Fratello Talks: Recent Shifts In The Watch Industry

Sorry RJ but I am going to have to strongly disagree with your analysis on Zenith’s future. You are being way to optimistic on the new high horology price point they want to have. The brand just doesn’t have the power to sustain at a higher price point, it couldn’t do it at it’s current price point. I’m going to address your main points:

#1 GFJ collection is doing very well:

I’ve seen this argument all over from watch media, maybe that’s what you hear from the brand. Of course I don’t have numbers but anecdotally the original blue GFJ had only 50 pieces. Over a year after launch I went into an Zenith AD and it was just there on sale, the salesman was trying to get it sold. That was their premier model and it was sitting on a shelf a year after release for such a limited run. Zenith has done other limited editions (lupin, bacs & russo) all immediately sold out and selling for more on preowned market. You can go on chrono24 and buy a Blue GFJ for 20% off MSRP. The other example I see is the recent 10 piece Naoya Hida collaboration. That is not a realistic example, Naoya Hida could have done that collab with any brand and it would have sold out due to the Naoya Hida name.

#2 Look at Universal Geneve revival and other high end indies

UG’s success at it’s new price point remains to be seen but in higher end circle that brand has a lot of power and there is a fandom of the brand that’s developed over the years. It’s not something that’s been selling in every AD’s all over with a modern production. Same with Daniel Roth. Both those brands have developed some sort of aura over years in the community. The new independents have production numbers in the hundreds and that market has a lot of speculative hype. Unless Zenith comes back and only makes a couple hundred watches a year it’s can’t be compared to these small independents.

IMO where Zenith failed is that they focused solely on the past and the movement in their marketing. They were kind of some hype on the brand (at least in the enthusiast community) during covid and I believe this gave LVMH the false impression that it would continue. They kept raising prices without a standout product. Their best selling watch appears to be the Chronomaster Sport which is basically a daytona homage and probably was selling well during covid when Daytona’s were going for 50k USD. During the covid era I saw Zenith on all the watch enthusiast channels quite often but in the last couple of years you barely hear about the brand. I’m not sure if they cut the marketing budget but it was clear the brand had lost enthusiast mind share. And in the current economic climate a their price point a no-name recognition brand just can’t survive. Their latest release was a basic dive watch priced the same as a Submariner with nothing special about it’s design.

Hopefully the brand can recover, the A384 case is amazing and now with smaller watches being more in demand its the only chronograph I can think of in that size that is slim. Maybe if they focused on that with influencers and brand ambassadors it could have become more popular, but even then the price point is too high for what it is. They should have tried to find success first at the current Tudor price point rather than going directly at the Rolex level.