As smartwatches grow in prominence, traditional watchmakers are working to stay relevant.
While luxury watch brands such as Piaget and Cartier continue to thrive in the top tier market, lower-priced watchmakers—those that sell in the sub-$500 market—are struggling. Swiss watchmakers are typically revered around the world, but have toiled the most to stay top of mind with consumers despite a steep drop in demand. Cultural events have impacted the watch market as well, including the Hong Kong protests, and more recently the Coronavirus pandemic—these events have left the lower end of the watch sector vulnerable.
Changes began taking effect after Apple released its first Apple Watch in 2015, selling for $349. The Apple Watch has continued to splice the sector as the brand released additional versions of the watch in the five years since. It’s not only smartwatches, however, that have decreased the desire for traditional watches—smartphones have also changed consumer mindset. In fact, 74% of adults in the UK agreed that smartphones have rendered classic watches unnecessary.
Despite these changes in consumer preferences, a few smaller brands have managed to stand out in the reasonably-priced watch market. Particularly in the direct to consumer segment, Daniel Wellington and Uniform Wares have found great payoff from their brand marketing efforts. Minimalist designs, premium branding, and persuasive digital influencer partnerships have helped these brands differentiate themselves from legacy watch brands, like Swatch. Luxury watch brands, on the other hand, have been slower to adopt digital efforts, according to a Gartner report on the topic.
As smart devices continue to modernize, the Swiss watch industry will have to continue to refresh its image and products. Utilizing social media to spread brand awareness, as newer watch brands tend to do, could lead to renewed consumer engagement.