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Audemars Piguet’s New CEO Could ‘Stop Growth’ to Focus on Desirability and Independence

The Big Four watchmaker will slow or even suspend production increases as new leader Ilaria Resta works to ‘solidify the company.’
Ilaria Resta
Former Procter & Gamble executive Ilaria Resta has taken the helm as Audemars Piguet's new CEO. (Audemars Piguet)

Le Brassus, SWITZERLAND – Audemars Piguet’s new CEO hasn’t just inherited big shoes to fill, but a white desk so large she could host Christmas dinner around it.

Speaking from her office in the sleepy Swiss village of Le Brassus, former Procter & Gamble executive Ilaria Resta suggests that the luxury watchmaker may need to pump the brakes before moving ahead: After revenues tripled during the past decade under predecessor François-Henry Bennahmias, reaching 2.3 billion Swiss francs ($2.6 billion) last year, Resta may stop the clock on rapid growth.

“It is not my objective to keep the growth of the past,” Resta said. “I’m here with another mandate, which is to solidify the company for long-term independence. I may take the choice actually to stop growth for a couple of years.”

Resta’s appointment was announced last May, surprising an industry prone to advancing talents from within. Previously a senior executive at big consumer brands like Duracell and Tide, the 50-year-old Swiss-Italian national had no previous watchmaking experience but now finds herself at the helm of one of Switzerland’s “Big Four” independent watch companies. The move echoes French giant Chanel Ltd.’s decision to bring on Leena Nair, a human resources veteran from consumer giant Unilever, to revamp the company’s structure and culture.

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“You see very few outsiders around the watch industry,” Resta says. “It’s typically people who have been groomed in this industry forever. During the interviews, I had the feeling I was the only one not coming from the industry. It was a courageous choice [by the board] to look outside the obvious roster.”

Now, a curious industry wants to know who Ilaria Resta is and what it should expect from this one-time champion of global consumer brands. A multilingual executive born and educated in Naples, Italy, Resta describes herself as a “servant leader” and an open book – “I’m not an actress,” she says.

Resta’s unassuming persona and cautious approach to growth set her apart from her predecessor, a charismatic figure who leveraged the power of street culture to turbo-charge Audemars Piguet’s business. One analyst backed Resta’s appointment.

“François-Henry Bennahmias’ successor needed to be his opposite,” says Oliver Müller, founder of LuxeConsult and co-author of Morgan Stanley’s most recent annual Swiss watch industry report, published last week. The report estimated that Audemars Piguet’s surging revenues leave it trailing only Rolex, Cartier and Omega, and ahead of Patek Philippe. “It needs a manager and not a showman, an organiser rather than a salesman,” Müller adds.

Resta inherits a full pipeline. In the coming months, Audemars Piguet is due to relocate its manufacturing activities to a new 17,000 square-metre facility in Le Brassus dubbed “The Arc”. She will also have to figure out how to maintain relationships with the portfolio of A-list spokespeople and clients Bennahmias built up over a 25-year period – Arnold Schwarzenegger, Jay-Z, LeBron James and Serena Williams among them – amid a luxury market widely acknowledged to be entering choppy waters.

And then there’s navigating the stark culture change. Resta has lived in Switzerland for 20 years, but admits her first impressions of Le Brassus, located 60 kilometres north of Geneva, were that it “didn’t belong to this century.” In the same vein, she says she’s “volcanic in terms of ideas” and is having to adapt to the watch industry’s slower pace.

Sale Rumours

Some have wondered whether the logic of Resta’s appointment was to bring group experience to a family-owned company readying for sale. But she refutes this. “I know this was the perception,” she says. “But independence is absolutely the future of the company and the desire of the board and the shareholders.”

Instead, her job is to shore up the business’ structure after its recent meteoric growth. “I need to create value by making it solid enough, resilient enough and qualitative enough to resist any turbulence in the market and survive and thrive as an independent company,” she says.

