Code 11.59 By Audemars Piguet: How To Fail At Marketing, AKA To Break The Rules You Must First Master Them
Imagine, for a moment, that you find yourself taken back in time several years and plunked down in the CEO’s chair at venerable watch enterprise Audemars Piguet. As you survey your empire, you are struck with two inescapable conclusions:
- Your leading product line, the Royal Oak with its Offshore extension, is one of the greatest blessings in consumer products history as it is eagerly sought-after by collectors, immediately recognizable, and has maintained its popularity over decades.
- Your leading product line, the Royal Oak, is a curse as you sense that at some point it must begin to decline, and your market research tells you its buyers are beginning to skew older. Your other core lines, the Jules Audemars and Millenary, have languished in the massive shadow of its success, and increasingly consumers see “Audemars Piguet” as synonymous with, and limited to, “Royal Oak.”
In the hundreds of case studies I analyzed back in my business school days each ended with, “what should the CEO do?”
What Audemars Piguet did
In real life it appears that Audemars Piguet concluded that the answer to its problem was to create an entirely new line of watches sportier and edgier than traditional dress watches while still being on the dressy side of the Royal Oak. And to launch it with great fanfare at SIHH 2019, the brand’s swan song at the Geneva fair.
The initial online response to the new Code 11.59 collection was extremely negative, and even among those who withheld judgment until handling the watches I’d say the word “lukewarm” was the general view.
In the Quill & Pad team’s SIHH 2019 retrospective, I went on the record to say that I didn’t think the watches themselves were the crimes against humanity some deemed them to be, but that there were substantial problems with Audemars Piguet’s marketing strategy and tactics on Code 11.59.
Having let the dust settle a bit, let’s take a look at the anatomy of a dismal product launch.
What went wrong?
There are a number of dos and don’ts when it comes to new product strategy, and Audemars Piguet fell afoul of many of them.
1. Clearly separate the new line from other ongoing product lines. As noted above, the Code 11.59 line is positioned somewhere between dress and sport. That’s already a bit problematic from a product portfolio perspective as (at least to me) the Royal Oak already sits atop the dividing line between dress and sport watches, and it’s tough for a single manufacturer to establish two distinct offering personalities in the same space.
Then there’s that case band – octagonal in profile as seen from above and intended to mirror the Royal Oak’s bezel shape, and ditto on the hexagonal screws at the spring bar positions on the lugs. There’s way too much talk about “DNA” in the watch business for my taste, and in this instance I feel that a misplaced desire to maintain visual similarities to the Royal Oak substantially diminished the ability of Code 11.59 to stand on its own.
If you imagine a wall-sized product positioning map on which the Royal Oak and Code 11.59 lines are plotted with pins, the pins would be almost touching and surrounded by ample areas of blank, unserved market potential. That’s not good.
2. Test, learn, adapt. While the Code 11.59 watches are perhaps too close in type to the Royal Oaks, they are quite different from the Jules Audemars watches they replace. In addition to logistical constraints, there are good reasons why companies (including luxury product leaders) roll out new sets of products within a family over several years using a disciplined product/derivative roadmap.
Whether it’s Ferrari with the Berlinetta, Spyder, and Competizione versions of a particular model or Nikon with successive tiers of products within a given line, starting a new product family with one or two initial models helps with a smooth transition as well as allowing time to judge market reaction and improve subsequent variants.
By contrast, in January of 2019 Audemars Piguet introduced no fewer than thirteen different references across six watch types (time/date, chronograph, perpetual calendar, automatic flying tourbillon, openworked tourbillon, and Supersonnerie) and three new movements.
Had I been in charge, I would have introduced one reference – likely the chronograph with Audemars Piguet’s new fully integrated movement, a significant advance for the brand – and then tuned subsequent releases over several years based on consumer response.
While we’re on the topic of test and learn, a well-placed (but unconfirmed) source told me that Audemars Piguet had conducted some feedback sessions with customers during the development process, but in the end decided to ignore much of the counsel received. While it’s true that consumers are often bad at identifying new classes of solutions to problems, it’s also true that they are pretty good at telling you whether your idea is pure genius or a stinker – and if you decide that you know better, you’re on your own.
3. If you’re trying to establish a sub-brand, go all the way. Audemars Piguet gives us a hint with its labeling of this line as “Code 11.59 by Audemars Piguet,” suggesting that it is intended to stand somewhat apart from the core brand. However, there was nothing that I saw in the launch of Code 11.59 that followed through on that suggestion, unlike when Vacheron Constantin launched its FiftySix line with its own promotional positioning clearly aimed at younger, fashion-forward male consumers.
Is this line mainstream Audemars Piguet or meant to be a separate proposition under the AP umbrella? And just who is the intended customer for this set of pieces? Other than CEO François-Henry Bennahmias’ almost comically vague statement that “it’s not a men’s watch and it’s not a woman’s watch, it’s a watch,” we’re left to guess.
4. Choose a brand name with meaning – to consumers. Okay, I’ll admit that my home area of Silicon Valley is the birthplace of some of the most nonsensical brand names ever conceived, but I’m a bit of a purist about at least attempting to give products brand names that have a chance of creating affinity with one’s intended customers.
