S2.N°8 : Georges Kern, CEO de Breitling

Absolutely. I was very young, but I always wanted to be CEO. I was maybe 33 or 34. I absolutely wanted to be CEO of Ebel, which was a very big brand at the time, even bigger than Cartier. People who knew me said, 'It's incredible, we thought you would resign much earlier.' Those who didn't know me thought, 'This guy is crazy.' I was the boss and I had a vision diametrically opposed to what people were doing. The press assassinated me because they saw what I wanted to do. Everyone said, 'You're going to fail, you're going to ruin the brand.' The former owner quickly sold his shares and left because he totally disagreed with what I was doing. I wanted to create a luxury brand that was cooler and more relaxed than traditional Swiss brands in our price range. That's why we immediately went into surfing and triathlon, which no one was doing at the time. Funny enough, now every luxury brand is into surfing, but back then no one was.

Hello Lou.

This is our marketing office. It's easier to recruit marketing people in Zurich than in Grenchen, where our headquarters is near Bienne. In Grenchen we have product development, purchasing, assembly, and after-sales service. In La Chaux-de-Fonds we have the real production. Here we have our entire marketing center. It's very practical, and we have many foreign employees, especially young ones, who prefer to live in Zurich.

It's great.

So, Georges Kern. Actually my real first name is Jörg because I was born in Germany. My mother was German, my father French. We moved when I was 7, and my name magically changed to Georges, but on my passport it says Jörg. Only my mother called me Jörg. From 0 to 7 I lived in Germany. My father was a very famous jeweler, René Kern. He won the Oscar for the most beautiful jewelry of the year three times. He had huge clients worldwide. But since he was French, he wanted my brother and me to have a French education. So we moved to France, first to Alsace, where I was in a Jesuit boarding school for 5 years. It wasn't very nice, but I survived. Then I did my bac at Lycée Kléber, then 1.5 years of SPO in Strasbourg, then went to a business school in Switzerland at Sion. My first job after that was at Kraft Jacobs Suchard, working on chocolate, coffee, cheese. I stayed there for 3 years. Then at 28, I was recruited by Tag Heuer, which had just been acquired by the TAG group. I stayed there for 7-8 years.

No, not at all. It was totally by destiny. My first job after Sion was at Kraft. Then I was recruited by Tag Heuer. I started as a brand manager in marketing. I did everything: media, catalogs, displays, corners. Then I became market manager, handling agents worldwide, covering Scandinavia and the Middle East. Then I quickly became country manager for Germany, Switzerland, and Austria. After Tag Heuer was sold to LVMH, I left for Richemont.

I was very young. I was brand manager, then market manager, then country manager. At Richemont, I worked on the acquisition of LMH (IWC, Jaeger-LeCoultre, etc.). I was the right hand of Franco Cologni. I wanted to be CEO, and I was promised that. I worked on integrating the brands, which was a huge battle with LVMH. Eventually, I became CEO of IWC.

Maybe. I was arrogant and young, and I didn't have the perspective of becoming CEO immediately. So I decided to leave. I called Jean-Claude Biver, who arranged a meeting with Nicolas Hayek. I went to Bienne, and Hayek asked me what job I wanted. I said I wanted to be CEO of a brand. He laughed and said there was already someone in place. Then he called Franco Cologni, who became my mentor. I had an interview with Cologni, and he hired me immediately. I worked on the acquisition of LMH. It was an incredible battle. I remember being in a Bentley with Mr. Perrin when he said 'We won.' It was 3.2 billion for the three brands.

Vacheron Constantin, Panerai, Baume & Mercier, Piaget. They wanted to create a watch division. The strength of LMH was that they were manufacturers with technical know-how. So we acquired IWC, Jaeger-LeCoultre, and Lange & Söhne. I worked with Gunter Blumlein, a legend. He gave me a book called 'Kangamet' about the art of going slowly, because I was too ambitious. I learned a lot from him and from Richard Lepeu. I never had a bad boss.

You mature with age and change your style. You reflect on how you work, how you treat collaborators, how you approach difficult strategic situations. I learned a lot from Richard Lepeu, who elevated the debate. The worst for a young person is to have a boss who is weaker than you. I never had that.

I created the RHHH department (Richemont Haute Horlogerie) to integrate the brands. I told Franco that I would have conflicts because people wouldn't want a 34-year-old from Tag Heuer telling them how to do things. I wanted a guarantee to become CEO. He agreed. After working on integration, I became CEO of IWC. I was the only one who spoke German, so I raised my hand. The first press conference was hostile: 'How can a 36-year-old manage IWC?' I had to win their trust through arguments and success. We quickly developed products intuitively, like the Portuguese with blue dials, which became iconic. We expanded the brand globally, especially in China and Asia.

It was about 100 million in revenue. We exploded the counters. It was a combination of intuition and taste. I think I have commercial taste; what I like, most clients like. The beauty of our business is that I make products. If I don't like them, we don't make them. But luckily, my taste is not niche. We launched the Portuguese, automatic movements, perpetual calendar, and it worked very well. The brand grew quickly.

Yes, completely. China was the big dossier, and Asia in general. In Japan, 80% of sales were pilot watches. It took time to balance the collections.

There were restructurings in the group. I was appointed head of all Richemont watch brands, plus digital and marketing. I was about 50. I had this role for only 8 months before resigning. I am more of a hands-on entrepreneur than a coordinator. I had a privileged position, but I wanted to take risks. People who knew me said they thought I would resign much earlier. Those who didn't know me thought I was crazy. I left a huge comfort zone in terms of job, prestige, and money to go to Breitling, where I could potentially fail.

