Interviews • 03 Mar 2023
15 Minutes with Ricardo Guadalupe, Hublot CEO
The Hour Glass sat down with Ricardo Guadalupe, CEO of Hublot, to talk about the industry trends, how COVID has changed the brand’s strategies, and the enduring appeal of “The Art of Fusion”.
Watch export numbers for 2022 shaped up to be a massive record year, with significant growth in the Asia Pacific region. What is driving that growth?
The Swiss watch exportation is doing incredibly well. For Southeast Asia and for Hublot, we’re even surpassing the Swiss export growth rates, meaning we’re doing even better in the region. Probably the reason is that we’ve done incredible work with our partner, The Hour Glass, in this part of the world. We now have 2 standalone boutiques in Singapore, 2 boutiques in Malaysia, 2 in Thailand, and 3 in Vietnam. The fact that we have really implementing the brand very strongly, I think, is a factor. And of course, the consumers of this region are really very mature, they’re really willing to purchase luxury watches, and they can be either male or female. The economic situation, of course, is quite positive also in this part of the world. So all those factors put together [have contributed to the strong growth].
Aside from the pure economic factors, what else has changed in the market over the last 4-5 years, especially in this part of the world?
There has been an evolution in the taste, and also from also the young generation. We have seen a flow of new consumers, younger consumers especially, coming to the luxury products with the luxury watch is in particular and I think this has been quite an important element.
Has the last three years of COVID changed Hublot’s strategies and approaches?
Yes, of course. COVID has changed how we approach the consumer and digital was a big part of it. Of course we have the physical, which are the standalone boutiques and different points of sales we can have, but the contact with the consumer is made much earlier, on a digital perspective. It means we can talk to our consumer – actual and potential consumers – through our website, which is the key element. And we can communicate through our social media as well. We have seen more and more of our boutiques having their own digital world, and being able to contact our consumers even when our [physical boutiques] were closed at a certain point. If somebody has a problem with the watch, or wants to buy a watch, we still have this contact. The digital world has really changed, and the acceleration of digital has been a key element [for Hublot’s growth] during those COVID times.
Hublot has started e-commerce platforms in some of your markets. Will this be one of your strategies moving forward? Will an all e-commerce approach be a possibility?
No, I don’t think so, because I think still for our consumers, we’re selling a physical product. Our consumers still want to see it, to touch it. Of course we have seen our e-commerce sales do well, but it represents a very small percentage of our [total] sales. But it is linked to the omni-channel approach: to be able to talk to our consumer and prospect through digital platforms. For instance, we have a million people that visit our site every month. For most of them, it could be the first contact they make with us. We maybe will transform a part of those it into a sale physically. So the balance between digital and physical has to be found in the right way. I think e-commerce will probably increase, but it will not take over completely. 10% of our sales [being through e-commerce] would already be a great success.
One of your partnerships last year was the Big Bang Unico Ledger, which was a surprising collaboration. What do you look for in your new partnerships?
We always want to be different, first and unique in everything that we do and in partnership in particular and talking about cryptocurrency. We want to be leaders. Hublot, being a young brand – we’re only 42 years old – we have to be leaders in what is going on in the world. The cryptocurrency market is a world that young people in general are integrated in; that particular business, as we have seen, has ups and downs, but it is still interesting. I think it’s also the future: we see more and more players, even traditional financial institutions, going into this world. The partnership with Ledger let us tap into that, and we created this watch that you can only buy in cryptocurrency. It has had an immense success, so the idea of partnerships is really always to come up with something particular.
How do you see these advances in technology, such as blockchain, being incorporated within the product itself?
We’ve already [started this] with our e-warranty – there is no more physical warranty for us. The e-warranty means we can identify every watch that comes out, its materials, when it came out of production, the unicity of the piece. The activation of the warranty is done through an application on the phone, and all the information is stored in the blockchain – the Aura blockchain which is part of the LVMH group. We are the first brand to use this technology for the identification of our watches. It means for sure you know it’s a real watch. This technology is really fantastic – it follows the watch from production through all its life – when it was sold, when it has been repaired, and when it was resold. It’s very advanced [technology] from this point of view.