The “Code” part of the brand’s name (I had to look it up) refers to “Challenge, Own, Dare, Evolve”: four words that may be fine as part of a corporate values statement, but don’t have any apparent linkage to consumers’ needs and wants. And 11.59 is meant to refer to being “on the brink of tomorrow.” Why not go right into tomorrow instead of hanging on the edge?
I wouldn’t be surprised if “Code 11.59” weren’t the internal project development designator for this line of watches, and the marketing folks ran out of imagination around the time a proper brand name was needed.
5. Underpromise, overdeliver. From the bombastic and self-important pronouncements associated with this launch, including the repeated statement that this was the single most important product launch for Audemars Piguet since 1972, these products would have needed to be nearly miraculous to stand up to the hype.
Then there was the presentation itself: I was at the AP booth at SIHH, and every several minutes the main reception area would darken for the panoramic showing of a self-congratulatory video accompanied by thunderous music (a version of which, if I’m not mistaken, can be seen on the brand’s site at audemarspiguet.com/en/watch-collection/code1159byap/film).
Had the presentation been the announcement of a cure for pancreatic cancer or the rollout of the Mars booster missile, it would still have been 50 percent too long; for a set of new watches, it was overblown enough to remind me immediately of the “Stonehenge” scene from the satire “rockumentary” This Is Spinal Tap, in which an intended concert finale is ruined due to the main prop having been made 18 inches high rather than 18 feet.
By the way, if you have a spare three minutes and you haven’t seen the full scene before, I’d heartily recommend it.
6. Don’t think you can control the message. There was a time in which it was possible to hand-pick the media through which a brand introduced a new product and carefully shape the messages consumers received. In the Internet era that’s all gone, and brand managers act otherwise at their peril.
With Code 11.59, a few media outlets received previews of the new watches prior to SIHH. On launch day, January 12, Hodinkee for example published Introducing CODE 11.59 By Audemars Piguet under Stephen Pulvirent’s byline that was considerably more laudatory than the immediate reactions from the great majority of the watch community and included a five-minute, slickly produced, Hodinkee-hallmarked video in which Audemars Piguet CEO Bennahmias tells us why Code 11.59 is the greatest thing since sliced bread.
The small number of selected media partners, and the marked difference in enthusiasm for Code 11.59 between the views of the chosen outlets and others, led to entirely predictable speculation that opinions had been bought and sold, at minimum with preferred access and likely with hard cash; this is not the sort of buzz that you want surrounding your product launch.
At the show itself additional media outlets were shown the watches in an abbreviated way (in at least one case I’m aware of without the facilities for photography being made available, for instance), and by the time our collector group saw the pieces three days into the fair the time-and-date references were no longer being presented for viewing.
In the famous words of heavyweight champ Joe Louis when asked about opponent Billy Conn’s plans to “hit and run” in their 1946 bout: “He can run, but he can’t hide.”
7. If you apply new technology or design innovation, make sure it delivers a benefit. At the launch, much was made of the introduction of applied Audemars Piguet logos on some of the dials manufactured through the use of galvanic growth methods. Bennahmias noted that these were developed “going against initial warnings regarding the feasibility of such a logo.”
In my view, the AP team should have heeded the warnings as the resulting chunky-looking characters with tiny bridges connecting the letters give the impression of those laser-etched metal detail kits you can buy to enhance the look of a plastic car model.
As a consolation, the unintended good news is that the applied logos (and for that matter, the hour indices and hands) are next to invisible against the darker dials in the series. Our group found it very difficult to capture any images in which the applied logo showed up at all, and the same is true even for many of the shots in the articles from sympathetic press partners.
I’ll give the benefit of the doubt to the double-curved crystals (radially curved from 12 to 6 and spherically curved beneath) as I haven’t personally compared them with other watches, but my impression in the room wasn’t of a significant decrease in reflections or increase in legibility.
What about the watches themselves?
For me, that’s largely a matter of taste. The watches are not particularly to my liking, but I can imagine that others might find at least some of the pieces appealing.
The time-date watch seems particularly problematic; from photos I’ve seen and from the report of a friend who was finally able to handle the watch in Hong Kong, the ultra-thin bezel and wide open spaces of the dial coupled with super-skinny hands and indices are particularly unkind to this simple watch.
I thought that the rectangular hole punched in the dial to reveal the date just looks cheap.
The buttress lugs, integral to the front bezel and stopping just short of the rear bezel, are somewhat interesting but as the owner of a Grönefeld 1941 Remontoire on which the lugs have tiny gaps to the case, I can guess that Code 11.59 owners will spend a decent amount of time fishing hair, skin cells, and other assorted crud out of the more pronounced gaps on the AP cases.
I’m sure that the new calibers developed by Audemars Piguet Renaud & Papi are as excellent as we have come to expect from this top movement design shop, and there were two pieces with established movements I thought had particular merit. The movement of the openworked tourbillon is just lovely to see, and the textures and tones are especially easy on the eye.
