Swiss watch exports in sharpest fall since financial crisis (Financial Times) — Swiss watch exports fell 9.9 per cent last year, their sharpest drop since the financial crisis, as big markets such as Hong Kong and the US continued to shrink.
Swatch Group is suffering from decreased sales and profits while accruing massive inventory levels over the past few years. The company has recently identified non-specific opportunities for growth in 2017 that seem to have little chance of loosening the quickly tightening belt. While Swatch Group’s self-projected sales growth would be nice, growing inventory levels are something that cannot be ignored. This should leave all of us wondering Is Swatch Group being realistic? Here is my op-ed analysis.
The watch industry is a very complex environment. While it is fascinating in the sense that it thrives off selling obsolete mechanical watches, it continues to baffle many watch collectors. I’ve assembled a simple analogy for the industry. This analogy includes the classic brands as well as the newer prestige brands entering the fray, and also micro brands. As an owner of both traditional Swiss watches and micro brands, this analogy brings both into perspective for me. The analogy starts down a road directly to my heart — food…
“It’s Complicated”: The American Watch Industry, Federal Trade Commission, and Claiming “Made in America”
Made in America claims in the watch industry have been elusive. Claiming anything is made in America is very difficult and costly in today’s global economy. The US has an “all or virtually” all parts made in the US requirement. Recently, many American watch companies have been rebuffed by the Federal Trade Commission for misleading claims. Watch companies claim the FTC guidelines are vague and put American companies at a disadvantage. To get to the bottom of it, I interviewed the FTC’s lead attorney for enforcement as well as two of the only American watch companies currently making Made in America claims.
It’s that time of year where the Richemont-hosted Salon International de la Haute Horlogerie (SIHH) is over and onto Baselworld (primarily a Swatch-oriented event). SIHH featured some pretty neat watches, especially tourbillons, and a lot of watches made with non-traditional materials. Yet, what was offered seemed unattainable; a celebration of the unattainable in a year that consumers are spending less on watches and sales are cratering.
Watch price increases seem like they have been out of control. In this article, I resort to some basic principles of economics to look at the watch industry and analyze just how much prices have increased, specifically for Rolex. I have repeatedly said how fascinating the watch industry is — in this case, even exchange rates and inflationary adjustments across borders become interesting. I’ve broken these concepts down into digestible bits that bring these concepts from your Economics 101 class into perspective.
This is Article 4 of our 4-part series on Design & Innovation. TAG Heuer Monaco. Rolex Submariner. Omega Speedmaster. Breitling Navitimer. Hamilton Ventura. Audemars Piguet Royal Oak. Lange 1. Over the previous 3 articles, I have argued why design is the only realistic hope the watch industry has to draw new consumers and shift preferences. I explained why the heavy investment in new movements, in-house movements, and material science are neat but don’t have the power to actually draw new consumers. Finally, in the previous article, I explained what makes a watch icon and why icons have defined watch history and encouraged watch companies to turn towards design to make new icons. In this final article, I’ll write about the watches that were icons and what them an icon, showing how much of that focused on design. These weren’t icons because of some massive revolution in them telling time better, or some genius new material. They were icons because of design. And while these designs continue to capture consumer imagination, it’s time for another bold step in design from the watch companies. Who will make the leap?
Here is a round-up of the latest watch industry news:
Watchmakers hope for Trump economics rally (Financial Times) — US president-elect has proposed policies that could cut red tape and boost sales.
This is Article 3 of a 4-part series on Design & Innovation. Rolex Submariner. Audemars Piguet Royal Oak. Patek Philippe Nautilus. Heuer Monaco. Hublot Big Bang. Hamilton Ventura. Gerald Genta. Jean Claude Biver. These names all share a special bond that few others deserve to be associated with. These people or companies/designs took risks to make something new, something bold. Yet, despite great examples, very few watches or designers today introduce bold new watch designs that are a risk to any watch company.
This is Article 2 of a 4-part series on Design & Innovation. Design is the last meaningful frontier for watch innovation. The rest of the moves towards in-house movements, new materials, and new movements are all tilting at windmills and are being propped up by marketing. In this article, I will explain why most of the luxury watch industry is ’tilting at windmills’ with in-house movements or new material research and surviving off a marketing machine that isn’t sustainable. In the follow-up article I will cover some of the iconic and bold watch designs of history, and explain why design is literally the last frontier. You can read the first article of this series here where I introduced the concept of bold design being a chance to shift consumer preferences.
This is Article 1 of a 4-part series on Design & Innovation. What does it take to shift consumer preferences? A lot. My marketing professor used to always say “never underestimate the customer’s reluctance to change.” In today’s watch industry, many classic watches designed 50+ years ago continue to fascinate consumers and define expectations in watches. Yet, many of these companies are not exactly innovative either. While some see classic design, critics see lack of innovation. People naturally look to innovation in the mechanics of the watch, but this is hard to do and consumers can’t notice the changes. I will present a case for why design is the next revolution in the watch industry, and has a chance to shift consumer preferences back to the mechanical art.
The watch industry is one of the most fascinating industries out there. Many people assume a watch is a watch — it tells time. That is a fact. This is why in 2017, I plan to explore industry topics that fascinate me. I will explain why the industry is a fascinating one, and why any business school or economics course could write a whole curriculum about the watch industry and cover just about every topic. Finally, I let you know what you can count on from Watch Ponder this coming year.
This is my review of the most inspiring micro brand watches (producing <300 watches annually) that I’ve had a chance to take a look at in 2016. These are not endorsements, rather a nod to things these companies have done. This is not an exhaustive list — there are quite a few out there and this list is a small sampling of those I have been most impressed with this year. I can’t speak for pricing or value, just for the fact that they have done something unique or “cool” from an entrepreneurial perspective.
How the Swiss became the best watchmakers is based on a series of choices and fateful shifts. What could reshape the watch industry again? We look to the history of the watch industry to find out.
I discuss the current problems in the luxury watch industry and make company-level recommendations for improvements in 2017. It is a business analysis of the industry.