Identification of the product and traceability of its materials to this extent is very novel. Sustainability also has a big part in Hublot’s long-term strategy. Could you elaborate more on Hublot’s sustainability policy?
Sustainability is very important, of course. A mechanical watch is one of the most sustainable products in the world because it will last forever. That is already something. What we do, is we look at where can we be sustainable. We are now forming new partnerships that are also [linked to sustainability], more linked to ecology, more linked to the protection of the planet. That’s why you see [we have partnered with] the Polar Pod in Antarctica and with SORAI. This is one aspect.
The other aspect is the sustainability in the product, and in the environment of the product. For example, we’ll be changing our boxes. The new watch box will come from a more circular economy, using wood from the forests in Europe, so there’s less transport. It will also be in our merchandising – what is linked to our shopping bags are now 100% recyclable. With our boutiques, we’re using materials that are sustainable. And soon, in our factory as well. Our new factory that is being built, it will be 100% carbon offset by 2025. So there are many aspects [of our activities] that link to sustainability.
Hublot’s partnerships range from sustainability, to sport, art, and lifestyle. What have been some of the memorable encounters with your brand partners, ambassadors, and friends of Hublot you’ve had over the years?
Football, as you know, is an important pillar in our partnership. For myself, being a fan of football, meeting Pele was an incredible moment of my life. When I was young, I had dreams about meeting him, and I had his posters up on my wall. And [also] to be at the finals of the World Cup in Qatar, in South Africa, and Brazil… I’ve been so lucky to have had these experience.
Gastronomy is another passion of mine, so I’m lucky to have our three Michelin-star chefs who are incredible people with a lot of talent and passion. Just to do this four-hand dinner in Paris [with Ann-Sophie Pic and Yannick Alléno] has been an amazing experience. So of course, being the CEO of Hublot, I’m really lucky because I can have these incredible experiences as well personally.
How does Hublot decide who to partner with?
That depends. I’m always open to good ideas. Sometimes it can come from our people, sometimes it can be from meeting people through life. There is not really a scientific approach to our partnerships.
Our world is an irrational world. The world of luxury is a world of dreams. For instance, art – it came from doing events in Miami and Art Basel, more than 10 years ago, it started with an artist who was known locally. Step by step, I saw that art could be something interesting as a platform of communication. That’s why we started extending our partnerships in art, with Sang Bleu in 2016, and Orlinski in 2017. Most recently we’ve welcomed [Takeshi] Murakami, which is maybe the peak of our partnerships. To meet Murakami in July, at his atelier and his workshop, that was quite impressive.
The idea is to create a universe of Hublot where you have sport, like football, and you have people – Kylian Mbappe, Usain Bolt. You have arts, you have gastronomy, you have sustainability, all those facets. And the people who buy Hublot, at the end, they feel part of this world.
Very much the art of fusion. This tagline came to life 18 years ago, and it’s still very relevant to Hublot today. What would you say contributes to this endurance?
The concept of “Art of Fusion” is something still very modern, still very up to date, meaning we can create watches that are respecting our watch industry, which is 400 years old, and combine it with innovation. For instance, we use materials today that didn’t exist 100-200 years ago. Hublot was the first to use rubber in a watch, back in 1980 – that was the first fusion, even though they didn’t know about the art of fusion at the time. Now all the brands are using rubber straps. It was the same with ceramic.
We want to be leaders in this art of fusion, and for that we need to do a lot of research and development, so we are able to always create new things, new materials. For movements, we have a new manufacture creating new types of mechanisms in the movement. The key element for Hublot is to always surprise our consumers with innovations and new designs. It’s about the three pillars to the art of fusion: materials, movements, and design as well.
What distinguishes Hublot collectors from others?
They’re young. Our consumer base is really young, with our core consumers being between 25-45 years old. They’re people who have succeeded in life by themselves in general – people who have studied, created their own business, or have a great job and having success in their professional life. They could be a man or a woman – 28% of our sales are to women: this is something I think we can improve, and we are working on making this better. People that, maybe because they are young, they don’t have “standard” tastes. They want something different. That’s more or less our consumer.