FT SPECIAL REPORT Watches Jewellery

Baselworld Imitation game Market movers Tough economic times The spectacular stories Asian diaspora’s lavish put pressure on the fair behind costume jewels gold-buying is changing

FULL COVERAGE Pages 2-4 MY FAVOURITE PIECES Page 18 BREAKING THE CHAINS Page 14

Thursday March 17 2016 www.ft.com/reports | @ftreports Hong Kong tumbles as Chinese travel beyond

pace in five years and well below long- Mostunderpressureareoperationsin But the watch run averages. Demand for luxury Hong Kong, long a hub for sales across watches in energy-exporting economies Asia. Hong Kong is feeling the effects of market may have has been hit by the precipitous fall in oil overstocking, which have yet to be prices. workedthrough(seepage9),aswellasa reached its bottom, “It looks like the outlook may even stronger US dollar, to which the Hong have worsened since the end of 2015,” Kong dollar is pegged. Swiss watch says Ralph Atkins says Julie Saussier, consumer industries exports to Hong Kong in January were analyst at Credit Suisse. “Hong Kong is 33 per cent lower than a year earlier, still faring badly, and in Europe you according to the Federation of the Swiss atchmakers gather for have had the effects of November’s ter- WatchIndustry. the Baselworld fair rorismattacksinParis.” A turnround in Hong Kong may be against a gloomy eco- What matters crucially will be some way off. Thomas Chauvet, luxury nomic backdrop. The demand from Chinese consumers. The goods analyst at Citigroup, reports a W luxury timepieces industry has been hit by the crackdown “profound change” in Chinese percep- industry is weathering not just sluggish on“gifting”aspartofthecountry’santi- tions of Hong Kong. “It does not seem to world growth and a Chinese economic corruption drive. From peak to trough, be an attractive tourist and shopping slowdown. It also faces particular diffi- watch sales in mainland China fell by destinationanymore,”hesays. culties in Hong Kong, the industry’s about30percent,accordingtoindustry “Chinese people’s natural inclination most important marketplace, and a estimates. for travel, rising purchasing power and strong Swiss franc — which has sharply The good news is that the one-off greater ability to travel individually and sent up the cost of producing luxury effect of the clampdown has fed The one-off further out internationally are likely to watchesinSwitzerland. through. Year-on-year growth in Swiss continue to encourage them to discover With sales dependent on economic exports to mainland China turned posi- effect of otherpartsofAsiaaswellasEurope.” Hatton Garden The untold story behind the heist optimism, there is nervousness about tive at the end of last year. Even if China’s Reflecting the shifts in demand, the therestof2016.TheParis-basedOrgan- China’s economy expands at a slower Geneva-based Salon International de la It was the biggest burglary in British history: jewels. Now, as the criminals behind the heist start isation for Economic Cooperation and rate, luxury watches still have cachet clampdown Haute Horlogerie announced in Febru- over one weekend last April, eight men broke their jail terms, the full story of how Hatton Garden, Development expects the world econ- with the country’s consumers. The has fed arythatitsHongKong-basedWatches& into a safety deposit building in London’s and its traders like Karl Karter (above), recovered omy to grow by just 3 per cent — the problem is that Chinese spending pat- Wonders exhibition would in future be diamond district and took £14m in gold and from the chaos of the robbery can be told. Page 17 same as in 2015, which was the slowest ternsareshifting. through Continuedonpage2 2 ★ FINANCIALTIMES Thursday 17 March 2016 Inside | Watches & Jewellery

Baselworld Runaway prices Precious tales The heist Your complete guide An era of inflation-busting price rises in the Diamond demand is The untold story behind the to the bellwether fair: watch industry is coming to an end as dying even as we £14m Hatton Garden overviews, interviews oversupply and economic crisis weigh on become gluttons for gold: diamond robbery and and a visual guide to global sales commodities diverge what the theft means the highlights of this Page 9 Page 13 for the London year’s Hall of neighbourhood’s future Dreams Page 17 Pages 2-4 Count us in South Asia We take a data-driven look at the luxury Indian families in the UK world: how smart are brands when it comes spend hundreds of millions of Real fakes 3D printing to their websites? And how are emerging pounds on jewellery every year — Art collector Patrizia Sandretto Re Watchmakers and jewellers markets faring? but the traders who cater to them are Rebaudengo picks her favourite items have always been early adopters of new Page 11 struggling to adapt from her historical collection of costume capabilities — we look at how they have Page 14 jewellery seized on the 21st century’s first Page 18 technological revolution Page 6 Patently Just as smartwatch Top 10 sales have taken off, From the brilliant cut to Museum pieces legal battles over the computer-aided design, via Jewellery, long excluded from galleries, is Digital diamonds tech behind them have electroplating, cultured finding its place in serious exhibitions — Stolen jewels are rarely recovered. That is begun pearls and clip-on earrings, and is reaping financial and cultural why a new diamond database that records Page 12 10 key developments in benefits from this new prominence every detail of a stone is causing excitement jewellery Page 19 Page 7 Page 16 Baselworld ‘is a family gathering’ Day in the life Kate Youde hears from five of the show’s habitués, including a watchmaker, a buyer and a blogger

RolfStuder gemstones—somenewshapes,new Jointchief colours—togetinspiration. executive Wehave100meetingswithour officer,Swiss customersandover50appointments watchmakerOris withallthebesteditors. Baselworldforus Youneedtobestrongbecauseevery isafamily nightthereissomeparty,somedinner, gathering.It’slike butitispartofthegame. whenyouhavea bigpartyatyourownhome:you’reabit LizaUrla nervoushowpeoplereceivewhatyou Jewelleryblogger offerthemandyou’relookingforward forGemologue toseeingyourfriendsorthepeopleyou I’llbegoingfor haveinvited. twodays.For It’sgoingtobemy11thshow.I’veseen bloggers, everythingfromspontaneousbirthday Baselworldis partiestodoctor’svisitsandit’svery excitingbutalsoa hardtopredictwhat’sgoingtohappen littlebitboring next. becauseofthelocation. Baselitselfisnotabigplace,the RoanneOrlebar weatherisnotparticularlygreat[and] Finewatchbuyer, thelightinginsidethetradeshow . . . is Harrods notfantastic,soit’sdifficultformeifI Weseeabout30 wanttocreatecontent. brandsoverfour I’mgoingtobepublishingon days.Thereare Snapchat,Instagram,Twitter,Facebook business andthewebsite,withcontentcreatedon conversations thespotandafterIhavevisitedthefair. thatdohappen butweprefertohavethoseinadvance Dominik sothatthemeetingswehavearevery Nyffenegger muchlookingatthenoveltyinthe Directorof productandtheexcitementthebrand marketingagency hastooffer. USPPartner Yougowithsomeideasastowhatthe Overall,therewill brandsmightbelaunchingandsome beateamof brandsmeetthoseexpectations,some around200 farexceedthemandsome,maybe,you peopleprovided werehopingforalittlebitmore. byus:140hostsandhostessesfor Baselworlditselfastheofficialpartner MarcoBicego andaround50to60peopleforthe Jewellery brandsandjewellerycompanies.Most designer ofthemworkasinformationproviders Atthebeginning forvisitors. oftheshow,when Wehavehostsandhostessesoff-site, Ihavemoretime whichmeanstheyaretakingcareof formyself,Iwalk welcomedeskandreception[facilities] aroundandsee attheairportandtrainstations. what’sgoingon.I Iwillgointo[theshow]tocheckon visittheHallofElements,whereIhavea ourhosts,hostessesandmodels . . . so lotofsuppliersandlookatthe theyreallydoaperfectjob. Hong Kong tumbles as Chinese travel beyond

Continuedfrompage1 Swatch complains that the apprecia- held biennially, with its organisers tion of the franc has caused “significant examining other destinations which shiftsinsalesinthemarkets,aswellasa couldalternatewithHongKong. marked distortion of the international Weaker sales in Hong Kong have been product pricing structure”. Swatch’s offset by improvements elsewhere. sales fell 3 per cent last year to While US watch sales disappointed last SFr8.45bn(£6.1bn)atcurrentexchange yearonthebackofthestrongerdollar— rates. Despite headwinds, Swatch said it and probably the rise of smartwatches had actually increased the number of —JapanandSouthKoreahavebenefited employeesinSwitzerland. fromChinesetouristflows. Meanwhile, Richemont, whose “There is a ‘bottoming out’ in global brands include Cartier and Montblanc, luxury watches but a lot of the business has warned its 9,000 employees in Swit- is wholesale, which tends to lag behind zerlandthatitislookingtocutupto350 the pick-up in the cycle,” says Scilla watchmaking jobs locally over the next Huang Sun, a sector specialist at GAM 12months. InvestmentManagementinZürich. The positive interpretation of job cuts In Switzerland, the effects of the atRichemontisthattheyshowagreater tougher conditions have been exacer- nimbleness. “They are being more bated by the strength of the Swiss cur- proactive and flexible with costs, and it rency since January 15, 2015, when the doesn’t mean that prospects for the country’scentral bank gave up trying to industry have changed,”says Ms Sauss- capitsvalueagainsttheeuro. ieratCreditSuisse. Thursday 17 March 2016 ★ FINANCIALTIMES 3 Watches & Jewellery | Baselworld Baselworld buyers hunt out value for money

the key to success at Baselworld, and in the year the relationship with a small, non-group maker The rapid dip in the global ahead,isgoingtobetomakewatchesmoreaccessi- tends to be more of a partnership. I also think this economy is taming the watch ble. More than ever before, people are looking for year’s Baselworld will see more retailers asking to goodproductsatsensiblepricesandthatisthearea get involved in the internet strategies of the big industry’s high spirits and on which we have focused,” says Mr Bernheim, brands, simply because online selling is growing so whosecompanysellsabout200,000unitsannually rapidly.” (See page 11 for how luxury brands are putting pressure on prices, through3,500outletsworldwide. faringonline.) “We haven’t found it necessary to move heavily But while such talk of affordability and saleabil- says Simon de Burton into[cheaper]quartzmovementstodothis,butwe ityisextremelyrelevanttothecurrentmarketsitu- have negotiated with our longstanding suppliers in ation, some are hoping Baselworld will produce at tisvariouslybeingcalledacorrection,adown- order to be able to continue making mechanical leastafewfireworks. turn, a consolidation and even a bubble. But pieces of our usual quality to offer at aggressive One of them is Wei Koh, the founder and editor- thetrueeffectoftherecentsofteninginluxury prices,”headds. in-chief of Revolution, the international watch watch sales in key markets will fully emerge On the buying side, Neil Duckworth, who has magazine, who believes it is essential that the I this week as news filters back from Basel- been in the business for more than 30 years as a industrydoesnotallowitselftostagnate. world, the most important show of its type in the retailerandnowasadistributorofluxurywatches, “Judging from the SIHH show in January, it internationalcalendar. believes many of his colleagues will shy away from seems as though people are making the safest and Baselworld’s organisers do not give any hint of the more expensive products of lesser-known most commercial watches possible. There’s noth- beingruffledbymarketconditions.“Allthebiggest brands.“IfIwerearetailer,Iwouldn’tattendBasel- ing wrong with that but equally the brands must and most prestigious brands will be attending worldwiththeideaofaddinganymorehigh-priced remember that the best way to combat consumer Baselworld2016andwillpresentthenewcreations watches to my portfolio. It’s no longer going to be apathy is to make watches fearlessly — the market and innovations that will become the trends that very easy to sell a watch costing £10,000-£15,000 isonlygoingtobestimulatedifwatchesarecreated will prevail for the following 12 months,” says or more unless it is from a big, instantly recognised whichcollectorswanttobuy.” Baselworld’s managing director, Sylvie Ritter. Ms brand. I do think, however, that watches in Mr Koh’s faith abides. “I think we can safely say Ritter says there will, however, be “comparatively the £1,500-£3,000 price bracket by small, inde- that mechanical watchmaking will prevail. It has fewer” jewellery brands from Asia after declines in pendent makers, which don’t have huge collec- survived for 400 years already, so the small blip theirhomemarkets. tions, are going to prove popular at the show,”says that it’s experiencing now is hardly likely to kill it One trend Baselworld will certainly be seeing is MrDuckworth. off. Like sailing yachts and internal combustion thehuntforvalueformoney.“Inmyopinion,value “The brands that belong to large groups tend to engines, interesting watches are cool and will for money represents the future of the watch busi- push retailers very hard to take on stock, whereas thereforebearoundforalongtimetocome.” ness,”saysPhilippe-E.Peverelli,managingdirector ofTudor,themoreaffordablesisterbrandofRolex, whichcelebratesits70thanniversarythisyear. A visitor at “We all felt rich for a few years while watches Baselworld 2015 were selling well everywhere, but now we are back Baselworld/Didier Oberson intherealworldandeverybrandisgoingtohaveto look in the mirror and recognise its own true value.” HeisbearishonHongKong:“Idon’tbelievesales in Hong Kong will ever be as strong as they were before the downturn, but we can now benefit from the fact that the Chinese travel the world and can buyanywhere.” RobDiver,TAGHeuer’sUKbrandmanager,says: “I wouldn’t be surprised to see retailers going for volume sales at competitive price points. And I ‘We all felt think we’ll benefit from the fact that, more than rich for a ever, end customers are going to be looking for the safetythatcomeswithbuyingawatchfromamajor few years brand.” but now we Affordability and conservatism will also be the keywords on the Raymond Weil stand at this year’s are back in Baselworld, where its chief executive Elie Bern- the real heim will be working especially hard to push watchesinthe£500-£2,500pricebracket.“Ithink world’ Jewellers weigh up event’s worth

perception that jewellers fall below The fair is a huge watch brands in its pecking order, most market — and a huge companies still regard it as the year’s key event. expense. Not all “It is the most expensive show of the year. And it’s also the best show of the companies are swayed, year, in terms of the amount of clients you get and the calibre of business you says Rachel Garrahan get,”says Michael Hakimian, chief executive of Yoko London, who attends Jewellery brands have more choice about 20 major trade shows a year. than ever of global events at which to “Basel is demanding for us, but it meet existing and new clients, even as deserves the preparation and bad economic news continues to take investment,”agrees Greek designer its toll on the international luxury Nikos Koulis, who is exhibiting for the market. Richemont, for example, fifth year; he says every year has been reported a 3 per cent decline in profits better in terms of sales than the last. for the final quarter of 2015 and “For 2013-14 we grew 20 per cent. For cancelled this year’s Watches & 2014-15, it was approximately 13-15 per Wonders fair in Hong Kong. cent,”he says, adding that the slight Each event serves its own purpose. In slowdown last year reflected market the last month alone, jewellers could turbulence in France, Ukraine and reach wealthy individuals in Doha or Russia. fashion fine jewellery customers during Amrapali, the Indian jeweller, took a Paris Fashion Week. Executives and break of seven years before returning designers agree, however, that no other to Baselworld in 2015. Tarang Arora, show is close to having the same scale chief executive and creative director, as Baselworld. says the decision to return after being More than 1,500 watch and jewellery awarded an improved stand location brands are exhibiting and visitor close to Hall One has paid off in terms numbers this year are expected to of sales. “Location is key in any show remain stable at 150,000. While there but especially at Baselworld. We get a may be complaints behind closed doors lot of passing footfall from the top about the show’s expense and a brands.”This year the company has made additional investments to its stand, including handcrafted Indian cabinets and mirrors. For Garrard, “Baselworld is a pinnacle event,”says head of sales Laura Davidge. Its luxurious two-floor, 292 sq ft stand gives the British heritage jeweller an opportunity to present new products in the best light to both international wholesale partners and press. “Our participation at Basel has aided in increasing our international wholesale partner network over the past four years approximately fourfold,”she adds. After 16 years at Baselworld, however, Stephen Webster is not exhibiting this year. The company has its own extensive store network as well as strong wholesale relationships. This, together with the collapse of Russian- speaking market, meant “we couldn’t justify the costs any more”,he says. “The rent on my Rodeo Drive store in Beverly Hills is less in one year than Baselworld is in eight days.”He will revisit the situation in future. “We’ll Baselworld visitors are ahead of see how Baselworld intends to connect the curve — Didier Oberson me with my client.” 4 ★ FINANCIALTIMES Thursday 17 March 2016 Baselworld | Watches & Jewellery

Too many watches, not enough customers, Jorn Werdelin tells Simon de Burton, plus our picks from Baselworld’s Hall of Fame

Jorn Werdelin is 1 Corum 2 Gucci 3 Carl F Bucherer worried about oversupply Anna Gordon

The first Bubble with a tourbillon and a If you’re bored with leather and steel, The Pathos range now has a swan which, chronograph, this also offers a second Gucci has a Plexiglas case and bangle while perhaps not subtle, certainly shines time zone for those trips abroad for the fashion-forward crowd with its 922 diamonds and sapphires 12 Omega Basel 2016 floorplan 4 Harry Winston

To hall 3 A49 D49 Corum C37 Gucci 1 Porsche 2 Design Girard- A39 Perregaux Ulysse C33 C35 Jean Nardin Richard

A33 Carl F Bucherer Reymond Weil D35 Bell & Ross 3 Oris A31 Chanel C31 Breitling D31 Tissot

A25 C25 D25 Hamilton Jaquet Droz Calvin Klein Balmain Rado Certina Glashütte This Speedmaster offers an image of the The moon glides across the horizon in the Mido moon so detailed they say you can see D23 Premier Moon Phase 36mm, eclipsed by Harry 4 an astronaut’s footprint on its surface Longines Omega Winston mother-of-pearl at the end of the cycle 12 11 Tudor A19 D19 5 Blancpain Luxury Breguet Blancpain 5 A11 D15 Rolex Chopard 6 11 Tudor D11 watches Patek Philippe

