Jaeger-leCoultre could be so much better

if you've been a watch Enthusiast for just a little bit of time chances are you'll have had the conversation with someone about why jlc isn't more popular this is the famous Heritage brand which made movements for ptic the brand that's known as the watchmaker watchmaker jlc is great but also just in some ways seen as underperforming what's up with jlc are they underperforming and if so why let's dive in there are two questions is jlc underperforming and if so why it's probably no big spoiler but I do believe that jlc are underperforming it is after all the base premise of this video after all I do think though that it's important to explain what I mean by underperforming so we have a shared Baseline for what I actually mean first of all jlc makes a little over 100,000 watches a year that's more than double what AP makes it's a fair bit more than ptic Vashon panai and shopart it's in the ballpark of numbers that a brand like IWC produces that's definitely not nothing on top of that rart has for a whole lot of years in a row reported strong growth in their watch business portfolio towards the end of 2023 the numbers slowed quite significantly but overall Rishon seems to indicate that their business in general including jlc are growing and profitable if you look at the Morgan Stanley report jlc is also just outside the top 10 best performing Swiss watch manufacturers we're not dealing with a business that's going to go under they're not poised to crash and again that's not the premise the premise is not that they're failing just that they are underperforming or they could be even better the indications that we have that jlc underperforming are partly factual and partly subjective on the part of the watch Community if we start with a subjective piece I think it's fair to say that both the online watch Community but also the Press around jlc is usually colored by strong opinions about jlc's massive price hikes that have really hurt people's opinions of the brand most enthusiasts also kind of like them but they are also met with a broader kind of attitude yeah we like the reverso but for the amount of attention the reverso gets versus the number of reverso actually sold there seems to be a bit of a disconnect I mean for the amount of time that gets talked about the reverso compared to how many gets sold is not proportionate to how many times you talk about a Submariner and how often a Submariner gets told on the more objective side jlc has consistently slipped in terms of position in the Morgan Dany watch report they used to be in the top 10 and have dropped every single year for several years in a row other brands have outpaced them both in terms of overall growth in numbers and also in terms of Revenue per watch a lot of other brands have succeeded in getting customers to spend more per watch and go for higher-end watches jlc just hasn't succeeded to the same extent that their competitors have objectively jlc has done well but a lot of other comparable brands have done so much better take a look at jlc's product portfolio and tell me what their strengths are commercially from a product lineup perspective they've basically got three hero products it's the reverso of course it's the Polaris and it's complications the reverso is perpetually respected it comes in a million different versions in terms of size dial configurations complications and materials whether you're a man a woman big or small there's likely a reverso out there for you you can even customize it to your tastes with engraving and even enameling if that's something you appreciate the Polaris is the jlc sports watch Rolex has the Daytona Zenith has the chrona master sport vacheron has the integrated bracelet overseas the Polaris is the watch that fills that dress sports watch space that today's consumers almost maniacally crave finally JC is also a complication brand you get technically impressive models like the reverso Dual face chronogram and also Perpetual calendars tuong in the reversal range and also in the Polaris and also varying master master control ranges so we can't say that jlc doesn't have hero products they do I also think jlc have two other strengths I mentioned it before from a product perspective but those movements in and of themselves are a significant strength you can get a perpetual calendar from Frederick constant but when it comes down to design finishing and also technical Innovation jlc is usually quite special just like Hooter or Langan zono one of the things you'll hear JC be praised for is how skilled they are at making great movements those movements also indicate another thing value this is a little bit controversial I know because we are more or less all in agreement that jlc's price hikes were exorbitant and unreasonable ask around and most people would have said the old pricing was fair for what you got and I do tend to agree but in some ways especially when it comes to techniques like lacer dials enameling and movement finishing there is a case to be made that you are getting a lot for your money from jlc still to this day the movements are maybe not longer or shapard level but I don't think it's unfair to say that you could potentially charge much more for that kind of work that goes into making those JC watches and movements which brings us to the problems and there are more than enough of them again the premise is not that they are a bad brand the premise is they could be so much better remember that think of the top 10 most popular watches in the world right now not your 10 most favorite but the 10 most popular in general my guess is depending on the price range you're in you're mentioning a chud black Bay Long jeene Spirit zul time a naess