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The Swiss watch industry has reported a significant decline in export volumes since 2015, with the number of timepieces sold falling by 12 million or roughly 40 percent. The value of exports has grown to record levels, however, as average price points soared. Top-end players like Audemars Piguet or rival Patek Philippe increasingly drive the market.

Audemars Piguet’s current annual production hovers around 50,000 watches, a figure that Bennahmias had said previously could expand to as much as 70,000 once the new manufacturing facility is fully operational. Resta is reluctant to talk numbers, though. “I don’t want to push quantity,” she says. “Numbers are misleading, because producing a watch with hours, minutes and seconds is very different to a perpetual calendar.”

Le Brassus facility
Audemars Piguet is due to relocate its manufacturing activities to a new 17,000 square-metre facility in Le Brassus dubbed “The Arc.” (Audemars Piguet)

Like other top watch brands, Audemars Piguet dealers are almost always sold out of popular styles, leading to surging prices on the secondary market. But the average markup for second-hand watches from the brand has slipped to 14 percent above retail, less than half the average premium on Patek Philippe, where second-hand watches sell for nearly 35 percent more than at primary dealers, according to price aggregator WatchChart. The narrowing gap with retail could suggest that brand’s well of pent-up demand isn’t as deep as previously believed — which would offer one explanation for why Resta is less enthusiastic about lifting production than her predecessor.

Changing Market

Resta enters the industry at a time when the watch business is not only becoming more upmarket, but more diverse.

“We see interest in [more expensive] complications rising more than in the simplest pieces,” Resta says. Interest in women’s watches is on the up, too. Resta says around 25 percent of Audemars Piguet’s direct clients are women, with a target of 30 percent in two years. While Resta is one of only two female chief executives among Swiss watch pure-players (alongside Catherine Rénier at Jaeger-LeCoultre), she says she’s less interested in creating watches for women than in making sure the brand is offering the right products to connect with anyone.

“Genderising a watch is starting to become irrelevant,” she says. “The big change I’m trying to bring is to look at the clientele based on the driver of purchase and their behaviours when they wear a watch. That way, you can offer them a watch that fits their lifestyle.”

Learning Curve

As Audemars Piguet’s chief executive, Bennahmias was a larger-than-life character who was understood to have endured a fractious relationship with its board. “Resta is obviously smart and will understand that the brand is the star, and that she must avoid being too visible,” says Müller. “The chief executive is here to serve the brand and not vice-versa.”

Resta worked hand-in-hand with Bennahmias during a five-month handover period that began in August last year, before formerly taking the reins from January. She says the duo bonded “from the first cup of coffee”. He described her as his “little sister” and the two appeared in a light-hearted social media film in December announcing her as his successor.

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What advice did he give her? “I didn’t ask him for advice, and he never gave it to me,” she says. “We agreed that when there is a change of leadership, there is really a change. And I wanted to listen to all the inputs, instead of being guided by my predecessor.”

Resta’s approach seems to be less about rocking the boat. “It’s a failure if the company adjusts to me,” she says. “Because I am one out of 2,700 people here.”

As an outsider to the industry, she will need to learn quickly. That might be her forte. As well as her native Italian, she speaks French, Spanish and English, the latter learned when she joined Procter & Gamble as a graduate in 1997. She says that as a child, she wanted to be a Greek and Latin lecturer, and that she’s studied history, philosophy, classical literature and financial mathematics. At the University of Naples, she read economics and marketing.

She’s already picked up watch lingo, riffing on favoured topics like complications, métiers d’art, hand-finishing and the lengthy cycle behind bringing a mechanical watch to market. She’s also learned the familiar senior watch executive refrain that while being functionally “useless” in a digital age, mechanical watches are “for eternity.”

She nonetheless winces when talking about how long it might take for a product with her fingerprints on it to arrive: The product cycle for the next few years was decided before she arrived. Next year, she says, we’ll see a project that she’s fast-tracked, but for now she won’t go into specifics.