And while I liked the look of the prior Jules Audemars version of the Supersonnerie better, to my ear the sound of that complication in the new Code 11.59 case was actually superior.
Super sound: Audemars Piguet Code 11.59 Supersonnerie (video courtesy AllenS)
For me the visuals of the other pieces in the line still need work; for instance, the aventurine-dialed perpetual calendar has enough going on to fill its dial, but was illegible enough in the bright lights of the AP booth that my friends took to photographing it (and several of the other calibers) under the table.
Product pass, marketing fail
In a pass-fail grading scheme, I’d be inclined to give the majority of these watches a “pass” as individual efforts (although, as mentioned above, I see real problems with them as a group from a portfolio perspective for AP).
From a marketing perspective, though, this was a clear “fail.” And if I were grading the effort as an exam response and feeling particularly snarky, I might scribble “to break the rules, you must first master them” in the margin of the blue book.
I have no idea whether Audemars Piguet will succeed in selling out its total first-year production of 2,000 units (across 13 references!) to consumers at full retail prices through its monobrand boutiques (perhaps I’ll return to this retail channel strategy topic another time), but it will be interesting to observe.
These are only my opinions, though. I have confidence in my views based on my experience as a business and marketing strategist and as a long-term participant in the watch scene, but also have plenty of respect for the principle of “test and learn” and look forward to hearing your observations in the comments below.
Note: while friends and Ian Skellern contributed some of the images for this article, the opinions expressed are solely mine.
Quick Facts Audemars Piguet Code 11.59 Selfwinding Chronograph Reference 26393
Case: 41 x 12.6 mm; white and pink gold
Dial: lacquered dial and counters (in blue or black) with applied gold indices and galvanically grown gold logo; glare-resistant double-curved sapphire crystal
Movement: automatic Caliber 4401 with column wheel and vertical clutch; 70-hour power reserve; 28,800 vph/4 Hz frequency
Functions: hours, minutes, subsidiary seconds; instantaneously jumping date; flyback chronograph with continuously advancing 30-minute and 12-hour registers
Production years: 2019 onward
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SIHH 2019 Round Table: What We Liked, What We Didn’t Like, And What We Would Buy For Ourselves. Warning: Heavy Photo Fest And Sexually Graphic Images
Becoming Horological Art: My Transformational Experience With Alexa Meade And The Audemars Piguet Equation Of Time
Audemars Piguet Royal Oak Offshore Chronograph Tourbillon & Royal Oak Offshore Chronograph Re-Edition 25th Anniversary: Boldness Is Relative
Hearing Is Believing: Audemars Piguet Royal Oak Concept Supersonnerie And The Science Of Sound
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Thank you for an excellent if biting analysis. One is left to wonder whether the helm of one of high horology’s main pillars is among the few places remaining where one’s blunders go unpunished.
Thanks, Marc — very pleased that you enjoyed the piece. Senior-level accountability is in my opinion somewhat under-enforced across industries! That said, the legacy management model of the established watch companies perhaps makes it even less likely that big mistakes will be punished in a visible way than in other businesses.
This is exactly the type of article I feel this industry needs. There’s so little critisism, too much praise, pampering and but-kissing. Thank you for an honest take on a fairly shitty release.
Many thanks, David — I have to give credit as well to Elizabeth and Ian here at Quill & Pad, who encourage contributors to speak our minds even on contentious topics.
As a rule if I don’t like something I try to find something else to write about instead! That said there are those occasions on which there are lessons to be drawn and where criticisms are deserved…
Gary, just an excellent analysis. And an appropriate comparison to the VC 56.
Time will tell if the 11:59 is a success as measured on its own merit. However, at this point, 6 months later, the term “buzzkill” comes to mind.
Thanks, Larry — opinions may vary on the VC 56 pieces (I happen to like them) but from the perspective of having a coherent marketing approach and not overdoing the initial launch assortment there’s a lot to like there, IMHO.
I’ll crawl a bit farther out on the limb and suggest that the new Patek 5172 is what CODE could have been — a sportier take on a dressy watch that doesn’t try too hard to be what it isn’t and doesn’t (in Patek’s case) sit atop the Nautilus’ market position.
Buzzkill indeed! Thanks as always for your thoughts.
Thank you for this great article.
I would be very interested to read about your thoughts on monobrand boutiques.
It seems to be a fad of successful brands like AP or Richard Mille but is it really a good way?
Thanks, Soudan! I appreciate your comment and question and I plan to write a full article soon on the topic of monobrand boutiques so please stay tuned!
Thank you for this exceptional article. Exceptional because on top of offering information and insights on watches it offers a master class in marketing and strategic thinking. I always read your articles Gary and learn a lot from you. I fully agree with what you wrote and AP seems to be managed by a management team that is less than optimal.
In my very modest opinion this is the best article I read since I can remember. It mixes horology with business strategy so what’s not to like. I have founded and run 3 businesses and it’s really a passion to think strategy while remaining humble and open to crowd wisdom.
As a final note I would love to have your opinion Gary on a watch I particularly like: the Glashutte Original Senator Chronometer in rose gold whenever possible some day. Thanks again.
