Lights Out for Tritium?

In recent years, watches with tritium numerals, markers, and indices have been glowing like mini-nuclear reactors. And they’re nearly as controversial. Though safe, the luminescent material alarms some people because of its minute traces of radioactivity.

With Italy, Germany, France, Japan, Hong Kong, and Scandinavian countries refusing to accept tritium, overseas manufacturers—especially in Switzerland—are phasing it out. “Some countries are eliminating tritium and some are limiting it,” says one distributor. “The United States has strong environmental groups, so it’s just a matter of time before it takes the same steps.”

In the 1950s, watches were illuminated with dangerous radium paint, which led to deaths of dial painters and, subsequently, lawsuits and new regulations. Retailers and watch companies still get concerned calls from consumers regarding the safety of luminescence.

The United States is cracking down on tritium users, though not for safety reasons. The Nuclear Regulatory Commission, which says tritium watches pose no hazard to consumers, has fined both Breitling USA and Cartier for distributing tritium watches without an NRC “possession and use” license. Breitling USA, in Stamford, Conn., has since applied for and received an appropriate license, NRC says.

So what should retailers do? Sell consumers on non-tritium material, such as phosphorus-based luminescence, which requires little light exposure to glow, or Luminova technology, a non-tritium paste applied to hands and dials. Japanese and Swiss manufacturers offer other technologies, as well. Tritec, a Swiss company, worked overtime to develop tritium-free Super-Luminova, and the Swatch Group is among those that have converted to it. Seiko uses environmentally safe Lumibrite, while Citizen is phasing in N Luminous, a paint that uses safer pure aluminum for brightness up to six hours. Most of these newer technologies sacrifice longer-lasting brightness for better perceived safety.

Luminox’s exclusive “radioluminescent” Traser technology uses impermeable, laser-sealed glass tubes that house minimal quantities of tritium gas, making it even brighter, safer, and longer lasting than any tritium paint, company representatives say. The surface is radiation-free where no tritium can escape.

Meanwhile, other moderately priced watch companies have been shifting toward button-activated light technology—Indiglo, Instalite, etc.—dropping the continuously glowing tritium dials.

Three Company Presidents Named

It’s time for the Swiss watch fairs, which means not only new watch launches but also new faces in executive offices. Among the most prominent recent appointments:

VLG North America, the wholly owned subsidiary of the Vendôme Luxury Group, named Robert Filotei president of Piaget. Filotei had been vice president of Cartier’s wholesale division for nine years. “I’ve been bleeding red for years, now I have to get used to bleeding blue,” jokes Filotei, referring to Cartier and Piaget’s respective corporate colors.

VLG recently purchased the U.S. distribution rights of Piaget watches and jewelry from the Movado Group for a reported $30 million. The contract was to expire in 2009, according to VLG North America president Simon J. Critchell. Critchell admits Piaget had suffered some in the past 20 years but says VLG intends to elevate the brand to its past glory. Part of the turn- around plan includes opening new Piaget boutiques in prestige locations.

Thierry Chaunu, former president of Christofle and past vice president of marketing for Cartier, was named new president of Chopard USA. He served six years as Christofle president.

Chaunu replaces William Fuhrmann, the popular president of Chopard USA until the crash of Swissair 111 flight claimed his life last September.

“I understand my predecessor was well loved by everyone in the industry,” says Chaunu. “On the other hand, we have a very dedicated team that shares an enthusiasm for the future, which is encouraging for me. I’m astonished to see the phenomenal growth this company has had in the past few years. I’d like to take it to another level. Chopard has emerged as a very powerful brand, which now needs to deepen its roots in the U.S. market. There are always opportunities for expansion.”

Chaunu says some of Chopard’s retailers are the same upscale clients he dealt with in the tableware industry.

Gary Ervick is the new president and chief executive officer of Hirsch Speidel. Ervick has significant consumer product experience, most recently as

president of Samsonite Distributing Co. Before that, he was president of American Tourister. His consumer product experience also includes sales and marketing positions with Procter & Gamble. In addition, Ervick has served as vice president of sales at Chiquita Brands International.

Rotary Rotates Again

What’s going on at Rotary? Your guess is as good as ours. First the brand favorably revamped its line, price structure, and overall marketing strategy in fall 1998. Then in a dramatic twist, the brand’s enthusiastic U.S. distributor, Rotary Watch USA, was terminated because the head office in England was creating a wholly owned subsidiary with a new U.S. president under its guidance. The terminated distributor contested and sued. Meanwhile, Tim Greene, the newly appointed U.S. president, was abruptly out of the picture as well. Rumors quickly spread of Rotary’s demise in the United States.