‘Big brands To hall 2 A05 D05D05 will suffer in will be told Hublot Zenith 7 10 to put a A01 D01D01 Bulgari TAG Heuer 8 positive 9 their surfeit spin on during Rolex’s sibling goes big on bronze in the It may be the 60th birthday of the Baselworld’ Heritage Black Bay Bronze, a diver’s Ladybird, but Blancpain is using watch alluding to bronze ship fittings Louisiana crocodile leather for the strap

his year marks a decade released by the Federation of the Swiss sometimes, due to so many ‘pre-Basel’ 10 Hublot 6 Chopard since the sale of the first Watch Industry are anything to go by, launches, before the event has even watches of Linde Werdelin, such reports could become more famil- started. To me, that means some of its City a London-based brand iar. The numbers showed overall historicalpurposeislost.” Lounge T founded by Danish-born exports down by 8 per cent to SFr1.4bn But while Mr Werdelin still regards it Jorn Werdelin, a former investment ($1.4bn), with 300,000 fewer watches as more or less essential to show at banker, and his life-long friend Morten being shipped globally than in the same Baselworld because of the concentra- Linde, a product designer. While Linde period last year. The top three markets tion of key players in the global watch Werdelin still makes fewer than 1,000 also recorded drops, with Hong Kong communityitattracts,healsobelievesit V01 Bundesverband pieces per year at an average price of down33.1percent(its12thmonthlyfall can be something of a double-edged Schmuck + Uhren SFr21,000 ($21,000), growth had been in succession), the US down 13.7 per sword to a small, independent brand V03 reassuringly steady — until last July centandChina1.9percent. suchashis. Comité Francéclat when, says Mr Werdelin, sales began to Thistroublewillnothitthebigbrands “We make fewer than 1,000 watches slowdramatically. hardest — it will be smaller companies peryear,andthecosttousofshowingat V05 Japan Clock & Henowpredictsaperiodofcorrection likeLindeWerdelinatthesharpend,Mr Baselworld is around SFr200,000 Watch Association across the board, and believes that this Werdelinsays.“Iftheendcustomersud- ($200,000)—thatworksoutatanenor- A100 A105 A107 Boss Tommy couldbethetimefortheindustrytostep denly decides that what he is being sold mousamountperwatch.Inaddition,it’s Coach Hilfiger back,reassessandprepareforalessrosy isn’t real, then we might suddenly find also necessary to produce extra stock Lacoste Juicy Couture future. ourselves back to where we were in the for the show and, of course, you are also A111 Movado “In some ways, I think much of the 1970s. much more inclined to accept orders. In its ceaseless quest for the unusual, Ebel Scuderia Ferrari The first watch from the Precious Chopard industryhaslostsightofthefactthatwe “There has been an enormous That’s great when times are good, but if Hublot needles interest in an organza Concord collection, sapphires and diamonds vie for are making luxury goods, and that amount of creativity during the past 10 we then fulfil those orders during a pro- silk dial with bright embroidery your attention in quite some number means things which should be desirable or 15 years, but I can really see all that longed period of falling sales, retailers and at least relatively rare. But when I disappearing. If we face difficult times are very likely to sell our watches on at 9 Bulgari 8 TAG Heuer 7 Zenith see the big groups pushing so hard to ahead, I expect the big groups will get discount prices because they need to increaseproduction,tomakeevermore bigger — and that makes me wonder maintain cash flow in order to pay for models and to open mono-brand stores whetherornotwewillseethebeginning premises,staffandsoon.” which squeeze traditional retailers, I of the end of smaller, independent This has unpleasant knock-on effects: start to become a little bit afraid — brands, which are often the really crea- “Customers who have previously paid because what will happen if the cus- tiveones.” the full price see their watch as being tomer suddenly realises that this hard WhenLindeandWerdelinsetuptheir devalued.Theotherproblemthatarises sell indicates that he or she is being brand in 2002 (the first pieces came out in a saturated situation is that we have encouragedtobuysomethingthatisnot in 2006), their aim was to create to hold on to any overproduction in reallyrareatall,butthatismore-or-less mechanical watches which, uniquely, order to prevent it from ending up on massproduced? double as platforms for quickly detach- the grey market — but the production “Scarcity must remain the key — lose able electronic “instruments” capable train can’t just be switched on or off. that, and I think the attraction [of a lux- of logging performance data for skiers, Eitherway,ittakesthreetoninemonths ury watch] is gone,” says Mr Werdelin. diversandthelike. due to the period of time required to His brand has traditionally produced LindeWerdelinfirsthadapresenceat order, manufacture and supply compo- only small numbers of each model, a Baselworld in 2009, and also hosts nents.” policywhich,hebelieves,helpstomain- retailers and journalists on a smaller A result of the slowdown, says Mr tain residual values and serves to scale during the SIHH show in Geneva. Werdelin, is that Swiss suppliers who enhancetheperceptionofLindeWerde- Butnow,asthebrandpreparestoattend were previously too busy to accommo- The Serpenti Incantati offers the TAG has reissued the Monza, still with Their 2015 movement, the Elite 6150, house’s snake motif in a new coiling pulsometer and tachymeter scale, but with its 100-hour power reserve, beats linamongwatchenthusiasts. Baselworldfortheeighthyearinsucces- datesmallbrandsarenowcomingtohis design To many, Mr Werdelin’s overview of sion, Mr Werdelin has started to ques- doortooffertheirservices—buthefeels now made from grade 5 titanium again but this time in a rose gold case the situation might seem unnecessarily tiontherelevanceofsuchevents. it is unlikely that Linde Werdelin will FT graphic compiled by Tatjana Mitevska Source: FT research negative — but it is, he insists, realistic. “My father and grandfather were in needthem. Contributors In September and October of last year, the watch and jewellery business before “I have no hesitation in admitting he claims to have been told by me, as retailers with stores in that, from the annual 30-40 per cent Ralph Atkins Kadhim Shubber Steven Bird some retailers that sales Denmark. When my father growth that we’ve been enjoying during Switzerland correspondent Alphaville reporter Designer growth across all makes had went to the Basel show 30 the past three years, we are going to be Alan Knox virtually ground to a halt. years ago, he did so reduced to single figures in 2016 with Simon de Burton James Wilson Picture editor (Not that you will hear because it was the only sales down, in real terms, by perhaps as Contributing editor, How to Spend It Mining correspondent muchtalktothateffectat way to see what was much as 25 per cent,”says Mr Werdelin. Tatjana Mitevska FT researcher Baselworld: “I think new. Exposure was Like many in the industry,he attributes Lindsay Fortado Elisa Anniss, Camilla Apcar, employees of the big very limited then, the downturn to myriad factors ranging Legal correspondent Anthony DeMarco, Rachel Garrahan, For advertising details, contact: brands will be told by and if a watch was from the fall in the oil price to flat inter- Avril Groom, Hettie Judah, Ming Liu, , +44 (0)20 7873 the management to put launched it might est rates and China’s continuing anti- Elaine Moore Syl Tang, Rachael Taylor, Charlotte Williamson 4038, [email protected], or apositivespinonthesit- not appear in the corruption drive, which began in ear- Capital markets correspondent Jessica Twentyman, Kate Youde uation during Basel- press until one or two nestin2012. Freelance journalists your usual FT representative. world.”) monthslater. “There’s a lot going on — and, when Michael Pooler If January’s figures “Now, however, news is you put it all together, it’s easy to see Industry reporter All editorial content in this report is produced by the FT. Our advertisers so instant that everyone why people might not place buying a Josh Spero have no influence over or prior sight of Oktopus Double knows about the latest new luxury watch at the top of their list Aliya Ram Commissioning editor Date Carbon Green products in seconds — and ofpriorities.” Consumer industries reporter the articles. Thursday 17 March 2016 ★ FINANCIALTIMES 5 6 ★ FINANCIALTIMES Thursday 17 March 2016 Technology | Watches & Jewellery 3D printing adds new time-telling dimension The digital world You can reinvent the tourbillon or devise impossible shapes with ease, says Michael Pooler

atchmakers have spent more than two centu- ries perfecting the tour- billon mechanism, W which brought unprec- edented accuracy to time-telling, so the idea of an amateur making their own version from scratch might seem at odds with this hallmark of haute horlo- gerie. YetChristophLaimer,aSwisscompu- terprogrammer,hasdonejustthat—he has 3D-printed the parts for his own tourbillonoutofplastic,exceptforafew pins and screws. “It’s a design of my own. The mechanical principle is long knownbutthearrangementisnew—it’s pletely different way, such as hollow- not have “the same aspect and light One company in the small but grow- Christoph niques: “[3D printing] has almost areinvention,”hesays. form structures,” he says. “An advan- reflectionassteel”. “Inourfieldofactiv- ingfieldofwatch“micro-brands”isALB Laimer’s 3D- become a way of life, which makes our Although Mr Laimer’s rendering is tage of laser sintering [a type of 3D ity,this is the best means to have a scale (Atelier le Brézéguet). The two-man printed parts for workshop a lot more efficient and does much larger than a conventional tour- printing] as opposed to casting is you’re 1:1 prototype within a couple of hours — French outfit makes colourful and a tourbillon of complement those hand and artisanal billon and runs only for about 30 min- able to produce a watch case out of solid from 3D [computer-assisted] design to three-dimensional dials — one repre- his own design skills.” utes before it must be rewound, it metal but with a honeycomb interior,so reality,”says Elie Bernheim, chief exec- sents a countryside landscape, another Butsomehousesare“scared”ofusing demonstratesthepotentialofatechnol- it’smuchlighter.” utiveofRaymondWeil. a sky — that are mounted on move- additive manufacturing for end-prod- ogy already widely used in jewellery 3D printing also enables quick turn- As such advantages favour small- ments manufactured by ETA, a com- ucts in case they lose their handcrafted making. rounds and the ability to produce one- scale producers, the technology is open- panythatispartoftheSwatchGroup. brand value, according to Michael Sor- While smartwatches and wearable offs without needing to order parts or ing up entry points along the price scale “Wedecidedtouse3Dprintingnotfor kinofFormlabs,whichsuppliesdesktop technologies are sometimes cast as the tools, making it a valuable tool for pro- for a new generation of watch designers trendy reasons but because it was the 3D printers to professional designers, cutting-edge of innovation in horology, totyping. Marques including Patek and start-ups with novel or unorthodox onlywaytodosomethingdifferentfrom dentists and jewellers, as well as watch watchmakers ranging from hobbyists Philippe,VacheronConstantinandTAG ideas. what we could find on the market,”says companies. and small independents to large Swiss Heueruseitforthispurpose. Industry figures add that 3D printing co-founder Simon-Pierre Delord. “We MrSorkinsaysthatdespitetheexcite- houses are exploring the possibilities of Christian Selmoni, artistic director of technologies are not yet accurate createaframethat’slikeapainting.” ment surrounding the technology, or 3Dprinting,alsocalled“additivemanu- Vacheron Constantin, says 3D printing enough for movements — the complex Despite only initially intending to perhaps because of the hype, the full facturing”. is used for every new model and new beating heart of a mechanical time- make some watches for friends, the pair potential of the technology risks not Through a process that forms objects case design. Over 10 years, he says, “it piece. Items made with 3D technology now make a handful each month to beingrealisedinwatchmaking.“There’s layer by layer, it enables experimenta- has proven to be a very important tool are typically non-moving parts such as order, with price tags of €1,500 and a danger of 3D printing being used as a tion with new shapes and forms other- forus,aswecangoquicklyfromcompu- dials,casesandstraps. €2,500. They hope to sell some items in coolgimmick,”hesays. wisenotpossiblebytraditionalmachin- ter renderings to a solid ‘volume’. It Over the past couple of years a hand- shopsbeforetheendoftheyear. Other limitations of the present tech- ing techniques. This is expanding the helps us a lot to judge the proportions ful of chronometric ventures using 3D In a profession that cleaves to its arti- nology include tolerances, or the degree boundaries of design and production in and overall design of a watchcase, for printing have sought internet crowd- sanaltraditions,therearealsosignsthat of deviation from a parameter of accu- watchmaking, particularly with pre- example.” But because they are not funding. These have ranged from a some bigger and longer-established racy.“If you want to do an assembly of a ciousmetalssuchasgoldandsilver,says made of steel, 3D models do not have watch printed out of a wood-like com- horologists are starting to harness addi- watch [movement], it could be OK at Jeremy Hobbins, head of horology at “the same definition” as the finished posite material to a brand that allows tive manufacturing for larger-scale 0.1mm, but normally you need to Birmingham City University’s School of product. buyers to customise colours, patterns production. be under 0.1mm,” says Simon- Jewellery.“The way of modelling things Marc Walti, product director of TAG and cut-out initials on a flexible nylon Mappin&Webb,anEnglishsil- PierreDelordofALB,whoadds means you can build things in a com- Heuer, concurs, saying 3D models do strap,thoughnotallaresuccessful. versmith that once made ear- that his parts take about five rings for Marie Antoinette and attempts on average to get traces its roots to 1775, has for right. several years produced For now, consumer bespoke jewellery such as interest appears limited to wedding rings through 3D enthusiasts who are keen on printing. This summer it will the capabilities of the tech- launch its first watches with nology, according to Robert- cases made that way — two pieces JanBroer,whorunstheFratello resurrected from its archives “with Watchesblog. aslightlymoderntwist”,saysElizabeth Yet he says additive manufactur- Galton,thecompany’screativedirector. ing could take off where it offers lower OneistheAustenforwomen,inspired costs and the ability to make uncom- by 1920s dress watches worn either on a mon designs, particularly in the case of silk strap or hung from a lapel, retailing smallerproducers. at £900. The additive process helped “Pricewise, some micro-brands are with modifications: its Art Deco design really interesting as they tend to stay was “technically quite a challenge as it’s below €1,000 for a mechanical watch quiteslimwithacurve”,MsGaltonsays. [whereas] with the established brands She does not see a cultural clash it’s more difficult to find one below between the old and the new tech- €2,000thesedays,”hesays. Jewellery makers seize on tech’s speed and ease Syl Tang on a new tool for luxury craftsmanship

In traditional jewellery craft, a designer creates a drawing required multiple moulds soldered together. Those designs and a manufacturer turns the 2D rendering into a 3D model. can be communicated across language and country barriers A standard run of 15 different styles is made in wax, before with 3D printing. the mould is cast around them, and they may cost a designer “Finding a good [mould maker] can be a challenge,”says $7,500. A single intricate design can be as much as $1,000. Karen Giberson, president of the Accessories Council, the But now that 3D printers range from $4,000 to $25,000, industry association that represents American jewellery creating more models, and more complicated ones, is companies. “If you’re printing a design in a 3D printer . . . the becoming cheaper and easier. guesswork is taken out of it. You make a file; if you print it “It allows me to rapidly prototype very quickly and not out here and you print it out overseas, it’s the same. It’s also a have as much back and forth because you can see the lot easier to change it if you don’t like it.” product live,”says John Brevard, a New York-based designer Some companies such as Metalepsis Projects, which has and architect. offices in Los Angeles and New York, have begun printing in It means surprises can be detected and amended quickly. metal. “Most of our kinetic edition is 3D printed in brass, as “Sometimes you get it back from a manufacturer and you well as all [our] Chromat collaboration in black nylon. We’re say, ‘Oh, I didn’t think it was going to be this big.’Now when able to use it for final products as well (including I’m showing something to a customer, I can print it out in interlocking parts),”says Victoria Cho, co-founder of plastic and they can then say immediately, ‘I want it in gold Metalepsis. (Chromat is a company which creates “structural or silver.’” experiments” in next-level wearables.) The appeal of speed-to-market has lured new talent to However, the ability to print directly in fine metals, which jewellery design. Suuz, a company founded in 2012 by six would eliminate the material lost in refining designs, may be engineers and based in The Hague, had previously explored a way off for the industry. Challenges include working out the technology in entirely different industries, but it now how to powder gold, a soft material, into a fine grain size, features a jewellery catalogue of 50-60 products, each with says Mr Verschoor. Plus it is hard to keep track of the gold potentially infinite variations. The company, which is powder: “Insurance companies are not so happy when you shipping between five and 10 orders a day and intends to tell them you have a cubic foot of powdered gold in your double this volume in 2016, says that meeting customer machine.” expectations more accurately is the main benefit of 3D John Brevard’s printing. Thoscene rings “On the website you get a preview of what you want to order, it’s production ready. They are convinced it will be the right size and know exactly what they’re receiving with these custom models,”says Jan Verschoor, partner at Suuz. Mr Verschoor also cites the ability to hold very little stock and to produce jewellery on demand, at a price point close to standardised product, as key advantages. 3D printers can execute more intricate styles with very little risk. Designs that might not be possible with traditional moulds can be done with the printers, such as objects with elements inside each other, which would previously have Thursday 17 March 2016 ★ FINANCIALTIMES 7 Watches & Jewellery | Security Digitised diamonds battle to defy thieves