Wow — speaking of humble, I am humbled by your very generous remarks! I couldn’t be more pleased that you found my thoughts interesting.
As for the GO Chronometer, I haven’t handled the watch personally but it certainly looks to be a beautifully made classic dress watch. I like the attention to detail on features such as the sunken sub-dials and the recessed edge around the date window (both by contrast to the CODE 11.59 simple watch, by the way) as well as technical features such as the zero-reset seconds. Of course only you can decide whether the watch speaks to you!
GaryG I always enjoy your articles and this one more so. I handled this piece (Chronograph in blue and black) in the AP boutique in Geneva a few days after the Basel world. I mostly agree with your article. The three handers are too plain, but the chronograph I liked a lot. Especially the operation/feel and the excellent calibre. I felt that this is the complementary watch to a Hublot: a watch full of substance failing in marketing instead of something that was purely the creation of marketing and marketing alone.
Thanks for your thoughts — I do agree that many of the strong features of the watches themselves were betrayed by weak marketing strategy, with the chronograph movement as one example. An interesting contrast to Hublot — I’ll have to give some thought to an article on brands for which marketing promotion overcomes pedestrian products!
Totally enjoyed your article for the simple fact is that you’ve expressed and shared my sentiments to a great degree. The overwhelming negativity at launch was tantamount to a public flogging of poor high level decisions and the brands incredible need to believe their own hype.
What made it worse was their CEO would go on these wild online interviews and make really crazy wise sweeping remarks that came off far more as him trying to cop a plea than anything else.
Time will tell, but this release did nothing for me. Added another Patek to my collection this year and rather happy with a lovely Annual Calendar.
Well said, Sir!
Kind Regards, M. De Silva
Thanks for your comments — and like you I also found the brand’s reactions to the initial market response less than useful.
Congratulations on your annual calendar purchase — wear it in good health!
The products finishing does not look to the par with what AP does usually.
The name of the line is a tongue twister and the novelties revolve around dark dials not so easy to read and over designed cases.
It feels like the very dark years of zenith during which design teams were let loose and marketing was permanent craziness. It took them a decade to come back from those terrible years.
I hope AP will rapidly adjust the heading, update the name of that line, bring some fine finishing to the cases and brightens dials.
The next step for the brand will hopefully be a case study of amazing recovery after original disaster.
It is hard to get it right all the time, but a rule of thumb still valid in our ever digital ever changing world.is : if you don’t have a good story, you don’t have a bright future. I think this applies well to code 11:59, imho.
Great thoughts, Jean-Philippe! Storytelling is indeed critical these days and a story that does not connect with consumers or create affinity for the brand is a real loser.
Nothing would make me happier than to write the case study of a remarkable recovery by AP! I’m fully aware that many people there worked extremely hard to create these watches and I’d like to see them succeed in the end.
Many thanks for this pleasant and thorough analysis. The best I have read in a while. Also the first time that I feel it makes sense to react (I tend to refrain from expressing useless commentary on instagram), since this time it is a meaningful discussion about a product launch that touches several interesting views.
You are quite respectful about the PR campaign, that has been not soo good to say the least. I like it when you talk about the topic of underpromise and overdeliver. They sure generated a lot of PR. But boy did that backfire…
This CODE 11:59 product launch is very useful as a modern business administration case. It touches a lot of classical concepts such as the BCG matrix and he classical 4P marketing mix while you can also use this product launch as a case study for modern social media strategies (think of David Chaffey). I like it how you peel off all of the layers of the whole CODE 11:59 product development and launch. Really thoughtful in your analysis, since you look at it from a product marketing strategy kind of perspective and touch upon several interesting topics that in themselves deserve extensive analysis on their own. And you made me laugh when you compared the announcement of the greatest thing since sliced bread with the announcement of a cure for pancreatic cancer or the rollout of the Mars booster missile. This whole launch made me think a bit of Billl Gates and Steve Balmer dancing around https://youtu.be/ojP0BO6H4Qc ) whereas these geeks actually rolled an quite successful cheesy 300 million marketing campaign with Windows 95 (not a very great example…lol)..
But seriously I think they missed out on explaining the benefits of the product because:
the public is always right that there is not a big benefit or value created
an actual problem solved
this solution isn’t explained in that manner that they really acknowledge these benefits.
Despite all the right and wrong comments from various criticasters, it is respectful that AP tried really hard to add another soo much wanted iconic sibling to their product family. It is a big family owned company with a lot of passionate employees. People tend to forget about that and give un-respectful harsh feedback, raging their day 2 day frustrations on social media. I rather prefer to read your meaningful analysis instead. Everybody can make mistakes and I hope that they will listen and learn. I think the Swiss watch industry on average has difficulties to listen to their client base. There are exceptions on the rule luckily.