“What is relevant for us is to make sure that we interpret time for our clients in a meaningful way,” she says, admitting that gives little away.

One thing she’s clear on, though: “We don’t want this company to be a Royal Oak company,” she says firmly. Diversification will be a priority, as in her predecessor’s final years. She says there’s “a lot of pull on Code 11.59,″ a collection introduced five years ago that she says now accounts for 11 percent of the business, and that when it comes to launching new lines “there is definitely fertile ground for more.”

Direct-Sales Push

Resta plans to pursue Audemars Piguet’s retail strategy, where a push to cut down on wholesale stands apart from most rival watchmakers. Under Bennahmias, the company slashed its global network of distributors and opened a network of its own stores, including 20 AP Houses — discreet urban locations that are more like fashionable private members clubs than stores. “We create a true friendship relationship with our top clients,” she says, adding that direct-to-consumer sales now account for more than 90 percent of the company’s turnover. “It is a great luxury for us to know exactly who our client is.”

And what about those high-profile ambassadors, spanning hip-hop, actors, and golf?

“I will definitely not choose [collaborations] based on my passions, or my personal interests,” she said, scotching the idea that simply because she’s a tennis fan that Audemars Piguet would sponsor pickleball, one of the world’s fastest growing racquet sports.

Serena Williams
Resta will also have to figure out how to maintain relationships with the portfolio of A-list spokespeople and clients Bennahmias built up over a 25-year period, including Serena Williams. (Audemars Piguet)

But she commits to investing in cultural relevance via music, art and sport, and praises the product and marketing strategy she’s inherited. “The magic of what has been done so far is that Audemars Piguet really spoke to the people of society of the moment without choosing an elite route,” she says.

Fair Play

One question she will have to answer soon is whether to participate in Switzerland’s annual watch fair, Watches and Wonders Geneva, where Rolex, Patek Philippe and Cartier are among the exhibitors. Bennahmias took Audemars Piguet out of the event’s precursor (the Salon International de la Haute Horlogerie) in 2019, citing the company’s switch to a retail model and the fair’s inaccessibility to the public.

Will she take it back? Not this year, though the door is open. “This industry is small enough that there is no war,” she says. “It relies on the success of all the players, not one player and we are sizeable enough to contribute to our partners in it. So I am thinking about what our role might be in the fair. But my plea [to the organisers] will be to make it more open to the public, because this industry needs to become more democratic and approachable.”

This year’s Watches and Wonders event in April will include three public days.

Democratising the store concept is also on the agenda, as AP Houses often give the impression of being closed to newcomers. “We’ll make sure that you can go into AP House even without an appointment,” she says, adding that during her application process she was welcomed at the Geneva location as a mystery shopper without an appointment or an Audemars Piguet on her wrist. But she admits there will always be an imposing security guard on the door. “It’s not the place where you buy a baguette,” she offers.

Bennahmias’s Muhammad Ali poster and full-scale Terminator model may have left the building, but the executive’s shadow will loom large in the coming years.

Resta seems unfazed by the legacy she must now pick up, insisting she has a clear brief for the company’s next steps. “As I told you,” she says. “Growth is not our number one priority. Our number one priority is the reputation of the brand and the quality and innovation of the timepieces we make.”

“The beauty of this industry is that you don’t have to do it fast,” she adds.

Further Reading

How Audemars Piguet Became Swiss Watchmaking’s Hottest Brand

The brand known for $50,000 Royal Oak watches transformed itself into a megabrand with more than $2.2 billion in annual sales by taking control of its distribution and forging culturally relevant partnerships. Outgoing CEO François-Henry Bennahmias breaks down the strategy.

Exclusive: Audemars Piguet’s Maverick CEO Gets the Last Word

François-Henry Bennahmias faced down doubters as he leveraged popular culture to transform Audemars Piguet’s business. Ahead of his departure from the now-$2.6 billion brand next week, Bennahmias revisits his triumphs and setbacks, and hints at his start-up ambitions.

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