Hermes sees success and growth in watch business
The Arceau Le temps voyageur and H08 are leading the way for the maison to earn its stripes in haute horlogerie
HERMES watches are no longer playing second fiddle to the maison’s beloved handbags and silk scarves. Its latest quarterly results (ending September 2022) reported a whopping 55 per cent growth in the watch category – triumphing all the other divisions including ready-to-wear and even leather goods and saddlery.
It has been a fantastic year for the brand’s timepieces, to say the least, with the new H08 flying off the shelves (actually you won’t even see it on display in the boutiques but more on that later) and the Arceau Le temps voyageur winning the Best Men’s and Best Women’s complication at the recent Grand Prix d’Horlogerie de Geneve (GPHG) awards.
Little surprise that Hermes Horloger chief executive officer, Laurent Dordet, was all smiles when he spoke to The Business Times at the VIP room of the maison’s flagship boutique at Liat Towers in October. The 54-year-old joined Hermes in 1995 as chief finance officer and took over the helm at the watchmaking division from his predecessor Luc Perramond in 2015.
Dordet, however, remained modest about his division’s achievements: “We used to occupy 10 per cent (of the business) 25 years ago, then it came back to 3 per cent, and now we are up to 5 per cent. So we are gaining some significant (growth) within the maison which is good.”
Like many luxury brands, Hermes has benefitted from revenge spending, and Dordet shared that 80 per cent of its watch clients are already existing customers who are familiar with the brand’s craftsmanship.
Entry-level pieces like the Cape Cod and Heure H – mainly for women and executed in quartz – have long been bestsellers and there are no plans to change things, even if the high complication Arceau Le temps voyageur and mechanical H08 are both grabbing headlines and catching up with sales. “Having affordable prices and simple but creative watches are great ways to enter a brand before moving next to complications,” said Dordet.
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The sporty-looking mechanical H08 for men, which Dordet was wearing at the interview, meanwhile, has become a runaway success for Hermes. Launched at Watches and Wonders in 2021, it sold three times more than what the maison originally projected.
“Everything that comes to the store now is pre-sold, so you won’t (see) the watch in the window because it’s gone,” he beamed. “It’s a good sign and we’ll try to catch up but as you know, given the state of the industry, we cannot (suddenly) multiply (production numbers) by five.”
Dordet added: “When we launched this project, we had to triple our capacity within three years, so we will expand our factory in the years to come in Switzerland.”
Pieces like the H08 and Arceau Le temps voyageur may make Hermes look like it’s trying to take watchmaking seriously, but the fact is the brand’s first timepiece was produced way back in 1912. It took another 66 years before its first factory was opened in Biel, Switzerland in 1978. More recently in 2006, Hermes bought a 25 per cent stake in Vaucher Manufacture Fleurier, which specialises in high-end movements and complications.
As Hermes wins over its clients and watch lovers alike with complicated yet playful watches like the Arceau Le temps voyageur and the unique and eye catching circle-in-a-square design of the H08, it joins the ranks of fashion houses like Chanel, Louis Vuitton and Gucci who are also stepping up their watch game and moving into haute horlogerie.
“There is now more room for non-pure players – much more than five years ago,” noted Dordet, who added that going into watchmaking then could be an obstacle for a fashion brand, but isn’t the case anymore as clients recognise the mark of quality that each brand possesses.
“For me, it’s an asset now to be different,” he continued. “If you’re not part of the top five super well-known (watch) brands, it’s an asset to bring something different, and we bring something different clearly (to watch lovers).”
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