World Watch, Clock and

Jewellery Show, Basel.

Basel Forum 2000.

Attendees Booklet.

Basel Forum 2000 Branding.

“Is Branding the Way Forward for the Jewellery Industry?”
26 March 2000 from 16:00h to 18:00h, Convention Center - Basel

Basel Forum 2000 Internet.

"How will the Internet challenge the traditional
promotion and sales channels of watches and
jewellery within the luxury market?"
27 March 2000 from 10:00h to 12:00h, Convention Center - Basel

For information
BASEL Forum 2000 Tel: + 41 21 329 00 39 Fax: + 41 21 329 00 42
baselforum@messebasel.ch

Presented by
The World Watch Clock and Jewellery Show, BASEL 2000
http://www.baselshow.com

in cooperation with PricewaterhouseCoopers Switzerland and ESSEC -Paris

Table of Contents

Basel Forum 2000 Branding Introduction............................................................................................................................................. 2

Company and speaker profiles - Branding .

Keynote speaker. FR - Michel Gutsatz, Director MBA program in International Luxury, ESSEC Paris ......................................... 3
Keynote speaker. UK - Jan Lindemann, Director Brand Valuation, Interbrand Newell and Sorrell ................................................ 3
Panelist. UK - Derek Palmer, Regional Marketing Director for Europe and America, De Beers........................................................ 4
Panelist. CH - Gianfranco Ritschel, Director Watches, Bucherer ...................................................................................................... 4
Panelist. USA - David Yurman, Designer and CEO, David Yurman .................................................................................................. 5
Panelist. IT - Franco Bosisio, Managing Director, Casa Damiani International ................................................................................. 5
Panelist. DE - Hanspeter Wellendorff, Managing Director, Wellendorff ............................................................................................. 6
Moderator. CH - Patrice Müller, Professor, MBA International Luxury Brand Management, ESSEC University, Paris .................. 6

Basel Fourm 2000 Internet Introduction ................................................................................................................................................. 7

Company and speaker profiles - Internet.

Keynote speaker. CH - Guido Streit, Head of e-business Switzerland, PricewaterhouseCoopers ................................................ 8

Keynote speaker. UK - Jerry Fielder, Chairman and Group Media Director, Leagas Delaney ....................................................... 8
Video conference. US - Lisa Allen, Senior Analyst, New Media Research, Forrester Research ................................................. 9
Panelist. USA - Kenny Kurtzman CEO, Ashford.com ........................................................................................................................ 9
Panelist. NL - Gerard Nijenbrinks, Retailer, Director, Horloge.com.................................................................................................... 10
Panelist. FR - Pascal Schermesser, Director of Viginet project, FR - Jean-Louis Mouillet, Partner, DRP ........................................ 10
Panelist. CH - Philippe Azzola, Lawyer .............................................................................................................................................. 11
Panelist. CH - Felix H. Thomann, Lawyer .......................................................................................................................................... 11
Moderator. USA - Joe Thompson, Editor, American Time ................................................................................................................ 11

Basel Forum 2000 Internet - Statements ............................................................................................................................................... 12

Basel Forum 2000 Internet - Statements II ............................................................................................................................................ 13

Basel Forum 2000 High-end Retailers' Survey ...................................................................................................................................... 14

Basel Forum 2000 High-end Retailers' Survey II ................................................................................................................................... 15

Basel Forum 2000 Links List .................................................................................................................................................................. 15

 Basel Forum 2000
Branding
“Is Branding the Way
Forward for the
Jewellery Industry?”
W hile the major part of the last two centuries was
dedicated to creating systems that would create goods,
the 21st century may be about creating systems to create
brands.
The role of branding in the jewellery sector is to be considered
as a growing phenomenon. Jewellery manufacturers are
becoming more keenly aware that the strength of an
outstanding product is often measured by the strength of its
identification or its branding. But what exactly is a brand and how
can it be established and developed?

While jewellery manufacturers have always created singular

masterpieces, they rarely lend their names to the selling or
promotion of these goods. Jewellery branding has been usually
handled by the retailers.

With the new trend of jewellery manufacturers and designers

"signing" their own goods what will be the consequences on the
traditional role of the retailer in building a jewellery brand?

A brand identity is the visual, emotional, rational and cultural

image you associate with a company or a product and is built
around a name and a logo and established through the
positioning of a company's or product's unique personality.

A good brand name gives a customer the impression that they

are in "familiar territory", a part of an easy to identify group,
"family" or "tribe" of other consumers who share in the
knowledge and love of the brand.

As jewellery manufacturers take a more active role in setting

trends in the luxury industry, they will also begin to define their
Sunday, 26 March, 2000
4pm to 6pm
special place in the market through their own quality brands.
Convention Center - Basel
World Watch, Clock and
Jewellery Show
http://www.baselshow.com 2
M ichel Gutsatz, is a leading academic authority in the field of luxury branding. At 50, he is Managing
Director of ESSEC's MBA in International Luxury Brand Management. Gutsatz graduated from one of
France's leading engineering Grandes Ecoles and has a Doctorat d'Etat in Economics. He was Dean of the
Faculté des Sciences Economiques in Aix-Marseille, one of France's largest universities, where he
developed new graduate and postgraduate programs in business in close partnership with leading French
companies. He is both a professor and consultant on numerous aspects for the luxury industry, including
luxury companies' strategies from the creation of value to distribution.

