Seiko Watch Corporation president Aiko Naito has made Grand Seiko a top ten brand in its price category in under a decade. Rob Corder finds out how.
It is hard to think of many luxury Swiss watch brands that have grown from almost nothing in Western markets a decade ago to become as established and desirable as Grand Seiko is today.
Although Grand Seiko was launched by Seiko in 1960, it only started being sold outside Japan in 2010 and got its own corporate office in the United States in 2018 run by Aiko Naito.
His success at establishing the luxury brand in the States led to the ultimate promotion to global president of Seiko Watch Corporation, the umbrella organisation overseeing Seiko, Grand Seiko and Credor.
He has held the role since April 2021.
Establishing Grand Seiko outside of Japan has been a multi-phase project, as Mr Naito explained to WatchPro.
It starts with a consumer-led movement.
In the USA, this was heavily influenced by a relationship between Grand Seiko and Hodinkee; more specifically between Mr Naito and Hodinkee founder Ben Clymer, who first met back in 2016.
The pair discovered that there was already a significant community of Grand Seiko fans in the US, and set about nurturing this.
An informal club, known as the GS9 collectors’ club, developed. It was not affiliated with Grand Seiko directly, but Mr Naito recognised its power to help him develop the brand as he tried to establish retail partnerships.
“Among watch aficionados and cult followers, the recognition for the quality of Grand Seiko was always there,” he recalls. “But outside of that niche group, the brand was unknown, and there was a difficulty understanding Grand Seiko as a luxury brand.”
That lack of recognition discouraged retailers from giving up valuable real estate in their stores to Grand Seiko, particularly at a time when American consumers put a huge premium on having “Swiss Made” on their dials.
To change their minds, he drew on the persuasive power of the GS9 club and other collector groups.
“I tried to convince retailers that we had access to a community of Grand Seiko fans in the country and that we could assemble those fans. We asked the retailers to allow us to use their stores to host events for our customers and they were pleasantly surprised because they saw the passion of this watch community for themselves and became very interested in taking on Grand Seiko. They were particularly excited because many of the Grand Seiko fans we brought into their stores were much younger than they had expected. These were new consumers to them beyond their normal clients,” Mr Naito describes.
“We organized those events one by one and this gradually convinced the retailers.”
In general, it was family-owned independents that made the first move, but soon the likes of Tourneau | Bucherer and Watches of Switzerland were taking notice and devoting space, manpower and marketing to Grand Seiko.
This opened up the brand to the less geeky watch consumer. “Once we had a presence with these top retailers, the next phase was that customers came into these stores and were introduced to Grand Seiko, often for the first time,” Mr Naito explains.
The process was repeated in several Western markets. London got its first Grand Seiko and Seiko flagship in 2017 in Knightsbridge.
A purely Grand Seiko boutique opened on Place Vendôme in Paris in 2020. Last year the Knightsbridge store was relocated to the UK capital’s most prestigious luxury retail destination, Bond Street.
All the while, brand recognition, respect and sales kept rising among the watch loving public.
“In 2016, according to one private researcher in the United States, in the price range for men’s watches of $5,000 to $10,000, Grand Seiko was number nine in terms of revenue. By 2020, we had climbed up to number four after Rolex, Omega and Breitling. So, in that short period of time, we were able to make very satisfying progress in the US market,” reveals Mr Naito.
Opening flagship stores on the other side of the Atlantic has had the same effect, with Europe right now the fastest growing market in the world for Grand Seiko.
It was not just been the US public noticing Grand Seiko. The Swiss, still carrying the scars of the quartz crisis, which they blamed on Japanese manufacturers like Seiko, have also been sitting up and taking notice.
Grand Seiko, they observe, is designing and manufacturing mechanical watches that meet or even exceed the exacting standards they set themselves.
This has led to the most recent phase of the Grand Seiko global growth story: being accepted as an equal in Switzerland by organisations like FHH, which runs Watches and Wonders; and by the judges at the annual awards ceremony GPHG.
“Two and a half years ago I was approached by the organisers of Watches and Wonders. My interpretation is that, at that point, Baselworld had fallen and they were trying to expand their show from being almost exclusively a Richemont event into something wider,” Mr Naito describes. “Swatch Group would not join, and this may have led to them thinking about Grand Seiko.”
Showing admirable confidence, Mr Naito pushed for an agreement that positioned Grand Seiko as an equal to the major Swiss manufacturers at the show.
“We started discussing terms and I made it very clear that it would have to be a long term partnership, not just appearing at the show one year and out the next. Also, I insisted that Grand Seiko is treated as a luxury watchmaker on the same level as the Swiss brands in terms of the space and location,” he explains.
Watches and Wonders agreed, and Grand Seiko has been a fixture of the event since it reopened in 2022.
In that first year back since the end of covid restrictions, Grand Seiko launched one of the most talked-about watches of the show, the Kodo grand complication.
“That launch elevated us to being taken as a serious luxury watch brand,” Mr Naito says. That same year, the GPHG jury selected the Grand Seiko Kodo Constant-force Tourbillon as the winning watch for the Chronometry Prize.
Job done? Well, no.
While Kodo gave Grand Seiko a seat at the top table, the business now wants to translate that position into growth for its core collections.
In particular, Mr Naito is focusing on building strong collections in the dress watch and sports categories.
That was the focus of this year’s Watches and Wonders collections, where we saw the launch of the Grand Seiko Evolution 9 Collection Tentagraph and the Masterpiece Collection Hand-engraved Manual-winding Spring Drive Limited Edition.
The Tentagraph, in particular, was a breakthrough product for Grand Seiko as its first mechanical chronograph.
Made from titanium and powered by the new Caliber 9SC5 (based on the Caliber 9SA5), it is a bridgehead into a new generation of Grand Seiko sports watches. Being Grand Seiko, the company could not resist a link to its Japanese roots so it has a patterned dial said to “evoke the magnificence of Mount Iwate”, the soaring peak visible from the company’s Shizukuishi Studio.
Having upgraded its presence in London, Grand Seiko is doing the same in the United States with the relocation of its relatively small New York boutique to a new location a couple of blocks north on Madison Avenue.
Originally pencilled in for a ribbon cutting late in 2022, the project has slipped behind schedule and is now expected to have a soft launch this side of Christmas.
The showroom is sure to be worth the wait with customers greeted to a grand showroom of over 3,000 square feet on the street level, alone. “It is going to be extremely big. I am a bit scared,” Mr Naito laughs.
While the flagships are important, Grand Seiko is determined to keep working with leading retail partners.
“We do not intend to increase the number of directly owned retail stores. We will only have them in key locations in major cities. At the same time, we want long term partnerships with great retailers who really understand our brand and can communicate that to their clients,” says Mr Naiko.
And can production keep up with demand?
“Yes,” Mr Naiko replies. But only just.
“The challenge is craftsmanship. Developing skills takes time. So far, I am confident we can meet the growing demand over the next few years within our existing facilities,” he concludes.
