Swiss watchmakers – An industry ripe for a shake-up(economist.com)
economist.com
Swiss watchmakers – An industry ripe for a shake-up
http://www.economist.com/news/business/21571943-industry-ripe-shake-up-time-money
8 comments
I went to Basel World in 2006 as part of a day trip, which is the huge Swiss watch exhibition they hold yearly in Basel. I'm not really into watches, but Swiss Rail sold a nice day trip package so what the heck, right?
All watches there were like $50K+, lots of Chinese and Arab buyers, I found it kind of crazy. They really are selling an image, and its something the Shanzhai copiers can't really provide. They also had part exhibitions, which I though were the most interesting part of the show; these are buildings that just specialize in watch part, many of them from Chinese vendors; tons of crazy stuff for watches that made me feel like I was in Akihabara.
I find watches to be kind of archaic, but I never really "got" them. I think disruption will come more from finding a better use for wrist real estate then making some sort of abstract fashion statement. An iWatch (assuming its useful) would be something to watch in that area.
All watches there were like $50K+, lots of Chinese and Arab buyers, I found it kind of crazy. They really are selling an image, and its something the Shanzhai copiers can't really provide. They also had part exhibitions, which I though were the most interesting part of the show; these are buildings that just specialize in watch part, many of them from Chinese vendors; tons of crazy stuff for watches that made me feel like I was in Akihabara.
I find watches to be kind of archaic, but I never really "got" them. I think disruption will come more from finding a better use for wrist real estate then making some sort of abstract fashion statement. An iWatch (assuming its useful) would be something to watch in that area.
I actually started wearing a watch regularly a couple of years ago after thinking a cellphone was enough for a long time.
There are a couple of advantages: it looks good (maybe the only male fashion accessory acceptable in a conservative professional environment besides a wedding band), and also it much easier to glance at and allows me to not check my phone throughout the day--especially helpful in conversations and meetings where it'd be rude to pull out your phone.
There are a couple of advantages: it looks good (maybe the only male fashion accessory acceptable in a conservative professional environment besides a wedding band), and also it much easier to glance at and allows me to not check my phone throughout the day--especially helpful in conversations and meetings where it'd be rude to pull out your phone.
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I own a few Swiss, German, Japanese and Chinese watches, including some with the ETA movements mentioned in the article.
But the high end remained, because men's fashion is about storytelling, and the story goes like this: This highly precise, beautiful timepiece that you are wearing around on your wrist is put together by hand, powered by what amounts to a crazy microscopic wind up toy, and is a prime example of craftsmanship and mechanical engineering.
The very fact that it's not as precise as a $2 quartz watch is the whole romance of it. Sure, I could use the inelegant solution, but I'd rather have the cool solution.
When people make adders and ARUs in minecraft, we clap and say well done! The inelegance and extraneous effort is itself the appeal.
But the high end remained, because men's fashion is about storytelling, and the story goes like this: This highly precise, beautiful timepiece that you are wearing around on your wrist is put together by hand, powered by what amounts to a crazy microscopic wind up toy, and is a prime example of craftsmanship and mechanical engineering.
The very fact that it's not as precise as a $2 quartz watch is the whole romance of it. Sure, I could use the inelegant solution, but I'd rather have the cool solution.
When people make adders and ARUs in minecraft, we clap and say well done! The inelegance and extraneous effort is itself the appeal.
I absolutely agree with you. It's the story that adds to the fashion appeal, but also the mechanical beauty of an automatic or hand wound watch. In such a digital age where time is so easily tracked with batteries and cell towers, there is something incredibly appealing in a mechanical watch.
I wonder why they didn't mention the Japanese watch market more. I've been noticing watches that used to have ETA movements move to Miyota movements and sell for half price. It even prompted me to recently consider the purchase of a Breytenbach with an ETA movement because so many of their watches are now coming with Japanese movements. The crazy thing, though, is that Japanese movements are practically flawless, I just want the ETA because I know they are going to become rare... Well, that and they feel more solid when worn, but that could just be marketing and the Swiss mystique working on my senses.
I wonder why they didn't mention the Japanese watch market more. I've been noticing watches that used to have ETA movements move to Miyota movements and sell for half price. It even prompted me to recently consider the purchase of a Breytenbach with an ETA movement because so many of their watches are now coming with Japanese movements. The crazy thing, though, is that Japanese movements are practically flawless, I just want the ETA because I know they are going to become rare... Well, that and they feel more solid when worn, but that could just be marketing and the Swiss mystique working on my senses.
Put them out of business with a beautifully designed, responsive HTML5 time app. Paying users can even have different timezones, and maybe a day-/ nighttime animation with earth circling the sun!
scnr
scnr
Whatever you think the future of timepieces, there are few other objects that hold such palpable, visible evidence of both cleverness and craftsmanship. The most exciting bit about it is that though we don't currently have a large-scale watchmaking industry in the United States, there is some entrepreneurial effort to change that:
http://shinola.com/
http://www.hagerwatches.com/page16/index.html
http://shinola.com/
http://www.hagerwatches.com/page16/index.html
What's interesting is the total revenues. Multiplying price by units sold, Swiss watchmakers sold $20B, and China + HK sold $9B worth of watches [1]. Also, margins are probably higher on the Swiss ones (as Asian watch buyers are typically more price-sensitive, there is more price competition).
[1] https://docs.google.com/spreadsheet/ccc?key=0An1kIBUYv_3ndDN...
[1] https://docs.google.com/spreadsheet/ccc?key=0An1kIBUYv_3ndDN...
> Swiss watchmakers – An industry ripe for a shake-up
Quick, quick. Someone, start selling luxury watches $5 a pop. That'll show 'em, pesky cheese-eaters!
Quick, quick. Someone, start selling luxury watches $5 a pop. That'll show 'em, pesky cheese-eaters!
Swiss watches are (mostly) a male jewelry a status symbol to tell others how much money you have, they are not about telling the time.
THE average Swiss watch costs $685. A Chinese one costs around $2 and tells the time just as well (see chart.) So how on earth, a Martian might ask, can the Swiss watch industry survive?
The average Coach bag costs $500+. A Chinese one costs around $12 and holds your junk just as well (see chart.)So how on earth, a Martian might ask, can Coach survive?
The average Coach bag costs $500+. A Chinese one costs around $12 and holds your junk just as well (see chart.)So how on earth, a Martian might ask, can Coach survive?
Coach bags are made in China since 2009 and the price actually went up when they moved production there.
Coach bags are made in China since 2009 and the price actually went up when they moved production there.
so is the Apple iPhone, but no one (maybe other than some economist) calls them Chinese.
so is the Apple iPhone, but no one (maybe other than some economist) calls them Chinese.
Your hypothetical Martian appeares to be an instinctive egalitarian, for whom conspicuous displays of disposable income provide no socially-differentiating benefit.
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So now it's really a fashion statement, and you've got fashion houses like Gucci selling quartz watches at 200+. If I were a betting man, I'd bet the fashion watch world is where the money is at. Nobody is getting SUPER rich selling 10 watches a year at 20-50k. They're making bank selling a $5 quartz movement at $400 to millions of people a year.