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AP House: a revolutionizing retail channel?

Traditionally, luxury brands are known to have wonderfully crafted and elegant boutiques that are made to impress and serve as a display of the brand's core vision. Audemars Piguet, the famous watch manufacturer from Switzerland, is no exception to the rule. However, in the last few years, the company developed a new concept, a new way of doing luxury retailing: the AP Houses.

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The rise in technology and the post-pandemic period have made the need for innovation and differentiation more important than ever. A major challenge facing the luxury industry is to be able to provide the same value through different retail channels, without losing the essence of luxury. The concept thought by Audemars Piguet, enables customers to experience a new retail experience while giving them a new viewpoint on the brand and products.

 

The AP Houses are not boutiques, they are luxurious and modern private apartments themed around the brand. These apartments, located around the world, are equipped with a professional cuisine staffed with a chef, a bar, a salon and a dining room. The concept is that the AP Houses can be used for a variety of events organised by Audemars Piguet, but they can also be booked by AP’s most important and valuable clients to organize private events. This is a clear departure from traditional boutique and is a real innovation in customer experience and retailing.


 

The concept of AP Houses caters to the features of luxury primarily by the fact that it appears to be an own brand store. This has the advantage of establishing a social and emotional bond between the customer and the brand, which is crucial for a luxury brand. This goes way beyond a seller-customer relationship; the goal is to make the customers feel as if they were relatives meeting and having fun all together while being immersed into Audemars Piguet’s universe.

We wanted to create a sense of comfort, intimacy and belonging for our family of customers.

By Michael Friedman, AP's Head of Complications

Furthermore, an AP House allows the brand to highlight their products and brand's image in the best possible way. Indeed, Audemars Piguet retains complete control over the image they choose to project their values, products, and meaning. It is worth noting, for example, that the colors and materials used, as well as the furniture and lighting are chosen to be in harmony to faithfully recreate the Audemars Piguet look and feel.



AP houses are meant to provide great service to the customers rather than generate direct sales, which can get tricky when thinking about brand’s purpose. Indeed, although customer service is important, it is fundamental for a brand to stay focused on its reason to be and not to diverge. Nevertheless, it appears that a visit frequently comes along with the purchase of a new watch, and a client who stays there has a higher willingness to pay after their stay. Furthermore, margins are higher since AP doesn’t have to split any profit from a transaction with an authorized dealer or franchise partner.

Customers spend three to four times more in AP Houses

By CEO François-Henry Bennahmias


Will the AP Houses be the pioneers of what will be a new channel of the luxury industry? Only time will tell… However, after surviving a pandemic, this is certainly not a hypothesis to exclude. Indeed, we live in a society where people constantly want to experience new things, feel emotions, and share with the people they love, which is all covered by AP Houses. Additionally, this new concept provides a way to get closer to the end-customers and to build a strong relationship, allowing companies to adapt their strategies and better respond to clients’ needs through their feedback.



References


WT, 2018. Une AP House à Hong-Kong. [online]

Available at: https://fr.worldtempus.com/article/industrie-news/boutique/audemars-piguet-une-ap-house-a-hong-kong-25787.html


Cordon, R., 2021. AP House concept encourages customers to spend four times more. [online]

Available at: https://www.watchpro.com/ap-houses-encourage-customers-to-spend-four-times-more/


Wallpaper, 2021. London’s Newly Opened AP House Immerses Visitors into Audemars Piguet’s Cultural Universe. [online]

Available at: https://www.wallpaper.com/w-bespoke/audemars-piguet-ap-house-london


Vella, D., 2020. Barcelona’s AP House immerses visitors into Audemars Piguet’s timeless creation. [online]

Available at: https://one.listonegiordano.com/en/architecture/audemars-piguet-barcellona/


FHH Journal Editors, 2018. Audemars Piguet cuts the ribbon at its AP House in Asia. [online]

Available at: https://journal.hautehorlogerie.org/en/audemars-piguet-cuts-the-ribbon-at-its-ap-house-in-asia/


Danziger, P.N., 2019. 4 Major Challenges Facing The Luxury Market In 2020, And Opportunities For Brands That Lean Into Them. [online]

Available at: https://www.forbes.com/sites/pamdanziger/2019/12/20/4-major-challenges-facing-the-luxury-market-in-2020-and-opportunities-for-brands-that-lean-into-them/?sh=525a9ba8176d

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