The world of horology is an interesting one, from masterful creations of movements to dials of every shape and size. We’d burn holes in our pockets to get that prized watch on our wrists and we’d know it was worth every single cent. But how wonderful it would be to have a watch to call your own and also keep your pockets intact? Business partners and father and son, Ton and Jordy Cobelens, founded TW Steel to make that happen. Based in Amsterdam, the Dutch watch manufacture makes big watches for a big market. Costing no higher than USD1500, the watches created a sensation that quickly built a reputation within 8 years since its founding in 2005. From a mere idea to a booming business venture, I talk to Jordy about TW Steel’s beginnings, the brand’s leap in sponsoring Formula One and his plans for the future.
So give me an overview of the journey that you’ve taken.
It started off as a very simple idea that I had together with my dad. I’ve been doing watches prior to TW Steel. When I was younger I got involved in the watch business because my father was involved in watches before I moved into the music industry. I was a professional DJ and I had my own record company and I started there when I was 19. It was a completely different industry and a completely different life hence me and my dad moved away from each other in terms of business but we decided to do something together. We sat down and we saw that these bigger watches are becoming popular so you know, we thought, let’s give these watches a try and see how it goes. We started off in Amsterdam and got some retailers on board. Then we started to go across the country and we got some nice sales and I wanted to see if there was international interest for the brand. I started to travel a little bit, went to some trade shows trying to find the distribution partners and got in touch with some of the right people and signed some partners on board – in Germany, Spain, France, and UK. They then put the brand up in stores and the product was just flying. I mean, it was just flying off the shelves as soon as the rumour got spread out that TW Steel was the new hit. We went from 2, 3, 4 countries to 5, 10, 20. This was all in 2006-2007. So the company grew enormous in a very short period of time. In the beginning we were just focused on selling product because a lot of people said, “yeah big watches, that’s gonna be gone next year, it’s a trend.” So at one point we were like, okay you know what, it’s definitely time to set some guidelines from Head Office and we have to focus on the marketing because a lot of distributors were doing something that they personally like.
You mentioned your father was part of the watch business. What aspect of the watch business?
My father started to design watches probably when I was about 14 years old. And around that time I had an interest for business so I started selling them. My dad had his own watch brand.
Anything that he’s designed that we’ve heard of before?
No, nothing international, all locally-based. And my involvement was just from a sales point of view. So when I was 15 years old I was on the road selling watches – I was still in school of course – selling watches to my friends, their dads and uncles, teachers in school.
So when you and your father came together and decided to do something together, what was the main idea behind TW Steel? First of all, how did the name come about?
‘TW’ means ‘The Watch’. Because we had 4 steel cases and we needed to come up with a name so ‘the 4 steel watches’ or ‘the watch in steel’. The beauty about it was the whole concept was created in 30 minutes. We saw that there was a gap in oversized watches at a particular price point and we designed 4 watches called TW because it was four steel watches called TW 1, 2, 3 and 4. I mean it was done so simply. When we introduced it we didn’t even have a proper brochure with pictures. We had the drawings from the computer printed out. We didn’t have a display but only had the watch boxes that they still come in which are the metal boxes. They’ve been modified a little bit, but still with the original DNA of the brand. And those were actually the cases that were displayed in. So in the jewellery store we had four of those watch boxes and that’s it.
So when TW steel started to become more popular, you decided to lay down guidelines, etc.
Yes then we started to focus on the brand itself. We chose Motorsport as the platform which we felt was a really right fit for TW Steel. Got involved with some local activities then I got involved with a company called A1 GP which was the World Cup of Motorsports. So I became the official timing partner to that, and did that for one season. Then I made a big jump into Formula One which of course changed the whole perception on the brand when you start sponsoring Formula One.
When you decided to go into Formula One, you would have to have a certain mindset to be ready for it. Did you feel that you were ready?
No, it was definitely a risk. It was definitely a big step for the company at that point. But I felt that it would bring TW Steel so much and I felt it was the right decision to do. When we announced it, it just changed the whole perception on the brand and when you start sponsoring something at that level, people look at things completely different.
So how did that process come about? Did you approach for someone?
Well at that time it was with Renault that approached us. When you start to have those discussions, they start sending you proposals, the figures are crazy – it’s very expensive. For example, with A1 GP, we had half of the track with signage. And then you come to Formula One, you get a small logo here and there, and with every logo there’s a zero added to the amount. There’s a reason that it’s so expensive of course because the reach is huge. It took about 8-9 months before I signed the deal. I went to a lot of races to really get used to the environment and see how we can activate that on a retail level because it’s great to have your logo there but if you don’t activate it on a retail level then it doesn’t really make sense. About 9 months or later we signed the deal with them.