a Daytona a Submarina uh TSO PRX now limit yourself to watches from Brands where the entry is above $10 $15,000 the picture is likely the same Royal Oak naess antar teque L of one what's the majority largely the most popular watches are sport style or dive style watches or integrated bracelets what's not in the top 10 dress watches this is where we line up jlc products on my tool versus dress Continuum I put Rolex for reference because Rolex are experts at this in general Rolex inhabits and dominates that Center left space where sporty dressy watches reside these are the most popular types of watches in the world right now and jlc they have the Polaris and that's it the reverso let's be honest is not viewed as a sports watch no matter how much jlc may try to convince us that it is there's the master it's a dress watch the master control also a dress watch take a look at gluto Oral that pricewise are often in the ballpark of jlc they have their dress watches as well but overall their lineup leans far more sporty with the specialist and the Vintage collections on top of that they have the Pano series they do something aesthetically that is not as middle of the road as the master or Master ultra thin collection next problem explain to a non-at Enthusiast the difference between a master ultra thin and a master control clearly they're not identical one is square one is thin and the last one is slightly more casual looking in terms of aesthetic they are both dress watches throw the reverso into the mix that's a dress watch too overall these watches are incredibly similar when considering how the market as such would react to them I like referencing the code 1159 from AP despite all its perceived faults the 1159 does one thing right and that is cater to a completely different market and aesthetic compared to anything at all that comes out of the Royal Oak Line in the Royal Oak Line you also have a massive range from relatively restrained Ultra thins to the beefy chunky outdoor forward offshores and then to the fashion forward Concepts and collaps you don't have to like all of them but in terms of breadth AP does this really well jlc on the other hand has a conservative dress watch a slightly less conservative dress watch and a rectangular dress watch they used to have a watch with a sector dial which was still dressy but far more sport forward and contemporary than anything else in their dress lineup the reverso is also a problem for a jlc in reverso lever this is likely a statement that's going to R you up but think about Rolex for a moment what comes to mind is it the air King the 1908 no it's the submarin it's the GMT it's the Dej whatever comes to mind when thinking of Rolex or longine or AP is likely going to be the model that the brand puts front and center in terms of positioning but it's also a very attractive watch from a market perspective the reversal no doubt popular but realistically it's the Polaris that speaks most to the trends of the market the reverso sells a lot I think it sells a ton to women it sells to JC enthusiasts but I'm not convinced it's as popular with the random new watch buyer even in the high-end segment last year I remember the releases of the jlc reverso Chrono the Polaris Kronos with new enamal dials and a slew of other reverso I couldn't tell you what happened in the other lines in terms of updates any person going in to buy a rectangular watch has to first get out of their head that a watch should be round so I do think that in some ways it's a problem a relatively Niche aesthetic like the reverso is so often front and center in terms of marketing and attention the Polaris is also a problem the Polaris chrona retails for $14,300 that's give or take about the same as a Daytona now which one are you choosing well a majority if they could get past the waiting list would choose the Daytona Polaris over a speed master Ed White I think most people would choose the Ed White Royal Oak Chona yeah it's more expensive but still the majority are going for the Royal Oak how about the Polaris State super compressor how often is that watch getting chosen over a Submarina Style watch or a planet Ocean or any other watch that has an external dive bezel dual Crown super compressors are again Niche and don't necessarily cater to a broad audience for the Polaris models there's either for the consumer a mental hurdle in terms of choosing something as almost esoteric as an internal dive bezel diver or on paper a sports Chrono in a market dominated by icons like the dayt owner the Royal Oak and the speed master it's a good watch I like a lot of the models but for the regular watch buyer it doesn't have the kind of recognizability a Submarina Omega C Master 300M or nless has I've even mentioned the concept of boardroom watches before watches designed purely to address a certain Market segment and the Polaris isn't quite that it has after all been around since the 1960s but it is currently in the lineup to address a gap in the jlc line and it's good but it's just not that good compared to the competition out there the next question I find myself asking is are jlc too cheap or too expensive I did a video about how jlc's price increases were totally off and how it likely hurt them so you would think the answer was easy but here's the thing what do people say when they talk about jlc they say it's the watchmaker's watchmaker they say that jlc delivered movements to Patek and other high-end Brands they say that the finishing and movements are far better than anything you find in AIC they say enameling they say Lac of dials they say complications a lot of what gets said about JC is what you say about ptic or chapek or chopad and then you look at the numbers from the Morgan