In 2017, Breitling was bought by CVC. No one else wanted it. I contacted CVC through my brother. I had dinner with Steve Caster, and I told him how I would do it differently. That started discussions. I wanted to be CEO and also an owner. I had no non-compete clause, so I could leave Richemont quickly. It was a shock for the company. I announced my departure, and within 48 hours the deal was done. I had a very emotional farewell at IWC. The employees applauded me in the courtyard. Then I went to Breitling. The former owner didn't know I was coming until 24 hours before. It was a culture shock. I had a vision diametrically opposed to what they were doing. The press assassinated me again. Everyone said I would ruin the brand. The former owner sold his shares and left because he totally disagreed with my vision. But I wanted to create a luxury brand that was cooler and more relaxed, which is why we went into surfing and triathlon.

At Richemont, uh, and the CFO, and they came gradually. They contacted me on that basis. Afterwards, I set up processes gradually, changed teams to enable international development and product range expansion towards what has always been Breitling's strength: being a generalist, making very elegant products like the Premier and very professional ones like the Emergency. So we expanded the range, set up international distribution structures, and you need a different team. You can't play with the same football team in the second division as in the first division or Champions League. You need different coaches, different presidents, different players. That changes everything.

A lot. A bit a lot.

No, but we changed everything. We created the concept of pub squad, created this environment in the offices, this modern retro environment with brick walls, loft, etc. I wanted to create a luxury brand that was cooler and more relaxed than traditional Swiss brands in our price range. That's why we immediately went into surfing, which nobody else was doing at the time, or into triathlon. It's funny, today everyone does surfing. All luxury brands are in it, but at the time nobody was. So we started that. I always said I wanted to represent inclusive luxury, not exclusive, in terms of approach. Obviously we are exclusive in terms of price and distribution, but not in approach, in communication with the client. So I said no to golf, no to tennis, etc., and let's do something else. Also out of necessity because we didn't have the money at the time for big investments like we do today with the NFL in the US. So we did something else, much cheaper and much cooler, much younger, much sexier than what all other brands were doing. We created this recognizable style, which is hyper recognizable and especially not copiable. No one can copy it. Above all, it doesn't age because this style is architectural, which you must not change. And today, we've re-done our boutiques with pool tables, libraries, sofas... The success of a brand is like when you cook: the chef isn't there taking measurements of 1g of salt, 2g of paprika, three onions. No, you open the fridge and you cook. Either it's good or it's not. But there are many things that need to work, and many brand owners have an intellectual approach. A little bit of Hollywood, a little bit of tennis, a little bit of Formula 1, and I'll be successful. No, it doesn't work like that. Either it's good or it's not. There's a lot of intuition, and when you cook, you improvise in a certain way. And that's what we did. So the beginning is difficult. It's like a puzzle. You have a very clear picture, which at the time was the aviation world, and then you remove elements from the picture and replace them with the new vision, and for a year or two the image is blurry because people are confused, clients are lost. Is it aviation? Is it the new products? People didn't understand. So for a year or two you go through a nebulous phase, but then you must accelerate and put the new image and new puzzle in place. So we pushed the boutiques enormously to express the new brand, obviously advertising, products. And then Covid arrived unfortunately very quickly; we were already in dizzying growth but then Covid came. But at the time, the first presentations I made — I remember the first ones in Zurich with our agents, I invited them about 3-4 weeks after my arrival, we did a kind of management seminar. I made presentations but there was dead silence. People said, 'Wait, this guy is crazy. He's completely crazy.' But I always told my closest colleagues, those I brought from Richemont, 'Listen, don't worry, we just need to put goals. Just put goals, we need to win. And when you put goals, nobody discusses strategy and plan anymore. People are just happy.' So we very quickly put goals.

I think we didn't have time, because making a product takes 3 or 4 years, but we had to act very quickly, like with IWC. So you work on aesthetics, you change the dials of the Superocean at the time, we very quickly relaunched or launched the Premier, we made new dials. The Premier was to reach more women. No, at the time it was mainly a men's piece, but to talk about history, people didn't know the history of Breitling. I wanted to talk about Willy Breitling, about its transition from instrument to more aesthetic watches. It was mainly to talk about the movements, everything that actually made the richness and strength of Breitling. That didn't exist and people had forgotten. The collector I work with, Fred Mandelbaum, throughout that pre-CVC generation, never spoke. That whole community of collectors wasn't in contact with the brand, and the difficulty was to build a bridge between the collectors who were completely disconnected and the buyers of Breitling at the time who bought those bling-bling watches. Yes, you really had two different types of clients, two different communities: a client community and a community that buys from us today that was more classic. And it was quite striking. I've never experienced that in brand rebuilding, having to face... you have collectors or people who know the brand, and then you have the buyers. Anyway, afterwards I lost a lot of clients who bought the old Breitling because they didn't like the new Breitling. But that's not the question. The question when you change a brand is: you have to gain more clients than you lose, simply. And we gained many more new clients than we lost. Obviously, today we probably have two-thirds new clients and one-third existing recurrent clients. But that's normal; you change style, you change clientele, it's totally normal. But at the time, I told my colleagues when they saw it — whether the press or agents or subsidiary heads — you have to gain confidence through success. You have to be successful. Uh, let's score a goal, that's all. Just win. And once you win the first matches, boom, trust is established.