The ongoing question of who can win the battle between luxury Swiss watches and modern Smartwatches continues to overshadow many of the leading players, meaning no time to relax for luxury Swiss watchmakers, as they meet the challenge head on.
In a market where prestige and extravagance were the driving force keeping the market buoyant, things are changing. In previous years China has been a major driving force behind exports which have now dropped for a second consecutive year as Chinas` collective belts are tightened.
This all means the Swiss watch market needs to and is actively changing their approach in an ever-changing marketplace to better reflect the opportunities presented to them.
This is happening in a number of ways, such as big brands “broaden their luxury market entry point” to attract a wider buying public into space. This offers their latest and greatest pieces alongside some more affordable entry level pieces.
Good examples of this were present at this year’s SIHH trade show where Parmigiani Fleurier and Baume & Mercier both entered the entry-level market, aiming to fill a potentially huge market space.
That’s not to say these entry level pieces are something to be sneered at, on the contrary, these are nice timepieces based on the top of the range models but, toned down to fit the entry level price point. One such example at this year’s SIHH was the renowned watchmaker Parmigiani Fleurier whose pieces demand and an average price of $29000, have entered the market with the Tonda 1950 in Steel for something under $10000.
The original Tonda 1950 came with a number of dial options in a 39mm white or pink gold case, with the exception of a titanium limited edition. The case housed their own in-house ultra-thin, micro-rotor, calibre PF701 movement produced by their sister company Vaucher, offered at a starting price upwards of $15,000.
The new offering in steel is slightly larger at 40mm diameter but the shape remains the same as do the alpha-shaped hours and seconds hands in polished steel with embedded luminescence. The dial which is so similar I can’t see the difference is available in black or silver on a leather strap. This piece combines Dress watch simplicity and subtlety of design to bring you a refined piece perfect for black tie or day suit wear.
The most satisfying thing is the knowledge the beat heart of the steel Tonda 1950 is the very same as in the original gold editions, so you really do have a full blown Tonda 1950 in a steel case for a very reasonable $9000.
Baume & Mercier
Not to be outdone by the competition other watchmakers at SIHH were also showing off their entry-level pieces. A fine example is Baume & Mercier introducing the new Classima collection with prices starting at 950 francs or $954 at the time of writing. Clearly, Baume & Mercier are making a supreme effort to enter the otherwise ignored lower level entry point making this collection the least expensive and more easily accessible timepieces at the show.
The Classima 10214 is a lovely piece designed to offer the option to wear a fine watch through your entry level years rather than just dreaming about it. With the easy price tag, you get the real Baume & Mercier experience.
The stainless steel case is perfectly sized to fit under the cuff but shiny enough not to get lost in its surroundings. Housed in the case is an opaline silver dial with Roman numerals raised on the perimeter and Blue feuilles hands.
Beneath the dial lives the automatic heart born from the SW200 movement that Baume & Mercier modified with their own details, such as their rotor giving the second hand a smooth sweeping action, and a 38 hours power reserve. In terms of a true Dress watch, it’s a little showy, but still subtle enough to get away with it.
Look at the deals you can find on the Baume & Mercier Classima collection today, from $849.00 with 37% off.
So it’s all good news for everyone wanting to own a top end watch without the top end price tag, but the big question is whether the cut-price entry level models will end up devaluing the brands. This could easily make the products less attractive to those who can afford the top end goods, but the jury is still out on that one, and only time can tell.
What we do know, is doing nothing is a dangerous proposition when exports by Swiss watchmakers have fallen by 9.9% in 2016 alone. This represents the largest drop in seven years if the Federation of the Swiss Watch Industry has got their number right.
We all live in a global economy and we see the largest single factor in its decline is a slump in sales in the Chinese tourist market. Such is the fear surrounding the fall in the China market it’s `all hands on deck` to rescue an industry in decline, and this year the rescue plan included opening the trade show to the public for the first time.
It maybe we see more and more big names following suit to enter this space as the Richemont Group, the holding company behind a number of well-known watch brands including the likes of Baume & Mercier, Cartier, Piaget, Vacheron Constantin, admit a decline in profits for 2016, and a downsize of its workforce.
With the slow down on luxury sales perhaps a new market space can be carved in the entry level space to save the industry as it recovers, or maybe the prolonged attack by Smartwatches deals a death blow, or perhaps just fades away. Nobody really knows yet.
If this all leaves you feeling negative then take comfort in the words of chief operating officer of Greubel Forsey, high-end watchmaker, David Bernard. He said in a recent interview “the company is a watchmaker and there was no future in devices that hinge on digital technologies”.
This is an interesting view when you consider that some of the main players such as Omega, Rolex, and Tag Heuer all entered the digital world with their crossover models, but it all goes to show one thing. Nothing is certain in the world of commerce.
We can guess, we can make assumption and predictions, but the only reality is the one that unfolds over time as the market adjusts to its many pressures and influences. This includes the mood of it`s buying customers.
On the other side of the same coin, we have a totally different approach by a Swiss giant in an attempt to beat technology at its own game. I am not personally convinced this a realistic approach, but Vacheron Constantin has certainly made a grand statement releasing the Celestia Astronomical Grand Complication with 23 complications. Their aim being to build a mechanical watch that can compete against the microchip. Well, good luck with that.
For more information about where to look for your favorite watch brand why not read my watch store reviews to get a better idea where to look?
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