Interview: François-Henry Bennahmias CEO of Audemars Piguet
By Russell Sheldrake
Audemars Piguet has been around since 1875. However, sitting in the office of François-Henry Bennahmias, the French CEO of the brand, you would be forgiven for thinking you were in Manhattan or Silicon Valley, rather than the Vallée du Joux. Surrounded by signed boxing gloves and pictures with Heads of State and celebrities, this is where Bennahmias has been directing the company for the last eight years, with his distinctive charisma and presence.
Formerly a professional golf player who then transitioned into the luxury space, he has been with Audemars Piguet for close to three decades, representing the brand from the United States to Singapore and Brunei. Since taking the helm of the company, he has presided over impressive growth in the brand’s global recognition, as well as a growing understanding and respect for its heritage. He has always done this under the guiding words of Yoda, the Star Wars character, of which he has a figurine in the office, “Do or do not. There is no try.”
We got the opportunity to spend the day at the Audemars Piguet manufacture in Le Brassus, sitting down with Bennahmias, who shared his thoughts on the past, present and future of the business. Whilst there, we visited the new Museum, as well as the archive department, handling some of the special pieces from the brand’s 145 year history. Certainly worth the two weeks of quarantine upon return, it was a trip to remember.
How has Audemars Piguet changed since you first joined?
When I arrived, we were 200 people. There are 2,000 of us today. In 1994, we were predicted to make about CHF 70 million. We have reached over a billion now. At the time, we didn’t have any subsidiaries. We would just walk around with a suitcase full of watches and show them by hand! Many of the buildings you saw on your way in hadn’t even been built yet [Laughs].
[Laughs] Seems like things have moved on since then…
Well, it was a small family company. The first big changes were done in 2000. Why? Because in 2000 we sold the 40% stake that we had in Jaeger-LeCoultre to Richemont.
How did that change things?
Selling our stake gave us a range of new opportunities. We had several distributors and we gradually bought back the markets one by one. Our turnover didn’t rise at first because we increased production. But our business has grown since, thanks to the shift from wholesale to our current retail strategy with fewer multi-brand retailers.
Consolidating your business?
Yes, the story of the last few years is about consolidation. We wanted to be able to take care of products, from the workbench to the client’s wrist, while connecting directly with end clients and learn from them. This is the real evolution of the company. We were making 15,000 or 16,000 watches when I arrived. Last year, we produced 40,000 units. So, we are still focusing on small volumes. Despite that, in the last 8 years, we’ve moved from CHF 500 million to CHF 1.25 billion in turnover. Not many brands do that.
Especially now, the proximity with the customer must feel important…
More than ever. This is crucial.
'When I arrived, we were 200 people. There are 2,000 of us today...'
Is that part of the logic behind the different AP Houses which have sprung up?
We noticed that many customers don't go to stores anymore. On top of that, the rent is so expensive that some of our stores aren’t big enough to welcome people the way we want to. We also realised that there are many people who buy watches outside the retail environment. And that’s why we opened our first AP House. The brief was simple. If Jules Louis Audemars and Edward Auguste Piguet were 25 years old today, what would the business look like? They would always make their watches in Switzerland, of course, but they would probably have apartments and houses all over the world, in Hong Kong, Singapore, Tokyo or Munich for example.
How did the concept evolve?
We imagined the AP House concept as a home away from home, in these major hubs to get closer to end clients and offer them exclusive experiences. Our AP Houses don’t look like shops at all. You don't see many watches. People go there for breakfast, lunch, a baby shower, a wedding anniversary, etc. And then sometimes, watches are presented to them. We noticed that customers on average stay three times longer in our AP Houses as a result.
What do you feel is the most beneficial aspect of this relationship? Is it to better understand the customer, and then maybe even reinvest that knowledge into product development?
Yes. When we weren’t in direct contact with clients, we didn’t have access to their opinion on the brand or to their needs and desires. But these customers have a voice. They say yes to this, and no to that and we do listen. Listening doesn't mean we're going to do everything they're asking for either, but it enriches our thought process. And let’s not forget that if we had organised a focus group on the Royal Oak in 1972, the watch would never have been launched! Same thing in 2019, for the Code 11.59 by Audemars Piguet, it also would never have come out if we had!
