ToyWatch gets ready to prove it’s more than a one-trick watch pony.
ToyWatch took the market by storm in 2008 with its bright watches, but instead of striking while the iron was hot and launching new product, it stalled and fell victim to copycats. Now with new teams in place in the UK and Italy, it is ready to put a tough 2011 behind it and charge ahead with new designs and a fresh distribution strategy, UK brand manager Gavin Foster tells Rachael Taylor.
The dictionary definition of a fad reveals it to be an intense but short-lived craze, a fashion that is taken up with great enthusiasm for a brief period of time. ToyWatch was a fad.
Back when the Italian watch brand cruised into the UK market in 2008, lashed onto the wrists of pretty much every celebrity of note, it sold by the truck load. Its Rolex Submariner-impersonating Plasteramic proved to be a massive hit; teenagers wanted one, luxury shoppers wanted one, even the editor of Vogue was wearing one (and still is, so we hear).
The ethos of the brand was fun, and in a year that proved to be the real start of the credit crunch, fun was what the market wanted; a relief from the worries that were yet to hit home, but at a price that was ready for when they did.
And that was exactly what the brand offered. Its tongue-in-cheek attitude poked fun at the stuffy watch industry with its plastic imitation Rolexes in a thousand colourways. It was the anti-luxury statement and kick-started the trend for coloured watches that went on to dominate the watch market, from the high-end watch houses to the pile-‘em-high fashion brands.
This boom in popularity, however, was to become a thorn in the side of ToyWatch. While early adopters splashed out on original ToyWatch models, a whole host of imitators sprouted up offering cheaper models through much wider distribution channels backed up by gigantic advertising budgets. ToyWatch became just another coloured watch brand at the centre of a craze whose participants had forgotten just which brand was the originator.
A brand in possession of a hot product can never stop others following suit, but while ToyWatch should have been capitalising on the dizzying highs of its success by jumping head first into new product development and rolling out fresh interpretations of its bestsellers instead it stalled.
From an outsider’s perspective it might have appeared that the bubble had burst for the ToyWatch fad, but in fact in terms of units sold, the brand was in as rude health as ever. But the potential for growth was dimming the longer that it continued to waste its potential by focusing on a single product.
As we have learned from the phenomenal rise of Pandora in the jewellery sector, branding is everything – an area that ToyWatch has excelled in – but as we have also learned from the mega jewellery brand, a single-product strategy is not one that begets a company with a long lifespan.
And this is something that ToyWatch UK brand manager Gavin Foster is fully aware of. He is part of a new wave of executives at ToyWatch, which in the past year has taken its UK distribution back in house and has appointed a whole new team.
“To me, when ToyWatch started it was a bit of a fad, it was built on sand,” he says. “Since then sales haven’t dipped, but they have plateaued. At the height of the fad anything sells, but you need to push new product and we didn’t and everyone else copied us.”
Foster comes from a fashion background, just like the other two Toywatch UK executives marketing manager Rob Blake and wholesale key account manager Tiho Kostadinov, and has worked for brands such as Evisu, Stone Island, Puma and Firetrap. The new team took over in November 2010, and have just moved to a brand new office and showroom on Old Bond Street in London.
There have been similarly big changes at ToyWatch’s head office in Italy, where former Richemont and Swatch man Matteo Morandi stepped up at the end of November to become worldwide chief executive. To date ToyWatch has enjoyed its status as a fun, relaxed brand, but with the arrival of Morandi, who has worked for some high-profile corporate giants, comes a more professional structure.
Within the first three weeks of joining ToyWatch he made a trip to the UK to find out exactly what had been going so wrong with his new brand, after what had seemed like such a spectacular start. This was something that Foster was only too happy to fill him in on.
“ToyWatch went off the boil as it was not developing new products,” admits Foster. “I’m not going to lie, 2011 was a really difficult year for us. But Matteo sees the UK as such an important part of the business. I did a blue sky report for him and they’ve said whatever you need to succeed, you’ve got it. I’ve laid out my strategy and he agrees with it.”
Foster’s strategy includes using his background in fashion to bring one of fashion’s most adhered-to rules to distribution at ToyWatch: two seasonal collections every year, one spring/summer range and one autumn/winter range, with the continual development of key bestselling lines.
“In the fashion apparel industry, if a cardigan works in autumn/winter then you do it again in spring/summer in a different colour,” he says. “This is what we’ll start doing at ToyWatch.”
The UK team had tried to follow this strategy in 2011 but were only receiving product from Italy as it was being released, giving no lead time to prepare retailers and to PR the collections to consumer press, which often works months in advance. From this month on that process is going to be tightened up, with three months between showing the collections to retailers and delivering the ranges to shops.
The type of shops that ToyWatch is dealing with has also changed dramatically over the past year as Foster has taken charge. Previously the brand was dealing only with fashion stores, but Foster has worked to change this and move into the retail jeweller market. He has to date achieved a 50/50 distribution split between fashion stores and jewellery stores.
“We’ve picked up a brand that was considered a fad but jewellers are starting to take it seriously as a watch brand,” he says. “Part of our decision to move our office to Bond Street was because we wanted the prestige of being near the jewellers, and we want retailers to come to our showroom to see the product as it should be displayed; we don’t want to sell out of boxes any more.”
