PANZERA flies high with record year despite the COVID-19 pandemic.
In the current tough COVID economic times most fashion retail-based businesses are struggling to stay viable. For a company in this space to double both revenue and profit figures over the last financial year is nothing short of a miraculous achievement. Yet the fast-growing Australian watch brand PANZERA has done just that. An amazing performance during a time when most of their global competitors have been in a continual state of decline.
In this interview with PANZERA founder and CEO Roger Cooper, we’ll try to analyse the brand’s ability to ride high even in the toughest market conditions.
So, what in your view has been the biggest factors that you see that has allowed you to grow when the overall luxury watch market has declined more than 21% in 2021?
It’s several factors really.
Firstly, PANZERA is a true B2C eCommerce company. Our core business has always been selling and shipping our watches direct to our customers globally. So while a lot of our competitors who rely on brick and mortar stores were scrambling to build online businesses and finding new channels, COVID has been business as usual for us.
Secondly, the mentality of consumers changed during COVID. Where before it was less common to order a watch or other luxury product online from overseas without ever seeing it, COVID lockdowns meant this became normal and, in some cases, the only option to purchasing a watch.
With so many people stuck at home in lockdowns a lot more time was spent on social media giving us greater access to advertise and reach our customers on these platforms.
Another aspect is our product positioning and price point. There are a lot of people who did not feel comfortable spending as much money on luxury watches as they did before COVID due to economic uncertainty. Our watches offer consumers luxury timepieces but at much more COVID friendly price points. We saw a large number of people holding back on buying their next Rolex or Omega and purchase a PANZERA instead. We know this because many customers write to us and compliment us on the quality of the watches compared to their other higher-end brands.
Diversification for the first time from mechanical-only watches to quartz models in our range has helped also. This has worked well for us with the creation of our new FLIEGER 46 quartz chronograph pilots’ collection and more compact models like the AQUAMARINE 38mm ocean collection that have been well received by our customer base. Something we were not 100% sure about at launch.
We leveraged upsell. Switching to a fast release mechanism on all of our watch straps enabled a whole new upsell when purchasing a watch. It takes seconds for the wearer to switch out their watch strap themselves with no tools, so why not buy several straps to change the look of your watch whenever you want. This has been a big step forward for customer choice and increasing the average order value.
Lastly, we harnessed the power of the growing PANZERA community. Before COVID most of our marketing was focused on finding new customers. However, when we looked at our sales data, we found we had a large number of customers that purchased not one but 2,3 or even 6 of our watches. Marketing campaigns directed to the existing PANZERA community grew our revenue significantly. This is something we did not expect to be able to achieve as we originally believed a watch was more of a “one-time” purchase. However, at our price point, people feel comfortable buying many of our watches and the growing width of our model collections encourages this.
What challenges did you face from COVID? Were there any significant issues you had to overcome?
We had to spend a lot of time improving our supply chain efficiency. One of the key issues we faced was the lead time on parts being shipped to Australia when COVID began. It impacted us for a few months and we were out of stock on many of our core models which was not good.
There was a silver lining though as it forced us to review and change our supply chain process. The result was; we not only improved efficiency for incoming parts to Australia but we also improved the time to deliver watches to the customer. Today we deliver virtually anywhere on the planet with 93% of orders received in under 7 days from order.
The other challenge to solve was our capacity to assemble, and we literally needed to double the size of our Sydney based team between 2020-2021. We added additional watchmakers, quality control, warehouse and despatch specialists to meet the upswing in demand.
Having some of our key watchmakers in Covid lockdown and unable to come to work was another challenge we have had to work around.
Have there been any models that have stood out during the COVID and 2021?
Our AQUAMARINE Pro Diver collection has been the biggest standout. Although it is currently the highest price-point range in our line-up, the % increase of units sold has been phenomenal. When we designed this watch, the concept was to create a watch that would serve as a dependable and professional dive watch but with a style that would appeal to non-divers as well. People love these diving style watches even if they don’t go near the water as they are big bold, sporty yet dressy, and masculine. Having said that, our AQUAMARINE 38mm collection has also been a big hit in 2021. It’s a scaled-down version for both men and women alike who prefer a smaller watch but with that dive-style design.
What is ahead in 2022 for PANZERA in the coming FY?
We are on the path towards doubling both revenue and profit again this financial year.
We intend to achieve this by leveraging what worked well in 2021, introducing fresh new watch collections and expanding sales across our global markets. We will also be increasing our focus on alternative marketing channels including, influencers, Pinterest and Tik Tok.
One of the things we are really looking forward to in the coming months is the launch of our new Aquamarine Swiss Made mechanical chronograph. It’s an absolutely stunning watch we have been working on for the past 12 months and made in our production facility in Switzerland. This new Aquamarine chronograph model will fill the position as the “flagship” timepiece for the PANZERA brand.
Stay tuned, it is sure to be a very exciting year ahead here at PANZERA for both ourselves and our customers!