tinctive, easily recognisable items of go undetected. An Everledger-regis- Blockchains Could “estate” jewellery, says Mr Higgins, a tered diamond which had been falsely new technology have smart thief wouldn’t even attempt to claimed for would be much harder to sellonapieceinitsintactstate. sell on, assuming the buyer checked out stopped a country Precious metal, after all, can be itsprovenance. melteddown.Diamonds,onceliberated The big drawback is the unique iden- house robbery? Jessica fromtheirsettings,areeminentlyporta- tifying number laser-engraved on a dia- ble, thus easy to transport abroad on a mond’sgirdlethatlinksaphysicalstone Twentyman reports commercial flight, stashed in a piece of tothe“digitalcopy”heldonEverledger. carry-onluggage,forexample,andthen AsVartkessKnadjian,chiefexecutive hen Lord March soldoninaforeignmarket. of Backes & Strauss, the world’s oldest kind of technology based on a global order to create a convincing new trans- Goodwood described a violent rob- Enter the blockchain. This is perhaps diamond company, points out, remov- positioning system (GPS) that is actionhistory. House was bery at Goodwood best known as the underlying technol- ing such an engraving is an easy job for small enough to be incorporated into Thistechnology,ofcourse,wouldonly robbed in House, his stately ogy for the bitcoin digital currency, but an experienced diamond polisher. Ms one of his company’s diamond-set work on “estate” jewellery, such as that January home, in January as it is becoming clear it has applications Kemp says that this process often watches without compromising its owned by the Marches, if the owners Simon Margetson travel/ W Alamy “challenging”,this was a very particular for diamonds too. Blockchain is, in depletes a diamond’s value, by remov- aesthetics. were prepared for pieces to be disman- kindofEnglishunderstatement.Heand essence, an online recording system ing weight — but that may well be a sac- The big And there are additional problems tled, to get the individual diamonds LadyMarchhadbeenattackedbyabur- which can be used to track where a dia- rifice that a determined fraudster or with which the industry must contend, laser-engraved,andthenreassembled. glar in the middle of the night, forced to mond comes from and can keep strict thiefispreparedtomake. drawback is mainly around its largely paper-based With antique items, there’s a consid- open their safe and tied up for two details of how and when it passes from Technology needs to catch up with the unique documentation processes: one is the erable risk of damage to the settings, hours. owner to owner. (See box for a more thieves. “As an industry, there’s a prob- issuing of fraudulent certificates, which might be almost impossible to More than 40 items were stolen from detailedexplanation.) lem here with traceability that technol- identifying another is the altering of genuine ones. repair without devaluing the item. In their 18th-century house near Chiches- That, at least, is the idea behind Ever- ogy really should be helping us to solve number Transaction histories are often incom- other words, Lord and Lady March may ter, south-west of London, including a ledger, a London-based start-up that is — and I still believe that it will, but we’re plete, or a stolen gemstone may be in future still have to rely on old-fash- diamond tiara dating back to 1820 and using blockchain technology to replace not there yet,” says Mr Knadjian. He engraved on traded multiple times in swift succes- ioned detection, rather than up-to-the- an emerald and diamond ring given by the current paper-based and fraud- says he is yet to see, for example, any a diamond sion in Dubai or India, for example, in minutetechnology. Charles II to his mistress Louise de Kér- proneprocessesthatsurrounddiamond ouaille, duchess of Portsmouth. Ear- ownership. rings, bracelets, necklaces and antique For a start, explains the company’s Rolex and Girard Perregaux watches chief executive Leanne Kemp, a block- werealsopartofthe£700,000haul. chain-based ledger like Everledger is If the theft were not bad enough, with not stored in one place, but is distrib- every week that passes the prospect of utedacrossapotentiallyvastnumberof recovering any of the heirlooms grows computers belonging to participants in bleaker. The last public update from a network. In Everledger’s case, these Operation Forster — the investigation are owners, insurance companies, dia- into the Goodwood House robbery — mond certification bodies and law came on January 27, when it was enforcementagencies. announced that a “substantial” reward Every member of that network has for information leading to the jewels’ access to the most up-to-date version of recovery was being offered; since then, the ledger, making it transparent. Each nothing. record on the ledger, meanwhile, is However, as a range of new security immutable — so the transaction history measures emerge, future victims may of a specific diamond can only be added farebetterthantheMarches. to with a new “block” of information. Stolen jewellery normally disappears This creates a complete chain of owner- without a trace, says Paul Higgins, head ship that can be trusted by the whole of specie at RK Harrison, part of Hyper- community because it cannot be other- ion Insurance Group. “You tend to see wisealteredorremoved. recoveries only when thieves are appre- Most importantly, Everledger holds a hended quickly, within weeks,”he says. multi-layered, digital version of a dia- “Much beyond that, recoveries are very, mond that links closely to its physical incarnation,viatheserialnumberlaser- engraved on its girdle. As with all dia- Everledger’s mond certification, the all-important Leanne Kemp says “four Cs” of a stone — its cut, colour, it holds records of 980,000 diamonds clarity and carat weight — are captured with the main goal on Everledger, along with its serial of combating fraud number, but 40 other data points are addedtoo. very rare. I’ll be honest, in around 15 By early February, Ms Kemp says, years,Icanonlyrecallworkingonacou- there were around 980,000 diamonds ple of cases where jewellery actually registered on Everledger, allowing net- resurfaced a year or more after it was work members to check out a stone’s stolen.” full history and characteristics. The “The recovery rate of diamonds is informationthatEverledgerholdscould usually very low. Open-source cases thus be useful in investigating robberies show that stolen diamonds and jewel- of high-value stones if they resurface lery are usually not found,” said a 2013 some time after an insurance claim for report by the Financial Action Task theirlossorthefthasbeenpaidout. Force, a Paris-based intergovernmental That is not Everledger’s primary pur- body set up to combat money launder- pose, Ms Kemp says, which is to combat ing and terrorist financing, two activi- fraud rather than theft, by helping ties frequently fuelled by stolen dia- insurance companies guard against monds. In a case such as the Goodwood fraudulent claims. According to Ms House burglary, involving highly dis- Kemp,around65percentofsuchclaims

Guide How do blockchains work?

To understand blockchains, it is worth expense of efficiency. If one computer looking at the digital currency bitcoin, fails, data are not lost because many writes Kadhim Shubber. other computers hold the same Bitcoin was launched in 2009 by an information. anonymous person or persons using Another is immutability. New entries the name Satoshi Nakamoto. The in the database are tied to preceding intent was to create digital money that entries using cryptography, creating a would be free from the control of chain that prevents earlier entries governments and banks. from being altered. Combined with the To prevent such a thing from being distributed nature, this dramatically shut down, it needed to exist in more increases the likelihood that any than one place, as governments can record made in a blockchain system seize and destroy one computer will be permanent. server. Distribute the information Some of these things become across many computers over the world redundant for spinout applications of and the task becomes so prohibitive as the blockchain. Bitcoin is open to the to nearly be impossible. whole world and full of anonymous What is more, a central authority users — are such security measures or could not be trusted to verify incentives necessary when users are transactions for the same reason. So pre-vetted and known? the users themselves do it, adding But with either the public bitcoin blocks of transactions on to the network or some more private, generic existing chain and stamping it by blockchain system, there is the solving a computationally difficult potential not just to maintain a maths problem, just as a writer might database of transactions but to link seal a letter by using a wax stamp. those transactions to individual, While debates continue over the identifiable real-world objects. sustainability of bitcoin, a broad range The ownership history of a specific of new and old companies are creating diamond, for example, could be stored their own blockchains, including securely and permanently, providing Everledger, either choosing to make confidence about its true source. The them accessible to anyone or to a obvious difficulty is that a digital select few approved parties. database, no matter how technically But whether companies choose to advanced, cannot in itself address the use the existing bitcoin infrastructure real-world issue of fraud. Indeed the or to create their own blockchain permanence of blockchain systems system, the core characteristics that carries that risk that fraudulent make the technology appealing as a records persist — blockchains solve database are the same. many things, but cannot escape the One of these is its distributed myriad political, legal, ethical and nature. Instead of one copy of the economic complexities of the real database in one place, a blockchain world. necessarily has many copies in many So think of it as just a sort of places, providing reliability at the database, albeit a very interesting one. 8 ★ FINANCIALTIMES Thursday 17 March 2016 Watches & Jewellery Tokyo, where time runs backwards

even years ago, Reiho Shibata The appreciation for European and opened Item, a vintage watch American vintage watches, and their store in Shibuya, Tokyo, iconography, is palpable from the where he specialises in minute you walk into some of Tokyo’s S watches from the 1960s, such leading vintage watch shops. as the Rolex Date and the Omega At Carese, which has three Tokyo Constellation. Within the glass cabinets stores, vintage point-of-sale materials that line the walls of the small shop, such as a 1960s poster advertising an there is a 1970s Cartier Vendome, an Omega Constellation are sometimes Omega Ladymatic from the 1960s, a just as compelling to the Japanese Rolex 1956 Precision. Although a watch collector as say, a pristine 1950s vintage Seiko sign is bold in the Omega Seamaster. A short walk away window, it is an anomaly: European at Dazzling Shiggy Collection, there is and US watches, not homegrown European and American watch brands, are why collectors come. Mr memorabilia such as a framed Omega Shibata says most of his customers are advert circa 1950, which fetches Japanese; the typical client is aged 25 to Y12,000 ($106) — positively entry level 30, buying a watch priced at around when you compare it with a 1965 Y100,000 ($880). Jaeger-Le Coultre Automatic Date for The vogue for vintage watches has its Y330,000 ($2,900) plus tax. roots in the shared cultural history of Carese uses original advertising many of today’s buyers. According to material and original boxes to enhance Masayuki Hirota, a watch expert who vintage watches by Rolex, Omega, IWC, writes for Chronos Japan, Nikkei Patek Philippe, Vacheron Constantin, Magazine and GQ Japan, the 1980s and Longines and Breitling. “We acquire 1990s saw a lot of publicity and interest most of these advertising goods, dating in vintage watches in the country. “Our from the 1920s to the 1970s, at vintage passion for vintage watches was watch shows,”says Emi Nomura, who strongly influenced by the Italian works in the sales division at Carese’s market in the 1980s,”says Mr Hirota. Roppongi Midtown branch. Company “From there the boom spread and staff travel to Germany, the UK and strongly took root in Japan.”He various cities in the US, including estimates that Tokyo has about 50 Miami and Los Angeles in search of vintage watch stores, when you add the vintage watches. At Carese, prices city’s pawnshops into the mix, and range from Y100,000 ($880) to Y7m names Carese, Private Eyes, Shellman ($62,000) for rare pieces. And of all the and Kusumoto pawnshops as among brands, “Rolex especially is always in the best. demand,”she says. Indeed, such is the appetite for Benjamin Clymer, founder of the US- vintage watches in Japan today that based watch blog Hodinkee, says fashion-forward, multi-brand stores wearing a vintage watch has become like Beams, United Arrows and Arts & part of the uniform in Tokyo. He Science carry a selection in their describes the Tokyo hipster as a man flagship stores. Even Shellman, he says, who “wears Visvim, carries Porter has outposts in department stores such [magazine], drives a vintage Land as Isetan Shinjuku Men’s, Mitsukoshi- Rover Defender, shoots with a Leica Ginza and Barneys New York. and wears a vintage Rolex Submariner Adding to the appeal of vintage big crown”. watches are favourable exchange rates and a rise in tourist visits to Japan. suyoshi Tojo set up East According to the Japanese National Crown in 1995 and was Tourist Organisation, the estimated later joined by his son number of international visitors to Katsutoshi, who says that Japan in November 2015 reached over T the turning point in the 1.6m, a 41 per cent increase on the business followed Christie’s Rolex previous year, with China, Taiwan and Daytona “Lesson One” auction in Korea the top three countries of origin. Geneva in November 2013, when However, Christophe Savioz, Swatch investors bought vintage watches. Group’s country manager for Japan, “Since then, the market for vintage says that Chinese tourists are in the Rolex has become crazy and changed a main “interested in current models, dealer’s life,”says Mr Tojo. and are not seen as much in pre-owned East Crown does not have a and vintage stores”. storefront and operates in a by- “Tokyo is well known as the main appointment showroom. “We wanted vintage watch hub for Asia,”continues our customers to see our watches Mr Savioz. “I would say that many privately, without any noise, Asian watch collectors come to Tokyo distraction or a feeling of being rushed. to find classic timepieces. Considering Also, we don’t have a lot in stock to that Omega, which is part of the display in a shop. Swatch group, was one of the earliest “We believe that in the vintage watch brands present in Japan, it is market it isn’t volume but the quality natural that a lot of our vintage of watches that is important.” watches, such as highly sought-after East Crown’s watches are sourced Constellations and Speedmasters from from all over the world and that too is the 1960s, are available.” Clockwise from top: where customers come from, seeing Rolex Daytona ‘Paul stock on their website or on Instagram. ‘The market for vintage Newman’, Rolex He says that what is most in demand Explorer, Omega depends upon where the customer is Rolex has become crazy Ladymatic, Cartier based. “In Japan, it’s a Rolex Daytona and changed a dealer’s life’ Vendome, Omega ‘Paul Newman’,and in Hong Kong a Constellation, Rolex Rolex Submariner is more popular ‘Jean Claude Killy’ than any other watch.” He cautions, though, that the pre- Illustration Nuno Da Costa And Mr Tojo’s predictions for the owned watch market is quite separate future? “We specialise in chronograph to Omega’s own retail and boutique watches and expect that the Killy 6036 network in Japan and that the only and 6236 — the most complicated time the brand liaises with vintage Vintage watches On a trip to Tokyo, Elisa Anniss observes watch ever produced by Rolex — will retailers is when there is a request for a soon be a hit in the market, as it’s still watch to be serviced. that you are hardly a hipster without retro wristwear undervalued and rare.” The skill behind the skull

Design Fiona Krüger has fought Fiona Krüger since it’s women’s watches it has to be women designing Watch out for... (right) is them . . . but I do think they should involve women in Five inspirations prejudice against her sex, age and breathing life thediscussionatsomepointbecausethat’syourmarket.” into her skull By her own admission, Mrs Krüger knew nothing about nationality to bring her iconoclastic watches watchesfiveyearsago—untilshefellinlovewiththem.While Kari Voutilainen watches to market. By Kate Youde Cédric Widmer studying for a master of advanced studies degree in crafts- The Finnish watchmaker’s eye for manship and design for the luxury industry at ECAL in Swit- detail impresses Mrs Krüger: “The zerland, she was fascinated by the decorative techniques she finishing on his watches is Four things stood against Scottish designer Fiona Krüger saw during course visits to the Audemars Piguet manufacture impeccable.” beingtakenseriouslyasawatchdesigner.Suppliers,shesays, andthePatekPhilippeMuseum. “justthought[Iwas],one,awoman;two,under30;three,not As her degree project, she presented a prototype of a skull- Maximilian Büsser evenSwiss;andfour,designingaskull-shapedwatch”.Eachof shaped watch, inspired by the themes of time and mortality, The founder of label MB&F was on these cavils makes Krüger a curious rarity in the “conserva- and spent two years finding supply partners before launching the jury for Mrs Krüger’s degree tive . . . male-dominated”worldofwatchmaking. production of her first Skull edition in 2013. The Black Skull project and still offers her advice. Mrs Krüger, 30, says the industry needs to improve its andcolourfulCelebrationSkullseriesfollowedoverthenext image,whichshelikenstothatofcognac,toattractmore twoyears.Herfourthseries,PetitSkull,launchingatBasel- Jean-Marc Wiederrecht women:“Whenyouthinkofacognac,youimagineyour world, is a limited edition of 54 stainless steel pieces — “He’s been behind some of the dad in his library with his slippers on with a cigar and a 18eachofsilver,blueandblack. most creative watch movements on cognac.”It was the same for watches — it “doesn’t say to Mrs Krüger, who studied fine art at Edinburgh College the market,” says Mrs Krüger of youngwomen,‘Thisisalsoforyou.’” of Art and now lives in Alsace, France, does not have Agenhor’s co-founder. She suggests watchmakers need to create products that technical watchmaking skills so her pieces are made by appeal to women. “Originally,I felt like brands didn’t really six people who each specialise in a different aspect of the Carole Forestier-Kasapi get the difference between designing a watch for a girl and craft. Mrs Krüger admires Cartier’s designing a watch for a woman,” says Mrs Krüger, whose The designer wants to use her fine-art background to master watchmaker for being watches are unisex. “I just kept seeing pink or diamonds or reinterpret traditional Swiss watchmaking techniques: in “adventurous” with movements. flowers. Those kind of watches are absolutely fine because her latest watch, engine turning is used to “sculpt” the skull, there are lots of women who like that but women have much likeasculptormightuseachisel,withadenserpatternsetting that then allows me to be a lot more open minded and free in Martin Frei moresophisticatedandvariedtastes. back the eyes and jaw. The balance wheel moves within the terms of the watches I want to design, and how I want to make “We have a similar thought process “Fashion brands aren’t doing pink flowery dresses so I don’t skull’srighteye. them.” and I love talking to him about understandwhyinwatchesyoudon’tseethatvariety.” Her outsider status — at first her weakness — is now her watches and art,” says Mrs Krüger She believes women’s watches were previously a “second strength,MrsKrügersays.“IthinkbecauseIamnotfromthe Harrods, Fiona Krüger’s first UK retailer, is hosting a pop-up of Urwerk’s co-founder. thought”, although that is changing. “I’m not saying that watch industry... it means I don’t know what the rules are and exhibitionofherwatchesbetweenMarch31andApril27. Thursday 17 March 2016 ★ FINANCIALTIMES 9 Watches & Jewellery

