Valerij Stepanov, Co-Founder & CEO at WatchAdvisor AG tells us about the luxury watch industry.
First of all, how are you and your family doing in these COVID-19 times?
Valerij Stepanov: Everybody who can work from the home office is super lucky! Here in Switzerland, we do not have a massive impact on our daily life. Of course, the quite liberal restrictions in schools, restaurants, and public transportation are painful. But the Swiss economy 2020 was affected less than expected. Our government is applying a “Swiss way” of managing Corona, and in my perception, they are doing a good job.
Tell us about you, your career, how you founded WatchAdvisor AG.
Valerij Stepanov: I’m in the third generation of family members with an engineering background. It seems that it is in our family DNA to innovate and to make the life of humans easier. I founded WatchAdvisor with my schoolmate from university some years ago, intending to simplify the life of the watch aficionados on this planet and help them find the right watch.
How does WatchAdvisor AG innovate?
Valerij Stepanov: The Luxury watch industry is discrete, conservative, and only a little digital. You can compare it with the private banking sector. The industry’s mentality has a massive impact on our growth strategy. The big bang is simply not working here. It is more an agile process of many tiny little changes in our offering we are adapting during the year. A Swiss proverb says, “the church has to stay in the village.” This is true for this industry.
How does the coronavirus pandemic affect your business finances?
Valerij Stepanov: Corona has had a huge impact on the luxury watch industry. First of all, many tourists from the middle and Far East love to buy watches when they travel. Now, they are home and spend less on luxury. Market decline was -25% last year. Therefore the marketing budgets from the brands are affected too. At the end of the day, we were lucky because there is a trend for more digital services in this industry, specifically triggered by the fact that many physical watch shops were closed for a long time last year.
Did you have to make difficult choices regarding human resources, and what are the lessons learned?
Valerij Stepanov: After a period of uncertainty, we are now hiring because of some nice momentum and higher demand for our services.
How did your customer relationship management evolve? Do you use any specific tools to be efficient?
Valerij Stepanov: Because most people are in the home office, they are easier to reach than before Corona. Furthermore, we face a higher interest in digital marketing services from the brands. There is an accelerating trend in digital services. Especially the watch brands are starting to launch new digital formats.
Did you benefit from any government grants, and did that help keep your business afloat?
Valerij Stepanov: Yes, we received some funding from our local government. The canton of Zug raised capital to support start-ups to invest in the future. We have been lucky to become part of this program. These funds will be invested to improve the user experience on our website www.watchadvisor.com and offer new and exciting community services.
Your final thoughts?
Valerij Stepanov: Corona is changing the way how we work, live and how we consume in the future. After the pandemic, there will be most probably a slight bounce back and a trend to physical. But new digital and hybrid technologies made a significant step forward in terms of maturity and acceptance.