Luxury Swiss watchmaker TAG Heuer and American sneaker brand New Balance are teaming up for a high-performance partnership.
At an event at New Balance’s Boston headquarters on Wednesday, TAG Heuer introduced the fifth generation of its luxury smartwatch, called Connected E5, headlined by a New Balance edition of the watch aimed at runners. The brands also introduced a co-branded running shoe, the TAG Heuer x New Balance FuelCell SC Elite v5.
The collaboration comes as running’s popularity has surged and it’s increasingly viewed as a lifestyle as much as an activity, creating new opportunities for fashion and luxury players. For TAG Heuer, the partnership simultaneously gives it a chance to burnish its performance credentials.
The TAG Heuer Connected Calibre E5 40MM x New Balance Edition will be limited to 3,000 pieces and carry a premium over most connected watches, costing $2,050 (£1,750). Included in the price are two straps and software developed with New Balance that offers six exclusive running plans, one of which is aimed at marathon runners.
“This is a very good image for us,” said TAG Heuer’s chief marketing officer, George Ciz, in an interview. “It shows we are aligned to the world we live in and a brand that embraces technology.”
New Balance has pushed its own elevation strategy as it races to hit $10 billion in annual sales. The brand has released buzzy collaborations with the likes of Miu Miu, Loro Piana, Stone Island and Sézane, recently announcing a version of its 471 “dad shoe” sneaker with the Parisian women’s fashion brand.
The TAG Heuer x New Balance FuelCell SC Elite v5 running shoe, which carries the TAG Heuer logo on the tongue and heel, has performance enhancements such as a carbon-fibre plate and costs $270 (£270). Only 3,000 pairs will be available.
“Our goal is to be the most premium athletic brand in the world, and to live at the intersection of sport and culture,” said New Balance’s brand president and chief marketing officer, Chris Davis. “Our partnership with TAG creates something unique, because these are not only performance products, they’re truly the highest-end pieces of equipment that are going to make runners better all over the world.”
Both brands are partners of the New York and London marathons. They also run ambassador programmes with high-profile athletes, with both counting Olympic gold medallist and 400 metre hurdles world record holder Sydney McLaughlin-Levrone as an ambassador. McLaughlin-Levrone will be the face of a new co-branded campaign pushing the TAG Heuer x New Balance story.
Running isn’t the only sport TAG Heuer has sought to link itself with as it has leaned more heavily into the lucrative world of sports marketing. In January, it was announced as the official timekeeper of Formula 1 as part of a deal between the sport’s commercial rights holder, Liberty Media, and TAG Heuer’s parent company, LVMH. The deal, which brings Louis Vuitton, Moët Hennessy, Belvedere and Glenmorangie into the sport too, was reported to be worth $1 billion over 10 years. TAG Heuer is also in golf and surfing, and counts Ryan Gosling and Alexandra Daddario among its ambassadors.
TAG Heuer continues to invest in technology as well, believing it’s important to the brand’s future. Among the first traditional watchmakers to step into the smartwatch category in 2015, it has updated its Connected series roughly every two to three years since, even though sales remain small compared to market leader Apple. One analyst estimated TAG Heuer had sold in the region of 500,000 Connected watches in the decade since it was launched, but said that wasn’t sufficient to justify the development and marketing costs, comparing it to Apple which is thought to have sold around 39 million watches last year alone.
“TAG Heuer will never catch up to the leaders in the category,” said Oliver Müller of the specialist Swiss consultancy LuxeConsult. “Like Tissot, TAG Heuer can be credited for the courage to try, but as good or as well manufactured as the products are, they’re aren’t competitive in terms of price or USP.”
That hasn’t deterred TAG Heuer, however. LVMH does not break down its performance by brand, much less by product, but Ciz said previous generations of Connected had been “one of our best sellers online,” and that he expected the new watch to perform “extremely strongly in the lead up to Christmas.”
“The world is changing and we believe we have a competitive advantage, we are prepared for it,” Ciz added. “There is a market for this with consumers who love the duality of a watch they can wear to the gym and into the boardroom looking the part. And it’s a great way to recruit people into the brand and to give clients who have a few TAG Heuer watches something else.”
The new edition is the first to run on a proprietary operating system, TAG Heuer OS — despite previous TAG Heuer spokespeople, including former chief executive Frédéric Arnault, saying there would be no point in developing an in-house OS, given it would have to compete with class-leading alternatives from specialist companies such as Apple and Google. To now, the Connected watches ran on Google’s Wear OS.
Ciz said the software landscape had evolved, though, becoming more cost-effective. The new OS was developed by TAG Heuer’s Paris-based software division and based on Google’s Android Open Source Project. (Ciz declined to put a cost on the operating system development, and said there were no plans to share it with other brands.)
The watchmaker says its watch will have 1.5 days of battery with full performance — or two in low power mode — and offer a suite of high-performance health and activity trackers, another attractive feature for runners, whether they buy the New Balance edition or not.
Both Ciz and New Balance’s Davis denied the collaboration was driven by the kind of hype that has amped up sneaker sales and prices over the past decade. “While the collaboration will undoubtedly provide heat and energy around both brands, the ethos was not to tap into hype culture,” said Davis. “The ethos was to create a performance piece of equipment that exemplifies the ambitions of innovation around both brands. Hype culture still exists, but it’s not a culture we strive to participate in.”
Ciz agreed. “Authenticity is the new currency of luxury,” he said. “Limited editions are amazing, because they can bring hype and energy, but you need to have strong foundations. Great collaborations help you stretch the brand and recruit new clientele. We have a pretty big population that we’re going to hit with this.”