Stanley report the average revenue per ptic sold is three times higher than that of Rolex huau is 50 to 60% higher per watch than a Rolex Vashon Blan pan bre are all over Rolex the average revenue per watch sold for jlc is less than Rolex doesn't this seem intuitively wrong to you AP and pic make their money largely not by selling their entry watches but rather by having a strong following of buyers that buy the Specialty Products the gold watches the high complications The Limited Editions clearly this isn't happening to the same extent with jlc people are buying in the lower end I'm certain there are a lot of female buyers of jlc and they're buying the entry reverso compared to patch or AP or somebody similar customers don't find the upgrade path to jlc's upscale models compelling they buy the entry reverso they buy a basic steel Master ultra thin not a gold perpetual calendar Polaris or gold Moon phas all of this is to say that considering how jlc positioned themselves in the way they talk about their technical prowess their Superior finishing their complications people are by and large choosing to buy the cheaper stuff despite having many high-end offerings huo excels at this people happily upgrade to a Gold version of the classic Fusion huo can convince people to pay big bucks for a Unico model but when people walk into the JC store they do not walk out with that toong they leave with a basic reverso otherwise the average retail price would not be lower than Rolex for a luxury positioned brand I think that's a problem I was a little bit on the fence for problem number six but it's online sales jlc makes most models available online for direct to Consumer sales there whole lot of strengths to this more profit margin better control of your product you can buy a Tesla online you can buy long jeene CER and a whole lot of other brands online but you can't buy chuda you can't buy Rolex you can't buy Pat you can't buy chopek generally speaking the more high-end brands do not have online sales channels this could be because they are slower to adapt to changing consumer Behavior but it could also be because luxury products and luxury customers expect a different experience deot ended up pushing me off the fence with their 2023 watch report it's clear people buy online because it's convenient because of the selection and because of availability the manufacturers though are also clear they see that the physical store builds a personal relationship you get to feel the watch you get to experience the luxury you don't buy a high-end Porsche online from Porsche you don't buy a Bentley or a Rolls either you can configure them online but at some point you need to talk to someone who guides you through the sales experience I'm just not convinced that jlc selling their models online is a good thing depending on where specifically they think they should be in terms of consumer demographic the more highend they see themselves the less I think it makes sense jlc is the watchmakers watchmaker everybody rants about their skills in terms of movements and complications but honestly who has a strangle hold on movements and complications it's pic for complications it's longer for finishing if you follow the way jlc market themselves there is is a lot of focus on technique videos of enameling complications and I just don't think it sells ptic don't even lean so much into the complications as such as you would think they lean into that they're just the best or exclusive technique isn't their setting Point hublo has lots of technique as well but the selling point is pure popularity the few brands that go all Inn technique are Brands like MB andf and even they lean more into the creativity and uniqueness of their products jlc even Tarts their skills at customization with personal engraving and enameling to order that's incredibly Niche and it's admirable and it's impressive but for a brand that sells one/ tenth of what Rolex sells and on average makes less per watch than Rolex that kind of Niche product offering is potentially a little bit misplaced final problem I made a video link up here about how luxury true high-end luxury so you know well above Rolex needs massive differentiation at the lowend and mid-end of watches Brands tend to look a lot more like each other Omega has their broadly appealing dive watch so does Rolex chuda has their broadly appealing sports watch so does longen so does nomos but take chaek Vashon AP and ptic there are commonalities but generally speaking there's a much greater level of differentiation AP is all about extreme collabs with their integrated sports watch Blan pan is almost the only luxury watch maker that has a fairly straightforward dive watch in their lineup Langer basically challenges you to wear your watches upside down because it's all about the elaborate movements mpnf show part likewise the overlaps are just smaller the differentiation the positioning is greater and then you have jlc the Master Series is an excellent but fundamentally Bland dress watch the complications are fairly simple upgrades to those simple dress watches they're good watches but apart from a select few models most of them have a superior competitor offering out there I would choose a calatrava over Master ultra thin I would choose a Daytona over Polaris I would choose a ler over dueta JC just doesn't quite stand out that's my contention so how do we fix that well jlc has two paths it can go option one is sell more watches this is likely the most difficult path for jlc if they want to sell more watches the numbers game would need them to overhaul their product line up massively and Chang their marketing jlc is not going to sell half a million watches or even 300,000 like chuda by pushing R