Recently, you’ve obviously pushed into new physical spaces, from the Houses to the Museum. How do you see the manufacture existing in the digital space?
For me, selling online is not an end in itself at all. We are not going to sell 20,000 watches online in one day and we don’t want to. This is not what matters. But dematerialising retail, yes please!
What do you mean by that?
We don’t necessarily need four walls to sell watches. I could sell you a watch here, but I could also sell you a watch anywhere, on a golf course or at a restaurant. There is a monumental job to be done, but we are going to return to the primary profession of the salesperson. A salesperson is not only that. He or she is also an ambassador, a friend, an advisor and much more. I think we'll get back to that, and use digital tools as support. We’re not inventing anything new, it’s not a 30th century strategy.
It's about doing the same thing through a different medium…
Yes, and above all to take healthy precepts. Nowadays, people throw everything away. As soon as the iPhone 6 came out, it was over for number 5. There is no attachment to things. On the other hand, people still value history, where the item comes from and whether a thing has substance or whether it’s pushed by bad marketing. In that sense, there is a phenomenal card to play here, because we can leverage digital media to tell a truthful story about our brand. But we also have to talk to each other in real life. I can't build a true relationship only behind a screen, I have to see you in front of me at some point.
And the message you’re putting out stays the same?
The brand hasn’t changed. Not at all. The only thing is that it’s been defined much more clearly. We asked ourselves, what is our “Why?” For this “Why?” to make sense, the customer who buys the watch needs to be able to give the exact same answer as the reason why you made the watch. Our “Why” is “We foster human talents to create the extraordinary”. It took one year of work to get to this sentence! It's not a tagline, it's a motto. This is the “raison d'être” of the company.
'And let’s not forget that if we had organised a focus group on the Royal Oak in 1972, the watch would never have been launched! Same thing in 2019, for the Code 11.59.'
What are some of the instances in which this human talent has proven itself?
There are watchmakers at AP who decided to work on new watches without being told to. The boss at the time knew this approach was successful and fostered this sense of autonomy and creativity. AP’s modern perpetual calendar, which helped the brand survive in the midst of the Quartz Crisis, was created by watchmakers without their boss knowing about it. And today, our steel Royal Oak Open-worked Double Balance Wheel model was yet again made by watchmakers, without running it past me at first! They came to me later and said, “boss, we didn't tell you, but we worked on a new movement”, “Who is we? How many are you?” I asked, “Uh, we're ten, boss.” And now the watch is an absolute success. Everyone wants it, but I wasn’t the one who asked for it. It was created by them.
And you like this slightly deviant approach?
I do! I’m like that myself. I don't have any diplomas. There are a lot of things that I haven't learnt, but that doesn't stop me from running the company. All this to say that you don’t have to be confined by conventional thinking or rules, and I am the perfect example of that.
'I don't have any diplomas. There are a lot of things that I haven't learnt, but that doesn't stop me from running the company.'
[Laughs] Is it a big priority for you now to find this new generation of people who want to work for Audemars Piguet?
It really is. At five o'clock today, we have the inauguration of the AP 'Padawan' training programme, the name was taken from the Star Wars movies.
We’ve created a group of six young collaborators who are going to be my shadow in everything I do. They’re going to attend all my meetings, travel with me - when we can start travelling again - and see what it’s like to manage a company as part of their internal training. I’m coming into a phase in my life where I really want to involve and teach the new generation but also learn from them.
Since we’re on the topic of new approaches, I wanted to dig deeper on this idea of balancing novelty and tradition. In recent years, it seems like you’ve invested extensively in promoting your heritage, from the books to the museum. Even your recent release of the [Re]master01 reinterpreting one of your early chronographs. Why this recent focus on tradition?
It’s not a recent focus. No one really knows what is behind the brand most of the time. For many people, it’s only when they come to visit the manufacture and the museum that they begin to understand the depth of our brand. Now, we're just opening the curtain and saying look at what's behind it. There’s the [Re]master01 collection, the museum, and we also have two or three small projects in the pipeline which are going to make a lot of noise.
Are you going to continue to pursue the route of re-editions?
We will do some more, but in fairly small volumes. This is not how we’re going to keep building the brand. These are collector’s items, they’re one-offs. It's just a way to keep a connection with the past. It’s meant to show people that we have been here since 1875, but we also look forward, to the future.
