08/2023

This statement has been adopted by several managers in the watch industry, and probably will end up being a dominant future slogan in the market. What does it mean? Simply put it, the time has come that the consumers, especially in the “high-end” watch market, should be officially separated in two major categories.

The first segment includes those who “know” that sometimes what you see is not what you get. There are many flashy complicated watches in the market, but their real value is rather questionable. There are those who are impressed in their presentation admiring their design and functions, and there are those who think how doubtful is their reliability and how unclear is their guaranty. It is a matter of knowledge and experience that helps someone to understand that a top quality luxury brand that produces several dozens of thousand watches per year is subjected to certain questions. How many watchmakers does she need for this volume of business…? Where did she found all these experienced technicians…? How much time does each one of them spends on a careful assembling…? Have these watches being properly tested before delivery…? What about servicing all these pre-owned watches in circulation…? At the very end those who “know” question even the type of consumers of such brands, and they do not like seeing historical names ending up selling mass production items to people who buy them in the same way they purchase shoes and clothes. This is why those who “know” prefer small independent watchmakers turning their back to the general market orientation.

The second segment includes those who do not care to “know”. They are interested primarily on two things, the brand name that will impress those around, and the price tag that will satisfy their ego. If it proves a good investment even better. The luxury and hyper luxury market love these affluent-ignorant consumers who look for in-house manufacture complicated mechanisms on large impressive cases that will end up in a safe box! These new generation collectors have shaped the market during at least the last decade and keep going turning some traditional names to … fashion brands! The truth is that the luxury brands who sell more than 10,000 watches per year could not ignore this type of customer, for surviving in the long run, otherwise they need to scale down and completely change their strategy. At the very end, an stablished brand is marketing driven in order to sustain its operation and save its valuable intellectual capital.

The bottom line is that this separation of consumers, sooner or later, will hold true for the brands as well. Pick up your type of customers end re-establish your name accordingly. Get the influencers you deserve and move along the way your “successful” CEO and your “happy” shareholders have decided to follow. The market has reached a crash point, for those who know!

GS