Rotary is, in fact, still distributed in the United States. Rotary S.A. suddenly named Anita Jakac, former director of Gucci Timepieces in Canada, to head up Rotary’s North American operations from Toronto. Jakac, who has a merchandising and sales team in place, says she had been running Rotary’s North American business for the past six months. Curiously, that time frame overlaps Rotary S.A.’s announced deal with Greene, who as much as anyone was surprised by the news.

“Rotary S.A. decided they wanted to run their North American business from Canada,” says Greene, who had a verbal agreement but no official contract with Rotary S.A. “We were only running it for four or five months when they made their decision.”

Was the proposed lawsuit from Rotary Watch USA the reason Rotary S.A. set up the distributorship in Toronto? Was there a legal advantage to basing the business in Canada? Did Rotary S.A. name two presidents simultaneously?

Fallout apparently has already occurred. According to a source, Rotary opted out of its exclusivity agreement with Peoples Jewellers, Canada’s largest jewelry chain, based in Don Mills, Ontario. Subsequently, the chain dropped the watch brand from its stores completely.

Tutima Looks to Fly into High-End Stores

Watch brands come and go, often failing because they don’t fill a unique niche. Tutima is capitalizing on current consumer interest in mechanical and sports watches with its classic, functional line of pilot-styled timepieces. Pilot-inspired watch collections are produced by only a few companies. Tutima, with timepieces from $710 to $2,860, remains one of the most affordable in this niche.

Known to aviators worldwide, Tutima offers a classic watch line and a military line. All Tutima watches are water-resistant to at least 100 meters with Swiss movements and easy-to-read black or white dials. Many have convex sapphire crystals, screw-down crowns, coin-edge bezels, and a day/date feature. The relative newcomer is just earning its wings among American consumers, especially among engineers, military officers, and special operatives. For instance, many Blue Angels prefer Tutima’s $2,320 automatic F2 Chronograph.

The company, based in Manhattan Beach, Calif., officially launched in the United States in 1997, and the line is sold in 20 to 30 higher-end stores. The brand is looking to add more such retailers.

Tutima’s history is interesting. Its name is derived from the Latin “tutus,” meaning safe or protected. The brand was formed as a spinoff of two East German manufacturing facilities that made movements and cases for other watch brands. A depressed economy caused the companies to file for bankruptcy, and a bank took them over. The bank appointed Dr. Ernst Kurtz to manage the company, and he founded the Tutima brand as a high-quality, robust wristwatch for men that could replace pocketwatches at an affordable price.

Kurtz’s brother was the first test pilot to make a blind night landing. Company representatives say the brand’s role as an official watch of the German Army during World War II is a testament to its quality. Acknowledging that this history may be troubling to some, Jens-Dieter Halle, Tutima’s marketing manager, says, “It’s true some people don’t want to buy a Mercedes or Porsche too, but they are great cars. We make great watches.”

After World War II, the U.S. Air Force used Tutima watches for its own flying missions. In addition, Tutima supplies NATO with watches and offers a NATO Chronograph with unique rectangular push buttons integrated into the case. Its Commander watch is used by an anti-terrorist group called GsG9. And Tutima’s $2,550 special order-only Mission Timer was made for an anti-smuggling unit in U.S. Customs. The brand also offers a GMT and a dressier Flieger Automatic at $1,310.

Sector’s Virtual Reality: Subsidiary Closed

On virtual life support in recent months, Sector’s Italy-based parent, Artime SPA, pulled the plug on its U.S. subsidiary at the end of March. This confirmed widespread rumors that the brand was in trouble. However, Artime immediately relaunched Sector in the U.S. market with a distributor strategy instead, according to Hal Wilensky, former president of Sector USA.

At press time, negotiations with potential U.S. and Canadian distributors were under way. The distributor route allows Artime to concentrate on marketing Sector in the European market. In turn, it also places more of the financial risk on the new U.S. distributor—rumored to be a distributor with luxury experience.

Artime poured significant dollars into its marketing campaign, but sales were unimpressive. Some sources say Sector focused so much on marketing that it neglected product development. The elimination of the brand’s U.S. marketing department in 1998 signaled hard times. Also, Sector’s price points and distribution strategy had see-sawed over the years. Although its prices, product, and retail distribution were better recently, the changes apparently came too late.

“The watch industry today is basically six big companies who control most of the marketplace,” says Wilensky, who joined Sector in 1995 in an attempt to grow the company’s business in better jewelry stores. “Besides the big six, everyone else is getting the crumbs.”

Those crumbs are still tasty, which explains why Sector and other brands haven’t given up on the U.S. market just yet. Growth in the United States will be the new distributor’s responsibility. Europe’s standard currency switch to the euro is a major reason for Artime SPA’s shift away from the U.S. subsidiary strategy, says Wilensky. He says the brand now considers Europe one country and is concentrating its efforts there, assigning a distributor to handle U.S. growth.