ThePuristS Interview Severin Wunderman
Chairman of Montres Corum SA

Severin is known to be a great turnaround artist with a golden touch. He built up the Gucci watch franchise from zero to the best selling brand (at one time, in number of pieces) and was known as the first brand to put diamond settings on stainless steel cases.

Corum has seen strong growth since his takeover of Montres Corum from the founding Banwart family although current tough economic conditions means he is unable to repeat his dramatic rapid expansion he is more accustomed to.

He is one of the boldest personalities in the industry and it is always a pleasure and a good educational experience to meet him on any occassion.

(Michael Wunderman, Marketing Director, heir apparent)

The Interview

TP: Mr. Wunderman, you are a legendary businessman with the "golden touch", yet I hear you are from a family of humble origin and that you had a rough childhood. Is there any truth to this? If so, can you elaborate?

SW:Yes, I do come from a very humble house. My parents were just workers, and basically I left school at 14 to start work. It was difficult but we moved on.

TP: How and when did you first enter the watch industry?

SW: I worked for a family in the watch industry in 1958 as a chauffeur. I drove and carried suitcases for him. Then he passed away a year later. His wife asked me if I would continue working for her. After a while I bought the company, which is how I got involved in this industry.

TP: Would you mind sharing the amazing story of how you first met the late Dr. Aldo Gucci? What can you tell us about the man Dr. Aldo Gucci was? Do you believe he influenced your life in some ways?

SW: I met Dr. Aldo Gucci in 1970 whilst on a sales trip for the firm Alexis Barthelay. I met him coincidentally in his boutique while I was trying to sell to Gucci our private label watches. On that fateful day, I was standing alone next to a phone in the boutique. The phone kept on ringing and ringing, and nobody was picking it up, so I picked it up and I started talking and it was Aldo Gucci. He was looking for somebody else. I started talking about watches I wanted to sell. He initially thought I was one of his staff and he made a rude comment in an obscure dialect used in some parts of Florence, which I happen to understand. I talked back in the same dialect. He roared "who are you?", one thing led to another and he became my mentor, my best friend and he really taught me everything I need to know about the business.

TP: How did Severin Montres end up as the official licensee of Gucci watches?

SW: After working with Aldo for 2 years, I went to see him in 1972 and asked him for the distribution and selling of Gucci watches under-license, which he agreed to do.

TP: The success of Gucci watches whilst under your care was phenomenal. A Gucci Watch then was an essential fashion accessory, not forgetting the iconic G-watch. What do you think was the secret of this success?

SW: The success of Gucci watches was basically due to the fact that we were the first. Never had a major designer label such as Gucci been put on a watch. I priced it within a very accessible price range and from there the rise went on its own. The success of Gucci was due to the fact that I gave fashion, price and quality.

TP: Why did you sell this winner to Gucci Group NV?

SW: I did not wish to sell to the Gucci Group, but since the company went public, and as a public company they were looking for every point of profit that they could take, they did not renew my licensing contract

TP: Some feel that Post-Severin Gucci Timepieces have lost their previous luster, and worse, they lack a clear identity. Why do you think this is so?

SW: The reason is basically because the design does not match the rest of the image projected by the company. They have no experience in the designing of watches, only clothing. They raise prices which has basically put them in a completely different market category.

For years we had a niche which no one could come close to. All of a sudden, they moved their prices up to a different category, where the crowd is very large. They have to compete today with brands such as Omega, Longines & Tag Heuer etc whereas before, we were the only kid on the block

TP: Despite the lack of financial ties, are you still emotionally linked to what is happening at Gucci Timepieces?

SW: I am definitely emotionally linked to Gucci timepieces, as it is my child, you do not get rid of the child, the child grows up and leaves home but the father always thinks about it.

TP: Diamond settings on steel watches, your innovation, were first done by Gucci and is now widely imitated by almost every watch house. Where did that foresight come from?

SW: I invented diamond settings in steel watches. Gucci wanted me to increase prices. However I felt that going into the gold-diamonds watch business would have been an error being that the market is so crowded I then decided to set diamonds into steel to have the exact same look as white gold. It became very fashionable and due to the price factor today everyone in the world is copying it. My father always said you have to start worrying the day people stop copying you.

TP: In the late 80's and early 90's, I remember the strong positioning of Corum watches. Admiral Cups, Gold Coins etc. They were well-recognized product lines. What went wrong?

SW: In regards to Corum, we had a very strong agent in Asia, a gentleman in Japan, who passed away. Unfortunately the son was not the father, and after that, the last position that killed it was the crisis in South East Asia where Corum had a majority of its sales. It just kept going down since.

(Famous American US$20 Double 22k Eagle Gold Coin watch was first introduced in 1964, still a recognizable Corum watch today)

TP: Why did you choose to buy Corum?

SW: I chose Corum because for me Corum is one of the most beautiful brands there are. They have always been very innovative. They have been very creative. It was a marvelous jewel that only need some polishing and, actually, I am quite a good polisher.

