Cross Heads Upscale With Time

A.T. Cross is making a move upscale and watches are a big part of the plan. Cross Timepieces is rolling out its line nationally after what the company calls positive feedback in two large test markets last fall. The watch brand already is in 130 doors – a quarter of them A.T. Cross writing instrument clients – and plans to expand into 500 doors this year.

Cross Timepieces range from $195 to $795; all carry a three-year warranty. The top-of-the-line Sonoma collection features a full-size chronograph for men and a mid-size chronograph for women. Both come in two-tone or steel versions. The bread-and-butter Scottsdale collection retails from $295 to $495; it will add colored straps at Basel. New straps also diversify the Monterey collection.

“We don’t want to sign up stores with 30%-off signs in their windows,” says Jeff Davis, Cross’s director of watches. “We’re Swiss made, so we want to be with Swiss-made product. We had to introduce quality product, so it didn’t reflect badly on our writing instruments.”

A.T. Cross will devote $3.5 million of its $5 million national advertising budget to watches in the first year – a considerable launching pad. The consumer blitz started last fall and continues this year in Vanity Fair, Gourmet and other lifestyle publications.

Hamilton Updeates Retro

With a retro trend around the corner, watch brands are diving deeper into their past for inspiration. That’s nothing new for Hamilton Watch Co., a firm that’s repositioning for the future while paying homage to its roots.

A technology pioneer, Hamilton produced the first electric watch and the first digital, called Pulsar. Today it manufactures retro-styled watches, giving it a unique niche in today’s market.

Perceived as the most American of fine watch brands, Hamilton now targets younger buyers via attractive price points and a retro product mix with a contemporary twist.

“We want to make sure young people today don’t look at Hamilton as a watch their grandfather wore,” says Linda Passaro, new president of Hamilton USA. “Hamilton is retro, but now it’s retro chic, which is what young people look for in watches today. And at this price point with this styling, it’s an impulse buy, which makes it an easy sale. Young people can buy two Hamilton watches in a year and not break their piggy bank.”

The brand is jazzing up its conservative and strap-heavy watch line with color. This spring, black and brown take a backseat to blue. More colors may come this fall, when the collection will get a more dramatic face lift.

• The Boulton, originally introduced in 1935, now has a distinct blue dial and strap to complement its goldtone case. This version retails for $395.

• Inspired by a 1934 piece, new Ardmore models shed the rose goldtone case for a modern silvertone curved case with dark blue strap. Retail: $300.

• The new American Traveler introduces silvertone cases with silver and gray dial variations on a blue or black strap. Retail: $375.

• This year’s Viewmatic features a see-through caseback, giving a clear view of this timeless watch’s 1960s origins. It has a silvertone case with a silver textured dial and black strap. Retail: $375.

Swiss Army Brands fights back

Swiss Army Brands has reported some disappointing sales recently (see January JCK, page 64). Consumer confusion about Swiss Army imitators has been blamed for some of the decline, but president J. Merrick Taggart says, “That’s not as much of an issue as is made out.” The company says restructuring, aggressive brand extension, a limited watch product line and production delays in multitools all contributed to the problems.

Taggart says the fourth quarter showed the start of a turnaround, “due to the last pieces of the restructuring.” He expects 1998 to be good and 1999, really good.

“We feel we have one of the mega brands,” he says. “You don’t like to go through hard times, but sometimes it’s good for the company to hit a brick wall, where things need to be rethought.”

Fourth quarter sales were $37.8 million, down from $40.7 million in the same period of 1996. Total 1997 sales were $118.7 million compared to $130 million in 1996. The firm lost $4 million in 1997 versus $5.3 million in 1996.

Taggart cites central issues. “One was the multitool business that emerged in the mid-1980s, which we didn’t initially participate in until late 1997. Second, we weren’t bringing enough watch product to the marketplace. We’ve quadrupled our design capabilities. And we’re bringing new families to market, updating styles.” Other factors were the company’s significant investment in sunglasses and a shift in pocket knives from a destination buy to an impulse buy.

Swiss Army Brands executives say their firm, unlike some watch companies, has no debt on its balance sheet. They are optimistic about Swiss Army’s distribution and high brand awareness, which they say gives the company legs for other category launches in the future.

The name game. Swiss Army Brands has held the Swiss Army Brand trademark since 1992, when the firm was known as The Forschner Group. When it tried to go global with Swiss Army watches, it met resistance due to the proliferation of imitators. So in 1996, it obtained sublicensing rights from the Swiss Federal Defense Dept. to use the name Swiss Army for watches, sunglasses, footwear and apparel worldwide. That agreement does not include the pocket knife business.

To Swiss Army Brands’ knowledge, this was the first agreement of its kind signed by the Swiss military. They did so, believes Taggart, because they respected Swiss Army Brands’ watch quality and its willingness to protect the name – and because the company employs about 900 people in Switzerland.

Swiss Army Brands recently introduced Swiss Air Force Watches in jewelry stores and some department and specialty stores. The design is inspired by instrumentation found in cockpit control panels of F/A-18 fighter jets. Built to withstand gravitational forces, the collection showcases Swiss-made quartz movements, shock-resistant automatic movements or chronograph functions. Features include phosphorescent luminous hands and markers designed for night maneuvers; non-glare, scratch-resistant sapphire crystals; shock- and water-resistant steel cases; and adjustable steel link bracelets or straps made from the same genuine leather as bomber jackets.

Swiss Army watches, the flagship product, retail from $95 to $595. Swiss Army Brands’ Victorinox Watches, sold wherever Swiss Army knives are carried, are $85 to $150, and the new Swiss Air Force watches $495 to $2,000.