In my honest opinion this product launch isn’t only a PR or marketing fail. It’s actually the wrong combination of an average product and managing expectations thats really went wrong in this case. Really good products tend to have a design (and to a lesser extent, but also very important product launch) of which the sum of the parts is more than each individual part. In case of the CODE 11:59 there is not a single part of the design and launch that meet the expectations our promises that they have communicated themselves. The watch is unconventional and complex and aesthetical different but not in a manner that it is pleasing the crowd. Instead a lot of the parts like the case, dial and glass in particular are very nice and interesting attempts but don’t succeed in their unconventional way to be truly innovative and potential iconic. They do not meet the needs of a new clientele nor do they create a new need like Apple that the customer is not yet aware of because they solve a problem that people actually don’t know about because the solution does not yet exist.
What doesn’t help either is that they tried too much in one attempt. Too many different design attempts, too many new products launched within a single product line as you already mentioned. I find it always very strange because during the pre Royal Oak vintage era AP used to make the most beautiful complications cased in gorgeous looking cases which are among the rarest watches, true gems of design and watchmaking. Look at the former Marcus Margulies collection of 1940-50s now within the AP museum, with for instance the beautiful (perpetual) moonphase calendars which are according to many one of the best dials ever. It would make sense to me if they would make like 4 different product lines: APRO, Concept, Jewelry and Neo Classical. Then AP would have a diversified portfolio and fill in some needs while taking your history as a Manufacture into account and at the same time being innovate enough.
Some watches are ahead of the curve but I am afraid this watch just tried too hard. But you never know and we will all be terrible wrong and perhaps this era’s avant garde kind of collector will buy the least popular model that will become the A-series of 2070…
Best, Wouter from Amsterdam
Small side note: It is really funny, I am into vintage watches and as a watch enthousiast, I tend to read as much as possible also from new watches. I havent been aware of the whole CODE abbreviation. The single minute after I read it for the first time in this article I already fogettabouit.
Many thanks for taking time to post these interesting and insightful remarks, Wouter! Very little for me to add other than that this truly is a case study worth analyzing and that any of the frameworks you mention would be fun to apply. As a side note, early in my consulting career I actually had the opportunity to work with Phil Kotler (creator of the 4P Marketing Mix construct) and that framework was certainly in my mind as I developed my outline for this article!
Thanks again — I’m glad you broke your posting silence and will look forward to future comments from you.
Will do so when I feel i can add something to the matter. You are among the best watch journalists out there (and not forget collector; I am also a big fan of independents) with an extreme eye for detail and an ability to describe these details in a pleasant way. Keep up the good work.
Code 11.59 by Audemars Piguet. The new fragrance for men.
Ah no, wait. It’s a watch.
Actually, to be consistent with the watch brand it would have to be neither a men’s fragrance nor a women’s fragrance — just a fragrance 🙂
Fabulous article; informative and well written. When I saw this watch I wanted to cry. Marketing fiasco aside, AP’s attempt at rejuvenating the dress side of the brand has just been a disaster. Good story, terrible execution. You can just see the new product development committees hashing this out, trying to come up with something new,
youthful and edgy while retaining the (agreed, awful, overused term) DNA of the RO. The result is a frankenwatch that only its mother (or father in this case) could love. What I don’t understand is why the fear regarding the aging RO line. Do we really feel it’s in decline? How different is Rolex and its dress Cellini line to AP? Indeed, one way to continue is to—gasp—slowly but surely reverse the trend of limited editions and grand complications and come out with more all-steel and slightly cheaper versions. Realistically, does the standard RO have to cost more than double its Rolex counterpart. In sum, in my humble opinion, kill this thing and embrace what you do best.
Thanks for the kind words and for the insightful thoughts, Will. The line between clever re-use of design codes and Frankenwatch can be pretty fine, but I agree with you — to my eye these pieces are on the bad side of that boundary.
I haven’t seen the primary data with my own eyes, but have gleaned from reputable sources that the average age of RO owners has been trending upward. That may be the result of the line finally losing some of its appeal, or (perhaps just as likely IMHO) an emphasis on more complicated pieces and LEs within the assortment itself, leading to a phenomenon in which more buyers are existing RO owners and/or those with greater income/age. Would be interesting to see the data!
While the car and watch markets are quite different in many ways, I’m now wondering what AP’s Macan/Cayenne equivalent — a product set in an entirely different sub-category from the brand’s previously dominant models and attractive both to prior brand customers and able to attract buyers new to the brand — is going to be, if in fact we’re going to see one…
I try to imagine what the response would have been if the design (or marketing) had been better, but have difficulty shrugging off the idea that it may have been a futile effort no matter what.
There was an interview he gave for your friends at Thewatches.tv way back in 2013*, where he boomed, “First of all the brand is Audemars Piguet, it’s not Royal Oak.”
I think this flop has shown that the company name is Audemars Piguet, but the brand is…well, take a guess. Their weird ladies watches, and understated dress pieces which acknowledge their past when they weren’t a one-trick pony, exist in the long shadow of the king. Nothing may approach the throne, and unentertaining hangers-on will be whipped from the room.
*refreshingly he isn’t wearing his ‘hello fellow cool people’ leather bomber jacket that his advisors told him he should wear for interviews, as it’s presumably what the target demographic imagine themselves to look like.
