When Apple introduced its eponymous smartwatch in 2015, there was plenty of hand-wringing and introspection in Swiss watchmaking. Some feared that the Apple Watch and its peers would erode Swiss market share in wristwatches, others dared even to be more apocalyptic, wondering if smartwatches would bring a repeat of the 1970s Quartz Crisis that killed the Swiss watch industry.
None of that came to pass. The luxury watch industry is indeed in the midst of a crisis, one that was brought on not by Silicon Valley’s inventions but its own actions. Watchmaking’s reliance on booming Chinese demand was lucrative until it wasn’t, resulting in luxury timepieces being too numerous and pricey for the rest of the world.
Nonetheless, to prepare for the smartwatch tsunami that never came, Swiss watchmakers attempted to compete with their own connected watches. Those ranged from traditional-looking timepieces with analogue hands to indicate smartwatch functions, to true-blue connected watches with touchscreens. Tag Heuer is arguably the most successful at the luxe smartwatch, claiming to have sold some 60,000 of them last year.
But smartwatches are still a minuscule fraction of the fine-watch business. At Tag Heuer, smartwatches are perhaps 10 per cent of output. With that being the case, watchmakers should focus their efforts on innovation in their core products, namely mechanical watches.
The innovation that is needed is not the grandiose sort involving complications that cost more than a house – too many of those are being made – but, instead, in the category of affordable watches. Watches that cost under $5,000 or $10,000 should be made better, either technically – in terms of more practical functions or superior timekeeping capability – or aesthetically, with more elaborately finished dials, for instance.
A good example is German watchmaker Nomos, which makes appealingly finished movements packaged inside tidily minimalist watches for low prices, making it a favourite of aficionados. Despite being relatively small, Nomos grew in popularity by doggedly sticking to a focused range of products, incrementally improving them year after year – for 20 years.
Longines manages to offer affordable, vintage-inspired timepieces with upgraded stock movements, but by virtue of the fact that it’s a behemoth producing over a million watches a year, with accompanying economies of scale.
Sometimes it doesn’t take decades or company size to produce a success. IWC’s redesigned Da Vinci launched last month is round and classically styled, a departure from the adventurous but poorly received barrel-shaped model it replaces. But it’s been well received by the trade and press, being a handsome watch at an acceptable price. Watchmakers would do well to keep this in mind.
Read more of Su Jia Xian’s incisive commentary at his website, WatchesbySJX.com.