Oris Group executive chairman Ulrich Herzog’s commitment to Oris runs far deeper than a job specification. While today, much of his motivation relates to ongoing product development by the talented team he works with, his dedication is inextricably linked to his part in saving Oris through a management buyout that began in late 1981.
He then led a turnaround in the company’s fortunes based on a strategy committed to mechanical timepieces. “If we hadn’t done that we would have disappeared,” says Herzog.
The period leading up to the management buyout of Oris Watch Co was rife with uncertainty. While today the watch brand boasts 15 years of steady growth and a particularly robust past five years, it hasn’t always been smooth sailing. In its earlier days, as well as having to stand strong during World Wars I and II and times of economic crisis, Oris fell foul of the Quartz Crisis of the 1970s and 1980s, during which the blossoming of quartz technology and general economic decline famously took its toll on numerous Swiss watch companies. A company that produced its own movements and escapements, had full chronometer certification, a dial factory in Bienne in Switzerland and was recognised for the quality of its gold plating on watch cases, Oris was among those predominantly-mechanical watch brands that suffered during the period.
TROUBLE SHOOTING
Oris was started in 1904 by watchmakers Paul Cattin and Georges Christian in Hölstein in the Jura Mountains and by 1911, employed more than 300 people. Soon the largest employer in the area, Oris built houses and flats for its workers. By 1970, it had 800 people working in its series of factories and was one of the 10 largest watch companies in the world.
In 1970 Oris was sold to General Watch Group, which later became the Swatch Group. Among the other brands within the group, Oris lost its independence somewhat and was assigned a strictly defined niche as a producer of inexpensive watches. Consequently, when the quartz crisis hit, Oris, along with other Swiss watchmakers, found itself in difficulty. Herzog explains that while quality was always at the forefront of the company’s manufacturing, dropping price points in the face of the crisis took its toll on the brand’s image and made for an uncertain future. At that time, Herzog was marketing manager.
When he joined Oris Watch Co as marketing manager in 1978, Herzog’s previous experience included studies in banking and, just before he joined Oris, a role as Basel-based retail and wholesale manager at Chevron Oil Company. The move to Oris came when Chevron announced a relocation to Zurich and Herzog decided to stay in Basel. “I looked for a new job and finally found this job at Oris as marketing manager,” he says. “It was this that brought me into the watch industry so it was just kind of by incident really.” Herzog acknowledges that at the time he had no specific passion for watches apart from enjoying the products and appreciating them as the opportunity to flex his marketing prowess. “Watches are an excellent product to do the worldwide marketing for,” he explains.
Herzog recalls his first watch. “It was an 18ct gold watch that I got from my grandmother,” he says. “It was one that didn’t have any name on it and it was very fragile. I’m not sure whether it still works.” After joining Oris, Herzog says he quickly became immersed in watches and fascinated by the products and skilled craftmanship.
This connection with the watch world proved fortunate because, despite having initially had no specific interest in watches, Herzog partnered with Dr Rolf Portmann, who had been hired as a lawyer by Oris in 1956, in buying out Oris when it looked as though the company had a bleak future. By April 1982, Herzog was at the helm of the company – now Oris SA rather than Oris Watch Co SA.
Herzog reflects: “At the time we were part of the [General Watch Group] and they actually didn’t see any great future for the brand within that context. Dr Portmann and I decided we could really do something with the brand and move it forward so we decided to go ahead with the management buyout.” Dr Portmann became majority shareholder and company chairman, while Herzog took on the managing director role before becoming executive chairman in 2001. Dr Portmann remains honorary chairman today.
MECHANICAL FUTURE
The Oris buyout came at a time when traditional Swiss watchmaking seemed to be diminishing, so when Herzog decided that the future of Oris was in mechanical watches, it was received with cynicism.
“People laughed at me and said you’re crazy,” says Herzog. “They asked me how we could make mechanical watches at a time when everybody wanted quartz watches.
I explained my feelings that mechanical watches were much more appealing because you could hear them tick, control the time and see, hear and feel the movement.”
Herzog also gives significant credit for Oris’ mechanical watch strategy to a visit to Japan where he observed that even though the country was at the heart of the quartz evolution and technological developments there was a growing faction of young people rediscovering an interest in mechanical watches. “When I saw and heard that these young people were really interested in this I thought, wow if this is happening then that could really be a really good way to go,” recalls Herzog.
Oris produced its last quartz timepiece in 1994 and from the late 80s and through the 90s, innovated with developments such as moonphase complications and the 1997 Worldtimer. Led by Herzog’s brave vision of making Oris a global leader in mechanical watches, the brand went on to thrive, moving away from lower price points into the luxury watch market, paving the way for it to become the internationally known watchmaker it is today.
Marketing has been key to Oris’ success too, capturing its four areas of focus: diving, motor sport, aviation and culture. These affiliations, which began in the late 1980s with aviation and sport, worked for the brand. “They really brought us closer to the consumers who were committed to this kind of motorsport or aviation,” says Herzog. “They have a lot of ideas about what a timepiece should look like and they gave us a lot of input on how we should move on from there.” The brand’s ties with diving are particularly strong and at BaselWorld 2013 it launched the Oris Aquis Depth Gauge, a technologically advanced divers’ watch. Savvy marketing and product variety also helped Oris build the brand in the UK, which has been a key growth area. Oris reported its best result here in 2009 and then built on that in 2010 when its turnover increased by 25%.
“There are very strong multiples and independents in the UK who are doing an excellent job,” says Herzog. “It’s very pleasing to see how they successfully compete in this tough market.”
Oris has a few own-brand shops in countries, including Hong Kong, Malaysia and Singapore but Herzog says although it is something they may think about for the UK eventually, there are no firm plans to do so yet.
Herzog shaped Oris into the brand it is now and his vision aligns with today’s consumer requirements.
“We call our watches ‘real watches for real people’,” says Herzog. “People want to buy things that make sense, which they can use in their daily life, an instrument they can put on their wrist and not in the safe.”
Despite all his achievements, Herzog isn’t ready to hand over the reins yet. He is still heavily involved in the watch manufacturer’s product development, marketing strategy and finances. “I need to be involved as long as I’m the executive,” says Herzog. “If I’m going to step back and become chairman of the board then that’s kind of different but at the moment I’m executive chairman so I have to do the executive job. Some people think you can slow down a bit but no, you can’t. Either you do it or you check out and leave it to somebody else.” Herzog adds: “Oris is strong and has good products, good marketing and good trade distribution. I want to continue to build on this and enable it to continue successfully in the future.” And what of Herzog’s personal aims? “I want to enjoy the success with a glass of wine.”
This article originally appeared in the August 2013 issue of WatchPro.
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