Of course at this point we will never know! Your points are exactly why I started off the article the way I did — if you or I had been in the CEO chair the path forward given the situation would have by no means been obvious. That the path they chose (and the way they executed it) led to such a poor response doesn’t suggest that they faced (or face) a simple set of issues.
Also agree on the leather jacket — the scarf is also for me a bit of an odd affectation, although I’m inclined to give him a pass on it as Laurent Ferrier sports a similar look…
Thanks as always for your thoughts!
Indeed, not a simple set of issues; or, at least not easily surmountable. One thing’s for sure, though – not many companies can attract this amount of attention from the community, so despite the apparent initial failure of this new model, they hold an enviable position where we put so much relative time and effort into slagging them off.
Absolutely agree that AP is in an enviable position of visibility and historical prestige — people do care. Happily, I don’t hear you saying that any reaction is a good reaction — some folks have tried to make that argument to soften the negative views of what AP did, and I’m not buying it!
Aye, I’m with you on that. Despite mainly giving lip-service to the possible futility of the launch, I know deep down a better design, handled more capably at a better price would’ve meant we’d now be talking about how we’ve tried to get hold of one but they’re out of stock already, instead of not even caring if they’ve slashed the price by half.
AP should create a blue ocean strategy for their next collection to succeed. (Google this business term). They need to turn non-customers into customers by creating a brand new watch segment or an uncontested market segment and not have to compete with their own indomitable Royal Oak collecion. This new collection fails to define itself! A new segment is essentially what they created with the luxury sports watch segment through the Royal Oak in 1972 when the Nautilus and Overseas models didn’t exist as competitors. The demand was created rather than fought over against competition. I suspect this was kind of what their intention was with Code 11.59 albeit with a poor execution and poorly defining what this market segment would be. Meanwhile they should just continue to celebrate the icon Mr Genta gave them and milk it till the “bracelets fall off”
Hi Farai — I’m quite familiar with Mauborgne and Kim’s work on Blue Ocean and of course agree that it’s very desirable to find open space in the segmentation map! As I mentioned in the article my view is that AP fell well short of this by positioning CODE far too close to RO on the map.
That said, if finding Blue Ocean were easy everyone would be doing it! We’ll see if AP can do so and of course it’s interesting to watch other watch producers search for these elusive open spaces as well.
Thanks for commenting!
Very well written and direct in it’s analysis. I own 2 Jules Audemars watches and find them to be quite distinct whereas these are more of the run-of-the-mill style family. Previously when one looked at a Jules it was speaking Audemars quality. This model I would have to really look at to get that instant impression.
Thanks, Barry — I own the Jules Audemars Equation of Time and in addition to being a huge fan of the complications, like you I find the styling quite distinct. We’ll have to see where AP goes from here!
This is a fairly big strategic and tactical marketing blunder given the small size of AP.
I think this product launch will go down in history as one of the big fails.
Whilst the comparison may be a bit extreme – the hubris of Mr Bennahmias reminds me of Mr Nataf during Zenith’s lost years.
Time will tell.
Whether or not the product line itself finds some level of success over the years, it seems clear to me that the launch process itself was filled with blunders, as you say!
An honest critique. Some may agree, and others not, but at the end of the conversation, let the watch be judged by its sell-out. Brand enthusiasts will vote with their wallets. The legacy of the Royal Oak has indeed been viscerally titillating, and one exceedingly difficult to surpass in iconic design. That challenge, further weighed upon by the hubris of success, has resulted, to this reader, in a rather insipid new design.
Bad decisions can result in good outcomes, and vice versa! We shall see whether the CODE 11.59 line can recover (or can be modified over time by AP) in order to drive commercial success. I’m with you in finding the designs uninspiring, but as you note the market will ultimately speak.
“Georges Golay, the charismatic boss of Audemars Piguet back then, had the courage to launch the Royal Oak designed by the brilliant Gérald Genta. One day, he summoned us. He was worried: this first steel watch, which was totally innovative back then – you could even see the screws on the bezel – had been rejected by most of the markets, except Italy. And on the other hand, he’d noted that Patek Philippe was buying back its old timepieces.
What were we to do? The young generation, of which I was a part, wanted to invest to conquer the future, not bolster up the past. Mr Golay replied: “Ok, but be careful, the Royal Oak must not cannibalise the collection!” We thought that would never happen; at that time sales stood at around a hundred items. But Mr Golay had sensed the risk and today it has to be admitted that in launching its Code 11.59 Audemars Piguet is trying to get out of a situation he anticipated a few decades ago.”
– Jean-Claude Biver in EuropaStar, Apr 2019 (https://www.europastar.com/time-business/1004090917-jean-claude-biver-past-present-future.html)
It’s been hilarious watching the pure saltiness of the watch press over the Code. Like this article – you’re effectively arguing about what a horrible job of marketing AP did in the launch of a product six months ago that everyone still can’t shut up about. How everyone argues that the Code is both too much and too little like the “iconic” Royal Oak, a watch that sold less than 100 units in the first three years it existed but is now 85% of AP’s product line. How if Audemars had any sense they would have made the watch look like the prosaically-named Patek 5172, a watch nobody was talking about then, nobody is talking about now and which is fundamentally indistinguishable from 2/3rds of the chronically bland chronos the lesser Saxon brands turn out.
