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Frédéric Arnault, the 26-year-old CEO of TAG Heuer, has signed a far-reaching mega-deal to collaborate with Porsche – and he’s only getting started.
It’s difficult not to draw parallels between Jack Heuer and Frédéric Arnault. Both were in their 20s when they took the reins of the iconic watchmaker TAG Heuer (it was known only as Heuer until 1985), and neither waited long before radically changing the course of their company.
In 1961, Jack, at the age of 29, took over the business his great-grandfather created. He aggressively pushed forward the development of Heuer chronograph timing devices, began establishing sporting partnerships to increase brand visibility, and was at the forefront of technical development at the brand including the creation of the Calibre 11, the world’s first automatic chronograph movement that came into being in the Sixties itself.
Frédéric – the millennial son of world’s third-richest person, billionaire LVMH chairman Bernard Arnault – was appointed as CEO of TAG Heuer in June last year at the age of 25. But don’t conflate his youth with inexperience, or worse still, an inability to perform at one of the Swiss watch industry’s most coveted jobs.
Joining the brand in 2017, he has been the driving force behind the development of the Connected smartwatch – a seminal timepiece with which TAG became one of the first mainstream Swiss luxury watchmakers to go digital and take the fight to Cupertino (more on that soon).
But more recently, adding to his winning streak, in February this year, TAG pulled the covers off its latest collaboration with Stuttgart carmaker Porsche – a deep-rooted, multi-layered, long-term partnership that speaks to its pedigree – in what many saw as the scion’s power move that few expected at the time of a pandemic, and one that proved him to be a canny operator too.
“When I joined TAG Heuer three years ago, we reviewed all our partnerships and it quickly became clear that Porsche was the brand with which we want to form an alliance. When partnering with others, it is always important for us to have an authentic and convincing brand fit. With Porsche, this fit was recognisable at first glance,” says Frédéric in an exclusive interview with Emirates Man.
“We are both disruptors at heart. We have not only a common DNA in motorsports, we also share the same mindset.”
That mindset seems eerily similar in several respects. You can’t fail to recognize that both Porsche and TAG have products that go by the name of Carrera. The Heuer Carrera chronograph was named after the Carrera Panamericana road race, which was last held in 1954 before being discontinued. Interestingly, it was a Porsche 550 Spyder which won that last race.
Additionally, the Carrera Panamericana was also the inspiration behind Porsche naming one of its most iconic sportscars – and one that remains in production until today – as the Carrera.
Jack was an avid motorsport fan. He decided to name the chronographs after motorsport races, which explains why the square-shaped Heuer Monaco, the first square automatic chronograph wristwatch when it debuted in 1969, was named after Monaco Grand Prix. It can’t escape your attention that it was a Porsche which won that Grand Prix thrice consecutively from 1968-1970.
But the Heuer Monaco was immortalized when the swagger-in-chief Steve McQueen wore one on his wrist in the racing film Le Mans, while going hell-for-leather behind the wheel of a Porsche 917.
McQueen said that he was channelling real-life ex-Formula One driver Jo Siffert by driving the same the car as him, and stayed in character by wearing the same watch as Siffert too. Siffert was a prolific ambassador for Heuer. In exchange for CHF25,000, he added the Heuer logo on his racing overalls and car. He was also permitted to buy watches from Heuer at wholesale prices, and then sell them for handsome profits among his well-heeled racing colleagues. Not only was Siffert a Porsche racer, but he was also the official Porsche dealer in Fribourg, Switzerland.
Heuer’s and Porsche’s paths would, over the next few decades, intermittently bisect. In the mid Eighties, TAG Heuer collaborated with Porsche to develop the Tag-Turbo engine which was used in McLaren F1 cars that won two consecutive F1 championships with Niki Lauda in 1984 and Alain Prost in 1985. But both, TAG Heuer and Porsche looked beyond each other.
TAG has been associated with Audi, Nissan, Aston Martin and even Red Bull Racing. Porsche meanwhile developed its Porsche Design timepieces, and also collaborated with IWC, and then with Chopard for the FIA World Endurance Championship.
It was Formula E though that would once again unite Porsche and TAG Heuer two years ago. “Formula E gives us the chance to prove ourselves in a new environment and to develop new urban and digital target groups. We are proud to support – since their inception – exciting platforms such as the ABB FIA Formula E Championship,” says Frédéric.
“Formula E continues to gain momentum and fans all over the world and I think the series has developed greatly in recent years and offers the greatest competition among manufacturers. We started as a rookie with the TAG Heuer Porsche Formula E Team, but we have a goal of being at the top of the podium,” he adds, after the watchmaker became the title sponsor and the timing partner of the Porsche Formula E team in 2019.
TAG Heuer is the golden egg within the LVMH Watchmaking division, which also comprises of Hublot and Zenith. Bulgari is an LVMH owned brand, though its business does not directly operate under LVMH’s Watchmaking Division.
The watchmaking division is headed by Stéphane Bianchi, the former CEO of TAG. Bianchi led TAG Heuer for nearly two years from 2018, taking charge from the larger-than-life industry veteran Jean-Claude Biver, with the latter’s career in the watch industry spanning over four decades.
