When you buy your next watch, it may have had a special journey on the way to your wrist. Zurich-based DKSH is a multi-billion dollar conglomerate that is increasing its focus on distributing luxury products worldwide. It purchased Swiss watchmaker Maurice Lacroix in 2008 and is using its network to put luxury goods into the hands of consumers that want to buy them. Recently Regional General Manager Francis Phua met with Elite Traveler Editor-in-Chief Douglas Gollan to give him an update on the latest trends from the front lines of luxury.
Elite Traveler: What does DKSH do?
Francis Phua: We call ourselves a market-expansion service. We are a Swiss distribution company but we do more than that. We do distribution, pricing, promotion, PR and marketing for all of our brands. We have 150 years of history. In addition to luxury lifestyle goods, we deal with fast-moving consumer products, pharmaceutical products and technology. (At the luxury level) we represent brands like Bovet, Ferragamo timepieces, Maurice Lacroix, Davidoff, and more. We represent Bovet for the whole region. Most of the brands we represent, we distribute across Asia Pacific. As you can see we represent brands on the high-end price point to mid-price range (luxury market). We are representing Ferragamo (timepieces) across Greater China and Southeast Asia, so we are their arms, legs and eyes of the brand.
ET: With such a diverse portfolio, are there any trends that you are seeing in the Asia region right now?
FP: The Asia part of the business is growing, especially for the watch business. In the past, people just bought one or two watches and had the same for years. Now watches are part of their everyday accessories, people own five to six watches, many times more. I think we are definitely seeing a growth in the appreciation of varied watches. The leader seems to be China. Vietnam, Cambodia and Thailand are right there too.
ET: Are smart phones impacting interest in high-end watches?
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FP: Some might argue that there is no need for a watch with a smart phone. This is not the case at all. Again, men and women are buying watches as accessories. It’s like us saying we only realistically need a couple of pairs of pants and shirts, but you and I know that this is never the case. A woman would absolutely disagree that she only needs one bag, right? Every man should have a watch or two or three.
ET: If you talk to a lot of watch retailers in the US, especially in the gateway cities, 30 to 50 percent of the sales are from Asia visitors, especially the Chinese. Just looking across the Asia region, do you see a lot of travellers doing their timepiece purchasing in these major cities?
FP: I think it depends on the country. Singapore and Hong Kong markets are mainly foreigners/tourists doing the purchasing, especially the Chinese. In places like Malaysia it’s more of a local purchasing power because they have a strong local economy. Maurice Lacroix is doing very well in Malayasia. It depends on the price point and type of consumer at the end of the day. The mainland Chinese will always be the bulk consumer, whether in Hong Kong or Switzerland. This is simply the buying trend right now.
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ET: You mentioned the Malaysia economy is very strong right now. Are there any other nationalities growing in their buying power?
FP: Thailand, Vietnam and Cambodia’s local markets are getting stronger. There are two types of tourists in these countries, the backpacker and the wealthy traveler for the most part. The local market is getting wealthier and wealthier and when they can afford it, they buy it because this has been an aspiration. Indonesia and Australia markets are doing very well too. We see that the Australians prefer sporty products, however.
ET: Is there anything else you want to tell our readers?
FP: Watches are an accessory for all occasions. Weddings call for classy and delicate/subtle perhaps. Weekends call for a casual or eccentric look. The work week calls for another look as well. DKSH does a good job of taking care of everyone. We like that we are making people happy with our wide-range or products.