Keynote speaker. "What is a brand? Who is branding in the

FR - Michel Gutsatz
Director ESSEC Paris
MBA program in
International Luxury
ESSEC Business School
Avenue Bernard Hirsch,
BP 105 Cergy-Pontoise Cedex
FR - 95021
Tel: +33 1 34 43 32 26
Fax: +33 1 34 43 32 20
http://www.essec.fr/mbaluxury/us
luxury goods industry?"
ESSEC - MBA International Luxury Brand Management
Modern organizations, amongst which the luxury & prestige industries, are faced with two
major challenges: creating value for their customers and simultaneously undergoing
permanent change so as to improve this value creation process. Luxury and prestige companies’
top executives need professional expertise and leadership skills beyond traditional business and
management practice. They need a more sophisticated understanding of brand equity, a
greater ability to analyze global markets and achieve successful worldwide distribution by
mastering cultural differences. The MBA in International Luxury Brand Management has been
designed to answer these new challenges. Launched in 1995, the level of expertise of this
unique MBA program is built on its close relationship with the major players in the sector. All
MBA participants, have the opportunity to interact with companies, by under-standing their
strategies and organization, and by working on projects for them.

J an Lindemann is a Board Director of Interbrand Newell & Sorrell and responsible for the company's
brand valuation practice. He has extensive experience in advising on brands, marketing and financial
issues in all major industries and countries. Lindemann's work has been widely published on these subjects
and is a frequent lecturer, commentator and broad-caster on brand related issues. Prior to joining Interbrand
Lindemann worked as Mergers & Acquisitions advisor for The Chase Manhattan Bank. His clients included
food and multinational companies. Lindemann holds a masters degree in history, philosophy and political
science from the Free University of Berlin, Germany and a masters degree in international economics and
international politics from The School of Advanced International Studies (SAIS) of The Johns Hopkins
University, Washington, D.C., USA. He is registered with the Securities and Futures Authority (SFA) in the UK.

“What is Brand Valuation?” Keynote speaker.

UK - Jan Lindemann
INTERBRAND NEWELL & SORRELL Director - Brand Valuation,
Interbrand was founded in London in 1974. In 1993, the company became part of one of Interbrand Newell and Sorrell
the world's leading advertising & communications group; Omnicom Group. Interbrand
Group is a leading international branding consultancy specializing in a unique range of
brand-related services and activities, including: brand strategy, corporate identity, name
development and nomenclature systems, package and product design, environmental desi-
gn, brand research, brand valuation, and trademark law. Their people, therefore, represent
a unique combination of talents. They employ strategists, graphic and product designers, Interbrand Newell and Sorrell
architects, accountants, researchers, and trademark attorneys. Each individual brings parti- 40 Long Acre, Covent Garden
cular talents that, combined as one, allows Interbrand to offer the most holistic approach to UK-WC2E 9JT London

3
enhancing their clients' brand assets. With offices in nineteen cities throughout the world, Tel: +44 171 240 4040
Interbrand possesses unmatched expertise and international experience in offering quality, Fax: +44 171 836 0516
service-oriented, and successful branding services and strategies. http://www.interbrand.com
S ince graduating from university in Chemistry, Economics, and Business Studies, Derek Palmer has
worked for De Beers for over 25 years in a variety of senior positions in marketing. He has been in
charge of global market research and strategy, and more recently was responsible for all marketing activity
in the western markets. He has also been responsible for the new De Beers branding initiative. For the first
time, diamonds were branded with the name De Beers, using new technology and marketed as a premium
product. This initiative led on to the development of the De Beers Limited Edition and other branding
initiatives. Derek Palmer is married to Pat Kerr, MBE, who is well known for creating and maintaining a large
orphanage in Bangladesh. They live in London.

Panelist. "What is De Beers expecting from branding?"

UK - Derek Palmer
Regional Marketing Director
for Europe and America
De Beers
De Beers
Diamond Information Center
1 Saffron Hill
UK- EC1N 8RA London
Tel: +44 20 7404 444
Fax: +44 20 7430 3166
http://www.adiamondisforever.com/
DE BEERS
De Beers is the largest diamond mining and marketing company in the world. De Beers
was founded in 1888; the company was named after two brothers on whose farm the
famed Kimberley Mines began operations. For three generations, the Oppenheimer fami-
ly has given a special continuity and direction to De Beers' operations which has preser-
ved many of the best traditions of family business. The De Beers group produces about
half of the world's gem diamonds by value, from its own mines in South Africa and in
partnership with the governments of Botswana and Namibia. The diamonds from these
mines, as well as from other major sources, are marketed through the company's
London-based Central Selling Organization (CSO), which sorts, values and sells rough
gem diamonds from all over the world. To help maintain the demand that keeps the "dia-
mond pipeline" functioning smoothly, De Beers runs a multi-million dollar promotion cam-
paign for diamond jewellery. This international program is co-ordinated through local De
Beers offices, in co-operation with the jewellery trade, to meet the specific requirements
of the local market. In this vein, De Beers began promoting its diamonds under the now
famous, " A diamond is Forever" slogan.