The job of fashion is not to give the people what they want, it’s to *tell* the people what they want and an entire community that will likely never *see* a Code can now immediately recognize a Code. Jacob & Co built a career out of watches that are recognizable on the step&repeat; Audemars is now the only luxury watch brand that has two entire lines that can be identified from the other side of an HD broadcast.
I’m sure they feel *real* bad about how badly they bungled the launch. Audemars has about 100 boutiques. If they sell 20 watches each the entire Code line will have sold out. That, too, will be subject to ample press releases and the watch press will again be salty that they weren’t consulted over the shape of Audemars’ success.
I’ve had no luck discovering who was on the team that designed the Code. It’s very clear they put a lot of effort into the design and no consideration into what the hoi polloi thinks. I’m reasonably certain that ten years from now, we’ll know all their names.
The flaw in your contention is, that the design has in fact been judged by many of the hoi palloi to be utterly derivative of certain other brands’ current models (I’m sure you must know the ones most cited), and rather than confronting the market with something seminal and challenging, AP have served up the opposite.
Also, as far as I could tell, it was the exception to the rule that any of the press reacted with derision to this; the majority gave no strong feelings either way at the time. In fact, Hodinkee served as a cringeworthy example of being overly defensive (perhaps on behalf of its high-paying client, who knows) in its patronising and arrogant protestations that everybody was wrong and their nasty opinions were all so toxic.
I have a lovely little Frederique Constant. It’s quartz. I get compliments on it all the time. Back in the ’80s it would have been a Omega DeVille. Back in the ’70s it would have been a Rolex Cellini. Back in the ’60s it would have been an Audemars Piguet dress watch and back in the ’50s it was a Universal Geneve Silver Shadow, one of Gerald Genta’s first designs.
Go look up a Chronoswiss Opus. They’re impressively intricate. They’re also a 15-year-old design. Now go look up an MB&F Legacy Perpetual. “Derivative?” The layout and design language is certainly similar but I don’t think I’m speaking out of turn when I say the MB&F has superior execution (and also 10x the price). Most watches are round. Most have similar layouts. AP did a bunch of subtle stuff with the Code that adds up to a more cohesive whole than the pieces everyone is accusing them of copying.
You’re right – the *press* didn’t lose their collective minds over the Code. It was everyone who *reads* the press. Those who wear watches vicariously through the collective coverage of a spoon-fed media were super-mad that they weren’t consulted. And I reiterate – they don’t matter.
Seth — thanks for taking the time to set out your point of view on CODE 11.59 and on reactions of watch writers, including myself, to its launch.
As you might expect, I disagree with several of the arguments you make. In particular, I’ve been waiting for someone to suggest that notoriety is the same as success, and it looks as if you’re the one. I’m a bit of an Opera fan, and have always had to shake my head at the directors and producers within that art form who believe that the more the audience boos, the more successful the production must have been. And that’s art, where I can at least imagine that one could make the argument that to provoke is as important as to entertain — here, we’re talking about indulgent purchases. I’m not buying the “people are still talking about it” gambit — we’re still talking about the Titanic, too. And I’m not so sure that there is an entire community that can recognize a Code from a distance; or for that matter, even distinguish it on the wrist — especially those generic-looking time-date pieces.
I do agree with you (and mentioned in the article) that the job of product developers is not to give people what they say they want (with Henry Ford’s famous line about how if he’d asked people what they wanted, they would have said a faster horse, coming to mind). If you’re going to follow your own muse, however, it’s best to be right about your ability to amaze customers (Steve Jobs of course, and in our own little world Max Busser) with the result — I doubt that in watch development anyone aims for the reaction “that stinks,” and especially not the designers, constructors, and watchmakers who put their hearts and souls into creating new pieces.
As for the 100 boutiques times 20 watches argument, I’ve seen that sort of appeal to wishful thinking in dozens of new business proposals over the years, and sad to say, dividing the target into small parcels doesn’t guarantee its attainment. As you say, “if” each Boutique sells 20 pieces in the first year (at full retail price, of course) that year’s production will have been sold through. That still doesn’t mitigate the fact that AP decided to launch 13 references to populate that number of watches — and this sort of “mini me” strategy (launching an entire business or complete product portfolio on a small scale and seeing whether it works or not, rather than beginning more modestly and adapting/pivoting as one learns) is one of the most fundamental strategic errors in innovation management. Could it work? Sure — bad decisions can result in good outcomes just as good decisions can lead to bad ones — but that doesn’t make the strategy chosen by AP any better. As a side note, a friend was in the AP Hong Kong boutique recently and found that there were almost no Royal Oaks for sale but a full inventory of Code watches; his report was that the sales staff was “practically begging” him to buy one as they were simply not moving. A sample of one, but a sample nonetheless.