ToyWatch UK has cemented relations with the jewellery trade by joining buying group The Company of Master jewellers and Foster says that he has taken much advice from its chief executive Willie Hamilton on how to work effectively with the market. “Our biggest growth will be in jewellers,” forecasts Foster. “We want to become more of a serious watch brand.”
Retailers in the jewellery sector might well be tired of coloured watches, particularly a breed of which is double the price of its nearest competitor, but Foster is ready for this question and in answer gestures to a wall full of product at its showroom, all of which are new designs.
“In the past ToyWatch has delivered product, it has never launched products,” he says. “But that’s what we are going to do now – we are going to launch products.”
New innovations being introduced at the watch brand include models that are better suited to an upmarket jeweller than perhaps its previous offer was. In January last year ToyWatch hired a new designer, Bianca Zabolo, who previously designed for high-end watch manufacture IWC and her designs are now beginning to filter through to market.
New products include classic designs on Milanese mesh straps, chunky aviator styles like the one featured on the cover of WatchPro this month, ceramic versions of its Plasteramic models, rubber watches that have a velvelty touch from the Jet-Lag line, some made entirely of velvet from its Sartorial collection and even a range of children’s watches with interchangeable bezels.
Perhaps the most exciting launch of the SS12 selection is ToyWatch’s very first automatic watch. The fully skeletonised watch, which is available in large and small sizes, is a real push forward into the watch market as opposed to the fashion accessories market, and will perhaps quieten those who criticise the brand as selling overpriced plastic watches with cheap quartz movements. “With our latest collection you can see a real watch coming through,” says Foster.
Pricing is still important for the brand, which achieves the highest level of sales at below the £200 mark, and the new automatic watch will retail at just £230. It has also managed to reduce the price of its ceramic watches: when the brand first started making ceramic watches they were priced up at about £1,000 but thanks to advances in technology this has dropped to just £340 for a chronograph version.
But while its product offer and distribution channels might be widening, ToyWatch is still planning on keeping a tight control over where its watches are sold, and how the models are presented in store.
ToyWatch has just taken delivery of some slick-looking shop-in-shop units, which will form a key part of Foster’s strategy moving forward. He feels strongly that any retailer selling the brand should be doing so with the use of these units. “I’m looking for retailers who will put their money where their mouth is and take these units,” he adds.
The first selection of units that were made available from Italy were constructed with wood and laminate to create an effect known as a piano finish, which is hugely expensive, with some units costing as much as £30,000. Foster was keen to keep the high-gloss black look that the brand is known for but he wanted to drop the price and has done so successfully with the help of shop fitting firm Axis. The new generation of units are made from MDF topped with a veneer that is heat treated and cost 80% less than its predecessors with prices starting at £2,000 for a unit.
ToyWatch is willing to help retailers with the financial implications of taking on the furniture and will offer payment plans and contributions depending on how much business the particular account generates.
What it isn’t willing to do is allow discounting. The retailers, both fashion and jewellery, that the brand is dealing with have been asked to sign a distribution policy and while Foster knows he cannot stop shops from setting their own prices for the watches, it is not something the brand will look kindly on. “If people discount the watches then we won’t supply them again,” he states firmly.
But how to deal with stock that wont sell? For that, Foster has a cunning plan. In June ToyWatch opened a store at discount retail destination Bicester Village. The shop was originally opened on a trial basis, but after a successful three months it traded up to a larger premises that is now permanent.
It is to Bicester Village that unsold seasonal stock will be sent – the only retail outlet in the UK where consumers will find discounted ToyWatch models. While retailers won’t be offered cash back for unsold stock, the brand will replace the number of units returned with fresh timepieces from the next bi-annual collection with the expectation of a two-for-one uplift.
ToyWatch was indeed a fad, something that Foster will confirm, but that was never a bad thing. The flash-in-the-pan excitement that characterised its first years have made it a very well-known and much-liked brand name. The challenge is what to do with that power.
As Foster has admitted, 2011 was a bad year for the brand; so bad that he’d like to erase it from memory. 2012 is going to be better, however, with a host of new product launches and a much tighter better-planned strategy in place.
Yes, ToyWatch was a fad, but is it a fad still? Foster hopes so, but he also hopes that in the future it will be one that harnesses the power of a series of fads rather than pushing just one.
New launches from ToyWatch planned for 2012
MESH – A collection of more traditional gold-coloured watches on Milanese mesh straps that has already become a bestseller on the ToyWatch direct-to-consumer website.
METALLICS – A range of typically bright, shiny aluminium watches that have been studded with crystals on the face, bezel and strap.
CHRONO VELVETY – ToyWatch is extending its range of rubber watches that feel like velvet with a selection of chunky chronographs.
SKELETON AUTOMATIC – The brand’s first ever automatic watch will be presented as a fully skeletonised timepiece, available in either black or white with an ornate crown.
RECTANGULAR – This unique watch with rectangular face meshes together clasp and bezel to become one – to remove the watch you must unclip the bezel from the face as it is also the clasp.
THE SATRORIAL – This watch has been inspired by smoking jackets and has been made entirely from velvet in a rainbow of colours.
ROX’S EDITORS’ NOTES: ToyWatch has created a strong brand through tight distribution and sticking to their core values. I’m confident they will turn things around. It is still a very popular brand and we’re looking forward to new ranges, particularly the ceramic designs.
This article was taken from the January issue of WatchPro. To read the issue in full online, click here.