presentedtoJackBrabhamforwinningthe inventoryoutthere.ButIthinkthe 1960sand1970sbypreviously Going under 1960FormulaOnechampionship. auctionhouseshaveseveraladvantages, overlookedmanufacturerssuchas Time is up for EstimateSFr30,000-SFr60,000.May14, notleastinthefactthatwedon’thaveto Yema,ElginandBenrus.Notlongago, Geneva. layoutlargesumsofmoneyonstock. whentheycouldbeboughtfor$200, the hammer Wecanalsobeselectiveaboutwhatwe collectorswouldscarcelylookatthem. John Reardon consignandcanadvisesellersofvalues Nowtheyarefetching$1,000-$2,000. May’sGenevawatchauctionsshould Christie’s, New York basedoncurrentmarketconditions. Watchtowatch:Corum“Buckingham”, above-inflation provideabarometerofthepre-owned Itisclearthatthe Ithinkthefutureliesinsmaller,very originallyownedbyElvisPresley.Estimate watchbusinessinthefaceofadeclinein worldofwatch well-curatedsales,andwhilemajor $10,000-$20,000.April13,NewYork. newretailsalesandgeneralfeelingsof auctionsis pieceswillcontinuetocometoauction, economicuncertainty,writesSimonde becomingmoreand themarketisnotlikelytobeflooded Jonathan Darracott Burton.Here,expertsfromthefive moreaboutvintage, withthem.Aswiththeartmarketasa Bonhams, London price rises leadingspecialistauctionhousesgive eveninHongKong, whole,Ithinkpeoplearefeeling Weholdregular theiropinionsonthestateofthe wherethesaleshavetraditionallybeen cautiousaboutspendingbiggersums. auctionsofmore collectormarket. dominatedbymodernpieces. Nextsale:May14,Geneva. affordablewatches an Audemars Piguet at 20 per cent dis- Manycollectorsareasking [from£500]atour Watches An outbreak count and the James Bond Omega is at Aurel Bacs themselveswhytheywouldconsider Julien Schaerer Knightsbridge of candour in the 38 per cent off. This is the model they Phillips/Bacs & spending$5,000onaPatekPhilippe Antiquorum, rooms . . . butnone justlaunchedlastyear.” Russo, Geneva Calatrava[asimplethree-handwatch] Geneva oftheKnightsbridgelotssoldforan industry suggests Watch companies viewed China’s Therewillbe witharepolishedcaseandarefurbished We’reheading exceptionalsum—biddingseemedvery unprecedented growth as a reason to watcheswith dialwhenthatsame$5,000couldbuy towardsourbigMay controlled,andbuyershadclearlydone rampant price ramp up production, as with Citizen, estimatesfrom somethingsuchasaUniversal salewitharealistic theirresearchandsetlimitsonthe which cited expansion into China as the SFr3,000- chronographinsuperb,original attitude—there’sa amounttheyweregoingtospend. increases are a thing of reason for its 2012 acquisition of La SFr500,000 condition. definiteuncertainty Ithinkthebiggestthreattothewatch Joux-Perret. ($3,000-$500,000).AndIthinkthat Watchtowatch:1817Breguetpocketwatch intheworldrightnow,andIthinkwe’re businessasawholeisprobablyfromthe the past, says Syl Tang Yet appetites for luxury goods were sayssomethingaboutthewayweneed formerlyownedbyCharles-LouisHavas, feelingthatintheauctionmarket. greymarket.Ifwatchesdon’tsellat already slowing as far back as 2012, toviewthecurrentmarket—that founderofAgenceFrance-Presse.May16, Interestingly,however,weare retailandendupinthesalerooms,they tterances from the Swiss when Pinault-Printemps-Redoute (now qualitycanactuallybeaccessible. Geneva. noticingthatcollectorsarelooking inevitablyfetchone-thirdtoone- watch industry tend to be Kering) saw just a 2 per cent increase in Bidderswillrangefromstudentsto hardertofindvintagebrandsthatareon quarterofthenewprice.Wewouldn’t sugar-coated, which is why Gucci’s sales in the Asia-Pacific region. billionaires,andtheywillallbethereto Tim Bourne therise—pricesofsomewatchesby turnnewwatchesaway,ofcourse—but Georges Kern, chief execu- With the production cycle of Swiss buyanepicwatch.Buttobe“epic”,a Sotheby’s, London makerssuchasUniversalandTAG we’reconsciousthat,whenretailers U tive of IWC Schaffhausen, watchesatanywherefromayeartofour watchnolongerneedstohaveaseven- Speakingtopeople Heuer,forexample,havedoubled, resorttosellingatauction,it’susually causedsuchastirinNovember2015.He years for the haute horlogerie pieces, figurevalue.Itneedstobeingreat, inotherareasofthe tripledandevenquadrupledduringthe thestartofadownwardspiral. said that watches in the industry were makersarenowfacingexcessinventory. originalconditionandhaveanamethat pre-owned pastthreeyears. Watchtowatch:Rolex“Comex” overpriced — a rare statement in gen- “Most of the brands,”says Mr Sadigh, resonates. business,there We’realsoseeinganincreasein Submarinerdivewatch.Estimate eral, even more so from a company “are telling you they’re not aware of the Watchtowatch:BreitlingDuograph appearstobealotof demandfordivewatchesfromthe £40,000-£60,000.June22,London. ownedbyRichemont,oneoftheworld’s discounting, but in some cases they biggestluxuryconglomerates. know they sold watches to distributors His brand has decided to bring prices or retailers which they knew did not down by focusing on its two mid-level have the capacity [to sell through]. collections, Pilots and Portofino, They say, ‘Oh, I don’t know where my launched in December 2014. Indeed, watcheswent,’buttheydo.” IWC confirms that prices for new Pilots Onlinediscountsmayrepresentafirst are lower now than when similar mod- quarterreactiontothesoft2015holiday elswerelaunchedin2012. season. But the discounts could also be As the brand with the highest growth part of a wider trend; Patek Philippe, within Richemont, one of the big three which declined to be interviewed, made watchgroups,MrKern’smovemayindi- a downward price adjustment in select cate what consumers can expect from markets 12 months ago because of the Baselworld:pricesadjusteddownward. unpegged Swiss franc, according to an Itcan’tcomesoonenough,saysAdam openletterfromchiefexecutiveThierry Craniotes, chief executive of Red Bar, Sterntoretailpartners. the worldwide watch lovers’ group, as Others in the industry are wary. “We inflation has been widespread and know what’s going on, and unfortu- relentless. “Honestly, it’s every brand. I natelythere’snobusinessasusual,”says don’t think there’s a single brand that Stephen Urquhart, chief executive of didn’ttakeadvantage,”hesays. Omega,whoindicatesthebrandwillnot Some within the watch industry are reduce prices but acknowledges 2016 even pleased that prices are now being willbeachallenge.“We’vebeenthrough examined. Alain Zimmerman, chief this. Omega has been trying to get its executive of Baume & Mercier, a Rich- position back properly so the worst emont brand, says: “I’m so happy that thingtodoistoloseconsistency.” price has finally become part of the dis- cussion. In the past, price didn’t matter mega is a case study in alot[tootherbrands].Formanypeople what will and won’t work $2,000isahellofalotofmoney.”Baume in shoring up prices. It has & Mercier decreased prices on its Clas- spent recent decades simarangeby10percenttwoyearsago. O working to restore the On the whole, growth in watch prices brand to its pre-1970s position when it has been outpacing inflation, says Jon was head to head with Rolex in prestige, Cox, head of European consumer equi- pricing and demand. Approximately 10 ties for Kepler Cheveux. “From years ago, the company dropped 2000-14, the value of the industry has numerous retailers including US increased on a growth rate of 6 per cent department store Macy’s and started year over year, but in unit terms, there building standalone flagships in an was no growth. So the boom is entirely effort to bring back parity.This leaves it due to prices.” Core global inflation has less at the mercy of wholesale distribu- not been above 3 per cent since 2000, tors’pricingpolicies. accordingtoJPMorgan. Following similar logic, over much of The most likely explanation for such 2014-15, brands within the Richemont exuberant price rises is the increase in group opened standalone stores, seizing wealth around the world. According to control of their inventory and distribu- the World Wealth Report 2015, com- tion. The conglomerate currently does poundannualgrowthinwealthbetween more than 50 per cent of all retail sales 2009 and 2014 was 7.7 per cent. Wealth withintheirownstores,accordingtothe in Asia, the key new market for luxury WorldWatchReport. goods, went from $5.9tn in 2002 to Brands within the Swatch Group such $15.8tnin2014. as Longines have rapidly moved to The consequence of such wealth- greater control. In the past twelve driven demand is that when growth fal- months, the company has opened three ters — such as with the current collapse of its own shops in the US, a market in commodity prices and the rise in the whereitdidnothaveasinglestandalone Swiss franc after it was unpegged last boutiqueayearago. year — the luxury market does too. The This suggests that it will be able to Federation of the Swiss Watch Industry maintain prices, as does its ownership. recorded a 3.3 per cent decline in value Richemont, Swatch and LVMH can of sales from 2014 to 2015, with Hong absorbthecostsofexcessstockorcoun- Kong falling by 22.9 per cent and main- teracttheeffectsofincreasedcosts. landChinaby4.7percent. Reduced prices please prospective In the light of such news, it is less sur- buyers — but almost no one else, says prising that the discounting of sought- Mike Margolis of Horology Works, after watches can be openly found which represents H Moser & Cie, Haut- across reputable internet retailers. lence, Anonimo and Cyrus Watches David Sadigh, founder and chief execu- across North America. “My personal tive of the Digital Luxury Group, a opinionisapricedecreasemakesevery- Swiss-based watch industry analysis body angry: the guy who bought two company, says he constantly sees steep weeks ago is angry, the dealer is angry; discounts. On Jomashop.com, a watches the only guy who likes you is the one and luxury goods website, he says you whohasn’tboughtyet.” can find Rolexes with discounts of Of the brands he represents, Margolis between 10 and 25 per cent, “and Ray- indicates that none has yet indicated a mond Weil is 75 per cent off. I’m seeing price shift downwards for Baselworld, with the exception of Hautlence which Georges Kern has already made a correction on one reference after feedback indicated it wasinitiallyslatedtoohigh. Pressure on prices comes from the Apple Watch too, which starts retailing at $549 and goes up to $1,500 for a modelwithaleatherstrapbyHermès.If Apple releases a major update, the Dig- ital Luxury Group estimates the likely sales of 25-30m pieces would hammer the mid-priced Swiss watch market at a time it canill-afford. The importance of prices is more than symbolic. Even if they do start to come down, whetheropenlyatBaselworld or surreptitiously afterwards, it may not be enough to pro- tect independent brands, says Kepler Cheveux’s Mr Cox, who sug- gests that consolidation and takeo- vers are likely. Prices may be only thefirstthingstofall. 10 ★ FINANCIALTIMES Thursday 17 March 2016 Watches & Jewellery

My Favourite Pieces John Taylor, inventor of the electric kettle switch, likes his watches to take him back in time. By Kate Youde Collector with a mind for the mechanical

hile he was flying across Arctic Canada near which does one revolution in 29-and-a-quarter days. It’s not the Magnetic North Pole, John Taylor’s something that fits in with round numbers . . . any people compass stopped working. Without have a watch today which tells you the panicking, he and his co-pilot navigated 500 phase of the moon?” W miles on the map “down that river, across this lake, to that island, round that mountain”.Eventually, A Puritan watch (1630) by James they landed in Alaska, and Mr Taylor found a new interest in Vautrollier navigation which soon developed into a passion for Mr Taylor is also fascinated by timepieces. the context in which his 17th- Mr Taylor, 79, has always had a mind for the mechanical: century watches were produced. he invented the switch which causes modern kettles to shut His Puritan watch, which he off when the water has boiled. In 1999 he retired from Strix, bought in 1999, is so called the company he founded to make safety control systems for because of its undecorated domestic appliances, and has since amassed a globally case, even if it is made of gold important collection of early English clocks. (He invents and has an elaborate, expensive clocks too: he designed and funded the Chronophage, a large mechanism. “It’s got a gold-plated clock on display in Cambridge which has a metal little calendar on it so grasshopper atop it, “eating” the seconds.) it will tell you the “I’ve collected more clocks than watches,”he says. “Good date, which is quite a watches are rarer than good clocks. It’s odd that [Thomas] thing for a 400-year- Tompion, the most famous of the makers, in round figures old mechanism,”he made something like 500 clocks and 5,000 watches.” says. But only 200 watches survive — and rarely in their original state: they “tend to be butchered along A Rolex Oyster Perpetual (1957) the way because people would try and He does not wear his antique pieces, which would originally make them more accurate”. have been carried around the neck on a ribbon. For “high days and holy days”,he uses the engraved stainless A quarter repeater watch (1697) by steel Rolex Oyster Perpetual he received on Thomas Tompion his 21st birthday in 1957. “It was a bribe,”he This is Tompion’s earliest surviving admits. “My parents offered me the Rolex if I quarter repeater, which Taylor didn’t smoke before I was 21.” bought at auction in 2002. It sounds “It went to Spitsbergen [in northern the number of quarters since the last Norway] with me in 1958 and I specifically set hour, as well as the number of it accurately to time before I left. It never left hours, when the plunger is pressed. my wrist in a hundred days and in all that time This helped people tell the time in the we were cutting samples of geomagnetic rock dark, rather than getting out of bed to light a candle. out of cliffs, hammering away with a hammer “That mechanism is uncommon on a clock and Left to right: Tompion’s quarter repeater; Munday’s and chisel, sleeping in tents in cold weather exceptionally uncommon on a watch,”says Mr Taylor, who astronomical verge watch; a Breitling minute repeater; and man-hauling sledges.”It lost just over a was awarded the OBE in 2011 for services to business and Vautrollier’s Puritan watch — Andrew Barton minute, “quite exceptional” given its horology. “Tompion was a perfectionist and he worked treatment. with [natural philosopher] Robert Hooke, who was a spring man, and he would use springs to bias the view, an inventor’s point of view,”he says. He tries to Breitling minute repeater (1998) mechanism one way or another so there was no understand how a design evolved. That his Rolex fell short led Mr Taylor to buy a possibility of the watch striking the incorrect time.” He therefore appreciates the “very, very clever digital quartz watch; he likes the Breitling because he mechanism” within Munday’s rare astronomical verge has both digital and analogue modes. He sets this An astronomical verge watch (c1660) by Joseph Munday watch. “The moon goes round the earth in about 29-and-a- minute repeater — his “everyday” watch — to show both While Mr Taylor admires the beauty of his pieces, he takes quarter days,”says Mr Taylor, who bought the watch at GMT and local time wherever he is. It’s perfect, he says, particular pleasure from looking at their internal workings. auction in 2002. “You’ve got to get a mechanism which will for navigation — which sparked his love of watches in the “I view all clocks and watches from a manufacturer’s point of turn a cog, which will turn a disc, which will display a moon, first place.

Oh deer! Not that Apple Oil and water watch Despitehorologists traditionallybattling Actor shoots RaymondWeilhas tokeepwaterwell madewhatits clearoftheir an ad — and chiefexecutive mechanisms, ElieBernheim Neuchâtel-based describesasa HYThasachieveda an animal “major surprisingdegreeof investment”in successwithits signingadealwith “hydromechanical” FrenchactorGérardDepardieuhas AppleCorps—notthe watcheswhichindicate liveduptohiscontroversialimageby techcompanybutthe thepassingoftimeby appearinginaRussiantelevision multimediabusinessformed pumpingcolouredliquidaround commercialforCvstoswatches byTheBeatlesin1968.Thedealwill atinycapillarytube. alongsidethecorpseofadeerheclaims enabletheindependent,family-owned NowHYThasannouncedthatitand tohaveshotwithahigh-poweredrifle. brandtoassociateitselfwithThe Preciflex,thecompanyfoundedto The50-secondsequenceshows Beatles,useimagesoftheFabFourin developtheliquidtimekeeping Depardieuleaningoverthedeadanimal advertisingcampaignsandproduce technology,haveraisedafurther andtoyingwithaspentbulletcaseashe Beatles-themedwatches.Thefirstof SFr23m($23m),whichwillenablean says,“Tosmokeadeeryoualwaysneed thesewillbelaunchedatBaselworld expansionoftheproductrangeduring tobeontime.ThankstomyCvstos,I andissettobemadeinaneditionof thenextthreeyears. wasontime—anditwashistime.” 3,000examples. Time to pay Pour Monsieur Mondaine,whichiswellknownfor Chanelhaschosen The Mille deal supplyingthedistinctiveclocksusedat Baselworldtolaunchits TheMcLaren-HondaFormulaOne Switzerland’srailwaystations,has firstwatchdedicatedto teamhassigneda10-yearpartnership becomethelatestbrandtoincorporate men.The“Monsieur” dealwithavant-gardewatchmaker acontactlesspaymentsystemintoa usesthefirstChanel RichardMille,whichdubsitsproducts wristwatch.TheMondainePayChip, movementtobedesigned “racingmachinesonthewrist”.Richard whichwillbedemonstratedat andassembledin-house. Milleisexpectedtorevealthefirst Baselworld,canbeconcealedinsidea Fiveyearsin watchesinspiredbythecollaboration specially-designedstraporina development,thehand- laterthisyear,anditsproductswill universalstraploop.Thedeviceuses woundmechanism nowbecomethepublicwristwear NearFieldCommunicationtechnology showsthetime ofMcLaren-Hondadrivers toenablepaymentsofuptoSFr40 througha JensonButtonandFernando ($40)tobemadewithnomorethan combinationofdigital Alonso. whatMondainedescribesasa“flickof jumpinghourand Thebrandtakesovertheroleof thewrist”.Similarsystemsarealready retrogrademinutes officialMcLarenwatchfromTAG availableontheAppleWatchandthe displays.TheMonsieur Heuer,whichnowappearsonthe recently-launchedSwatch“Bellamy”. (around£30,000)will enginesoftheRedBullteam.Bell& SimondeBurton initiallybeavailableinan Rossrecentlyannouncedanew editionof150inbeigegold partnershipwithRenaultSportand and150inwhitegold.Until CasiowithScuderiaToroRosso. now,maleChanelfanshave hadtomakedowiththemore masculineversionsofthe Start your engines ceramicJ12which,saysthe TheLVMH-ownedZenithwatch house,hasalwaysbeen brandissettofurtheritstieswith presentedasa“unisex”model. theautomotiveworldby announcingitsappointmentasa partneroftheDistinguished Clubbable Gentleman’sRide,anannual Jaermann&Stübi,thenichebrandthat motorcycleeventwhichseesbikers makesgolf-inspiredmechanical gatheratlocationsaroundtheglobe watchesincorporatingspecialshock eachSeptembertoraisemoneyfor absorptionsystemsandstroke prostatecancercharities.Zenithwill counters,willusedayoneofBaselworld officiallylaunchthepartnershipat toteeupanewseriesdedicatedtothe BaselworldonSunday,March20,inthe golferIanWoosnam.Itwillfeaturecases presenceofMarkHawwa,amotorcycle madeofmetalrecycledfromtheirons fan,marketeerandbrandingexpert usedbythe58-year-oldelshmanto whofoundedtheeventinSydney, securevictoryatthe1991USMasters. Australiain2012. Jaermann&Stubiwillalsounveila Bylastyear,theDGRhadgrowntothe watchdesignedtomarktheinclusionof pointthateventswerestagedin400 golfinthisyear’sOlympics;itwillbethe cities,attractingmorethan37,000 firsttimethesporthasfeaturedinthe ridersandraisinginexcessof$2.2 gamessince1904. million. Thursday 17 March 2016 ★ FINANCIALTIMES 11 Watches & Jewellery | Data