I’ll give you a pass on the arrogance of some of your statements (the “hoi polloi” one, the reference to “lesser” Saxon brands, and the observation that Patek’s reference number based naming system is “prosaic,” for example) as I’m not above the occasional barb myself. It is interesting that you mention the Ref. 5172, which to me is the watch that the Code chrono could have been — a classic chronograph that recognizes the market shift toward more casual watches without, in Patek’s case, trying to sneak in the shape of a porthole. “People” may not be talking about it, but they are buying it — and I’ll bet you five bucks right now that in 10 years, a 5172 will resell for more than a Code chronograph. But we shall see!
The core point of my article was that the reaction to the launch of the Code line was so negative for a line of watches that on their merits actually had some strengths along with their weaknesses, it made me consider the product portfolio and marketing strategies that could have led to such an outcome. It would have been, in my view, far better to follow the path of the original Royal Oak (launched with a single reference, and backed up over time with marketing communications that established the idea of a steel luxury sport watch) than to take the bombastic and scattered approach that AP undertook this time around.
We’ll see whether the line succeeds nonetheless — and while I’m not sure what you mean by your comment that watch commentators will “be salty they weren’t consulted on the shape of Audemars’ success,” no one would be happier than I to see this historically great brand succeed and to chronicle the path that AP navigates from this fumbling start to ultimate triumph.
Really, Gary? You’re going to compare a bunch of complaints on Twitter and Instagram with a nautical disaster that killed 1,500 people? And then you’re going to ask what I mean by “salty?” And about opera – if you’re in the audience booing it implies you… bought a ticket. What we’re talking about here is a bunch of people who were never going to buy one anyway being super-duper mad that a company with a 200-year tradition isn’t pandering to their expectations.
Steve Jobs’ designer, Jony Ive, has been recycling Dieter Rams for twenty years. That’s fine, he does a great job of it and clearly it’s what the market wants but it’s foolish to argue that Apple products aren’t the subject of howling derision whenever they do something new. Apparently you don’t remember the raw tech hatred of the Bondi Blue iMac, the despair over the iPod ever finding a market, the “me-tooism” of the iPhone and the “four phones taped together” dismissal of the iPad. Whenever a company does something new, the people who think they know that company the best howl in betrayal.
If AP sells 150 Codes in the next three years they will have outsold the Royal Oak’s initial launch. Not a watch that was subtly introduced, either – I suggest you look up some of the old advertisements. They rolled it out exactly like the Code. Full page ads, full-court press, and it sold slowly. AP puts out 40,000 watches a year, of which 30,000 are Royal Oaks. If fifteen people go to AP to buy a Royal Oak and *one* of them buys a Code they’ve made their numbers. Anecdata of one? I don’t know many watch collectors, but I’ve met two people who wanted a Royal Oak and are now eager to buy a Code. Both Asian women in their early ’30s, the fastest growing demographic in watch sales. I’m not a fan of Rolex’s styling myself but I’d be foolish to argue there’s anything wrong with it. You are, after all, talking about a company whose high jewelry collection is the Diamond Punk, the Diamond Fury and the Diamond Outrage, all watches designed to piss off an indignant public. SIHH saw AP introduce the Sapphire Orbe, a much-less-offensive construction of sapphire and gold. Nobody cared. They’re too busy talking about the Code.
The core point of my argument is that the outrage of Watch Twitter is utterly irrelevant to the sales of AP watches, if not inversely proportional. Their outcome was they got everybody talking about a line of watches that they’re rolling out *really* slowly (and didn’t drown any transatlantic travelers in the process). That’s what I mean by “salty.”
Your favorite Patek is a $70k watch. A Code Chrono comes in at $40k. It *better* sell for more.
Do you work for AP in some fashion? You argue well ether way ! Well except the last sentence, can’t make sense of it but nobody s perfect !
The 1159 looks so so so so so cheap.
Thanks, Da — I’m very pleased that you enjoyed the article. As you read, I’m not quite so negative on the watches themselves, although they’re not to my taste — but I do think that the way that AP launched them was very much a mess…
Great article powered with a great analysis. I share most of your thoughts.
Current CODE sales results are not very flattering for the brand.
7 years of development, if you exclude the movement, to come up with this collection cannot be satisfying.
I Really Do not understand AP product strategy which is sometimes not coherent. Pretty sure it is due to the product team’s lack of judgement, daring and vision. Now top AP collectors are buying vintage classical watches, such as JA or EP.
Indeed to me is a big fail in term of product positioning, why making another hybrid sporty watch, whereas you already have RO, ROO, RO concepts.
AP is in need of a freshier traditional collection to establish its brand legitimacy and compete against Patek.
Spoke to many AP VIP customers, who are pushed by sales staff to purchase the Code, to access to other Hot models and are becoming tired of such practices.
The CODE name itself does not speak to anyone, And the overall design brings nothing new to the market.
I understand the disappointment as expectations were really high.
Thanks for your thorough comments, Wayne — as you can imagine I agree with your analysis and it’s sad (but not totally unexpected) to hear that AP VIPs are being pressured to buy the CODE line in exchange for access.
I do wish the brand well, and I think the Remaster piece is one step in the right direction (although I have not handled the watch in person).
one more work of art by the genius Gerald Genta 🙌