearly two decades at the upper echelons of the Richemont group with brands like A Lange & Sohne, Jaeger-LeCoultre, and IWC (where he was the youngest CEO), he was roped in by the British private equity firm CVC Capital Partners in 2017 to revitalise the storied Swiss luxury watchmaker Breitling which they had just acquired. Famous for its iconic watches like the Navitimer, Superocean, Chronomat, and Avenger, Breitling, which celebrates its 140th anniversary this year, was then floundering under the weight of its unwieldy catalogue mainly targeted at an ageing demographic.   

 

Kern, with his rich experience, proved to be more than capable. He stripped away the frills, slimmed down the product line-up, and refocused the design, marketing, and distribution to make Breitling popular across a broad spectrum of watch buyers, particularly the young and the new while keeping the brand's heritage story intact. His emphasis was more on lifestyle than age. He was so confident in the strategy that he invested his own money in the restructuring along with the majority stakeholders. Success followed soon after. CVC, which had valued the brand at $900 million when it bought the 80 per cent stake in 2017, sold the majority stake in the brand in 2022 to the Swiss investment company Partners Group at a five times higher valuation at $4.5 billion.   

 

According to Morgan Stanley's latest annual report on the Swiss watch industry, Breitling's estimated sales in 2023 were close to $1 billion, elevating it into the list of the top 10 Swiss Watch brands for the first time. But Breitling’s recent success has come largely from its traditional markets of Europe and America, with the large Asian markets contributing very little. That is why Kern believes that the brand's best days are still to come as he pushes towards expansion in the fast-growing markets of India and China.   

 

Breitling India's revenues, for instance, jumped by a robust 40 per cent last year. Besides selling through multi-brand outlets like Kapoor Watches and Ethos, the company has, in the last year, opened two exclusive boutiques in Hyderabad and Chennai, with more to come in the months and years ahead. Kern was in Mumbai last week on his first trip to India in nearly two decades, where we caught up with him for an exclusive interview:  

 

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Kern sporting a variant of the iconic Breitling Navitimer Chronograph

 

Georges Kern is one of the greats of the modern Swiss watch industry. After spending nearly two decades at the upper echelons of the Richemont group with brands like A Lange & Sohne, Jaeger-LeCoultre, and IWC (where he was the youngest CEO), he was roped in by the British private equity firm CVC Capital Partners in 2017 to revitalise the storied Swiss luxury watchmaker Breitling which they had just acquired. Famous for its iconic watches like the Navitimer, Superocean, Chronomat, and Avenger, Breitling, which celebrates its 140th anniversary this year, was then floundering under the weight of its unwieldy catalogue mainly targeted at an ageing demographic.  

 

Kern, with his rich experience, proved to be more than capable. He stripped away the frills, slimmed down the product line-up, and refocused the design, marketing, and distribution to make Breitling popular across a broad spectrum of watch buyers, particularly the young and the new while keeping the brand's heritage story intact. His emphasis was more on lifestyle than age. He was so confident in the strategy that he invested his own money in the restructuring along with the majority stakeholders. Success followed soon after. CVC, which had valued the brand at $900 million when it bought the 80 per cent stake in 2017, sold the majority stake in the brand in 2022 to the Swiss investment company Partners Group at a five times higher valuation of $4.5 billion.

 

According to Morgan Stanley's latest annual report on the Swiss watch industry, Breitling's estimated sales in 2023 were close to $1 billion, elevating it into the list of the top 10 Swiss Watch brands for the first time. But Breitling’s recent success has come largely from its traditional markets of Europe and America, with the large Asian markets contributing very little. That is why Kern believes that the brand's best days are still to come as he pushes towards expansion in the fast-growing markets of India and China.

 

Breitling India's revenues, for instance, jumped by a robust 40 per cent last year. Besides selling through multi-brand outlets like Kapoor Watches and Ethos, the company has, in the last year, opened two exclusive boutiques in Hyderabad and Chennai, with more to come in the months and years ahead. Kern was in Mumbai last week on his first trip to India in nearly two decades, where we caught up with him for an exclusive interview:  

 

When you took over Breitling seven years ago, you brought about radical changes. Did you think that was a risky move that may have backfired as well?  

 

When I first met CVC, they were focused on cost-cutting due to our heavy investments and the expenses of maintaining a jet team. I explained to them that this wasn't just about cutting costs; it was about growth. As an investor, I had put a lot of money into this, embracing significant risks — my wife thought I was crazy! I had just been promoted, life was great, and I was financially successful, so I was prepared to take these risks, and so was my team.  