Frédéric’s management style will, in the short-term at least, bank on the combined experience of Biver and Bianchi. “It was special encounters that brought me here, especially with Jean-Claude Biver, with whom I keep in regular contact. He has a real eye for the product and communication. Bianchi has also brought me a lot in terms of management. During Bianchi’s tenure as CEO, we worked very closely together on all TAG Heuer topics. In addition, I was leading the Connected watch development as well as the digital transformation of the business,” reveal Frédéric.
TAG launched the third generation of the Connected smartwatch just before the first wave of the global lockdowns began to take effect last year. “Of course, traditional watches remain our main activity for the long term, but the Connected represents a new audience forming a relationship with the brand. We are still discovering new features and use cases, so the potential is very exciting. We’re seeing strong trends towards health and fitness at the moment, interests which we address with our new Connected and the TAG Heuer Sport app.”
Not only will the Connected be a major focus for TAG going forward, but for the clued-in Frédéric, overall business plans for digital transformation and e-commerce will be accelerated. “TAG Heuer pioneered e-commerce in luxury watchmaking back in 2015 and it is a strong driver for the business. We’ve since opened our online sales platform in nine markets with more underway, and it’s becoming an increasingly strategic area of growth. While a flawless boutique experience remains a cornerstone of our business, we see e-commerce as a very powerful complement, offering our customers a highly personalised, interactive and educational touchpoint with the brand – even more during the times we are currently facing.”
Frédéric will be looking East and West as he seeks to carve a larger footprint for the brand. “We have a great presence in the US…sometimes people think that we are an American brand. The UK, Japan, Australia and Korea are also important growth drivers together with Europe.
We still have to work on our presence in China. But we have great development ambitions for that region, particularly thanks to the launch of the new Connected Watch.” The
Middle East market in general, meanwhile he says, is an increasingly “fast moving market” for TAG, while Saudi Arabia specifically is a “very important market”.
In a region with overall high-capita income and greater disposable incomes, a smart partnership with a luxury automaker, can only further its cause.
To commemorate the new partnership, the watchmaker has launched the TAG Heuer Carrera Porsche Chronograph watch. There are two versions of it, one with a bracelet, and the other with a leather strap. Both the 42mm watches are fitted with a Calibre Heuer 02 automatic movement, and a grey asphalt dial above it. As Frédéric explains, the new timepiece is only “a first step and glimpse of what we could achieve together.”
To look at the partnership as a mere branding exercise where the Porsche logo would be featured over a couple of timepieces, iterations in different hues of which are released every few months, is a limiting exercise. As TAG is keen to point out, this is a multi-pronged partnership. Take for example, sport. The carmaker backs the Porsche Golf Cup and the Porsche European Open golf tournament – both of which TAG has now announced that it too would partner on.
As for tennis, TAG has said that it will also become the official timing, watch and chronograph partner of the Porsche Tennis Grand Prix in Stuttgart. On cue and in preparation for these new sporting partnerships, TAG announced in January that it was signing on world number three tennis star Naomi Osaka (it came days after Louis Vuitton signed her on as the face of Spring-Summer 21 campaign), and English golfing star Tommy Fleetwood as their latest ambassadors.
“We have dedicated a lot of research and effort this past year to refocus the brand on its core values and translating them into all areas of the business including a very clear direction for our choice of ambassadors. We want to count on personalities who have a personal link with the brand, are passionate about our products. In this perspective, we have restructured our contracts and continue to work with for example Patrick Dempsey as well as many friends of the brand locally, but others have been stopped,” says Frédéric.
Fleetwood’s addition to the roster of TAG ambassadors will ostensibly push forward the development of the Connect wristwatch. “Tommy will be working closely with the TAG Heuer’s Connected team software engineers in Paris and lending his professional expertise to further develop the TAG Heuer Golf app and enhance the overall player experience of the app.”
TAG’s partnership with Porsche is already cross-pollinating across events, products and ambassadorial ventures.
At 26, Frédéric has only to look at his family members, all of whom have top roles within the LVMH conglomerate, for inspiration on how to move forward. Alexandre was the ex-CEO of Rimowa and is now an executive at Tiffany; Antoine is the CEO of Berluti and chairman of Loro Piana; Delphine is the executive vice president of Louis Vuitton. “The way the group has managed to foster a spirit of entrepreneurship, independence and creativity for each brand, even if they are sometimes competing on the same markets, is remarkable.” When asked what were some of the lessons he has learnt from the family, he adds, “The desirability of a brand should be as strong now as in ten years.”
That desirability comes from peering into its lineage, though not overtly relying on past hits. “History is a great source of inspiration for us – but we are not a nostalgic brand,” explains Frédéric of the brand which turned marked its 160th anniversary last year. “We are focused on the present – such as with this new Porsche partnership.”
As for what comes next, he says, “You can expect real innovations from a movement perspective and drawing inspiration from automotive technologies from the Porsche world in the future.” It’s a cryptic, yet equally revelatory, statement of intent into the direction that he is driving the brand.
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