TP: There were reports that you were negotiating to take-over Ebel prior to the Corum take-over. Is this true? If so, can you elaborate?

SW: Yes, not only was I negotiating for Ebel, I also negotiated for Zenith. I negotiated for quite a few brands before the majors started going after them. Unfortunately every time I was interested in one of the brands, one of the majors came behind me and outbid me substantially. However, I think this will come back and bite them in their faces as they seriously overpaid those prices.

TP: News reports in early 2000 indicated that Jean-Rene Banwart (who was the original owner of Corum) still owns 10% of Corum. Any change since then? What is his role in the company now?

SW:Yes, Jean-Rene Banwart did own 10% of the company, however I have bought back those 10% since then and I am now the sole owner. He is today still on the board of Corum.

TP: You have a loyal team of people working for you. What do you think are the reasons for this?

SW: I have a very loyal team because I have always kept them and pamper them. I have never asked any of my people to do something that I have never done and I was able to recuperate the majority of my Gucci Team.

(The famous Bubble Joker, now much sought after)

TP: Your Corum bubble watches are both bold in design and fashionable. Can you tell us how this idea originated and about the product's development process?

SW: The idea of the bubble originated because I read everything there is to do about watches. I look at all magazines, all handbooks, and I go through archives constantly. The Bubble was inspired by a Rolex watch on Professor Picard's submarine which has an enormous sapphire to withstand the pressure; this gave me the idea.

TP: Your limited edition Bubbles have been very successful, even in the secondary market. Why? Are the non-limited versions also selling well?

SW: The limited series is selling very well as you know. The non-limited as well, due to the fact that it is completely different from anything (available) in the market place. It is fashionable, it is well priced and it is of fine quality.

(The Jump Hour, Prestigious Watch of the Year 2002)

TP: The panel of judges led by Mr. Philippe Dufour selected your Heure Sautante (Jump Hour) as the prestigious Watch of the Year in 2002. I am particularly fond of the movable lugs for this watch. Can you tell us more about this range of watches?

SW: (Heure Sautante) is the line which we call the classical. With regards to the movable lugs, I feel this (is what) we call the innovative and completely new as it enables the watch to fit on a large or a small wrist - it fits perfectly.

(The Prestigious Watch of the Year 2002 trophy)

TP: The only Platinum 1000 (99.999%) watch! Other case manufacturers complained that Platinum 950 is too difficult. How did you do it?

SW: The platinum 1000 was again one of our ideas due to the fact that everyone has done it in Platinum 950 and find it difficult, we don't find it difficult because difficulty for us is a challenge.

(Tourbillon 999, the First Platinum 1000 watch in the world)

TP: How does Corum measure financially, in terms of market position and image thus far, since your takeover in 1999?

SW: Financially, Corum has done quite well even in this very difficult market. When I took over the company we were doing CHF30M of turnover with CHF7M of losses. We are now in our 3rd year doing a CHF100M in sales with a profit of CHF3 million. The year before we had much better profit, but to be able to do the same amount of business as we did in 2001, we would have to spend substantially more in marketing. However we are here for the long term and I believe changes will happen and the good days will return.

TP: Your enamel watches. Is the quality comparable to the work of, for example Susan Rohr or Miklos Merczel?

SW: Yes, they are in the style of Susan Rohr and Miklos. Although these 2 people are exceptional artists, I believe the person who does ours is comparable (in quality).

TP: There is a feeling that there are too many brands and too many similar watches in the market. Coupled with the stronger domination of big groups like The Swatch Group, Richemont and LVMH, what do you think will happen to this industry in the next 2 to 5 years?

SW: I personally feel that in the watch industry, there is going to be an enormous clean-up specifically in these difficult times. Many people are hanging on by their fingernails. Only the companies with strong financial backing (or companies) with major motivation to invest for the future will survive, in my opinion.

TP: Will that strengthen or weaken Corum?

SW: Corum will always be here to stay. This is my passion. My son who is 27 is a marketing director. This company will continue, will prosper and I am certain of this.

TP: Corum has done well in the market, yet there is a perception that Corum watches are mere luxury fashion watches and non-technical in nature, is this fair assessment?

SW: I totally disagree, as we make major complications, including our own manufacturing, as in our Admiral's cup Marees, as well as our golden bridge which we re-launch this year.

(Admiral Cup Marees 44 regatta, Limited edition of 250 pieces, COSC certified chronometer, moonphase, strength of tide, time of tide, height of tide and date, 18k rose gold, 44mm diameter, domed sapphire crystal with anti-reflective coating, water resistant to 50m. Bracelet outer links in Rose gold with unusual navy blue vulcanized rubber covered steel central links)

TP: There are more and more watch manufacturers with in-house design movements. Is this in your plan? What are the pros and cons of being a manufacturer?

SW: No, I believe I played the game with ETA. I am more than satisfied with their deliveries and their positioning. We are very well treated by them; we have absolutely no problem in receiving our merchandise. We do our planning 18 months to 2 years in advance which is appreciated by them and we are 100% with them.