estate, compared with 17 per cent for brands’ own pages. For 3. Instagram has become by far the most important social platform jewellery brands, the opposite is true (chart 2). total number of visits) Fabrice Paget, founder of the Luxury Brand Agency, based Per cent (Numbers in brackets = Instagram = likes, comments 80 Luxury brands in London and Philadelphia, says prestige brands whose Facebook = likes, comments, shares audience is a few thousand people worldwide may need to Twitter = favourites, retweets provide a segmented digital experience in the same way a n=40 brands luxury retail experience is divided, with private areas selling 60 special items for VIP clients. lack digital savvy “It may be counterintuitive to established thinking but if my cheapest product is a ring at $40,000 I don’t want to talk 40 to all people,”Mr Paget says. “[We need to] filter people Online On websites and in apps, watchmakers away and create a different experience for my best clients. It’s a very different business model than a company selling a 20 and jewellers are making up for lost time million bottles of perfume after a fashion show.” The L2 data reveal that 75 per cent of “prestige” brands here luxury watch and jewellery brands once (such as Patek Philippe and Van Cleef & Arpels) actively lagged terribly behind the rest of the promote assisted purchase options (online concierge 0 business world when it came to digital services) on their website. The number drops to 57 per cent innovation, they still lag — but much less for less expensive “masstige” brands and falls to 35 per cent Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 W than before. “The industry has improved for “accessible” brands. (14.8m) (16.5m) (22.2m) (24.8m) (22.3m) remarkably as compared to other sectors,”says Scott Source: L2 Digital IQ Index: Watches & Jewelry, December 2015 Galloway, founder of business intelligence company L2. Comparing progress since the organisation’s first Digital IQ 2. The grey market dominates search results for watch brands have 75 per cent of all the interactions. Nor is it ever too late Index in 2011, he says the march of digital innovation has First-page results on brand term search to start. Rolex, the last company among those surveyed to been “slow but steady”: “When we first did our survey a move on to social media, now has one of the most robust quarter of the brands were selling online. Now those not Watch Brands Jewellery Brands presences among the brands surveyed, including the largest selling online are in the minority.” Facebook following of a watch brand (chart 4). However, the findings for L2’s most recent survey of 66 The brands in the survey differ widely in terms of the type Other Grey market Other Grey market brands in December 2015 show that most of these companies of image they project and the customers they attract. still lack advanced features wealthy consumers might expect Department Galloway says this is why there is no single method to 14% (chart 1). stores 14% success when implementing a digital programme. Department 26% When it comes to website features, the majority of brands 8% “There’s no such thing as a digital strategy,”he says. “You are good at offering the basics, but only 18 per cent have 38% stores have a corporate strategy and digital is a tool to use to sortable results and only 15 per cent allow you to initiate implement that strategy. No matter how big the brand, you servicing online, especially useful for watch buyers. 15% 9% 31% have to pick your punches and do one or two things really Watch brands in particular need to worry about what Retailer well.” comes up when a potential customer looks for them on 8% Retailer 7% Galloway adds that no matter the strategy, brands need to Google or other search engines. Grey market sellers (non- 17% 13% adapt quickly to an increasingly digital world. “Every time authorised dealers) have been very successful at being seen E-tailer Brand E-tailer Brand you hear a siren it’s an analogue person dying and a digital on paid search results. Across watch brand queries, grey person being born.” market channels control 38 per cent of the advertising real Anthony DeMarco Source: L2 Digital IQ Index: Watches & Jewelry, December 2015 4. A few brands dominate social media 1. Many brands’ websites are missing out on sophisticated features The importance to brands of using social media to create a Per cent of brands with given feature, 2015 community and engage both customers and admirers is clear 60 in the report — although not all social media are of equal Facebook Instagram value (chart 3). 29.8m interactions 82.4m interactions 50 Twitter, a text-based medium, has never been a major player for watch and jewellery brands: its share of social Other Tiffany & Co Other Tiffany & Co 40 engagement has bumped along the bottom at 1 or 2 per cent for the past year and a half. In the meantime, Facebook has 12% Rolex 19% Alex & TAG Heuer 18% gone from Instagram’s near competitor to a distant rival: Ani 30 33% 10% 3% Facebook’s share has fallen from 44 per cent in Q3 2014 to 19 Alex per cent a year later; Instagram, concurrently, has grown 8% & Ani Cartier 6% 16% 20 from 55 per cent to 80 per cent. The total number of visits has also seen a fit of growth: David 8% Bulgari 9% 14.8m in Q3 2014 to 22.3m in Q3 2015 (a slight fall from the Yurman 5% Pandora 10 6% 6% 15% previous quarter). 6% 6% Bulgari 14% In terms of brands who best use social media, there are TAG Heuer 0 some clear leaders. Tiffany & Co dominates both Facebook Hublot IWC Pandora Hublot Geolocation Buy Schedule Compare In-store Live and Instagram, and its Instagram posts have over 34,000 online appointment products pickup chat interactions each, while the average from brands in the Source: L2 Digital IQ Index: Watches & Jewelry, December 2015 December 2014-December 2015 Source: L2 Digital IQ Index: Watches & Jewelry, December 2015 survey is 3,000. Overall, the top five brands on Instagram China dangers receive mixed reviews Consumer sentiment Americas more depressed than Asean by Chinese slowdown Lao Feng Xiang Co store in Mong Kok — Bloomberg / Xaume Olleros

Consumer sentiment across the key Chinese consumer confidence* has been falling for years emerging markets of China, Southeast 75 AsiaandLatinAmericahasbeenunable to withstand the impact of the Chinese economicslowdown,writesDavidWilder of FT Confidential Research. In China 70 itself, hopes that consumer activity would hold up as old economic drivers slowed down have faded: there is evi- dence that growing uncertainty about 65 the country’s financial future is crimp- inghouseholdspending.Astockmarket * An aggregate index of the YoY crash, a depreciating currency and a changes in consumer sentiment sharp economic slowdown have driven 60 Chinese consumer sentiment to record lowsinthepastfewmonths. 2011 12 13 14 15 16 Thefortunesoftheemergingmarkets Source: FT Confidential Research — and the global economy as a whole — are inextricably linked to Chinese Asean countries are cautiously positive, while demand and, as China has slowed, so Latin America despairs consumer sentiment in many countries Chinese consumer confidence index intheseregionshassuffered. 70 China’s slowdown has hurt Latin Asean America, where economic confidence 60 among consumers has, with a few nota- Improving confidence 50 ble exceptions, fallen sharply. Polls of Deteriorating confidence consumers show confidence among 40 Brazilians, Chileans and Peruvians in 30 their economies — always low — has continued to fall away, reflecting their Latin America 20 gearingtothelarge-scaleexportofcom- 10 modities to China. In Mexico and Colombia,however,whicharemoretied 0 to US economic fortunes, sentiment has 2014 2015 held up, while the anticipated election Source: FT Confidential Research offree-marketeerMauricioMacritothe Argentine presidency saw confidence in Malaysian and Thai consumers is also Latin America’s third-biggest economy weighed down by political uncertainty actuallyriselastyear. in those countries. However, Indone- Sentiment surveys show consumers sians and Filipinos began feeling more in Southeast Asia remain generally Mexico, optimistic thanks to increased govern- upbeat but the China effect means they ment spending to counter the slow- are also less confident in their econo- Colombia, down. mies. China’s slowdown, coupled with Philippines, the associated fall in commodities FT Confidential Research offers data-based prices, has taken its toll on Malaysia in Indonesia insights into China, Southeast Asia and particular, though sentiment among fare better LatinAmerica 12 ★ FINANCIALTIMES Thursday 17 March 2016 Watches & Jewellery Smartwatches herald new legal battles

Patents With technological advances come claims of intellectual property theft. The Apple Watch is the latest accused, says Lindsay Fortado

hen executives at Valencell, a North Carolina-based tech company, agreed to meet Apple researchers in 2013 to discuss the heart-rate sensor technology they had W developed for mobile fitness trackers, they probably envisioned a potentially lucrative partnership with one of the wealthiest companies in the world. Apple was, at the time, believed to be creating a watch that would incorporate the technology used in its iPhones and iPads. Any deal incorporating Valencell’s fitness technology could be particularly profitable for the seven-year-old company so Valencell was all too eager to help. But after a series of meetings at which Valencell demonstrated its technology to Apple, no contract was ever offered and the tech giant, Valencell alleges, disappeared. Yet when the Apple Watch was unveiled, Valencell claims the product contained the exact functions that it had been showing to Apple — and Valencell has filed a lawsuit to that effect. The lawsuit, filed in January at federal court in North Carolina, also alleges that Apple employees who were working on developing the watch used fake names to download publicly available white papers from their website detailing how the sensors worked. Apple had not yet responded to the claims in court at time of writing and declined to comment to the Financial Times. “Apple is knowingly using Valencell’s patented technology in an effort to achieve a licensing rate that is below a reasonable royalty,”Valencell’s lawyers allege in the lawsuit. Apple had decided “that the benefits of infringing upon Valencell’s patented technology outweigh the risk of being caught and ultimately forced to pay damages”. The Apple never likely to be as big because smartwatches are not demonstrated a watch to about 15 Apple employees that While the case may seem a straightforward intellectual Watch has not considered as essential as smartphones have become. included a heart-rate monitor. Apple was sent some of the property dispute, it is also one of a handful of lawsuits arrived without “Alot of the foundational technology that formed the basis products powered by Valencell’s technology, known as around the technology used in the emerging field of controversy of the fight in the smartphone wars is still applicable, like PerformTek, the lawsuit alleges, and until March 2014 Apple smartwatches. Lawyers are not expecting the same multi- Getty Images touch screens,”says Mr Calia. Many of these disputes have carried out detailed testing on the products and analysed million-dollar litigation boom that was seen in the patent now been resolved through lawsuits. “But there could be a their circuitry. In December that year, there was another wars stemming from the first smartphones, but they are number of other areas that are unique to smartwatches, such meeting with Dr LeBoeuf. By April 2015, Apple began predicting further claims as the market matures and a wider as biometric sensors that monitor your pulse. You can’t do shipping its watch, without ever negotiating a contract with range of companies seek to create watches with ever- that with your smartphone. Or around flexible displays, Valencell, it is alleged. The North Carolina tech company is improved technology and design features. there’s a whole lot of technology around miniaturisation. If accusing Apple of infringing four of its patents and of unfair The battles between major tech companies including and when there are lawsuits I suspect it’ll be on those sorts of and deceptive trade practices. Apple, Nokia, HTC, Google and Sony over smartphone technologies.” While the majority of legal disputes over smartwatches are technology began in late 2009 when Nokia and Apple sued He cited a lawsuit in federal court in the Eastern District of bound to hinge on intellectual property rights, they are not each other for alleged infringement of various patents. In the Texas in which a patent that covered security systems, where the only issues engaging lawyers. ensuing years, lawsuits, countersuits and trade complaints a smartwatch could be used to turn on or off a car alarm, was In the EU, regulation that takes effect in March gives have mounted, resulting in verdicts and settlements that in dispute. In that case, last June, Colorado-based Intellectual smartwatch makers an advantage: customs agents now have have reached and sometimes exceeded $1bn. Some cases are Capital Consulting sued Apple, Samsung, Lenovo, LG, Sony the right to seize any counterfeit goods that pass through a still going on. and car manufacturers including Audi, BMW and General country in the trade bloc. Previously, if the goods were Last year, Apple and Ericsson began a dispute over Motors. It claimed they were infringing its patent for remote shipped from China, en route to the US, for example, whether the Swedish technology group’s 4G mobile patents car start, lock and alarm systems via smartwatch. customs officers did not have the right to seize them, says are essential for the manufacture of the iPhone and how “That’s an example where there’ll be a distinct point of Daniel Marschollek, a disputes partner at Norton Rose much Apple should pay if they are. It was settled in function; those are the kinds of things we’ll probably see,”Mr Fulbright in Frankfurt. “For sure there are counterfeit December 2015 with a patent licensing deal between the Calia says. “There’s unlikely to be the big titan v titan smartwatches out there,”Mr Marschollek says. “We have for companies. litigation that we saw in the smartphone wars.” a considerable period of time represented the then world- Alan Fisch, an intellectual property lawyer at Fisch Sigler Mauricio Uribe, a partner in Seattle with the intellectual market leader in cell phones and whatever they launched in Washington DC, says the level of claims will depend on property law firm Knobbe Martens, says it is unlikely there was immediately copied.” how popular the watches become. “Smartwatch patent will be a rash of claims over smartwatches because, in Then there is the long-shot case filed in Los Angeles battles will increase or decrease as a function of the demand addition to it being a smaller market than smartphones, they County Superior Court by a group called Coalition Against for the product itself,”he says. “Substantial patent disputes do not work in the same way. Distracted Driving against companies including Apple, often follow a substantial demand for a new product class. “Other than some of the more generic Bluetooth or WiFi Samsung, Microsoft and Google. It asked for at least $1bn This was true for sewing machines in the 1800s, disposable standards, the operation of smartwatches to date does not ‘Substantial annually to fund a public education campaign to explain the diapers in the 1900s and smartphones in the 2000s.” involve standardised technologies,”he says. “This makes risks of using smartwatches while driving. Analysts at Gartner, a technology research company, patent evaluations more specific to the individual devices patent And in a David v Goliath dispute, a 32-year-old man from expect the market for smartwatches to soar, with sales and does not lend itself to widespread licensing efforts akin disputes Wales won a lawsuit against Apple over a crack in his Apple projected to rise 6 per cent from 30.32m units in 2015 to to the smartphones.” Watch Sport, which he noticed 10 days after he bought it in 50.4m units this year, generating about $11.5bn in revenues. In the Valencell lawsuit, the problem began in February often follow July. The tech giant refused to reimburse him because it said That figure is projected to increase even further in 2017 to 2013 when Liang Hoe, at the time a senior partnership substantial the claim was not covered by warranty, but Gareth Cross 66.71m units. manager at Apple, contacted Valencell to discuss the latter’s challenged them in a small claims court in Aberystwyth, Kurt Calia, a litigation partner at Covington & Burling in heart-rate sensor technology. Talks between the two demand for Wales, saying the company had claimed it was scratch- Silicon Valley, says that, so far, there is not the same demand companies progressed and in June 2013 Dr Steven LeBoeuf, a new resistant. Apple was ordered to refund the watch, plus Mr for smartwatches that there has been for smartphones, but the co-founder of Valencell, met Apple representatives to Cross’s legal costs, and may have to change its marketing that could change as the technology develops and more discuss using some of its features in Apple’s products, the product claims as a result. Mr Cross told the BBC that despite the companies introduce their own versions. Still, the market is lawsuit says. In the summer of that year, Valencell class’ dispute, he would be buying another Apple Watch.

Deconstructed Watch Hublot Ferrari Sapphire The idea is to represent the Hublot MP-05 Winding crown power of the La Ferrari’s La Ferrari engine in clockwork form

With its hybrid engine containing a 6.2- litre, V12 petrol engine and an electric Cylinder display KERS motor, Ferrari’s £1m F150 “La for power reserve Ferrari” supercar has 950 horsepower and a top speed of 217mph. It also wails like a banshee and draws crowds 11 barrels in line for wherever it goes — and the fact that just 50 days’ power reserve 499 will be produced ensures that every Cylinder display buyer gains access to an elite club. for the hours But when it comes to demonstrating membership, what is a La Ferrari owner Minutes to do when their pride and joy is away, being expensively serviced, or simply tucked-up in the upmarket garage? One answer might be to spend a third of the car’s value on a wristwatch to go with it. No sooner had the wraps been pulled Vertical tourbillon Tourbillon cage that off the F150 at the 2013 Geneva Motor indicates seconds Show than Hublot, official watch partner of the marque, unveiled its counterpart: the MP-05 La Ferrari wristwatch, designed to resemble the car’s transparent engine cover. That original model, limited to 20 examples costing £225,000, is now followed by a version being launched at Baselworld, which takes the idea of FT graphic Photo: Hublot showing off the “engine” of one’s watch even further: it has an entirely see- through case made from seven parts, grams and allows an almost unhindered and enable it to run autonomously for 50 is echoed in the hour, minute and second polished sapphire crystal and titanium. could not be described as understated, each machined from a solid block of view of the 637-part tourbillon days once fully charged with a special, displays that take the form of revolving, With a price tag of SFr500,000 practical or cheap. Which, on reflection, sapphire crystal. movement, which features no fewer than electric winder. The idea is to represent transparent cylinders. Indeed, even the ($500,000), the MP-05 La Ferrari makes it the ideal horological companion Said to have taken 600 hours to 11 spring barrels. These form a “spine” the power of La Ferrari’s engine in watch strap is transparent and is secured Sapphire — 45.8mm long, 39.5mm wide for the car. develop, the case weighs more than 53 running through the centre of the watch clockwork form. The see-through theme to the wrist by a buckle made from and 15.3mm thick (very thick indeed) — Simon de Burton Jewellery

Boucheron’sboss Ten milestones in Statement necklaces on being nimble precious stones demand attention

INTERVIEW Page 19 TOP TEN Page 16 TREND Page 16 Diamonds suffer from oversupply in new era

mond are all a larger force than they Raw materials After werejustfouryearsago. The trade is now focused on how companies invested quickly demand will stabilise and billions of dollars, increase, helping to eliminate the over- hangofinventory.Thesignsaremixed. mines are being shut Underlining its claims to be more transparent, De Beers has started to down. By James Wilson publish data from its 10 annual dia- mond sales events (known as sights). nly eight years ago, De The first two sights of 2016 achieved Beers celebrated the open- revenues of $545m and $610m, ing of Snap Lake — a land- regarded as a strong result. Meanwhile, mark project for the dia- Johan Dippenaar, chief executive of O mondproducer. Petra, said last month that he was The diamond mine in Canada’s encouraged by stable diamond market remote North West Territories was De conditions. And De Beers has taken the Beers’ first outside its African heartland lead in pumping more money into mar- and the first completely underground ketingspendingtoencouragedemand. diamond mine in the country. By the Yet there are continued headwinds in end of 2014, $2.2bn had been spent on theformofthestrongUSdollar,whichis developmentandoperations. dampening demand from some emerg- Yet today, not a single diamond is ingmarkets.ChowTaiFook,China’sbig- beingproducedatSnapLake,whichhas gestjewelleryretailer,reporteda20per been closed with the loss of more than cent drop in demand for gem jewellery 400 jobs as De Beers responds to one of over its key Chinese new year period. the worst market downturns in dia- Andweakeroilrevenuesforstatesinthe mondsforyears.Thisyear,DeBeerswill Middle East are also denting consumer consider whether the mine has a viable demand. future.Asrecentlyas2014theminewas Notwithstanding the shutdown at producing 1.2m carats of diamonds Snap Lake, De Beers is preparing for the annually. opening of a new Canadian mine this The temporary closure of the mine year — Gahcho Kué. Mr Mellier takes summeduptheproblemsfacingthedia- comfort in the fact that, while emerging mond industry during 2015, when a Rough times: diamond mines are being shut as lower demand puts their viability in serious doubt — Getty Images marketsremainfragile,theworld’slarg- downturn gathered pace and led to est and most mature market — the US — financial pain for miners, dealers and diamondtrade—thepolishersanddeal- growth, particularly from Asia, and of decades ago, when De Beers had a Liberum estimates that the duo have remainsbuoyant. retailers. ers — aided by widely available cheap there was reduced industry financing as monopoly on supply and could manage built up 20m carats of rough inventory “We have seen the American con- The industry confronted “a perfect finance. a prominent diamond financing bank the market more effectively to control over the past 18 months, against an sumer’s love affair with diamonds go storm of problems” in 2015, said But signs of cooling retail demand, reduced exposure, a pronounced prices. annualmarketof135mcarats. from strength to strength,” he said in a Philippe Mellier, De Beers’ chief execu- particularly in China, and more caution destockingcycleensued.” During last year’s downturn, De But today the pair control less than speech this month. “As the industry tive,thismonth. bythebanksthatprovidedfinancingfor The consequent period of “inventory Beers, which is now owned by Anglo half of diamond supply, according to begins once again to increase its invest- Today, a greater degree of cautious the diamond trade, led to pressure to indigestion”, as many in the trade American, and its main rival, Alrosa of Citi,sotheirabilitytoinfluencethemar- ment in advertising, there is an excel- optimism is apparent but many dia- reducemidstreaminventories. describe it, led to much lower demand Russia,thelargestminerbyvolume,did ket is limited. Miners such as Rio Tinto, lent opportunity to win back share of mond analysts think the sector could “Manufacturers and channel players forminedroughdiamonds.AtDeBeers, cut sales to try to manage supply: Petra Diamonds and DominionDia- walletfromotherluxuryproducts.” still face tough times this year as the had built considerable speculative rough prices fell 15 per cent in 2015 — impact of rising supply and weak contributing to the pressure on mines demand continues to be felt in the mar- Industry upheaval has led suchasSnapLake.DeBeersalsoshutits ket. “Elevated inventory levels of rough smallerDamtshaamineinBotswana. diamonds and weak end markets will to friction between large Industry upheaval has led to friction inhibit any recovery in rough diamond miners such as De Beers between large miners such as De Beers pricesforatleast12months,”analystsat and some customers over how the pain Liberum,theequitiesbrokerage,say. and some customers is being shared. De Beers, which has Thereisadegreeofconsensusindiag- begun to introduce more transparency nosing what has gone wrong in the stockpiles, supported by inexpensive intoitsoperations,insistedinDecember industry over the past 18 months. Sup- financing and an industry-pervasive that its price cuts were leaving room for plyfromprojectssuchasSnapLakeand belief that rough diamond prices could itscustomerstobeprofitable. other new mines had grown steadily only rise,” analysts at Citi, the invest- The industry turmoil last year points over a six or seven year period. It was ment bank, say. “When prices began to to a big difference between today’s dia- absorbed by the “midstream” of the decline in 2015 amid tepid demand mondmarketandthesituationacouple Gold price takes off in early 2016 as a refuge from turmoil Commodities Buying gold is a questionable act of faith in troubled economic times, says Elaine Moore