And has it worked?
Yeah, it took TW Steel to a completely different level. If you show a movie, you don’t have to explain that much anymore. That was the most important part of it – our partner saw that we were investing in the brand and they felt comfortable investing in the brand as well. Especially in Asia, we didn’t receive so many requests in the beginning for people to want to carry TW Steel because they don’t to take on a brand that will be gone next year. They want to go for brands that are there for the long run. And when they saw I was investing in Formula One, they must’ve thought, “Ok well if they take those kind of decisions, it must be that they’re here for a long period of time.” So then for Asia, it helped massively.
I was speaking to one of the members of your staff and she has been with you for six years. She told me that when you first started, you had 15 staff and now you have 80 and a Head Office. Give me a sense of the growth TW Steel has experienced in terms of sales, distribution points in the world, etc.
We grew from a couple of stores in Amsterdam to now over 5,000 points of sales globally. We then started to open our own offices around the world and then opened our own boutiques. So in terms of the reach, because we were so unique in what we were doing, there was a hype that was created that got the name out so quickly. So many people around the world increased our distribution and got us a lot of partners that wanted to get a piece of the action. The growth of course has been phenomenal. We now have 16-17 of our own boutiques and that’s still growing.
One of the things in my early exposure to TW Steel was walking past a few watch retailers and I was struck by the fact that the display was in your face – the name itself, plus the watches. In a sense for me, when I first saw the brand, I thought that it was a brand that presents itself in a certain way and sorts of sells itself.
Absolutely. Wherever we go, we put the product in-store and it automatically sells. Now, I would never say “easier”, for there’s still so many people around the world pushing TW Steel to make it happen, but because we’re so unique in our looks, it stands out. People really love the design. Now we’re launching in Singapore where the brand is technically new to the market. When people enter and when they see Kelly Rowland, Yamaha Motor GP, Formula One, … automatically they’re like, “I don’t know the brand but it must be something big because they sponsor all these activities.” That makes it easier but the bottom line is that people walk into a store, they see the product, they love it, and they buy it.
You’ve managed to take the company from where it was to where it is now. Give me a sense of your business philosophy.
What I’ve always tried to do is to create a hype around something. When I was in the music business, I had to stop with that when TW Steel really took off. I re-launched an entertainment company about 3 1/2 years ago and with every event we were doing, we managed a lot of DJs as we were about 250 events a year. We always create a hype, making sure that everything we do have people talking about it. I think that’s what we’ve done from the beginning, creating very strong products with really good marketing strategies that brought TW Steel to where it is today.
Here at REVOLUTION, we tend to be more interested in mechanical watches. You have a few pieces in your collection that are mechanical but tell me about your plans for that aspect.
Especially in Asia, the mechanical movements are very, very popular. We have people coming into our stores and asking which ones are the automatic and they only want that. For us, of course, quartz is at a certain price level so it is still very appealing. For example, the Miyota multi-function automatic is a really, really high quality movement and it’s also an attack on the Swiss watch industry. Because it used to be that, if you want an automatic you need Swiss that’s actually the “better” movement. Now you can see Japanese quartz are in a lot of cases, better than the Swiss quartz. It has less deviation and less problems. And now Miyota’s making automatic movements that are at a completely different level. If you look at the multi-function automatic, it’s super high quality. So it’s a really high quality movement and we’re definitely exploring that more and more in our higher range products.
I personally see that with the way you’ve run the business and the way that you’ve been able to grow it so fast and so well, I think you’ll be able to find a particular niche at the higher price segment that will satisfy mechanical watch lovers.
Now we have quite a range of automatic pieces just in three hands or in multi-function and they do really well, and there’s definitely a big market for that. We try to just offer something for everyone – from certain styles, to having it Swiss-made.
What is your current price range now?
In US dollars it’s starting between USD400 to USD1500. That’s the core range.
So will TW Steel always remain in this range?
Yes. I always say never change a winning team. There’s a lot of brands that made the mistake of going from a certain price point because the brand is strong and all of sudden go up. But this is where we are strong and this is where we fit best. A lot of our partners were concerned with bringing out more and more editions at a certain price point but it’s not like we take the same product and make it more expensive. We choose more expensive materials but still, for the last two years we’ve introduced a lot of products on the more affordable price point level which shows that we’re not going away from where we came from. We still respect that area as well. We just want to hold that price bracket and we want to own it.