Luxury Watch Brands Designing for Security
New York Times, December 11, 2008
NEW YORK — NEW YORK: At a lunch with the president of Rolex Hong Kong, Doug Bradstreet, watch buyer for Wynn & Co. Watches in Las Vegas and Macau, could not help but notice the flashy Rolex Milgauss on the wrist of the busboy clearing dishes from their table. Neither could the president.
"He stopped talking and apologized for being distracted," Bradstreet recalled. "They take it very personally."
It did not require presidential expertise to determine the "it" in question was what watch enthusiasts euphemistically call a "Fauxlex," one of the estimated 40 million fake timepieces circulating in the market every year - a figure all the more impressive given that Switzerland exported just under 26 million timepieces in 2007.
More sobering, however, is the fact that vast improvements in the quality of counterfeit watches - which can now cost upward of $2,000 and feature none of the shoddy workmanship, misspellings and lightweight metal that singled out their predecessors - have made it much harder to distinguish fakes from the real thing.
One high-end brand, Vacheron Constantin, thinks it has a solution. In October, the watchmaker rolled out the Quai de l'Ile collection, named after the Geneva street where it has done business for most of its 253 years. The watches are available in up to 400 customizable variations and range from $29,900 to $60,000, depending on the customer's choice of a model in titanium, pink gold or palladium. Protected by multiple advanced security printing signatures, they are being touted as invulnerable to counterfeiters.
"It's an important part of our identity to create a product that includes the maximum level of protection for our clients," said Christian Selmoni, product marketing director for Vacheron Constantin. He said the brand was not particularly vexed by counterfeiters, but the pace at which fakes had improved in quality had inspired them to create a watch employing state-of-the-art anti-counterfeiting technology.
By passing a magnifying glass over the dial, Selmoni said, it is possible to discover a hidden world. One part is made of sapphire crystal that has been laser engraved, embossed and galvanized with numbers and micro-lettering. Beneath it lies a sheet of polymer marked with inks visible only under ultraviolet light, and subtle Escher-like graphics created by Roger Pfund, a Swiss painter who has spent 40 years designing passports and international currencies.
"It was an old dream of mine to contribute some know-how to watchmaking," said Pfund, who is a friend of Vacheron Constantin's chief executive, Juan Carlos Torres. "We used our shared creativity to make a decorative pattern on a dial which is not only beautiful but also very useful; we designed a dial that is secure."
That someone with Pfund's security expertise has been asked to address counterfeiting in the world of haute horlogerie reflects the degree to which it has harmed the business - if not in sales, which, despite a looming downturn, are expected to exceed 16 billion Swiss francs, or $13.3 billion, this year, then certainly in image.
Rolex shoulders the brunt of the problem, not because it lacks controls, which are among the best in the industry, but because it makes the same coveted models year after year, drumming up the global demand that is the counterfeiter's call to action.
"Counterfeiting remains a big preoccupation for the Swiss watch industry and the Internet contributes to its evolution because you can order fakes from home, you don't have to go to Shenzhen or Bangkok," said Jean-Daniel Pasche, president of the Federation of the Swiss Watch Industry.
While some watches sold online may be genuine, none is authorized - no major Swiss watch brand has a primary e-commerce channel - which means that buyers have little recourse if a timepiece requires after-sales service or proves to be forged.
"You're more at risk if you're shopping on the Internet and trying to find the lowest price," said Paul Boutros, a New Jersey collector. "For $400, you can tell right away" that a watch is a fake. "It's the ones that sell for $2,000 that are very dangerous."