Gold is the cynic’s investment, a haven from the vagaries of the wider world, and this year cynicism is proving to be popular.Amidfallingstockmarketsand spiking volatility, the price of gold has soared by close to 20 per cent in 2016 from $1,060 to $1,253 a troy ounce, one of the strongest starts to the year for the metalindecades. Investors who are perennially bullish ongold,knownasgoldbugs,canpointto all sorts of plausible reasons for the out- Asia’s appetite for gold is strong as ever — Getty / ChinaFotoPress performance. According to the World Gold Council, supply is tightening: gold Pixley in central London sells gold bars backed by the fact that gold is not a per- mined in the fourth quarter of 2015 was —£1,477willgetyou50g. fect hedge against economic downturns down 3 per cent compared to the previ- Central banks including Russia’shave and market volatility. During the 2008 ousquarter. been adding to their gold supplies in financial crisis, gold prices strength- At the same time, global markets are recent years, possibly in the hope that ened, but last year’s market turmoil feeling the strain of a slowdown in their currencies will be less inclined to failedtoraisethem. China’s economic growth; concern for weakeniftheirgoldreservesarehigh. Julian Jessop, chief global economist emerging-market stability; and the But for some investors, buying gold is at Capital Economics, thinks the metal long-term effects of quantitative easing, moreakintoanactoffaiththanrational is vulnerable to a short correction as the orcentralbankinterventioninfinancial asset allocation. Gold does not pay out a USeconomyrecovers. assets. fixed income like bonds or dividends To Simon Derrick, chief currency Together they add up to uncertainty like companies. It cannot be used for strategist at Bank of New York Mellon, about the global economy that is push- power like oil or for electrical equip- goldisinterestingforthestoryitcantell inginvestorstoseeksafety. ment like copper. In 2011, then Federal abouttherestoftheworld.“It’samisan- Buyers are changing too. In the past, Reserve chairman, Ben Bernanke, sug- thropic investment that you can’t do a India and China led demand, buying gestedthattraditionisthereasoninves- lot with,” he says. When its price goes gold jewellery, bars and coins. Now torsbuygold. up, he says, it is a sign that faith in cen- western investors are increasing their “Alot of people believe gold is a store tralbankersisgoingdown. buying via gold-backed exchange of value or a hedge against inflation,” Whatnextforthegoldprice? traded funds like SPDR Gold Shares, says Mike Riddell, portfolio manager at Analysts at Société Générale think which means owning units in a trust Allianz Global Investors, “but I have no goldisovervaluedandGoldmanSachsis that owns the gold. Holdings in these idea how to value an asset which has predictingpriceswillfallto$1,000. funds are at a year high, according to limited industrial use and no income Then again, few market commenta- Commerzbank. For investors who want stream. I have no interest in it. How can torspredictedtherallyatthestartofthe to hold gold, a store set up by Sharps the price be justified?” This argument is year. 14 ★ FINANCIALTIMES Thursday 17 March 2016 Markets | Watches & Jewellery

Heritage in flux rices at Asian jewellers Indian immigrants tended to be lower than at the fair, the disgruntled brought lavish shoppers say, because P manufacturers use family traditions of buying or business ties at home to source raw materials and save on labour wedding-gold to costs. Indeed, India is now playing a more Britain. But 50 years important role in jewellery exports on, tastes and the than ever before. India’s diamond exports have almost doubled compared market are changing. with 10 years ago, according to data from the GJEPC. Indeed, Sabyasachi By Aliya Ram Breaking the chains Ray, the GJEPC’s executive director, says almost all diamond jewellery from India is exported, unlike jewellery ast year, India’s Supreme made of gold. “Whatever we produce in Court ruled that women have diamonds, 95 per cent gets exported,” an inalienable right to he says. certain property after Mr Soni saves on production costs by L marriage. Brides, the court sourcing diamonds in Mumbai or said, can lay claim to their stridhan, Surat, port cities in the west, and even if they leave their husbands having them cut and manufactured in without getting divorced. his home town of Ahmedabad, in the This stridhan, whose name comes state of Gujarat. from ancient Hindu law, is the gold and Once the pieces have been imported jewels given as gifts by families to their into Britain, Mr Soni can sell them at daughters as insurance for life after attractive prices. His success speaks to marriage. the decline of jewellery manufacturers For many communities in South in Britain, many of which were Asia, where banking systems are originally based in Birmingham, “the unevenly developed and gold is city of a thousand trades” as it was sometimes the most trusted once called, until cheap imports and mechanism for transporting wealth, recessions caused them to close down stridhan is the only property a woman from the 1980s. explicitly owns. With Prime Minister Narendra Modi The marriageable woman, in this pushing a “Make in India” agenda to way, is the backbone of the Asian turn the country into a global centre jewellery market. But as first- for manufacturing, Mr Ray hopes the generation immigrants in Britain who reputation of Indian jewellery will brought these traditions over are improve so it can fetch higher prices succeeded by their children and abroad. He says trade centres have grandchildren, the market is being already opened in Gujarat, Mr Modi’s forced to reinvent itself. hometown, to promote diamond India consumes approximately artisans. 100,000 tonnes of gold a year — about But even he admits that demand a third of the world’s supply — for fine jewellery is slowing. “Jewellery according to India’s Gem Jewellery is not growing, people are putting Export Promotion Council (GJEPC). their money into [other] luxury items This appetite has been exported with or holidays,”he says. “If the demand its diaspora; the 2011 UK census had has not declined, it has at least 2.99m people of South Asian origin. In stagnated.” the UK, Asians spend more than £220m a year on 22-carat gold and n the London borough of Newham, diamonds, says Pravin Pattni, a former another heartland for British chairman of the National Association Asians, Jayant Raniga buzzes in a of Jewellers and the first person of client as the daylight fades on Indian origin to hold the position. I Green Street. According to Mr Pattni, the average Through the door walks Jag, a South Asian family spends between professional in her 30s, smartly £20,000 and £25,000 on a woman’s dressed with brightly painted red nails. wedding jewellery — but now Beside her is a bespectacled old lady in assimilation into British culture is traditional dress, her handbag clutched changing this. tightly. “This,”Jag declares, “is my A trip to Sparkhill, the centre of nani.” Birmingham’s “Balti Triangle”,bears Jag’s grandmother chatters in Hindi this out. Dotted amid halal butchers to Mr Raniga, the brand director at and Punjab supermarkets selling clay PureJewels and grandson of the man pots and steel dishes, a handful of who brought the shop to Britain in jewellers sit behind locked doors, 1975. Nani is from Kolkata, in West guarding their stock. A number have Bengal, which she still calls Calcutta, its their shutters down and appear to be imperial name. Jag speaks to Jayant in out of business. English. Once the centre of a bustling For Jag, who has a full-time job and jewellery trade, Sparkhill jewellers now career ambitions, wedding jewels more often make headlines for the hardly seem a necessary hedge against crime they attract. One goldsmith, Atif the future. But she insists the Sheraz, says he was robbed while inclination to buy gold as security has walking between his shop and his car. survived in her cultural consciousness: The display cases inside his store are “Nani said buying gold is always a good bare — you must ask in order to see thing as an investment.” anything — and customary masala chai Green Street, a long, still-grubby high tea is not on offer. road in which sari shops and curry Birmingham boasts one of Britain’s houses bustle with the trade of a large densest South Asian communities, with visited Mr Soni at his stall at last once the heart of Britain’s jewel trade, New direction: “With Indian jewellery there’s always British-Indian and Bangladeshi more than a fifth of its population month’s exhibition. He insists it is shopkeeper Ken Taylor smiles Ravleen Ruppal going to be the independent store that diaspora, boasts dozens of shops still having Indian, Pakistani or possible to tap into European knowingly. “That’s the way Asians see (top); Pravin people know of and go to, but we’re targeting women like Jag. The area is Bangladeshi origin, according to the tastes without compromising sales it,”he says. “Gold is gold if you can sell Pattni (left); seeing a bit more in terms of brands.” poor, but a multi-million-pound South 2011 census. I to the Asian bridal market. He it any day of the week.” Ken Taylor’s Ms Rendle says even if shops close, Asian shopping mall that opened on But according to Jaimin Soni of says simplified and more affordable But as the price of gold rises, Mr shop in Indian designs will survive and the street last year suggests a belief in jewellers AG & Sons, who paid £4,000 versions of intricate Indian designs will Pattni says it will become less Jewellery influence fusion trends in the future fortunes. to display his diamonds at this year’s do battle on all fronts. “When an affordable to buy 22 carat, the Asian Quarter, mainstream. Still, Mr Raniga, who has become an annual trade fair in Birmingham, the Indian is buying jewellery, it’s more an staple, and even stalwarts will move to Birmingham Mr Pattni, however, says the unofficial spokesman for Green Street, key to survival for Asian jewellers is investment,”he says. “But the British- lower quality gold, silver and platinum. (middle top and direction of influence is the other way says he is looking to move. “Our future cross-selling to the larger British Indian market is different.” He grins as he acknowledges the above). Below: around: from the British population to clients don’t want to shop in the Asian market, which is worth approximately A “goldsmith by caste”,Mr Soni sees wisdom of forebears who diamond dealer the immigrant. areas except when it’s wedding time,” £2.5bn a year. in the tastes of third-generation Asians recommended the metal to him for Jaimin Soni Ravleen Ruppal, 23, from he says. “To have Jag aspire to own one The Jewellery & Watch exhibition is the end of the British-Asian jeweller as investment purposes; at the time of our at work Chandigarh in Punjab, travelled from of our rings is rare, it means we’ve what fair portfolio director Julie it has been. Peering through his interview, gold had reached a one-year Neville Williams/Anna Gordon India to Birmingham with exactly this punched above our weight.” Driscoll calls “a mammoth security jeweller’s loupe at a ring, he says he is intraday trading high of $1,260 an change in mind. She took a stall at the Mr Raniga, who has experience in operation” for “very high value determined to stay relevant. His game- ounce. Jewellery & Watch fair in the hope that private banking and risk management jewellery”.It takes place in the city’s plan is to try to gain market share from she could sell her upmarket costume with Merrill Lynch and Deutsche Bank, National Exhibition Centre because it is British rivals by offering better value oday, the market for Asian necklaces and earrings, which marry took over PureJewels in 2003. The the only building large enough to host for money. jewellery faces the same Indian motifs with large Victorian-style business began as Bhanji Gokaldas and the spring event of which the fair is a Mr Pattni says that ethnic Asians pressures as the In the UK, stones. Sons in Nairobi, Kenya, in 1950, and Mr part. arriving in Britain during the 1960s mainstream. Karla Rendle, Asians “We Asians,”she says, “we’re not as Raniga now wants to take it to a more But Ms Driscoll says “there wasn’t and 1970s from east Africa, where they T an analyst at Euromonitor Asian as we would like to think.” affluent area of London, such as the appetite” for Indian wholesalers at the were taken as indentured labourers, International, says the retail jewellery spend more A group of disgruntled Pakistani West End. show. “My understanding is that clung to the idea of gold as insurance — industry in Britain has consolidated than £220m shoppers at the fair seem sceptical of Until then, he focuses on the client [British Asian] jewellery is very a safe investment in a strange land. and that the fragmented Asian South Asian jewellery that has been at hand. Jag has removed from its different. Would it appeal to “First-generation Indians came here jewellery trade will head the same way. a year on influenced by European styles, which case an enormous wedding ring independent retail jewellers in the UK and bought lots and lots of gold and “Branded jewellery is on the rise. 22-carat they say also allows branded exhibitors made of multiple snaking bands of that would sell it to UK consumers? To gave it to their children so they Where people would have looked for a to charge higher prices. “There are diamond-encrusted platinum. She my knowledge,”she says, “there is not wouldn’t need a plan B.” particular metal they will now look for gold and Asians selling on the street anyway, so sighs. “Now my only problem is finding a big trend for that at the moment.” In Birmingham’s Jewellery Quarter, a Pandora bracelet. diamonds why would you come here?” a groom.” Thursday 17 March 2016 ★ FINANCIALTIMES 15 16 ★ FINANCIALTIMES Thursday 17 March 2016 Watches & Jewellery