 

During my initial presentation to journalists, clients, and our team, there was a lot of scepticism. Many thought I would run the company into the ground. While our business had roots in aviation, I envisioned something different, a new direction. Often, it's hard for people to see the potential in things; they see an old house and can't imagine it being transformed. Initially, the vision was unclear, but after a few months, we began to integrate the old elements with the new, gradually bringing the whole picture into focus.  

   

What is it that you thought the market wanted, in terms of design and a success story? What are some things your team has gotten right?  

 

Breitling was a car driving in first gear — it had so much more potential. Using 140 years of history, we pushed for more classic watches, women's watches, and global reach. This is easy to explain. What’s difficult is to do it.  

 

As an aesthete, I don’t know any brand that has as many nice products as us. I also think we have the best image. The modern-retro style of our boutiques is unique and very appealing and our lifestyle, our communication and advertising campaigns speak to our customers. The only thing we are missing now is the awareness of the ‘new’ Breitling. Only 10 per cent of our target group knows the new Breitling. They all live in the old Breitling. Luxury is a process to build — look at the most successful fashion and luxury brands. It's not investments over two or three years, it's cumulative investments over 10 years and more that make it happen. However, we’ve cracked the top eight with just 10 per cent awareness; imagine what we could do with 50 per cent. This is why I’m so confident we can reach the top five.

   

Tell us more about the acquisition of Universal Genève, and your plans for the brand.

   

The idea behind it was simple—we can do it! We have a great team, great organisation, and excellent infrastructure. We plan to manage it differently, effectively incubating the brand. A similar structure allows us to offer diverse price points to our partners. As an independent group, our approach is distinct from traditional groups. Beyond a certain price point, you transition to another brand. Currently, Breitling’s price points range from approximately £5,000 to £20,000. However, with Universal, we could tap into a market ranging from £12,000 to £300,000. It’s a different market, like comparing different classes of cars, but under one umbrella.  

 

I consulted historians to find out which brand out there has significant appeal, and Universal Genève stood out. It has an incredible history, exceptional products, remarkable storytelling, and groundbreaking innovation. It’s akin to reviving Bugatti. There was immense competition for it, even from large groups. After we acquired Universal, the response was overwhelming. I've been bombarded with interest; every retailer wants it, and I've started holding collectors' meetings.   

 

Our biggest challenge now is managing the high level of expectations. People think that with Universal, success is guaranteed—that we’ll win decisively, like scoring four-nil in a football match.  

 

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Kern joins explorer and brand ambassador Bertrand Piccard on the Climate Impulse project: a record nine-day, nonstop, zero-emission flight around the world powered by green hydrogen to inspire climate action, due in 2028

   

You've been in the industry for 30 years, witnessing how changes in the nineties redefined the world of Swiss watchmaking. What are some significant changes that you've seen?  

 

The wake-up call for everyone, especially since COVID, is that independent brands are now more successful than those within groups. Breitling is the first private equity-owned company in this context, and we're doing very well. This success leads us to question what might be going wrong in other contexts and why some brands are not as successful, especially post-COVID.  

 

I'm confident that many brands within groups could be much more successful under another leadership model. A group isn't a deity; it doesn't guarantee success. A group is merely a collection of individual CEOs, who are more or less competent. 

 

So, what does being in a group really mean? It doesn’t inherently aid in success. There's no divine intervention in a group. You might have a slight advantage in negotiations, such as with landlords, but at the end of the day, if you're strong as an independent brand, they'll want you anyway. And if you, as part of a group, produce subpar products, they won't want you. Ultimately, it's performance and success that matter, not whether you're independent or not.  

   

Are you targeting a younger audience as compared to before?  

 

We don’t think about age, we think about lifestyle. It doesn't matter how old you are. The question is: Do you appreciate our lifestyle, or what we represent as a lifestyle? 

 

Today, customers first identify with the brand, then the design, and finally the technology. This is a complete reversal from 25 years ago when I started in this industry and technical features, and the movement of a watch were decisive. Now, the initial consideration is of the brand before anything else.

 

Where do you see yourself five or ten years from now? Are you going to continue with Breitling?  

 

If it remains a fun and exciting journey, now with an additional brand, why not? I believe that it depends on your personality. You have people who can spend their days living on the beach, and I'm not this type of guy. I like winning, but not just for the sake of making more money or just per se. I like winning against others.  

 

And that’s also the expectation I set for my team. We seek individuals who strive to win every single day. I don’t want them to be satisfied with past successes. Winning is enjoyable, and it's even more satisfying when others doubt you or expect you to lose, and yet you succeed again. With Breitling and Universal, we will continue to win.

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