In a bolt from the blue, on March 16th businesses and retailers across Switzerland followed government directives to prevent the spread of coronavirus and shut up shop. Already hit by a decline in sales in Asia, watch brands were forced to pull the plug – literally – at their production facilities for an indefinite period. A first in the industry’s modern history. The excitement and anticipation of 2020’s big reveals faded as the major international gatherings were cancelled one after the other, starting with Watches & Wonders then Baselworld. With industry observers already predicting a lasting transformation in consumer behaviour, with sustainable luxury and pre-owned benefitting, one thing is for sure: the crisis will accelerate the role of digital, illustrated by the online initiatives launched, in the eye of the storm, by brands and event organisers.
Export figures for March (-22% in value; -43% in volume), just published by the Federation of the Swiss Watch Industry, are a reflection of the state of the global market. The numbers for April are expected to be even worse. According to a report by Boston Consulting Group, luxury sales could plummet by at least 65% and as much as 80% over March and April 2020. A number of brands have already decided not to launch their spring collections, no doubt preferring to wait for what they hope will be brighter days to come.
Having only ever sold its watches in person, at end March Patek Philippe announced it was authorising online sales.
Watch brands had to respond… and not always in the way we might have expected. Patek Philippe is a case in point. The brand, which has only ever sold its products in person, took everyone by surprise with the announcement, at end March, that it would allow its authorised dealers to sell its watches online. An official statement declared that, “During this extremely difficult time, an exceptional decision was taken to allow authorised retailers, while their showrooms were closed, to sell online Patek Philippe watches they have in stock. This exceptional and temporary measure to help Patek Philippe authorised retailers that are closed due to the Covid-19 situation will come to an end on May 1st.” This was something of a revolution for the firm, established in 1839, which continues to favour a network of retail partners over own-name stores. Asked whether this was the first step towards a more marked transition to digital, the brand declined to comment.
Others are more forthcoming. At end April, Omega rolled out its new European e-commerce site. Already up-and-running for the United States and United Kingdom, this new platform from the Swatch Group brand is open to customers in Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Italy, Lichtenstein, Luxemburg, Netherlands, Norway, Sweden and Switzerland. Coincidence or not, this latest stage in the brand’s omnichannel strategy couldn’t have come at a better time. Omega plans to extend the initiative to more countries in the near future.
Not that digital is for the big guns only. Less ambitious but certainly original in its approach, since the start of the pandemic, HYT has been live on Instagram. Fans can listen to CEO Grégory Dourde in conversation with specialist media such as Portuguese watch magazine Espiral do Tempo or Qatar Watch Club. All the podcasts are available on Spotify or Apple Music. Elsewhere, Louis Moinet used its website to host the brand’s Discovery Days, which ran from April 30th to May 5th. “The world is going through difficult times, and during this period, Louis Moinet is offering a chance to explore its historical and creative values,” wrote brand boss Jean-Marie Schaller. “This is an artistic rather than a commercial approach addressed to the whole world while staying at home.” The “discovery” took in an Intergalactic Trilogy describing the brand’s creative universe, a Black Book narrating its history, and a virtual museum.
Digital Watches & Wonders
This idea of an online watch fair took on a whole other dimension with Watches & Wonders Geneva. Previously SIHH, it should have been held in Geneva this April 25th to 29th but was cancelled on February 25th. Faced with this gap in the calendar, the event’s organiser, Fondation de la Haute Horlogerie, decided to fast-track the platform’s digital launch. Opening on what would have been the first day of the original event, watchesandwonders.com features pages for each of the thirty participating brands where visitors can view the newest releases, completed by a series of “insider views” presented by the FHH. The platform will be a permanent fixture, with more content still to come including analyses, reports and business talk. It will be joined by physical events in Geneva and other cities.
Lockdown and closed retailer doors have boosted online sales of mass-market products, that much we know. Whether the same applies to luxury has yet to be proven. We can, however, say with some certainty that online initiatives introduced during the pandemic will carry on beyond the coronavirus crisis and even expand; an opportunity for the watch sector to catch up its digital deployment.