S wiss-born Gianfranco Ritschel is the Director of Watches for the high-end, Swiss-based, retail chain,
Bucherer, a company he joined in 1994. Within his position he is also in charge of developing the
international branding strategy and development of the Bucherer signature watch line. Born in 1962, he
attended the State Watchmakers Academy in Soleure and has handled every aspect of the watch
business from inside the movement, to sales and finally international commercial and marketing strategies.
Ritschel developed his in-depth knowledge of the field through positions on both sides of the "workbench"
with Bijouterie Roman Mayer, Chromachron Watches, Rolex, Piaget, Baume & Mercier and ASSA.
"How does a high-end retail chain handle the branding of Panelist.
its own products?" CH - Gianfranco
Ritschel
BUCHERER Director Watches
Founded in Lucerne by Carl Bucher in 1888, presently owned by Jörg Bucherer, Bucherer Bucherer
is one of Switzerland's watch and jewellery companies with the highest turnover. One rea-
son is its selection of some 50,000 items - each of superior quality and design - while its
dedicated staff of 1,000 employees - including highly qualified watchmakers, goldsmiths,
designers and gemmologists - speaking 23 different languages are present throughout its
network of 17 retail outlets located on international shopping streets and in world-famous
resorts. Bucherer offers a selection of over 4,000 models for all tastes and budgets, prices
ranging from SFr. 50 to SFr. 70,000, with international guarantee. A worldwide service net-
Bucherer AG
work of 200 service agents in 180 towns in 47 countries serve watch and jewellery needs
throughout the world. Bucherer is the largest ROLEX retailer in Europe with the most com- Langensandstrasse 27
plete range of ROLEX watches including all latest models. The partnership with ROLEX CH-6002 Luzern
dates back to 1925. Besides its traditional activities as a top retailer, Bucherer's watch fac- Tel: +41 41 369 70 00
tory produces over 100,000 BUCHERER watches a year, which thanks to the exclusion of
the intermediary trade are sold at highly competitive prices. The Bucherer brand name also
extends to award-winning jewellery creations.
Fax:+41 41 369 73 64
http://www.bucherer.ch 4
D avid Yurman and his wife and partner Sybil had the foresight early in their careers to recognize the
viability of a designer brand name in fine jewellery. Each came to jewellery from the arts." I am an artist
in a jeweler's body" David often says. Prior to starting their company 1979, David apprenticed with noted
sculptors Jacques Lipchtiz and Theodore Rozack; Sybil was an accomplished painter. They have remained
steadfast to their dream of building a designer brand with a strong, artistic image. As a result of the Yurman's
talent, persistence and unique point of view, designer fine jewellery evolved into a flourishing retail category
in the 80s and 90s led by the David Yurman brand, it remains a vital collection today.

Panelist. "How is David Yurman branding its jewellery,

USA - David Yurman
Designer and CEO
David Yurman
David Yurman
Madison Avenue 501
N.Y. 10022 New York
Tel: +1 212 593 11 22
Fax: +1 212 593 15 97
http://www.davidyurman.com/
as new fashion jewellery design?"
DAVID YURMAN
David Yurman is truly a phenomenon in the world of fine jewellery. This internationally acclaimed designer
has masterfully combined the aesthetics and craftsmanship of fine jewellery with fashion. Recognized as
the leading American jewellery designer, Yurman paved the way for a new era in the world of fine
jewellery with wearable, classic designs that carry a distinctive signature cable look. They are available
today in over 400 Authorized Retailers doors within the United States and worldwide. David and Sybil
Yurman's company continues to grow at a phenomenal pace. Yurman in-store boutiques continue to open
at authorized independent jewellery store and select specialty stores nationwide. In the fall of 1999, David
Yurman's first retail store opened on Madison Avenue in NYC. Looking ahead, the Yurmans are poised to
grow and branch out into the luxury products. With their designer status firmly in place, additional upscale
product extension to complement their jewellery business are in the works. Most recently, the company
introduced a line of Swiss-made fine timepieces - Watch for more!

F ranco Bosisio arrived at Casa Damiani with a very unique legacy of experience. Milanese, 48 years
old, graduate of the University of Bocconi, Franco Bosisio started his career in consumer marketing
with Procter & Gamble. From Marketing Director at Cartier, Bosisio continued his career to Director of
Worldwide Communications for Cinzano. In 1986, he arrived at the SMH (now Swatch Group), where he
was instrumental in the creation of the Swatch Watch, as well as heading the company's Italian headquar-
ters. At SMH, Bosisio also held the key position of Head of Communications and Advertising. The success
of endeavors with SMH translates into figures, as SMH Italy jumped from a turnover of 29 billion Lira in 1986
to 336 billion Lira in 1994. In 1995, Bosisio became Mr. Superga. He guided the construction of the brand
name which would lead to an increase of 80% in business for the firm on a over a three year period, main-
ly due to Bosisio's revitalizing of its visibility and positioning on foreign markets. At Casa Damiani, Bosisio
is the directly in charge of the brands strategic development for foreign markets. He also contributes to its
marketing and communications.
"How does a brand become global?" Panelist.
IT - Franco Bosisio
CASA DAMIANI Managing Director
The tradition on which Casa Damiani was built,not just inherited. It was fought for and CasaDamiani International
nurtured in Italy, a land rich with a venerable goldsmith tradition. In 1924, in Valenza Po - which
became a centre for goldsmiths in the 19th century - Enrico Grassi Damiani began his own
jewellery production. Enrico's son, Damiano, forged the small company ahead based on the
creation of precious gold jewellery. Today, the company, which became a plc in 1994, can be
understood better if we look at the figures showing how it has evolved: 300 experienced crafts-
men, creative designers and artists, talented sales and marketing representatives make up the Case Damiani SPA
heart of Casa Damiani, and contribute to its prosperity - a turnover of 300 billion Lira in 1998. Viale Santuario 46
Women symbolize Casa Damiani. Damiani speaks through its design and communications
I - 15048 Valenza /AL
director, Silvia Grassi Damiani. She is the oldest of the children of Gabriella and Damiano
Tel: +39 0131 92 96 11