Do you think there’s some particularly under-appreciated periods of Audemars Piguet’s history?
Yes, and the perfect proof is found at auctions. If you take all the wristwatches made from 1910 to 1950, Audemars Piguet has nothing to envy anyone, in terms of quality, movement and design. However, the other brands get auctioned at higher prices! We have seen a strong increase in appreciation for these early pieces over the past three years, but we are still very, very far from what it could be.
And there’s so few of them…
We produced such a small number of wristwatches during that period. If you are lucky enough to find one from before 1950, it’s essentially a unique piece. That’s how few we made. We recently published a book that catalogues the complicated models from this period. With this, you have the information at your fingertips.
'They came to me later and said, “boss, we didn't tell you, but we worked on a new movement”, “Who is we? How many are you?” I asked, “Uh, we're 10, boss”...'
Do you monitor the pre-owned and vintage market closely?
We have always kept an eye on it. Every month, I get reports on everything that is happening on all the auctions and websites, for both vintage and current collections. This is very important because it reflects the health of the brand. You should never forget that. The first time a Code 11.59 by Audemars Piguet sold for over $1 million at Only Watch, it was fantastic.
The last few months have been especially tumultuous for the watch industry generally, with the impact of COVID-19. Has this changed your perspective on things in any way?
It hasn’t changed my perspective but confirmed what I already thought. The relationship with the end customer is vital, even more so in troubled waters.
How troubled are the waters?
First of all, we are independent. We have a Board of Directors that said from day one of this crisis, “François, we have to keep everyone onboard.” This reassured everyone in the company and the fact that you don’t have to worry about your job means that you can focus on your work, what you do best, it leaves room for creativity. And this is exactly what is happening. So far, we’re doing well.
'Every month, I get reports on everything that is happening on all the auctions and websites, for both vintage and current collections. This is very important because it reflects the health of the brand.'
How do you manage that relationship with the end customer considering the current circumstances?
I’ve been saying for years, “how long are we going to measure ourselves by the size of our stores?” So many watch stores are excessively large, and they’ve got extremely high rents because they have to be on the best avenues in the world.
But let’s not forget one thing. When you have a 300 square metre store, which was decorated by a well-known designer and you pay millions in rent per year, it doesn’t necessarily mean that the client’s relationship with the sales staff is good. And if the client’s experience is not good, then all your investment goes to waste. We prefer to invest in the client, rather than in physical spaces. This is a colossal change in mind-set.
Hence this focus on individuals, as you said.
Yes, but be careful, because this is the hardest thing. Do you know why? Because it cannot be taught.
Do you feel Audemars Piguet has managed the global distribution of its customers well? Some brands have overly relied on certain markets, which can prove dangerous…
It also shows how important this is for the future. Today, Europe is very affected by the current situation, because typically, in countries like France, Spain and Italy, tourism has come to a halt and the local clientele is rather small. So, the lesson of all this is that we're going to have to put things back in place to attract local customers, because they're there. They exist.
And why do you think they’re not being captured at the moment?
Because we didn't take care of them well enough! To improve on this, we have to listen to them more, show appreciation and respect. That’s how you build a relationship based on trust.
Is it also about creating a certain type of product for that market, or is it solely about the relationship?
100% the relationship, because the product identity will never be either French, Italian or Spanish. The evolution of the product is global. We are a Swiss brand with a global reach.
What did you learn from your past experiences, good or bad?
I’ve realised that creating a positive environment and encouraging people to give their best is the way forward. You know, a while ago, I started meditation. It’s not really my sort of activity, but I got into it and learned an incredible thing.
What was that?
It rarely happens, but sometimes I get up in a bad mood. And then, I can be quite confrontational. Well, there’s one thing I learnt in meditation: to smile. If I come into the room with a smile, even if in my head I'm not feeling well, everything changes. It's primal. And it’s the best way forward.
We would like to thank Mr. François-Henry Bennahmias for taking the time out of his busy schedule to sit down with us and talk about the past, present and future of Audemars Piguet. We would also like to thank Mark Schmid and Raphaël Balestra for taking the time to show us around the Museum and opening up the archives to us, giving us the opportunity to handle and photograph historic pieces and documents. Finally, we would like to add our thanks to Olivier Müller, for facilitating the visit.