Trend The days when your Brilliant! necklace had to be light and The bold, the big, Ten breakthroughs in jewellery discreet are over, says Rachel Garrahan. Subtlety is Late 17th century Brilliant cut dead — now you need to rock Baroque jewellery focused on maximising brilliance. the biggest rocks the beautiful Developments in gem cutting in the diamond workshops of Paris, Amsterdam and Antwerp produced the precursor of twashardtoignorethebedazzlementofstate- the contemporary brilliant, ment necklaces during this year’s award sea- today the cut of choice for son. From Jennifer Lawrence at the Golden 75 per cent of diamonds. Globes and Saoirse Ronan at the Baftas, both I wearing Chopard, to Charlize Theron in a 1840s Electroplating Harry Winston diamond sautoir of close to 50 car- Gold and silver ats at the Academy Awards, it seems that big neck- electroplating became a lacesarebackinvogueontheredcarpet. mainstay of affordable After several years of the light, layered look pre- jewellery production after vailing, women are returning to bolder choices of the Birmingham surgeon neckwearintherealworldtoo. John Wright developed Fawaz Gruosi, founder and chief executive of De electroplating baths using Grisogono, says that in the past few years the com- potassium cyanide (as pany has been selling more one-of-a-kind pieces, toxic as it sounds). Wright liketheboldmonochromaticdiamondnecklacehe and his associates George plans to unveil at Baselworld this week, and fewer and Henry Elkington of its wholesale collections of lower-priced, gener- patented the electroplating allymorediscreetjewels. process in 1840. This is not just a style-based development, he says. The economic uncertainty that still prevails 1886 Tiffany setting in many parts of the world, he believes, has led to The Tiffany setting for a jewelsandpreciousstonesbeingperceivedasasafe solitaire elevates the single investmentoption. brilliant cut diamond above “Apiece of jewellery has become like a moveable the band of the ring, where asset,” says Mr Gruosi. “If something bad hap- it is held in place by a circle pened,youwouldn’tlosemoneyinitandyoucould of prongs. Raising the takeitwithyou.” stone allows light to flow in While most of De Grisogono’s business at Basel- through the sides, world,hepredicts,willbesplitfairlyequallyacross providing extra sparkle. its one-of-a-kind pieces and wholesale collections, bold, high-ticket items also serve as a branding exercise during the fair. “We bring these pieces for c1900 Platinum clients to understand who De Grisogono is, and for Strong and rigid, platinum eyesofthepress,”headds. came into jewellery Shaun Leane is pleased to see larger pieces com- following the development ing back into vogue. The London-based designer of a means to melt it on an says he always includes a significant statement industrial scale in the necklaceorbroochasthe“heropiece”ineverycol- 1860s. Its particular lection he designs. “They are a beautiful canvas for properties allowed for fine, tellingastory.” lace-like settings At Baselworld he is presenting a one-of-a-kind exemplified by Cartier’s octopus cuff, the first piece in a capsule collection ‘garland’ designs. for Muzo, the Colombian emerald mine. The larg- est piece in the collection, however, is a striking 1905 Cultured pearls necklace of diamonds and emerald cabochons, Mikimoto Kokichi produced scheduledtobeunveiledinMay. the first hemispheric Comparing it to his “Queen of the Night” neck- cultured pearls from Akoya lace for Boucheron’s 150th anniversary in 2008, oysters in 1893. It took which featured an array of precious flowers that another 12 years to create opened at the touch of a button, he says the neck- spherical pearls (like these, lace“isachanceformetoexploreconceptsanddif- owned by Marilyn Monroe), ferentmaterials”. by inserting beads into Statement necklaces also offer Mr Leane’s carefully farmed and bespoke clients a chance to tell their own story. controlled oysters. “There’s a real hunger for uniqueness and people want a piece they feel reflects who they are,” he Early 1930s explains. Today’s self-purchasing, Alexander Clip-on earrings McQueen-wearing female client, he adds, wants a A conservative backlash necklace that is precious but modern in spirit. against the “barbaric” “They want extraordinary jewellery in keeping practice of piercing in the withtoday’sfashions.” early 20th century led to Messikaisanotherbrandpushingacool,modern the development first of vibeinhighjewellery.TheParisiandiamondjewel- the screw-backed earring lerispresentingarangeofnecklacesatBaselworld, and then the less fiddly including the Calypso, a dramatic collar of pear- clip. The clips encouraged shapeddiamonds. designers to focus on the Designed to be fully flexible, the brand’s neck- One of Georg Jensen’s statement necklaces — Illustration: Nuno Da Costa lobe, rather than create a laces, says Valérie Messika, creative director and hanging pendant. chief executive, are “easier to wear and considera- featuring rare gemstones and diamonds,” says ‘Apiece of This year, as well as adding further iterations of bly more comfortable than a traditional large col- FrançoisGraff,itschiefexecutive. the Runa necklace in tiger’s eye, malachite and 1933 Serti mystérieux lier once was”. These have contributed to an At the more accessible end of the luxury market, jewellery othercolouredstones,ithascreatedagoldanddia- The invisible setting increaseinpopularity,shesays. GeorgJensenishopingtobuildonthesuccessithad has become mond version of Ms Torun’s 1950s wide collar developed by Van Cleef & Graff too is seeing an upturn in sales of high- withnecklacesin2015. design, with a 195-carat pendant in smoky quartz Arpels allowed for the priced necklaces, such as the rare emerald and Last year,Vivianna Torun’smid-century designs like a orrockcrystal. creation of flowing ruby beaded tassel designs it is presenting during such as her Dew Drop and Runa necklaces were 16 moveable “We are making,” says Meeling Wong, Georg surfaces of gemstones Basel. “Among our clients globally we have seen an per cent of its total jewellery business, a rise of 12 Jensen’s managing director for jewellery, “a com- uninterrupted by a metal increase in demand for one-of-a-kind necklaces, percentagepoints. asset’ mitmenttonecklaces.” setting. The effect was achieved by sliding calibré- cut stones along thin metal rails that ran through tiny channels cut into the back section of the gems. 1960s Titanium A Parisian’s hot stone treatment The strength and lightness of titanium has allowed the creation of large, sinuous and very wearable jewels. Trendsetter Lydia have no say, and I was surrounded by distinctive style. “I know I will be Since the mid-1980s, JAR clocks rather than other jewellers,”she copied so each collection is different,” has used blackened Courteille has a knack says. Sales in 2015 justified spending she says. The latest collection derives titanium alloys of secret over SFr35,000 ($35,000) on another from a month spent in Ethiopia and formulation to enhance for knowing the next tiny booth this year, but this time in a uses her cache of in-vogue green the colours of pavé set better spot. stones. “It’s a spiritual place with layers gems that seem to ripple fashionable gem, says She hopes to replace falling sales to of religion — shamanism, Islam, Coptic over his work’s naturalistic Russia. “[It] was our most important Christianity and the Falasha Jews,”she forms. Avril Groom market from the start of our business, adds. This is reflected in cuffs tracing 1990s 3D Computer-Aided so the fall-off in sales due to its the cross-shaped outlines of Lalibela’s Design With its main halls dominated by the economic and political crises, and high rock-hewn churches, a ring based on CAD has made the lavish booths of global brands, import tariffs, is disappointing. But we carved angels in an Axum church, commissioning of bespoke Baselworld can be a daunting prospect have been more than compensated by menorah-shaped earrings and tangles work more affordable and for an independent designer. Only a a rise in US sales in recent years — it is of green stones based on the foliage has reinvigorated the field few exhibitors — around a dozen — are now our foremost market and still headdresses of the Mursi tribe. for small design and high-end designers creating unique increasing.” production studios. The pieces under their own names. One Taking a stand at Basel among her ‘I stockpiled stones like red ability to visualise and wonders how Basel works for them. large competitors might seem risky, calibrate a design in three One answer comes from Lydia but Mme Courteille has confidence. “As or green tourmalines and dimensions down to the Courteille, a mineralogist with a 20- a small company with limited funding dark or white opals 10 years tiniest detail makes CAD year-old design business run from an we have to be nimble and far-sighted,” invaluable for work with opulent Paris boutique. Using unusual she says. “I stockpiled stones like red ago when prices were low’ fragile materials. and sometimes antique stones, her or green tourmalines and dark or white 2000s 3D Printing pleasure is designing one-off pieces opals 10 years ago when prices were Rare acid-yellow tourmalines and This is commonly used based on her research into low. I forecast future trends and act dark, white or reddish opals are added with the ancient technique ethnography and world religions. She accordingly.” for a series inspired by the volcanic, of lost wax casting. Pieces makes about 400 pieces a year, priced Most of her large, complex pieces are sub-sea-level Danakil Desert, one of like these rings by Suuz between €10,000 and €100,000. made in small French workshops but the hottest landscapes on earth. Most can be 3D printed in wax Her new collection, Queen of Sheba, for simpler items which can be made in pieces are set in ancient-looking brown and then cast in metal (see contains only 18 pieces, but recent several versions, albeit with different gold alloy. Few such painstakingly page 6). Designer Jo demand from upscale retailers and stones, she uses a French-owned imaginative pieces exist at Basel, or Haynes Ward praises the websites with a personal service factory in China. “The craftsmanship is indeed elsewhere. “The stores that find amount of detail that element made it worthwhile taking excellent but benefits from guidance on me are looking for individual pieces transfers to the final piece what she describes as “the smallest European techniques,”she says. different from well-publicised brands,” from the computer possible booth” for the first time last Keeping ahead of the pack means she says. “So we are here, holding our visualisation. year. “When you are not known you searching out new slants on her heads as high as anyone.” Thursday 17 March 2016 ★ FINANCIALTIMES 17 Watches & Jewellery | Crime

Hatton Garden Rachael Taylor has the untold story of the heist

What they left behind

or those who work in Hatton business rates for the larger companies Garden, London’s historical in the area, pending a ballot of local jewellery quarter, last April’s businesses in July. Its broad focus, £14m heist was more than a however, is not wholly welcome news F blow to bottom lines: it was a for the industry that lays historical bitter prompt to reassess the area’s claim to the street and which is already fortunes, which are not what they used feeling the pressure of commercial to be. When some of the jewels were gentrification. (One jeweller said, later found in a cemetery in north-east “Being part of the BID is like [the UK] London, it seemed appropriate for a staying in Europe — we need to have a community that many fear already has seat at the table.”) one foot in the grave. While David Marshall is in favour of The robbers spent the weekend regeneration, he says that an exodus of breaking into the Hatton Garden Safe the smaller businesses will affect the Deposit building, using heavy cutting livelihood of the local jewellery trade. equipment, before looting the contents “At the moment I can nip round the of 56 locked boxes. “We had a box corner and get a diamond trimmed if it there and it took two and a half months doesn’t fit, then get it set. If everyone to find out whether or not it was moved out, the logistics would be affected,”says Daniel O’Farrell, co- slower at a time when we are looking to founder of Daniel Christopher get things done more efficiently.” Jewellery, which has a store off Hatton According to Alistair Subba Row, Garden on Greville Street. (The police senior partner at Farebrother say the operation was “highly chartered surveyors and a leading complex”,hence time-consuming, and member of the Hatton Garden BID everything was treated as evidence.) team, regeneration was inevitable — “People lost a lot, many were and is in fact overdue. “Because uninsured. It was mostly small guys [Hatton Garden] is predominantly working with diamonds who don’t earn jewellers, the opportunities were a lot of money. Their life savings were limited as the type of spaces available gone overnight.”A lack of insurance didn’t appeal to everybody.” does not imply they were concealing This has started to change as the anything illicit — more that traders creative media businesses flocking to trusted in a locked box rather than Hatton Garden are not interested in expensive insurance. “vanilla office space”,Mr Subba Row Traders report wrenching stories. says. Instead they want trendy, One Orthodox Jewish diamond dealer, interesting spaces such as converted whose family had escaped the Nazis warehouses and churches — buildings with diamonds sewn into their clothes, Hatton Garden is full of. was described as being utterly crushed This demand will increase with the by the shame of losing some of his arrival of Crossrail at nearby hard-won legacy when his uninsured Farringdon in 2018 as companies seek box was stolen. An Indian family went space beyond prime central London. into crisis after a box that had been The Hatton Garden BID estimates that steadily filled with gold jewellery office rental prices in the area currently throughout their daughter’s life was sit between £40 to £60 per square foot; caught up in the heist; they were left in Mayfair, they can go up to £115, fearing that a good marriage was no according to Savills. longer possible without their dowry. “Hatton Garden can’t sit there and Mr O’Farrell, who has noted an say no, because it’s not entitled to do increase in curious shoppers seeking so, but the aim is not to have the out his store since the heist, was one of jewellery industry run out of town the lucky ones whose box was not because of high rents, so we need to broken into. However, everyone who find ways to work with them to had a Hatton Garden Safe Deposit box stimulate the local economic was affected by the delays as police development,”says Mr Subba Row. The logged evidence and it created a knock- question is, as ever, the balance on effect throughout the community, between the past and the future. not unlike the credit crisis of 2007-09 when liquidity bled out of the system. he Hatton Garden BID As work and cash flows seized up team believes that if the while nearly 1,000 boxes were held by area as a whole improves police, the situation became tense. and diversifies, more T people will visit, leading to t took me barging in with a higher sales at jewellery retailers and business card for the police to more work for the hidden network of help us,”says Victoria McKay. manufacturers. Ms McKay is the chief operating However, it is also trying to protect ‘I officer of the London Diamond the jewellery industry by working with Bourse, a not-for-profit organisation Camden Council to put pressure on funded by its members that acts as a developers to create affordable trading floor on Hatton Garden for workshop spaces. There have been diamond dealers. Ms McKay, members successes already, with the number of say, has modernised and publicised proposed jewellery workshops in the what has long been an introverted and repurposed Baldwins Garden secretive bourse. (A trade publication development doubled by rejigging the said it was “shrouded in mystery”.) floor plan. Pllanning approval for a Formal meetings between Ms McKay large basement gym at 120 Holborn and the police followed and soon a flow was granted on the proviso that part of of information started to ease the that building is given over to jewellery situation, if not immediately fix the workshops. problems. Ms McKay, meanwhile, Bourse has so far been unreported, says Gary Williams, a director at But for some of the newer jewellery pledged to offer assistance to all eclipsed by the audacity of the crime Hatton Garden precious metal refiner businesses, the good intentions of the victims caught in the heist, not only and the derring-do of colourful culprits Pressman Mastermelt, who has also BID still feel like an advanced eviction bourse members. “For the uninsured, like “Billy the fish” Lincoln. (Such was served as the chairman of the British notice. “It’s quite depressing for me as it was tea and sympathy,”she says. For the drama that a feature film based on Jewellers Association. I’m looking for a shop at the moment others, it was pressing the police and the robbery is now planned.) And now One of the major competitors for and I’m having to look at Islington [a Hatton Garden Safe Deposit for that seven men have been convicted jewellery retail is Mayfair. David nearby district],”says Karl Karter, information, or passing on security and sentenced to a total of 34 years, the Marshall, who has been working in founder of London Rocks. He says now advice from meetings with the Bank of focus is spreading beyond the crime, to Hatton Garden for 36 years, opened his Hatton Garden landlords prefer media England. the future of a specialist retail area that first shop in 2013 in Mayfair. “My Hatton Garden jewellery representatives are Mr businesses to jewellery manufacturers. “Hatton Garden ground to a halt,” has been haemorrhaging footfall for product wouldn’t sell here, it’s too denizens, like Williams and Ms McKay.) The BID was London Rocks is a collective of young she says. But neighbourliness, and the past half century. price-conscious,”says Mr Marshall, Matt Martin of formed in the shadow of the heist in jewellery designers focusing on perhaps a feeling of “there but for the whose work sells for up to £300,000. London Art October 2015, the same month in modern, bespoke designs that Karter grace of God”,won out: “They started n the 1960s, its heyday, Hatton He believes the discount culture, low Works (top) and which police were digging up some of describes as “a mix of art, fashion and giving each other stock, or lending out Garden actually had many fewer footfall and a lack of other attractions jewellery PRs the recovered loot from a graveyard in craftsmanship”.Even though the mean tools.” jewellery shops than today — one- in an area dominated by law firms and Kathryn Bishop Edmonton. age of this group is way below the Gem dealer Trevor Sigsworth third of today’s number, some digital agencies, marooned between the and Anna street’s average, they feel bound to the corroborates Ms McKay’s role: “The I jewellers estimate. (The Hatton bustling West End and the fashionable Chapman atton Garden has been a area. “Hatton Garden is part of my bourse acted in the interests of the Garden Business Improvement District East End, are hobbling Hatton Garden. (bottom), were centre of commerce for brand’s story,”says Mr Karter. “I whole jewellery quarter and gave says there are 60 shops and 300 This is a view shared by Jason Holt, burnt by the hundreds of years and started here as a 15-year-old, I grew up victims somewhere to turn to; this businesses connected with the who owns a shop on the street called robbery but there are now 1,465 here. Hatton Garden to me is just dead enabled the whole trade to feel jewellery industry in the area.) Yet it Holts, specialising in handmade strive on H businesses operating in now, it’s bleak.” confident that an organisation was was the go-to destination for hopeful jewellery set with coloured gemstones Anna Gordon the area, according to the BID. While The fate of the building that has put looking after their interests at a higher fiancés and newly engaged couples cut by its own lapidaries in the the jewellery trade has deep roots in Hatton Garden’s jewellery community level than they could individually.” from London and the surrounding basement of the building. “What looks Hatton Garden — De Beers opened its back on the map is perhaps the most When a break in the case led to some area. Now it is seen as a street to find a good to me is something like Charterhouse Street office in the 1870s perfect example of the dichotomy the of the stolen goods being recovered — bargain, fuelled by jewellers Marylebone High Street,”says Mr Holt. — retail stores did not open until 1951, area is facing. David Pearl of landlord one of the criminals admitted stashing undercutting each other and the rise of “It has very strong landlords that starting with AR Ullmanns, which has Pearl & Coutts, who has acquired the his proceeds in a family plot in a so-called emporiums that rent out worked out that creating a good vibe since moved from the main drag to lease of 88-90 Hatton Garden, the site graveyard in north-east London — the multiple cabinets within one shop unit, and a multiple-purpose destination will Greville Street. of the now liquidated Hatton Garden bourse helped police identify the complete with sales staff on the steps benefit the whole.” The Hatton Garden BID aims to serve Safe Deposit, is yet to make up his jewellery and diamonds, expediting outside, pulling in passers-by like bar This is one of the major focuses of all types of businesses in the area, not mind on what to do with it. Rumours of their return to the original owners with reps in cheap holiday destinations. the newly formed Hatton Garden only jewellers, according to its website, his plans, which he has neither appropriate secrecy for a security- “It has been hard for jewellers [in Business Improvement District, which and is being led by regeneration confirmed nor denied, are split conscious industry. Hatton Garden] to work cohesively in was championed by Mr Holt, though he consultancy Primera. It will be funded between a jewellery heist museum and The role of the London Diamond the past, which has allowed it to drift,” does not hold an official role. (The key in future by a mandatory levy on an upmarket wine bar. 18 ★ FINANCIALTIMES Thursday 17 March 2016 Watches & Jewellery The true stories behind costume jewellery

saysMrsSandrettoReRebaudengo.She My Favourite Pieces alsoaccessorisesaccordingtothe Art collector season:Christmastreebrooches,sentto Americanservicepersonnelfightingin Patrizia theKoreanwar,inDecember;palm treesinsummer.Inspring,she Sandretto Re favoursfruitorflowers. Moini’sflowernecklace, Rebaudengo whichsheboughtfromhis NewYorkshoptoweartothe talks to Kate Youde ItalianliteraryprizePremio Campiello’sceremonyin2004,is atriziaSandrettoRe oneoftheyoungestpiecesinher Rebaudengowasso collection.Itisactuallytwopiecesin intriguedwhenafriend one:thebigflowersdetachtoforma pinnedaTrifaricostume- brooch. P jewellerybroochonher “It’sapieceofartbecauseatthe jacketinthe1980sthatsheimmediately MetropolitanMuseumofArtin2006 delvedintothesubject.“Iwasreally someoftheseobjectswereexhibitedin fascinatedbytheseelegantdesignsand anexhibition[offashioniconIrisApfel’s thecontrastofthehumblematerials,” collection],”shesays.“Thesameatthe MrsSandrettoReRebaudengosays. Louvre:thereareafewpiecesofhisin Shethentracedthedevelopmentof theirpermanentcollection.” costumejewelleryintheUnitedStates fromthe1920s,whenCocoChanel Unsigned necklace (1960s) popularisedtheconcept. Attributed to Kenneth Jay Lane Milestonesinherstudyincludedthe Thecollectorboughtthisnecklace, GreatDepression,costume consistingofmetal,plasticimitation jewellery’sadoptionby dropcoralandrhinestones,foradinner Hollywoodandhautecouture, markingtheopeningoftheFondazione andhowdesignerscopedwitha SandrettoReRebaudengo’sTurinvenue banontheuseofcertainmaterials duringthesecondworldwar. ‘In collecting jewellery I try NotonlyhasMrsSandrettoRe Rebaudengo,56,amassed1,000 to use the same rules that I piecesofAmericancostume apply to my contemporary jewellery(the“culturalheritageof adifficulttime”whichforcedtheuseof art collection’ cheapmaterials),butshehasalso collectedcontemporaryart.In1995,she usuallychoosesherjewellerybefore originalpieces,”saysMrsSandrettoRe Clockwise from haveitanymorebecauseithadbeen in2002.“Formeit’sanimportantobject establishedtheFondazioneSandretto pickingclothestomatch,usingher Rebaudengo,whoadmiresthe top left: Iradj sold,”shesays.“Iwasreally becauseitwasanimportantmomentin ReRebaudengo,anon-profitart monochromaticdressesasher“canvas” designer’suseofrecycleditems.The Moini’s necklace; disappointed.” mylife,”shesays. institution,thenopeneditsfirstvenue forthejewels. 20cm-highbraceletfeaturesmaterials Patrizia Butwhensheopenedher50th SheappreciatesLane’splacein inafamilypalazzoinGuarened’Alba, Sheworeherblue-and-greendeLillo includingwood,miniatureplastic Sandretto Re birthdaypresentfromherhusband, costumejewelleryhistory:heproduced south-eastofTurin,in1997anda necklacewithablackdressforthe figures,semi-preciousstones,glass, Rebaudengo AgostinoReRebaudengo,andher copiesofjewelleryforfamouswomen secondvenueinTurinitselfin2002. openingnightofa2012exhibitionatthe brassandshells.“Everyonepays wearing a youngerson,Emilio,shewastaken includingJacquelineKennedyOnassis “IncollectingjewelleryItrytousethe WhitechapelGalleryinLondonofpart attentionbecauseit’sfullofobjects,of necklace aback.“Iopenedmygiftandtherewas andmadepiecesavailabletoeveryone samerulesthatIapplytomy ofherartcollection.Thepiece,which life,”shesays. attributed to myoctopus,”shesays.“Itwasareally from“princessestostudents”. contemporaryartcollection,”saysMrs sheboughtin1993,ismadeofgilded Kenneth Jay Lane; greatsurpriseandso,forme,it’salso “Whatisveryinterestingtomeisthis SandrettoReRebaudengo.“But,atthe metal,greenglass“stones”andplastic Brooch with octopus (1940s) Wendy Gell’s importantbecauseitmeanstheloveof opportunitythateverywomaninthe end,Iletmyinstinctmakethefinal “stones”thatresemblelapislazuli. Marcel Boucher bracelet; de Lillo’s myfamily.” worldcanwearoneofthesebeautiful choice.” Afterspendingyearssearchingfor necklace; piecesofart,ofjewellery,”shesays. Buddha in dark forest bracelet (1988) Boucher’srhodiumandrhinestone Boucher’s Necklace with two flowers (2004) Necklace (1960s) Wendy Gell octopusbrooch,MrsSandrettoRe octopus Iradj Moini TheexhibitionCostumeJewelry—Patrizia de Lillo “WendyGellbegancreatingthis Rebaudengofinallyreceivedanofferof Viola Armellino “Inacertainwayyoucanunderstand SandrettoReRebaudengo’sCollectionisat MrsSandrettoReRebaudengowears jewelleryduringthe1970sandshe onefromacollector.“ButwhenIwrote mymoodthroughmycostume PalazzoMazzettiinAsti,Italy,fromApril piecesfromhercollectioneverydayand reallydevotedherselftothecreationof tothemagaintheytoldmetheydidn’t jewellery,fromtheobjectsthatIwear,” 16toOctober30 A jeweller finds opportunity in Russia’s depressed market