5
Grassi Damiani. The daughter of artists, Silvia has always known how to capture and express
tradition with an innovative spirit. Another woman, Gabriella Grassi Damiani is the company's Fax: +39 0131 94 16 53
President while Isabella Rossellini is the epitome of the Damiani woman to the world, through http://www.damiani.it
her intensity and her classical, natural elegance.
H anspeter Wellendorff is the great-grandson of the company founder Mr Ernst Alexander Wellendorff
who created the firm in 1893 in Pforzheim, Germany. After finishing his studies at MIT in Boston,
Wellendorff joined the family firm in 1960. Today, he shares the management of the company with the next
Wellendorff generation, his sons Christoph and Georg. Wellendorff's jewellery is easily recognizable through
its signature; the Diamond "W", the mark of high carat jewellery and the highest levels of craftsmanship.
Hanspeter Wellendorff still maintains his high standards of quality, creating exclusive jewellery for modern
women all over the world.
Panelist. "How is Wellendorff branding its jewellery, as
DE - Hanspeter a historical manufacturer of jewellery?"
Wellendorff
Managing Director WELLENDORFF
Wellendorff Established as a brand in 1972, the Wellendorff jewellery name goes back to 1893 when the
firm was created by Ernst Alexander Wellendorff in Pforzheim, Germany. Due to its foresight
for branding its image, today Wellendorff stands among the most highly respected high-end
jewellers in the world. The Wellendorff image reflects luxury and eternally classical design,
far from the every changing moods of fashion. Building the strength of its reputation of the
dedication of a family-owned business, the Wellendorff brand has never ceased to grow and
develop. It is known around the world as "the brand with the diamond W", which refers to the
18K gold diamond set "W" with is the trademark of the brand. Other key design features of
Wellendorff the brand are the patented silk rope, which was introduced to the world market in 1975, as
Turnplatz 3 well as the enamel-enhanced, colored rings which can be turned within themselves. In 1998,
D - 75172 Pforzheim Wellendorff inaugurated a showroom/ the jewellery park, as an international communication
Tel: +49 7231 28401 - 0 centre. The same year it expanded its jewellery production facilities by more than 1,000
Fax: +49 7231 28401 - 50 square metres. The jewellery is produced exclusively at the company's production facilities in
http://www.wellendorff.de Pforzheim Germany.

P atrice Müller, is not only a professional professor in the ESSEC University, Paris MBA in International
Luxury Brand Management program, but he is also a strategic and financial advisor and an allround
expert in financial and promotional practices in the luxury industry. After completing his studies in economics
in Switzerland and Israel, Müller, became closely involved in controlling and logistics for a number of major
luxury firms. Müller's career has evolved through key positions with companies like Vendôme Luxury Group
where he was assistant to the logistic manager.
He continued to develop in financial spheres through a key position Moderator.
with PricewaterhouseCoopers SA, Geneva as consultant in M&A, CH - Patrice Müller
specializing in the Luxury Goods Industry. Today, Müller also works Professor, ESSEC University,
as a strategic financial advisor for the London based financial group Paris MBA in International
Luxury
Ipolitis & Hubertus Ltd. in Geneva. Brand Management program

Ipolitis & Hubertus Ltd.

Representation in Geneva
Rue de St-Jean 15
CH - 1203 Geneva
Tel: +41 22 940 25 30
Fax +41 22 940 25 31 6
 Basel Forum 2000
Internet
"How will the Internet
challenge the
traditional promotion
and sales channels
of watches and
jewellery within the
luxury market?"
T he global challenge of the cyber marketplace is a difficult
one to face by any industry. Whatever seems to be ailing a
sector off-line appears bigger than life on the WWW. The luxury
industry is no exception.
Rampant discounts, over-stocking, poor quality and/or imitation
goods are the bread and butter of the cyber retail market for
watches and jewellery and other luxury items today.
The stakes are high. How many traditional retail outlets can
claim to have had 200,000 informed consumers walk through
their front doors over the past year?
Consumers consult the Internet voluntarily which makes them
more attentive to the information they receive. They are,
however, are concerned about safety, privacy and bad service.
The success of an e-business operation rests on how the "brick
and mortar" retailer will embrace the new culture of the virtual
marketplace. Keeping close to the needs of the customer base,
and being able to bypass fear of gray or black market goods will
guarantee the success of the venture.

The sincerity and clarity of the retailer’s message and on-line

sales practices may make or break the business.

The quality of the presence of both retailers and manufacturers

on-line should reflect their standing in the real world. This also
goes for the delivery of their message to the market. Certain
aggressive sales practices that go unnoticed by most consumers
in the "real world" become obvious and nagging on-line.