versos and dress watches in the masterline jlc would likely need to Pivot away from those dress watches and into far more sporty offerings just like nomos that built the nomos club sport to take the popular but Niche nomos club and place it squarely in the sportswatch segment jlc would need that entry sports watch they would also need to lower prices and pivot away from Custom enameling which although cool is not useful if you're going to play the numbers game the technical press that jlc show would need to take a backseat to luxury lifestyle watches with a Twist this path though also means you start competing directly with Rolex Omega and a ton of others the competition is Cutthroat and all indications are that the real money is upscale in the luxury segment so option one is not the path they would take option two would be in my opin ion to sell more expensive watches and I think to a certain extent this is also the path jlc is trying to take I think they have some level of analysis that comes to some of the same conclusions that I have why do I think this well because they've raised their prices by 30 40% jlc I think knows and they want to go more highend and they want to put distance between themselves and that upper mid-range Riff Raff of your regular Rolex buyer but raising prices alone is not going to cut it it just angers as consumers and it doesn't fundamentally change by a behavior or by a perception this is where we've got one last major comparison coming in consider again Rolex or Omega and their lineup how's it built up it's essentially built like a pyramid you have a large assortment of options at the entry level a steel sub a steel gyt a steel op steel Rolex Explorer from there you have upgrade paths to more exclusive models in terms of materials primarily for Rolex for Omega complications get thrown in the mix but the semi- pyramid kind of structure is there the volume comes from the base jlc is very similar to these Brands you've got lots of entry reverso in steel you've got lots of Entry Masters in steel you've got Master controls in steel and even $10,000 entry Polaris models in steel now look at ptic or Lang okay they have the kraa and the saxonia but how many options do they have in steel how many entry options do they have at all their product line up doesn't have that pyramid kind of shape not only that but their most desirable most talked about models are not necessarily the entry models jlc still has this pyramid type shape and I think potentially this will hold them back having so many relatively speaking affordable options is not conducive to pushing people up the funnel they just happily stay at the bottom of the pyramid I would be fine with jelc having a master ultra thin dat in steel but why also offer the moon phas in Steel phase it out and keep only the Gold version same for the steel power Reserve model make it exclusive if you want the power Reserve you have to upgrade to Gold remove a lot of the steel models and have only the gold models if you as a customer want the complication you have to pay the precious metal premium get rid of that pyramid approach jlc would need to address their marketing not pivoting away from their very technical positioning but by making their complications price-wise more exclusive they would add Credence to the fact that they are something special the reverso of course I'd keep it but imagine again a little bit more focus and not as much of a pyramid lineup now if they do everything that I'm thinking what would they have well they'd have a slightly cheaper Von Constantine realistically JC isn't poised to take on the likes of AP chape or Patek but Vashon think about it the 56 has a lot of what the master control has it's a youth and Sport forward dress watch the patrimony aligns somewhere near the master Ultra Thins the overseas versus the Polaris jlc has relatively speaking a lot in common for Von now I stand by my assertion that in the real high-end differentiation is also hugely important and I do think that that's also part of Von's problems they're just not particularly differentiated in terms of products and positioning but could jlc with a few adjustments challenge Von for their spot jlc is not doing badly by any stretch of the imagination but they are such a good and historically important brand that I do think they could do so much better than they are doing jails here kind of in this no man's land the pricing is similar to mass Market offerings like Rolex but they're only doing Niche numbers like PCH and AP jlc I think personally could do well to pick a path more clearly the path I see is not volume growth and I don't think they see that either but average revenue per watch growth I think that jlc are good enough to be able to move their customers upwards in the product lineup not just by raising prices but by convincing buyers to buy the more high-end offerings they would need some lineup changes they're not hugely differentiated but tell me you wouldn't at least be open to considering a master ultra thin moonphase in Gold over a 56 moon phas calendar throw on a steel bracelet on a master control and you have a relatively decent high-end sportswatch that isn't quite L Zera Odus level but it could potentially be quite compelling jlc could be so much more if they wanted to that's what I think at least I've overthought it I know but that's part of the fun so what do you think how would you feel if jlc became even more exclusive would that be in keeping with how you see jlc historically let me know in the comments like subscribe cheers

Channel: This Watch, That Watch

Views: 56,980

Keywords: jcl, jaeger-lecoultre, jaeger le coultre

Id: bKEXgac-ruI

Length: 23min 20sec (1400 seconds)

Published: Sat Feb 17 2024