Sustainability, materials, novelties for 2022 and the lessons to be learned from the pandemic were some of the issues addressed by Panerai’s CEO, Jean-Marc Pontroué, in this interview with Turbilhão.
Panerai has a very engaged audience and has done a lot during COVID – like PamCast – to find new ways to keep the community engaged. What emerged from these conversations with the public?
The pandemic forced us not to travel and that 40% of time we spent on travel before Covid allowed us to have more distance and think twice before making any decision. On the other hand, we discovered that we can do business without traveling so much, we reallocated our priorities and realized that we only had to listen to the needs of our communities.
The biggest problem when we develop products and marketing initiatives is that ideas usually come when we travel, when we come into contact with other cultures, people and activities. And that stopped happening with the pandemic. So we relied on what our community had to tell us. And it was based on feedback from our audience that we developed the new Submersible QuarantaQuattro. It was the Paneristi who alerted us to this “need” to have another case size in our Submersible offer, it was through the conversations we had with those who, often, know the brand better than we do. When we listen to people who like the brand, we can understand certain aspects or needs that we are not able to see because we are too immersed in the business. That’s why I love talking to all the people who are passionate about our brand and who are a very strong source of information for us.
In your opinion, what will the watch industry look like after the COVID-19 crisis?
First, I strongly believe that the “big ones” have never been stronger. On the other hand, I think that all those who were weak before the pandemic are weaker today or simply left the scene. I firmly believe that all the brands that have worked well, that have local customers, are the ones that went through the crisis with the fewest problems, and many others that focused only on tourists failed to do so. In Portugal, for example, our stores in Lisbon and Porto continued to sell, despite the fact that the number of tourists dropped drastically, which proves that the brand is relevant to the local population.
We learned a lot from the pandemic, there was an increase in the e-commerce business and the fact that some countries lost momentum while others gained had to do with how countries dealt with the crisis, how quickly they reacted, how much serenity was involved in the different decisions of different governments, etc.
Sustainability and nature have always been at the heart of Panerai. How we find them in this year’s collection?
This is not an attempt to put sustainability on Panerai’s agenda because it feels good to do so. It all started through our ambassador, Mike Horn. When we have ambassadors who are close to nature and alert us, the impact of that alert is different than when we read in the newspapers that the planet is in danger. When one of them tells us that we’re in trouble if we don’t change our habits, we realize the scale of the problem.
Mike Horn was constantly referring to the thickness of the ice where he walked at the North Pole, where he went very often. He said that there were years when, in some remote areas of the North Pole, it was possible to land an Antonov plane and that, nowadays, in the same areas, even he can no longer walk on that ice because the thickness has decreased so much. We believe that Panerai is one of the brands that has to act. As CEO of a brand I have this power to do something. That’s why we decided three years ago to follow the path of sustainability and today, fortunately, there are many more brands making this commitment.
In this year’s collection, nature and sustainability translate into two different activities. First, we continued to roll out eSteel in our lineup with three Submersible QuarantaQuattro models in this material. In fact, I can already say that eSteel will, in the next three years, replace all the steel models in our collection. A year ago we believed that we would have steel and eSteel in parallel, but, based on what we have experienced in the last 12 months, a few days ago we decided that, in the next three years, 75% of our production that today is in steel will be transformed into eSteel.
The second issue has to do with packaging. Currently, around 30% of our packaging is recycled. That means 70% are not yet. In this Watches & Wonders we featured, as a highlight, a new packaging concept, which will become the norm in our collection. Thus, this year we will have 50% recycled packaging and, in 2023, 100%.
What was the easiest and hardest thing to do to make this issue a priority?
The easiest is that if we really want to do something, we can do it. We do many things routinely without even thinking that we have a chance to do them differently. In reality, Panerai’s recycling program is about thinking that we have a choice and how we can make it happen. With the pandemic, we stopped traveling, leaving our homes, offices or countries and had time to think more than before. How to make this issue a priority at all levels of the company? When I first introduced the program, all Panerai employees were impacted, even the finance people. How could they create initiatives to also contribute to our ecological program? Using less paper, changing the way you work, etc. We found that our business has never been stronger without traveling. So, answering the first part of the question, it is quite easy, as long as sustainability becomes a priority for the company.
The challenge is that we work in many countries where not everyone has the same sense of priority in approaching recycling. Some people think we can still wait 50 years. So how do we create a sense of urgency? We had the issue of COVID that proved that there are other priorities and that we had to relativize others because our world is full of priorities. How to make sustainability a priority? Relativizing others that were until now a priority, and doing something that is valid for Americans, Chinese, Portuguese, Greeks, Taiwanese, etc.