The success of an e-business operation for the traditional

retailers lies in how they will combine the power of global
Monday, 27 March 2000
10am to 12noon communication through the WWW with the products and
Convention Center - Basel services that are at the center of their offering.
World Watch, Clock and

7
Jewellery Show
http://www.baselshow.com
G uido Streit joined PricewaterhouseCoopers in 1998 where he is a Senior Manager of PwC
Zurich, Head ofE-Business and Head of E-Strategies Service-Group within Management
Consulting. Born in Switzerland in 1963, Streit studied Computer engineering, and went on to obtain
a 'Master of Business Management' (MBM) degree. Streit has developed an in-depth knowledge in
handling electronic media as it pertains to modern business techniques through key positions at IBM
(over a 10 year period) from large account representative to CEO in an IBM initiated e-business joint
venture and as e-business consultant for the firm. He was instrumental in defining the strategies and
concepts behind the basic e-business working model and working to their implementation for a
number of major corporations.

Keynote speaker. “What steps must be taken to build a strong

CH - Guido Streit business into a successful e-business?”
Head of e-business
Switzerland PRICEWATERHOUSECOOPERS - Integrated Professional Services
PricewaterhouseCoopers PricewaterhouseCoopers (http://www.pwc.ch), the world's leading professional services
organisation, helps its clients to solve complex business problems and measurably
enhance their ability to build value, manage risk, and improve performance. Drawing on
PricewaterhouseCoopers Ltd the knowledge and skills of 155,000 people in 152 countries PricewaterhouseCoopers
Affolternstrasse 52 provides a full range of business advisory services to leading global, national and local
CH-8050 Zurich-Oerlikon companies and to public institutions. With 2800 people in Switzerland specialised in
Tel: +41 1 630 11 11 various industries and markets - it can tailor its services to every individual client's wish.
Fax: +41 1 630 53 05 The range of services includes audit and business advisory services, management
http://www.pwc.ch consulting, financial advisory services, business process outsourcing as well as tax and
http://www.pwcglobal.com legal services.

A fter obtaining his Degree in Economics, Jerry Fielder followed a rather nomadic trail during his
formative years in Advertising. He joined Leagas Delaney, shortly after their start-up as the
Agency's first Media Director in 1982. The last 18 years at Leagas Delaney has seen the Agency
progress from the "interesting young creative hot-shop" to being an international Agency of
substance with offices in London, San Francisco, Düsseldorf, Paris and Rome working on clients such
as Adidas, Harrods, Cnet, Barclays, The BBC, Patek Philippe and Nintendo. Fielder handles major
media projects and became Chairman of The Digital Partners, the Agency's wholly owned internet
development consultancy, in 1997.

“What are the advantages and pitfalls of Keynote speaker.

building and communicating a brand identity UK - Jerry Fielder
on-line?” Chairman and
Group Media Director
Leagas Delaney
THE LEAGAS DELANEY GROUP
Founded in 1980, Leagas Delaney is an independently owned international
advertising agency group headquartered in London with offices in San Francisco,
Paris, Düsseldorf and Rome. The combined billings of the group are $320
million. The agency's biggest contribution to its clients has been to deliver incisi- Leagas Delaney Group
ve strategic direction. This, combined with creative work of the highest 233 Shaftsbury Ave.
UK - WC2H 8EL London
standard, has enabled its clients to fully realise the commercial potential of their
Tel: +44 207 836 44 55
brands.

8
Fax: +44 207 636 31 68
http://www.leagasdelaney.com
L isa Allen’s current research agenda focuses on local content directories and community. Lisa's
background in electronic media is extensive. Prior to joining Forrester, she was founding executive
producer of Microsoft's Boston Sidewalk, an online city entertainment guide, where she led the site's editorial,
design, and production staff.Before her stint with Microsoft, Lisa served as director of editorial operations for
AT&T New Media Services. She was responsible for the launch of Business Network, its first proprietary
online service, and for launching Interchange Central, a general news and feature service on the Interchange
platform. Before entering online publishing, Lisa held a number of on- and off-air positions in cable and
broadcast TV. As director of editorial and video communications for Cablevision Systems, she won one of
her three Emmy Awards. Lisa is a summa cum laude graduate of
Video conference.
Tufts University, where she was elected to Phi Beta Kappa. She holds
US-Lisa Allen a J.D. from Emory University School of Law and is a member of the
Senior Analyst,
New Media Research
State Bar of Georgia.

Forrester Research, Inc.

400 Technology Square
Cambridge, MA 02139 USA
Tel: +1 617 497 70 90
Fax: +1 617 613 50 00
European Research Center
Forrester Research B.V.
Emmaplein 5
1075 AW Amsterdam
Netherlands
Tel: +31 20 305 43 00
Fax: +31 20 305 43 33
http://www.forrester.com
"Selling On-line To The Af fluent Customer"
Forrester Research
"Information Is Free; What It Means Is Priceless" This is one of the cornersstones of the
Forrester philosophy. Forrester is a leading independent research firm that analyzes the futu-
re of technology change and its impact on businesses, consumers, and society. Founded in
1983 by George F. Colony, during the last 15 years, Forrester has helped its clients stay
ahead of a wide range of technology developments, including the Internet's evolution. Clients
use Forrester's "whole view" of Internet commerce, corporate technology, and customer
behavior to drive winning strategies in the Internet economy.

