Although pessimism is rife among Swiss watch industry executives, there are reasons to be optimistic. Demand is picking up, especially in China. Brands, even traditional ones, are seeing the benefits of omnichannel. Luxury brands are shifting to the lucrative pre-owned segment. The industry as a whole realises the importance of sustainability and ethics across its entire value chain.

The Swiss Watch Industry Study 2020 is based on a survey of more than 55 watch executives and 5,800 consumers living in China, France, Germany, Hong Kong, Italy, Japan, Singapore, Switzerland, the United Arab Emirates, the United Kingdom and the United States.

85% of watch executives forecast a grim outlook for the industry in the year ahead.

Key findings

Hover over one of the watch segments to find out more

COVID-19 hits the industry hard

Over 80% of industry executives forecast a grim outlook for the industry. The collapse in global tourism due to travel restrictions, a drop in domestic demand due to the lockdown and cautious spending habits are having a direct impact.

More than just the pandemic

54% of executives said external factors such as protests in Hong Kong and France, and political uncertainty from Brexit, the US-China trade war and upcoming US elections will have a negative impact on the industry. Weaker foreign demand, softening domestic demand, and a strong Swiss franc continue to pose significant risks to the industry.

'Consumers first'

Over 70% of Swiss watch executives believe that offline distribution channels will continue to dominate digital ones. Over 60% of watch brands are prioritising their omnichannel strategy. Executives are looking to enhance the in-store experience with experiential brand experiences, a mobile-driven workforce and mobile apps.

Smartwatches

62% of watch executives said the industry missed the boat with smartwatches. However, 60% of consumers would wear either a traditional watch or both a traditional and a smartwatch, a positive sign that consumers are not fully digitalised with their timepieces.

Pre-owned watches

Watch executives mention pre-owned watches most often as the ‘next big thing’. One-fifth of consumers are likely to buy a pre-owned luxury watch in the next year, a proportion that is likely to increase with the shift to selling via digital channels, online auctions and dedicated pre-owned spaces in retail locations.

Sustainability

Nearly 90% of the executives believe that sustainability and supply chain transparency are important for the industry, and over 50% of consumers surveyed consider sustainability when purchasing a watch. Greater transparency is being driven by changing consumer demands, the company itself, and the media.

Industry highlights

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Karine Szegedi

Managing Partner

+41 58 279 8258

kszegedi@deloitte.ch

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Jules Boudrand

Director

+41 58 279 8037

jboudrand@deloitte.ch

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