upon a smelting temperature of 970 Profile degrees centigrade. As far as I know, nobody else is using such operating con- Ilgiz Fazulzyanov ditions.” enjoys a rare solo His relationship with the Kremlin museums started in 1998 with a com- Kremlin show. mission to produce a miniature of the Kazan Cap, a 16th-century gold filigree By Hettie Judah diadem created for Ivan the Terrible. “I’m not sure what made them choose The natural world as portrayed in Ilgiz me as a jeweller for that task: that I was Fazulzyanov’s elaborate enamelwork is fromKazanorthatmyfirstinternation- nodrowsy,whimsicalEden.Instead,the ally acclaimed jewellery pieces were Russian jeweller finds inspiration in made using the filigree technique,” he natureatitsmostuncompromising:tree says. boughs splintering with ice after a A move to Moscow in 2003 came “out storm; battling ravens tugging at each of necessity”, and at first Mr Fazulzy- other’s feathers; grey clouds over a anov relied on clients who rented a choppywinterlake. workshop for him. His business has His painted enamel flowers and drag- been built slowly, aided by a handful of onflies are delicately wrought in Art prestigious awards, foremost among Nouveau-inspired tangles around rings which was Champion of Champions at and pendants, but this is nature as por- the Hong Kong International Jewellery trayed by a close observer. The forms of Show, which he won both in 2011 and a pheasant or finch are glimpsed 2013. through grids of denuded golden Ilgiz Fazulzyanov and, below, his His simplest pieces retail for €3,000, branches or cascades of diamond rain- ‘Ravens’ pendant though more complex works, set with drops; slow fish weave through painted fine stones and requiring weeks of reeds;dragonfliesappeartopulsateasif machismo associated with a national meticulous work, can cost up to warmed by sunlight. In recognition of centre of power. As with the Assump- €400,000. While he sells through part- his achievements, he is having a solo tionCathedral—thesiteofimperialcor- ners in Geneva and Tokyo, and has a show of 250 works in the Assumption onations — it is a locale that recalls jew- shop in Monaco, 60 per cent of sales Cathedral,oneofthevenerableMoscow els’ status as spoils of war,and their role come through his appointment-only Kremlin Museums and part of the indisplayingwealthandpower,todayas Moscowshowroom. Kremlin Palace complex. He is the first inthe16thcentury. Since the Champion of Champions independent contemporary jeweller to Born in Tartarstan, south-east of awards,MrFazulzyanovhasenjoyeda obtainsuchashow. Moscow,in1968,MrFazulzyanovstud- growing demand for pieces bought as His burgeoning career is a rare bright ied art in Kazan and was among a investments, and his collectors now spot in Russian luxury, following the group of students sent away to learn includeanItalianwhopurchasesallof collapse of the rouble in December traditional jewellery techniques. his competition pieces. Neverthe- 2014. “The Russian luxury market is in The apprenticeship “didn’t go less, everything he makes is depression now,” says Mr Fazulzyanov. according to plan”, he says, so designed for the body rather “Most luxury brands have closed their the group returned to Kazan, than a display cabinet. “I [concessions] and boutiques in Moscow but not realising he had not want to make sure that the and other Russian cities, but as a small completed his training, earrings don’t weigh workshopwithnobudgetformarketing friends started down the ear lobes, and advertising I have a very special approaching with that the locks don’t place in this market,” he explains. “We small commissions. unclasp, that the need only a small group of clients. For “Mysenseofpride collar rests somepeople,crisisisanopportunityfor prevented me comfortably on enrichment.” from admitting the neck, that His fighting “Ravens” pendant is ignorance, and the rings don’t among six of his pieces bought by the so I had to learn quickly. getintheway,”hesays. Kremlin Armory in 2014. It’s an apt The first instruments I “All of my pieces are locale for a pendant with a bellicose used, I got from dental sur- tested first by my wife and I theme inspired by the “aggressive geons.” pay close attention to her opin- atmosphere in the air”.“It’s not an easy Mr Fazulzyanov flourished as an ions.”Studious observation, as ever, pendant to wear because of its relation autodidact, and soon began experi- remainskey. towar,”hesaysthroughaninterpreter. mentingwithfineenamelwork,using His delicate, attentive nature studies a combination of French and Russian Ilgiz Fazulzyanov’s work will be seem far removed from the histories of enamels to achieve the perfect tone: exhibited at the Assumption Cathedral, bloodthirsty conquest and battlefield “Working by trial and error, I settled Moscow,fromApril1toJune31 Thursday 17 March 2016 ★ FINANCIALTIMES 19 Watches & Jewellery

Emeralds Cracking idea Fabergé, the jeweller to the tsars that Jewellers reap has been revived by Gemfields, burnish hopes launches two new invisibly-set egg pendants at Baselworld today. They use for brighter sapphire and Mozambican ruby in an invisible mosaic setting, recreating that rewards of Afghan future first used by the jeweller before the Russian Revolution, when Nicholas II gave the Mosaic Egg to Tsarina Alexandra as an Easter gift in 1914. At the Smithsonian Museum in credibility from Washington DC, Turquoise Mountain: Artists Transforming Afghanistan sees Van Cleef at the barre part of the gallery reimagined as an On June 24, choreographer Benjamin Afghan caravanserai. Millepied — until recently director of London-based designer Pippa Small dance at the Paris Opera Ballet — will museum shows will be the only exhibiting jeweller, bring a vision inspired by Van Cleef & with a necklace made in collaboration Arpels’ jewellery to the stage at with Saeeda Etebari, a young female London’s Sadler’s Wells theatre. Ballet known by jewellery aficionados for its From top: a piece from Hewitt triennial designers, agrees about artisan from Kabul who is deaf and was a great source of inspiration for the Exhibitions The bold aesthetic and its mix of gemstones Noa Zilberman’s brand, if not about sales. “It gives dumb. Behind its emerald-laden maison’s founder, Louis Arpels, and with unexpected materials, including conceptual “Wrinkles” designers legitimacy,”she says. “I’m not surface lies a small compartment that remains so for contemporary creations Cooper Hewitt concrete, iron and copper. The exhibi- collection; earrings by sure it has a direct impact on their busi- holds Afghan soil, a reminder of home such as the Ballet Précieux collection. tion features a pair of snail brooches Hemmerle; a brooch by ness or on sales. It’s more of a brand as the necklace travels the world. triennial offers brands that incorporate actual snail shells with Jantje Fleischhut exercise than about providing financial The exhibition, which runs until a prime position, says gold and diamonds. Christian Hem- Cooper Hewitt benefit.” January 2017, explores the work of the Flaubert’s carat merle, its director, says that with one Ms Delettrez is one of the world’sbest charity founded in 2006 by the Prince Chaumet is showcasing jewels from its Rachel Garrahan storeinMunichandalimitednumberof known contemporary jewellers, in part of Wales and the then president of archive in a new exhibition, Une piecesavailableforpurchase,anexhibi- thankstoherstatusasafourth-genera- Afghanistan, dedicated to reviving the Education Sentimentale (named after tionlikeBeautyisanopportunityforthe tionmemberoftheFendifamily,aswell country’s artisanal heritage and Flaubert’s novel), at its Place Vendôme ewelleryhasplayedasmallrole company’s work to be appreciated by ashercelebrityfollowing. regenerating Murad Khane, an old maison until September. A tiara from in the Cooper Hewitt design visitors who may never own a piece or TheFrench-Italiandesigner’ssurreal- district in Kabul. around 1890 and a pair of winged museum’s previous triennials, otherwiseevenseeit.“That’sthebeauty istjewels,likeherdiamond-encrusted brooches are among the historic items but in this year’s show it is ofamuseum,”hesays. moustache septum ring, are fea- on display alongside a new, specially- J assuming a new importance. Viren Bhagat, another high-end jew- tured in the show’s“Transgressive” Wood stock created collection, Escapade de The theme for the international survey ellery designer, agrees. He says that section and reflect what she Cartier is turning to an unlikely Chaumet. The exhibition is the second ofcontemporarydesignisBeautyandits museums taking contemporary jewel- describes as her “schizophrenic precious material for an addition to its in a series of six-month-long archive ethereal, transgressive and extravagant lery design seriously is a relatively idea of beauty”, where opposites Amulette collection in April: wood. The showcases — so-called “ephemeral facets,acrossfieldsfromproductdesign recent phenomenon. “It’s a big change attractanduglinessisseenasbeau- timber of choice, snakewood, is more museums” — open to the public. and architecture to game design and TV and jewellers deserve that space,” says tiful. commonly used on guitars and interior credits.Jewelleryfitsinneatly. theMumbai-baseddesigner. She is pleased with the curators’ furnishings, and marks an unusual Ellen Lupton, senior curator at the MrBhagat’sworkisbeingexhibitedas selection since they incorporate diverse high jewellery departure from precious Marino/Murano Cooper Hewitt, a Manhattan branch of part of the Bejewelled Treasures exhibi- elements of her work: her commercial metals and gemstones. The padlocked Bulgari will open its renovated New the Smithsonian museum, says the tion at London’s Victoria and Albert collection,limitededitionhigher-priced pendant, ring, earring and long Bond Street boutique on April 14. Peter museum made a decision to feature six Museum(untilApril10).Hasbeingpart pieces and some that have never been necklace design was introduced last Marino has drawn inspiration from jewellers, including Israeli Noa Zilber- of a museum show, however, led to availabletobuy.Thismixture“givesme spring. fellow architects Sir John Soane and man with her conceptual “Wrinkles” actualsales? more credibility in the art and jewellery Carlo Scarpa, by way of Murano crystal collection and German-Dutch Jantje “Of course it has. It’s happened designworlds,”shesays. chandeliers and classical columns. Fleischhut’s plastic and precious post- at the recent exhibit and when One piece in the exhibition, her gold Strewth! industrialsculptures. we were exhibiting at the Met bee ring, was shared by the singer Graff opened its first Australian store “Webelieve jewellery is an important [Metropolitan Museum of Art] Beyoncé with her Instagram followers this month, continuing its global Brought to book partofdesign,”saysMsLupton.“Every- andattheKremlin,”hesays.“It’s (current count 62.2m) in an experience expansion and bringing its total count This month Assouline publishes a one adorns themselves in some way or a great way for contemporary that the designer describes as giving her to more than 55 stores worldwide. The retrospective on jewellery house other. It’s a global, universal part of jewellery to be recognised and “an amazing commercial reward”, pre- new shop will be housed inside the Messika, the diamond specialist run by beinghuman.” it gives you wonderful expo- sumably one with far greater reach and Crown Melbourne hotel and casino Valérie Messika, daughter of dealer Hemmerle, the German high-end art sure. Collectors see you as hav- influence than any museum exhibition complex on the Yarra River. Despite a André. Messika, which was founded in jeweller,is one of the designers featured ing more serious appeal, in line evercouldbestow. fall in mining investment last year, 2005 and which opened its high in the Extravagant section, alongside withotherformsofart.” sales of luxury jewellery and jewellery atelier in Paris last year, joins couturier Giambattista Valli and ValeryDemure,ownerofajewel- Cooper Hewitt, Smithsonian Design timepieces grew 5.4 per cent between brands like Valentino, Cartier and make-upartistPatMcGrath.Thefourth lery showroom that represents Museum presents “Beauty — Cooper 2014 and 2015 in Australia, according Chanel on Assouline’s shelves. generation, family-owned business is Delfina Delettrez, one of the Cooper HewittDesignTriennial”,untilAugust21 to Euromonitor. Camilla Apcar Boucheron toes a fine line between intimacy and growth

“Onthelongterm,theywilltakemore MsPoulit-DuquesnetoBoucheron.She Interview The house’s initiativeandwillstillbuyoutsideof spentthebulkofherCartiercareerinits first female CEO on China.” watchmakingbusinessandwasbehind Onemarketwheresheiscautious, thelaunchofitsBallonBleurange. how to be nimble in a however,istheUS.OfBoucheron’s34 Unlikethewatchmarket,whichshe boutiques,noneisintheUS(whereit saysis“moredifficultbecauseit’s luxury conglomerate. has13wholesaleoutlets).Citinghigh mature”,jewelleryisstillgrowing. retailandmarketingcosts,MsPoulit- Nostrangertoworkingunderalarger By Ming Liu Duquesnenotesthecountryhas“huge entity,shedrawscomparisonswithher potential”,yet“forforeignbrandsit’s daysatCartier,whichbyanalysts’ Forthechiefexecutiveofastoried moredifficultbecause[consumers]are estimatescontributedabouthalfof jewelleryhouse,thereisafinebalance inlovewithAmericannames.”Shecites parentcompanyRichemont’searnings: tobestruckbetweenexpandingyour TiffanyandRalphLauren.“Youhaveto “Ingeneralthegrouptriestogivealotof brandandmaintainingtheintimacy investinthelongterm—say,thenext15 attentiontothebigones.Thenattention yourclientsvalue.Thisisexactlythe years.It’snotaquickwin.” meanspressure.” challengefacingHélènePoulit- Kering,whichalsoownsGucciand Bycontrast,threefashionbrands Duquesne,whotookoveraschief aloneaccountedformorethanhalfof executiveofBoucheroninSeptember ‘People have become Kering’s€11.6bnrevenuesfor2015, 2015,itsfirstfemalechiefexecutiveand accordingtothecompany’sfinancial oneofthefewonthePlaceVendôme. a bit fed up with how big statements.Asasmallercompany “IntheworldofPlaceVendôme,being brands are treating withinthegroup,MsPoulit-Duquesne asmallplayerisakeyadvantagetoour says:“Youfeelmoreconfidentand clients,”saysMsPoulit-Duquesne,who them . . . dedicating time to autonomousinhowitistakingcareof waspreviouslyatCartierfor17years. clients is important’ you.Theyhaveakindofbienveillance— “Peoplehavebecomealittlebitfedup thereisniceattention—butprobably withhowbigbrandsaretreatingthem— lesspressurethanthebigones.”Shealso andhavingthecapacitytostillserveand StellaMcCartney,watchmakersGirard- feels“aligned”withKering’svalues,in dedicatetimetoourclients,asifthey PerregauxandUlysseNardinand particularwomen’sinitiatives.Ms werefamily,isreallyimportant.” jewellersPomellatoandQeelin,does Poulit-Duquesnewasthefirstwoman Thehouse,whichwasfoundedin1858 notseparatelyreportBoucheron’s onCartier’sexecutivecommittee.She andbecamethefirstjewelleronthe performance,thoughitnotedthat insistssheneverfelthergenderheldher PlaceVendômewhenitmovedin1893, revenueforitsjewellerybrandswasup backandindeedsheadviseswomento hastheresourcesofluxury 6percentin2015.JohnGuy,luxury- refrainfromactinglikemeninthe conglomerateKeringbehindit,making sectoranalystandmanagingdirectorat businessworld.“Thatwouldbefoolish,” expansionapracticalpossibility,butMs MainfirstBank,estimatesBoucheron’s shesays.“Whatwomenbringistheir Poulit-Duquesneappearstofocusmore 2015revenueswere€160m—a femininity,”whichshegoesontosay onthetypeofcustomerratherthan 220percentincreasesince meansacertaindirectnessindealing puregeography.“Wehavealotof 2011—withearnings withproblems. renseigné—well-trained, beforeinterestandtaxof Asaself-proclaimed“jewellery sophisticated—clients,”she €14m. purist”,MsPoulit-Duquesnesayshigh explains. Jewelleryexecutives jewellerywillbeacentralfocuslooking “Theyknowalotabout surveyedbyMcKinsey, ahead.Boucheronlaunchestwoannual jewelleryandyoufindthem, themanagement collections,thoughtheideaisto forexample,inTaiwan,the consultants, streamlinethisandMsPoulit-Duquesne MiddleEast,Russia.Intermsof predictedthat hintsatthepossibilityofone. anaveragebaskettheybuy brandedjewellery Beyondthehighjewellery,thehouse higherticketpieces.”Ms (thatis,from isknownforitsQuatrering,alayered Poulit-Duquesnesays global,not designthatincorporatessignature sheis“optimistic” national, motifs—rowsofspecialvaporised aboutRussia,despite brands) browncoatingthatmimicthe notingadropin would cobblestonesofPlaceVendôme,for business,while increaseits example. Chineseclients,she marketshare Pricedfrom£1,260,theQuatreisnot believes,will from20per onlyitsbestsellerbutalsocommercially remaina“huge centin2014to distinctive.“Inaportfolioit’svery part”ofthebig 30or40per importanttohavebothhighjewellery jewelleryhouses. centby2020, andoneiconicproductthateverybody “Theywill andBoucheron canrecognise,”saysMsPoulit- upgradeand is“wellplacedto Duquesne.“Youthensuddenlybecome upgrade,”shesays. benefit”from areferenceinthemarket.” this,saysMrGuy. WhetherBoucheroncanbecomea Purist: Hélène Thatforecastis biggerplayerinthatmarketremains Poulit-Duquesne partlywhatattracted thequestionforMsPoulit-Duquesne. 20 ★ FINANCIALTIMES Thursday 17 March 2016