K enneth E. Kurtzman joined Ashford.com in May 1999 as Chief Executive Officer and a Director. After
obtaining a Bachelor of Arts degree in Economics magna cum laude from Rice University, an
undergraduate degree in Economics from Cambridge University and a Masters in Business Administration
degree from the Graduate School of Business at Stanford University Kurtzman developed a keen know-how
of the inner workings of the business and IT world through a number of key position with top firms. Kurtzman
served as Vice President and General Manager of several divisions of Compaq Computer Corporation, he
also worked for McKinsey & Co. as a Principal working in the computing, telecommunications, systems
integration, banking and energy industries.
“How can luxury manufacturers build new Panelist.
business through e-commerce without USA - Kenny Kurtzman
jeopardizing the identity of their brand or the CEO Ashford.com
relationship with their established channels?”

ASHFORD.COM
Ashford.com (Nasdaq: ASFD) is the leading Internet retailer of luxury and premium
products and is the Internet's No. 1 retailer of watches.The company's e-commerce
site, located at http://www.ashford.com/, offers a vast selection of diamonds and Corporate Office Location
more than 13,000 styles of new and vintage watches, designer jewellery, fragrance, 3800 Buffalo Speedway Suite
bath and body products, leather accessories, ties, scarves, sunglasses and writing 400
instruments from more than 300 leading brands. Dedicated to creating a comfortable Houston, TX 77098
and safe shopping environment, Ashford.com offers customers the Ashford.com Tel: + 1 713 369 13 00
Protection PlusTM policy, which provides industry leading warranties, privacy and
security. Ashford.com is headquartered in Houston, Texas.
Fax: + 1 713 623 04 44
http://www.ashford.com 9
G erard Nijenbrinks is director and owner of Horloge Platform Nederland®, a combination of an Internet
website and a physical meeting space and retail shop for watch enthusiasts. Born in 1960, Nijenbrinks
started his first company in 1989. Specializing in mechanical wristwatches, he imported several Swiss
brands in order to supply interested Dutch retailers. Six years later he took his business on-line, under the
banner of horloge.com, the Horloge Platform Nederland® which unites retailers, distributors, manufacturers
and watch enthusiasts throughout The Netherlands. In the last two years, a close co-operation with one of
the oldest established watchmaking families of The Netherlands has brought four generations of watch
making experience to the platform.

Panelist. “How will

NL - Gerard Nijenbrinks e-commerce affect the relationship between a
Retailer, Director Horloge.com traditional retailer and the customer?”
Horloge Platform Nederland® HORLOGE.COM
t.a.v. Gerard Nijenbrinks
Anton de Haenstraat 43 WATCH-STORE.COM
NL - 2563 BP Den Haag This internet watch store is part of 'Horloge Platform Nederland®' and is based in The Hague,
Netherlands, where it has its office and a physical store and showroom. It enjoys a strong co-operation
Shop with one of the oldest watch and clock ateliers in the Netherlands. This family owned company exists
Noordeinde 157a
NL- 2514 GG Den Haag for over 120 years now, and belongs to the best and most well known in The Netherlands. They make
Tel: +31 70 427 45 62 sure that all watches offered on www.horloge.com are fully serviced and guaranteed.
Fax: +31 70 427 45 63

B orn respectively in May '62 and June '62, Pascal Schermesser and Jean-Louis Mouillet were
fellow students at the prestigious ISG (Institut Supérieur de Gestion) in Paris. Specializing in the
foods industry, the two young graduates went as far west as to San Francisco to take on their first job
experience. The pair went on to establish a market research company DRP in 1989. The main
purpose of the company was and is to fill the information needs for top luxury brands in how they are
being positioned, priced and sold on the international market. With the arrival of the Internet, DRP went
on-line in 1998. There, through their Viginet software, they surfed the web, studying and surveying
pricing and discounts and ultimately fraud and counterfeiting of luxury perfumes on-line. DRP have
broadened their studies to include watches.
“What is the affect of rampant on-line pricing Panelists.
and sales practices on the image of luxury FR - Pascal Schermesser
goods?” Director of Viginet
project for DRP
DRP
DRP is the first international provider of price surveys on luxury goods, distributed worldwide in local markets, FR - Jean-Louis Mouillet
duty free and web shops. Partner

DRP
6, rue Mignard
FR - 75116 Paris

10
Tel: +33 1 45 03 02 72
Fax: +33 1 45 03 02 96
http://www.drp.fr
 P
“How can traditional hilippe Azzola's law firm is an inherent part of the luxury industry and
distribution channels be works closely in the identification of Intellectual Property Rights
protected with the evolution of infringement in this area. Azzola has been active in the field of Commercial
e-commerce in the luxury Law, Company Law and Intellectual Property Law since opening his firm in
industry?” 1982. Born in La Chaux-de-Fonds Switzerland (one of the world capitals of
watchmaking) in 1951, Azzola has specialized in the legal exploitation,
Panelist. licensing and enforcement of trademark and patent matters, whereas the
CH - Philippe Azzola procedures to obtain such Intellectual Property Rights are handled by an
Lawyer independent company he established for that particular purpose in 1987.
Azzola Philippe P. Azzola studied law at the University of Geneva, becoming a member of the
Law Office Geneva Bar Association in 1980. He also studied at NYU Law School working
Rte de Florissant 81
CH - 1206 Genève
simultaneously for a US Law Firm based in New York.
Tel: +41 22 347 94 45
email:azzolaw@iprolink.ch “What are the major legal
issues that will shape the
P resident of the Basel Bar association (83-86) and of the Swiss Bar
Association (86-88) Felix H. Thomann has nearly 35 years' experience
in legal matters pertaining to intellectual property. Born in 1936, he studied at
future development of
e-commerce in the watch and
the Universities of Basel and Zurich and has been admitted to the Basel City,
jewellery industry?”
Basel County, Zurich, Berne, Lucerne, Aargau, Solothurn, St. Gallen, Zug and
Panelist.
Federal bars. He practices as counsel and attorney before courts and CH - Felix H. Thomann
arbitration tribunals, mainly in patent, design and model, trademark, copyright, Lawyer
competition and cartels, computer, software, telecommunications, multi-media,
ThomannFischer
Internet and contract law. In the past few years he has become vocal on the Elisabethenstrasse 30
subject of the law and the Internet, a topic on which he has published several CH - 4010 Basel
Tel: +41 61 226 24 24
articles and conducted conferences and seminars. Fax: +41 61 226 24 25
http://www.thomannfischer.ch
Moderator.
USA - Joe Thompson
Editor of American Time