TP: If this is not too intrusive, do tell us about your family, and especially your children.

SW: My family is my strength. I have 2 daughters and 2 sons. My eldest son does not work in the company, he basically works in a major company's think-tank, and his IQ is 20% above what Einstein's was, so the watch industry has no interest in him. My 2 daughters are well married and have given me 4 grand-children and they are not in the (watch) business. However, Michael, my youngest son is the one who will be taking over (Corum).

TP: You are one of the survivors of the holocaust, and have also lived through serious illness. Obviously, you are a man who has been through a lot. What can you tell us about your experiences and how would you guide others to be stronger?

SW: I have been a survivor as you know of the holocaust. I am a survivor of cancer, and I am a survivor of many things, good business and bad business. I believe that returns on life are very good. What I believe is that you get back everything you give. I can honestly say in my 40 years in the watch industry or in business, my main accomplishment, I believe that I have never made myself an enemy.

TP: A lot of your watches have dark themes, for example Jolly Roger and Lucifer etc...

SW: No, it is not the dark side, on the contrary I find it humorous, and there are only 2 things in life that are certain, taxes and death. Taxes? I have been there and I have paid a lot of it. I am not interested. Death? I was very ill at one time and I was supposed to die. I want to learn about everything there is to know about death. I started collecting things related to death, I found out that there are thousands of collectors of Mortica, there are internet sites and tons of others involved and I started contacting all these people. And I thought, why not make a watch? Today anything related with skulls and bones are number 1 in Japan.

Also in America, including those people who ride Harley Davidsons. They are directors of very big companies. On Sunday they put on their leather jackets and their watches. I made watches for these people at $100K a pop, They are not Hell's Angels (laughing).

(Bubble Jolly Roger, hot favourite in US and Japan)

(This year’s Bubble Lucifer, Limited edition of, dare I say it? 666 pieces!)

(One of the many window display at Corum Booth, Basel 2003, the gothic theme is obvious)

TP: Do you have a favourite city? Your favourite residence? Do tell us a little about your home.

SW: My favourite city is the City of my heart is Paris. However I have residences throughout the world and my favourite is my chateau in South of France which used to be a hunting lodge for the King Francois (Francois-I?). Its history goes back to 1023.

TP: You are also a passionate antique collector. Would you mind sharing some of your feelings regarding this and your experiences as a collector?

SW: I am a passionate antique and art collector. I love to get up in the morning, go to the open market and to be able to look for antiques left and right. I also have an antique business in England where I am a partner of a major antique wholesaler. (This) enables me to furnish my home to my taste and when I get tired of it, to return them to the store and get back something else.

TP: What are your hobbies?

SW: My hobbies are fishing, hunting as well as reading and some paintings. I am an artist, a painter, but I consider myself not particularly good at it so I keep those paintings to myself.

TP: Despite heavy responsibilities, you look relaxed, happy and confident. How do you cope with stress?

SW: I cope with stress only in the way of trying to ignore it. It serves no purpose to cry over spilt milk once a problem has arisen. (If) there is a problem, what you can do about it is to try to solve it. Getting upset about it or crying about it will do no good.

(Bubble Casino, featured a lacquered roulette wheel dial with the second-hand carrying a white ball that goes around endlessly)

TP: Is there a secret to your "golden touch"?

SW: There is no such thing as a golden touch. You have to be number 1, a hard worker, number 2, considerate. You are nothing without good people working for you. My secret is never do to others what you don't want done to yourself.

We also do things differently, you want to play around with a "Square" watch, Corum is not the watch. We at Corum make watches nobody else does. That is our success. Nothing else!

I utilize my archives, Corum has phenomenal archives, something that worked 30 years ago. If I bring it back it is going to work too. If it worked 30 years ago why wouldn't it work now?

That is the case with Admiral Cup, is the case with all our new pieces. All pieces that existed in one way or another in the past has been brought up to date.

I need to stress again that I have a very good team and the people I work with are the best. I also have the best thousands of retailers in the world. Every retailer I worked with has Rolex, has Cartier has Patek. Corum is always the OTHER brand, but we are the only one that is different. We might not have the prestige of Patek Philippe but Corum is a lot more fun! I find the Swiss industry so square, we are the round peg and it is difficult to put it into a square hole.

TP: The others are doing well too, no?

SW: When you read a watch article, everything is great, fantastic, and wonderful, the business is great, and this is great and that is great. That is not real life, my friend.

TP: Considering your illustrious business achievements and successes are there any more challenges left for you?

SW: There is always a challenge, Everyday there is a challenge; my next challenge is to be able to enjoy retirement, if I ever get into it.

TP: Thank you for your time!

SW: Thank you very much.

(Dragon Fire, hand-painted Russian miniature painting, limited edition of 50 pieces)

(Classical GMT24, Second TimeZone with cities bezel, 24 hour indicator for second time zone)

(Mr. Severin Wunderman, the man with the golden touch)