How challenging is it to get the right materials and produce these pieces?
It is a good question. Last summer I traveled through Spain and discovered an airport full of planes, which turned out to be a parking lot for planes waiting to be destroyed. Did you know that there are currently Airbus A380s that have never been used and are directly destroyed? This is because airlines don’t want to use these planes because they consume a lot of energy. So, what was widely used three years ago has become an obsolete product because the new conditions make it unfeasible. And the world today is full of materials that are no longer used. I live in Switzerland, which is the world’s largest producer of coffee. If you thought it was Brazil, no. It’s Switzerland because of the Nespresso capsules that are all produced in Switzerland. As such, there is a large use of aluminum and we have a large recycling depot for Nespresso capsules. This is just an example. Everything we do in our life today is something we can reuse many times over.
To answer your question, finding the right metal was not the challenge. The difficult thing is to get in touch with suppliers who were not used to working with the watch industry. They usually sell millions of tons of metal for cars, boats, planes… and when we are the Panerai of the Swiss watch industry and we need “only” a few hundred kilograms, they look at us with suspicion. However, when we present ourselves as the Richemont Group, we have another influence. As such, I can say that other major brands in the group will soon announce that they will also use eSteel in their offer. It’s everything we wanted when we announced this material a year ago. We wanted it to be an open ecosystem, where any company, inside or outside the group, can visit Panerai in Neuchâtel and ask all they want about our recycling model and follow the same business model to accelerate change.
Still in ecological territory, Panerai originally planned to create a watch made from 100% recycled materials. The ‘Submersible eLAB-ID’ watch is made from 98.6% recyclable materials. Why not 100%?
It was the first question I asked our watchmakers. Not least because it is much more powerful in terms of advertising to say that it is 100% made from recycled materials. The answer is that it costs the environment much more to do 100% than 98.6%. The missing 1.4% is associated with spare parts. Especially rubbers for water resistance protections. That is, if we have to produce these parts from an existing material, it costs much more in energy than if we start from scratch. Because recycling is not the only parameter that we take into account in our calculations. It’s also how much energy we need to recreate a new product. If we use more energy in a recycled material than if we start from scratch then it is better to start from scratch. That 1.4% was consuming much more energy than if we were using new materials. I know in terms of advertising it’s not that impactful. We could have done so, but at a higher cost to the environment.
As this is an unprecedented project with materials based on recycling, what does that do with the price?
The price is higher, but do you know why? Basically because we learn every day. When we learn something new or test it 100 times, we waste time. Even today, at Panerai, we waste a lot of time finding solutions. Of course, with what we learn every day we also start to gain some time, but it will still take much longer. That’s why if more and more companies use eSteel, it will bring us some learning, experience and time saving, as well as other future innovations.
Material innovation has been the cornerstone of the brand. What is the magic ingredient and new focus material for 2022?
We will continue to have Carbotech, Fibratech, Goldtech, platinum… all Panerai specific alloys. But this year we are very focused on eSteel. It will continue to be the construction of a story of the future.
Last year, Panerai presented, for the first time, a women’s watch. What has been the public response to ‘Piccolo Due’?
We received women in our stores, who usually accompanied their partners, to choose a watch for them. Then there were those who “stole” their partner’s watches and used it. So, we knew that there was an interest, a demand in the women’s market for Panerai watches. That’s why we developed this collection in 38 mm. We didn’t change it. We kept the same case, everything the same. We just changed the size and a little bit of the design, with the quick-change strap system, colored straps and dials that have a more feminine approach. The response has been very good. It is one of the lines that is currently out of stock and my priority is to replace it in the next six months.
What would you highlight from this year’s novelties?
This year the focus is on experience. It’s about everything the brand is best at and knows more about. The highlight will be the Submersible line, recycling – including materials and packaging – materials such as Carbotech. We will also highlight Luna Rossa because we are proud to announce another three years of partnership with Prada for the next America’s Cup.
All this encapsulated in experiences. We launched this concept three years ago and it was a great success. First of all because nobody died (laughs). All the people we took with us we brought back safely. Experiences were my highest priority because we have many people wanting to live these experiences, created for those who know everything about Panerai, who have visited our manufacture or historic boutique in Florence, or the design studio in Milan… could we offer them more? These experiences were the answer to this question and we continue to try to find other experiences, new themes.