J oe Thompson is editor-in-chief of American Time, the New York-

American Time
One Penn Plaza
US - NY 10019 New York, based watch magazine. Thompson has covered the global watch and
Tel: +1 212 714 13 00 jewellery industries since 1977 and has developed a reputation as one of
Fax: +1 212 714 13 13
http://www.americantime.com the watch industry's most knowledgeable observers. His writing and repor-
KEY STAFF:
ting have won nine editorial excellence awards from the American Business
Editor-in-Chief Press. Thompson is frequently quoted about watch industry developments
Joe Thompson
Tel: +1 913 383 31 05 in major American media, such as The New York Times, the Wall Street
Managing Editor Journal, Newsweek, the International Herald Tribune, U.S. News and World
Norma Buchanan
Tel: +1 212 317 08 66 Report, and the Washington Post. 11
 "What will be the biggest challenges facing the luxury industry in
the coming decade due to the development of e-commerce?"
CH- Guido Streit
"I see three major and (inevitable in a networked world) interrelated PricewaterhouseCoopers
challenges e-commerce poses to the luxury industry: How can this 'personal Head of e-business
relationship'-driven industry adopt to the concept of 'virtual relationship' in Switzerland
Keynote
e-commerce? E.g. do the decision makers have the right mind-set to move contact -guido.streit@ch.pwcglobal.com
swiftly enough into this direction? What role will the dealer network play? Which
dot.com's already target your customers and eventually own the
customer relationship? To a large extent e-Business is about alliances: the
long-established players will have to think across the existing industry borders
in order to identify the best business-models and partners. How can the
enormous potential of strong brands and very attractive profile of the
customer base be the best leveraged in the Information Age?"
USA - Kenny Kurtzman, "The e-commerce landscape is evolving quickly, and over the next year,
CEO Ashford.com
Panelist luxury manufacturers will need to create e-commerce strategies, or they will miss
contact - Lisa@Labradopr.com the fastest growing distribution channel and a new model for building customer rela-
tionships. In creating an e-commerce strategy, luxury manufacturers must address
the following issues: - Whether to build a transactional e-commerce site internally or
partner with an existing Internet retailer or both - How to support and maintain their
established channel relationships while embracing the Internet. - How to maintain
and extend their brand identities on the Internet. - How to manage the potential
impact of the Internet on pricing."

"I believe that the luxury industry must face, as of today, three major CH- Dr. Philippe Azzola
Attorney at law
challenges. Two of them have legal implications, namely the controle of the Panelist
distribution channels and the protection of intellectual property rights. The third, contact - azzolaw@iprolink.ch

but not the least, challenge is to become part of the e-commerce

without damaging the components which make up the essence of luxury i.e.
exclusivness, rarity, emotion and the unique atmosphere of the boutiques."

"As a journalist, I'm far more adept at asking questions than answering them. USA - Joe Thompson
Editor-in-chief of
Nevertheless, many luxury watch firms say the two things that most concern American Time
them about e-commerceare the impact on their established distribution network Moderator
and pricing. If a significant portion of consumers find e-retailing a viable way to contact - jthompson@mfi.com

purchase watches and jewellery, luxury suppliers will be forced to find ways to
incorporate e-tailers within their authorized distributor network. Devising such
systems will be difficult, but not nearly as difficult, it seems to me, as creating a
global pricing system." 12
 "What will be the biggest challenges facing the luxury industry in
the coming decade due to the development of e-commerce?"
"The first reaction of the manufactures should be to become more aware of the countless websites which offer their
goods on-line without their knowledge. These practices are not only illegal, but are parasites to the image of a brand.
They destablize prices and challenge their role of retail in the sale of luxury goods. In some way this is a way of taking
luxury brands "hostage" in an illicit traffic of products and image. When present on the web, brands should notify
visitors that their site is the only official source of information about their brand online. Only brands with strong
official online presence can protect themselves against false representation. Selling directly online is linked to a
problem of exclusivity and selective and controlled distribution. Can the Bulgari Store or the Chanel Store display their
prices on a world scale and still take into account local tax and import laws that affect brick and mortar retailers and
distributors? To alleviate such discrepancies, brand online shops will have to go the way of software vendors and sell
only through local on-line outlets respecting the sales conditions of each area. Luxury brands belonging to
conglomerates and big groups (LVMH, PPR, Swatch and those of the future) may be able to preserve their image and
prices in their on-line sales by global pricing agreements and group brand building. Communicating on a brand over
the Internet is one of the biggest challenges facing the industry today. Some brands will adapt to the new
communication possibilities offered. There may be a new equilibrium that will combine both traditional distribution and
retail ande-commerce. Certain on-line and off-line sales points will be more communication and brand building
vehicles than profit centers."

