Q&A with Eric Loth, CEO of Graham Watches
Earlier this summer, at JCK, I had the pleasure to meet Eric Loth, the founder and CEO of Graham Watches. If the brand traces its origins to George Graham (1673-1751), a British clockmaker, inventor of the start and stop device of the chronograph, the dead-beat and cylinder escapements, just to name a few, GRAHAM SA was created in 1995 and it is based in La Chaux-de-Fonds, Switzerland.
Would you please tell me a bit about how did you got into this business?
I was born and raised in a watchmaking region; I’ve spent my youth in Le Locle, at the hearth of watchmaking, however when I was at the university, the business of the watch industry was really low. I did all my best, not to end up in that industry. It’s started a completely different way around, that’s why I’m a mechanical engineer and a material scientist. However, once I finished my studies, there has been not much to do in the machine industry, and in turbine industry. The only company that was ready to hire me was Rado. They were very attractive because they were looking for an engineer, not for the technical department, but to add this engineer to the design department, because designers were always complaining that their project got killed by the technical department. They wanted to reinforce a little bit the design.
I entered the business through the door of innovation, and from there I built up my career for about 12 years at Swatch Group. I ended up as the responsible for the product development of all of their brands. At one point, I decided to step out because I did not want to end my career as an executive, I’m an entrepreneur.
This is the short version, my life was a lot more complex, just to show you the idea that I was not meant for that, but my brain was meant for that. It is at Rado that I realized that it is exactly the thing I wanted for my life.
What made you revive the Graham name?
Actually, I have three or four things that were pushing me in that direction. I always liked the roots of watchmaking, the history of science. I have always been interested in the origin of things. Second, I’m an anglophile, I always loved England; this is the second point, not the least, I would say. Third, I wanted to build up a company, but my ego was not strong enough to put my own name on my brand, I believe. I wanted to serve the company and not be myself the company.
As an engineer, I knew that George Graham among other inventors, have been inventing escapements. I knew about him a little bit, but after reading a few books about history, I crossed always the same path, the same story, Graham was always mentioned, by everyone. There is no book of watch history that would not mention him. The genius of George Graham was that he not only able to invent, but he was a fine instrument maker, even for astronomers and probably also for Isaac Newton himself. They lived during the same period and they were sitting at the same table at the Royal Society. This was very exciting, and I told myself, that it would be fantastic to wake up Graham, because the brand was dormant for more than 150 years, and I’ve decided to take the brand back to life. For me, that meant to find the right direction, know more about George Graham himself to make it consistent with his legacy. Now it’s 20 years that I’m working on this and I think, I’m far from being ended. I don’t know if I will be ending this thing, but for sure there is another 20 years to go.
Innovation was Graham’s thing; he was always going into directions that people were not expecting. He was more interested in inventing than in making money. I’ve been like that too; money is not my final thing. I need money to go ahead, but it’s not my personal objective. I’m a happy person, because I could bring back to light such a fantastic story.
How do you find 2015 so far?
I believe this is not an easy year, but I have 35 years of experience, and I’ve seen good times and I’ve seen hard times; I’m not impressed at all. You have the take the wright decisions when things go wrong, which I’ve already implemented last year because I saw it coming. We have a lot of subsidiaries and there were warning signals. We accelerated certain projects, like the new racing pieces, but in the same time we slowed down other projects that are no longer important for the brand. I’ve been realigning my priorities.
Also when you have a more difficult period, it is a very good time to realign the strategy and thing about the future. I believe America is a very important market for Graham, that’s why I’m here, and I believe America will be one of the two main pillars of the brand, with the other being South-East Asia. We have to work on a project that would go to the hearth and soul of the Americans.
Among the novelties, which one makes you proud?
It’s a very hard question. Graham is coming out with new things every year and we always have more options than we present. We have to postpone some launches because some look more important for our short-term strategy, such as the Silverstone RS Racing line. This is something that plays more on the design than pure technique.
Graham was among the very first brands that introduced colours, we were among the first to use a blue or a yellow strap for a $10,000 watch, and since than we have been pushing this direction. This passion for colours, frankly it comes from me. I like art which is colourful, I’ve been always attracted by colours and by racing. I discovered that all racers love colours, in order to differentiate your car, you put a lot of things on it.
The colours of racing have been a strong influence and I’ve been inspired by that and then, I said instead of using drop-by-drop, why not do it straight, make a collection on racing. We will deliver it this summer, but I’m expecting by the end of the year to be sold out. There is a lot of demand, also because the price is a key.
Doing a good product now is possible, but making it a good value for the money for the customers, with the right positioning is another question. This is why, our retail price is $5,800, which is very unusual for Graham, and this is another of our response to the bad times.
When you’re strong and you’re creative, you can find a response to any period, and this is the way we go forward. I believe this is something that will push further the brand.
One of the things that has created a lot waves this year was the Apple watch, and there are many brands that have launched or are working on their response to it. How do you see the smart watch phenomenon?
Well, I have three statements: the first one, thank you Apple because you put something on the wrist of the young kids. You know, the 15 to 25 are not used to wear something on their wrist.
The second statement, as long as this watch won’t have an autonomy of a year or two, I see it as an additional issue, because you have to plug your phone, you have to plug your watch to the computer, for some this is not a big deal, but for most it is a problem. It makes you addicted to the plugs, the first thing you want to see in a room, where are the plugs, and I think it is the major weakness of the project.
The third, as long as you have good eyes and you can read a very small screen, but I’m 50 something and I can tell you, I can’t read anything on it.
I don’t think this is the future, the future will be different for smart watches, their future is in health. It is a sensor that screens your body and your vital functions on a daily basis. Then you can have your blood pressure, maybe a DNA analysis, we don’t know what it will end up to be. It can also play the role of a passport or an ID, and anything would happen to you, you get into an accident, with the watch they can know exactly your medical history and they can save you.
The phones, tend to be larger now. I started with my NOKIA, very narrow with a small screen, now the screen is becoming larger and larger. What do you think, the watch will replace the phone? Never, ever; you can’t play or go on apps, it is very difficult. But if the watch connected to your wrist, send regular information to the phone and interacts with your body and it helps you to improve your condition, then it will be interesting.
My interpretation of the future is that it will become a portable doctor, and when we will get there, we will have a good reason to wear it. At that point, the question will be, will we call it a watch? I believe the watch is just an intermediary step, before it will be replaced by a patch that can play the same role, and it might be more comfortable for everyone.
Intelligence will reach us anyway, probably not our generation, but the next will live to see this.
This is a more playful question, which model do you think George Graham would wear?
I believe, he would probably have worn the Orrery, but I can’t ask him. Because the Orrery is probably the closest to what he has been trying to achieve. I believe this watch is almost perfect, not because it’s ours, but because it’s there. Actually, I’m trying to wear it from time to time and I think anyone in the company would like to have one to wear it.