Editor’s Note
This article discusses significant leadership changes at Richemont’s watch division, including the departure of Panerai’s CEO, against a backdrop of shifting corporate focus toward its jewelry segment.
Richemont is in the midst of upheaval: its watch brands are grappling with declining sales, and top management is rotating. The group is increasingly focusing on the lucrative jewelry business rather than watches.
This is not how Richemont managers usually communicate: On Monday evening, Jean-Marc Pontroué, CEO of the group-owned watch brand Panerai, announced his departure on LinkedIn and Instagram. Emotional and personal – a break in style for the discreet world of the luxury conglomerate. After 25 years, he is leaving Richemont.
Pontroué, known for his open and approachable manner, did not want to simply disappear quietly. Richemont, however, seemed to have no public announcement planned. The company also did not officially comment on his successor.
But the information did not remain secret for long. Already late Monday evening, the French online media Miss Tweed reported on the succession, and NZZ was able to confirm this on Tuesday based on further sources: Emmanuel Perrin is taking over Panerai. Perrin was previously head of Richemont’s watch division and thus Pontroué’s superior. In this role, he oversaw all eight of the group’s watch brands, including IWC, Jaeger-LeCoultre, and A. Lange & Söhne.
What this change means for the structure of the watch division of the Geneva-based luxury goods group remains unclear. Apparently, the overarching department above the individual brands is to continue, but a successor for Perrin is not planned.
The change at Panerai is only the latest in a long series. Last year, Richemont replaced the leadership at four of its eight watch brands. A massive restructuring also took place at competitor LVMH: all major watch brands there (TAG Heuer, Hublot, Zenith, and Bulgari Watches) were assigned new CEOs.
Behind these reshuffles lies, not least, the weakening watch market. Although Swiss watch exports fell by just under 3 percent in 2024, the numbers are deceptive. While some brands continue to grow, many are struggling with significant sales declines.
According to a study by Morgan Stanley and Luxeconsult, the “big four” – Rolex, Patek Philippe, Audemars Piguet, and Richard Mille – were able to expand their market share. Some jewelry brands that produce watches (Cartier, Van Cleef & Arpels, and Bulgari) also gained. However, sales at Richemont’s watch brands fell by 9 to 25 percent, according to Morgan Stanley.
Whether the new leaders can turn things around depends on how much freedom they are given within the group. A central problem in recent years was the distribution strategy – a decision that did not lie with the individual brands.
The direction came from above, specifically from Emmanuel Perrin. The brands were instructed to withdraw from multi-brand retailers like Bucherer or Wempe and instead focus more on their own boutiques. Exclusive models were only available there. However, in countries with few boutiques, this led to massive sales losses because coveted models were simply not available.
In general, Richemont is focusing more than ever on jewelry rather than watches. Just a year ago, the CEO was a “watch guy”; now Nicolas Bos leads the group – previously head of the jewelry brand Van Cleef & Arpels. In the executive committee, watch people have also been replaced by representatives from the jewelry brands.
The stronger orientation towards the jewelry business is understandable: this is where the group is growing and making most of its money. In the Christmas quarter, Richemont’s jewelry brands (primarily Cartier and Van Cleef & Arpels) increased their sales by 14 percent and generated almost three-quarters of the group’s total sales. The watch brands, however, were 8 percent below the previous year. Their share of total sales was 14 percent.
That the jewelry sector is growing so strongly is not only due to the strength of brands like Cartier or Van Cleef & Arpels but also to the market environment. While the watch market is almost exclusively dominated by established brands, the jewelry market is far less saturated. Morgan Stanley estimates that globally only 40 percent of jewelry comes from brands – for watches, it’s 100 percent.
This represents a relatively straightforward gold mine. Watches require regular maintenance, which requires qualified watchmakers. The major watch brands maintain service centers worldwide.
Jewelry pieces, on the other hand, hardly ever return to the manufacturer; at most, customers bring them in for polishing once. Furthermore, the production location hardly matters. No one asks exactly where a Cartier bracelet was made – as long as it says Cartier on it. This allows margins that watch manufacturers with their “Swiss made” can only dream of.