FR- Pascal Schermesser and Jean-Louis Mouillet

Partners and creators of DRP Marketing research firm
Panelists
contact - pascal@drp.fr

NL- Gerard Nijenbrinks "The biggest challenge for the luxury industry will be to turn Internet and
Retailer
horloge.com
e-commerce into an opportunity instead of a threat. Hundreds of thousand
Panelist of potential customers are browsing the web to find confirmation that their
contact: info@horloge.com choice to buy a certain product is the right one. They are not looking to find
aggressive warnings not to buy their chosen product anywhere on-line.
Finding a way to inform Internet visitors of the value of a product with res-
pect to their situation or needs is of paramount importance. E-commerce
and Internet could be an extra tool for the traditional promotion and sales
channels if used in that way."

"The biggest challenge facing the luxury industry in the coming decade due to CH- Dr. Felix H. Thomann
Attorney at law
the development of e-commerce will be to avail itself fully of the advantages of Panelist
e-commerce while preserving its image of exclusivity and its high class contact : felixt@thomannfischerlaw.ch
distribution networks."
13
 Basel Forum 2000 Internet PART I - GENERAL INFORMATION
1. Regional Split
High-end Retailers Survey. Europe 80%*
Germany 40%
The BASEL Forum 2000 conducted a survey on a Italy 5%
The Netherlands 5%
selection of high-end watch and jewellery retailers in
Switzerland 50%
order to get a better view of how the realities of the
North America 12%
Internet relate to the way they do business today
Asia Middle East 8%
and how they will do business tomorrow.
(* the majority of high-end retailers that were surveyed were located in Europe)

Out of over 250 retailers that were contacted only

20% had e-mail address. Of the 30 retailers that 2. What percentage of the brands you work with do you have exclusive agreements
replied, all had e-mail addresses and most were alrea- with?
dy Less than 5% : 60%
5%-10% 9%
on-line.
10%-40% 20%
More than 50% 11%
Although 50 dot.com retailers were contacted, none
of the retailers that responded were doing on-line
sales. However, many indicated they were looking PART 2 - YOUR BUSINESS AND THE INTERNET
into it.
1. Is your business on-line?
It's important to note that this survey will be an Yes 60%
ongoing process over the coming year. The BASEL No 40%
Forum will be relaunching this survey during and
after the World Watch, Clock and Jewellery Show, 2. If yes, when did you go on-line?
to include a larger crosssection of high-end Before 1996 -
retailers, mid-range dealers and department stores. 1996 2%
1997 3%
1998 -
1999 95%

3. If no, will you be going on-line? (please choose 1)

Before the end of the year -
In 2000 5%
We're thinking about it 95%
Never -

4. If never, what are the reasons? (please choose 1)

It's too expensive -
My business doesn't need the Internet -
The Internet is not important -

5. Do you sell products on-line

Yes 5%
No 95%

6. If yes, how much revenue do you expect to make from e-commerce in 2000?
Under $100,000 5%
$100,000 - $500,000 95%
$500,000 - $1mio -
$1mio - $10mio -
Over $10mio -

14
 PART 3 - HOW THE INTERNET WILL AFFECT YOUR BUSINESS
Basel Forum 2000 Links List.
1. What do you think is the biggest danger facing the watch and jewellery
World Watch, Clock and Jewellery Show industry because of the Internet? (please choose 1)
http://www.baselshow.com
American Time Rampant discounting 50%
http://www.americantime.com/
Increase of fake and replica goods -
Ashford.com Increase in the sale of gray market goods 20%
http://ashford.com/
Loss of confidence in brand names 10%
Philippe Azzola Law Office Loss of image for brands 10%
email:azzolaw@iprolink.ch
Lack of customer service -
Bucherer Lack of contact with customers 10%
http://www.bucherer.com
David Yurman
http://www.davidyurman.com 2. What is your greatest fear concerning the Internet? (please choose 1)
DeBeers
http://www.adiamondisforever.com/ Infringement of consumer privacy
It's too expensive to play the game 3%
DRP
http://www.drp.fr The market is not ready for it 3%
Inability to find enough goods to satisfy 4%
Essec customer needs
http://www.essec.fr
Not being able to fulfill orders, internationally 5%
Forrester Research Lack of customer service 5%
http://www.forrester.com/
Losing touch with our customer base 80%
Horloge.com
http://www.horloge.com/
Interbrand
http://www.interbrand.com 3. What is the most positive thing that the Internet can offer your company?
(please choose 1)
Leagas Delaney
http://www.leagasdelaney.com/
Development of new markets (international) 3%
PricewaterhouseCoopers It's a good way to find new customers 45%
http://www.pwcglobal.com
It will make information on our company 50%
ThomannFischer Law Office and products more accessible
http://www.thomannfischerlaw.ch/
It will help consumers in their buying choices -
TimeZone It will allow customers to buy products on-line 2%
http://www.timezone.com
Wellendorff
http://www.wellendorff.de/

15