Exclusive face-to-face events were once some of the most hotly anticipated dates in the watch industry calendar. Customer service was also person-to-person, between the client and the sales assistant; a white-glove experience as luxurious as the watches themselves. Since the Covid-19 pandemic, from watch fairs to shopping, retail has been turned on its head. So, how are digital solutions replacing these important physical experiences? We take a look at how “New Normal” is shaping up for the watch industry, and ask whether the future of retail lies in digital.
As an industry perceived as obsessed with heritage and tradition, watchmaking has been slow to embrace digital innovations. Now Covid-19 could push watchmakers online. Bain & Company predicts that online channels could represent up to 30% of the market in 2025, up from 12% at the start of 2020. A majority of brands has started selling online. Patek Philippe even allowed retailers to sell online briefly in March, while others have crafted more robust online offerings, such as Piaget’s online salon: a VR experience that allows shoppers to virtually browse and discover its watches. IWC joined the digital revolution by creating an Augmented Reality viewer that uses a QR code to have the watch appear before your eyes. It’s a novel and immersive way to look at watches, but it also reminds us what AR can’t show: the feel of the watch and the finish of the materials.
As lockdown and social distancing moved physical events online, Watches & Wonders was one of the many initiatives rolled out this year. Its digital platform features content from leading industry figures, photos and videos of new products by the 19 exhibiting brands, and private presentations for retailers. Additionally, the digital format takes the event to a wider as well as a younger audience, now an important demographic beyond the traditional public of retailers and media professionals.
Auctions are also making the digital transition. Online bidding is nothing new, but was generally reserved for less expensive lots, while big-ticket items such as timepieces would be auctioned-off in person. “New Normal” has incited auction houses to adapt faster to a digital way of life. Sotheby’s reports that 25% of its sales in 2019 were made online. Christie’s notes that 64% of its global clients bought or bid online in 2019. This spells a promising future for online auctions. However, they too have their limitations as physical contact with the object, as well as the atmosphere and excitement of the saleroom, are harder to replicate online.
The pitfalls of e-commerce
AR, VR and other virtual experiences can transport you to new worlds, show you products in detail and even put them virtually on your wrist, but some things don’t have a digital equivalent. Gauging a watch’s weight and fit, seeing how it feels on the wrist, are an important part of the overall experience. For many buyers, nothing can replace the pleasure of choosing and trying a watch in person. This, and the excitement of leaving the store with a masterpiece in your bag, are what many are hoping will keep brick-and-mortar shops in business as they safely reopen their doors.
A further pitfall of a more digitally focused retail environment is that it leaves the door open for rogue websites trading in fakes. A report by the OECD and the EU’s Intellectual Property Office states that in 2019 counterfeit and pirated goods accounted for 3.3% of global trade. The closure of physical stores, which maintain a controlled inventory and the paperwork to go with it, has allowed unauthorised retailers and untrustworthy independent sellers to take advantage of the increased number of people shopping online. Solutions that verify the authenticity of products have a key role in the online marketplace, as growth in the certified pre-owned market demonstrates.
The pandemic has touched almost every corner of our lives, even those so steeped in history that any type of change seemed unlikely. It has shown that retailers and event planners must become more agile and develop digital Plan Bs that tick as many boxes as physical experiences, and more. Online events such as Watches & Wonders have reminded retailers that there is a case to be made for online experiences, and less exclusive ones. As burgeoning technologies such as AR and VR go mainstream, unprecedented opportunities arise to interact with watches online and reach new markets. The fashion industry was among the first to advocate fewer in-person events, originally for environmental reasons and now in response to Covid-19 safety measures, and it’s likely we will see this replicated not only in the watch sector but other luxury markets as virtual options highlight how, in some instances, in-person should no longer be default.