https://www.bloomberg.com/news/arti...ts-suffer-biggest-monthly-drop-in-seven-years

 

Fewer people need watches with smart phones.
Plus Asian slowdown.
Add to that significant price inflation and you have shrinking demand.

The other factor is the internet and the grey market. This has resulted in more price transparency but undercuts full retail pricing and the associated margins.

 

Don't forget the vintage market too!

 

Their sales have been dropping too.

Do many people on here have Smartwatches? I have no interest in them.

 

It might be interesting to know if the volatility of the watch market which has dramatically affected total sales, is being experienced by all of the Swiss watch companies, Are some (eg. Swatch) being hit harder than others? Speaking personally, I am finding greatly renewed interest in repairing older watches, and returning them to service.

 

So, kids these days are giving up on watches in favor of their "smart" devices--and putting that money toward wine? Isn't that essentially what winos do?

 

People actually buy those? They feel awful gimmicky, as do the Samsung Gear and Moto equivalents. It's bad enough having to plug in your cell phone every few nights, let alone your watch. I honestly don't think I've spotted more than 1 or 2 of those things out in the wild. I do see plenty of those fitbit wrist trackers though!

 

And in video form:

 

I guess the biggest question is what the longterm ramifications would be for the swiss watch consumer? Does doom and gloom for the watch industry mean that general pricing will be more competitive?

 

https://www.bloomberg.com/view/articles/2016-07-22/the-swiss-watch-industry-s-perfect-storm
Good read
60% of retailers market cap in unsold goods? Yikes.

 

The place, or the crockery?

I'm so confused.

 

I guess he's not a fan of ceramics then?

 

If anything the rise of smart watches will drive the market of luxury watches upward

if a young up & comer wants to stand out amongst his superiors, he'll start looking at more expensive wristwear than an Apple or a Samsung

So those markets are shrinking a bit too.

The problem is more endemic and complex and probably hidden more than those figures show

For yonks the Swiss model was sell to a dealer.

The wholesale invoice is sent and the figures are logged and the sales recorded.

None of the manufacturers cared if the dealer actually sold the watches to the customer

Now factor in the expansion of brands that have invested big-time in in-house movements and new factories ( thanks to ETA) and you will see that their desire to get a return on that investment is to keep those factories humming and churning out more watches and also increasing prices

The huge rise in grey market sellers discounts is a sign of this massive over-supply

Throw in the downturn in the emerging markets of China and India that were unforseen only a couple of years ago and hey presto, you have a downturn

It will be interesting times ahead

 

There will always be demand for watches. Nowadays with the advent of technology, wristwatch role as a time keeper has been diminished. At the very basic, it is a functional man jewelry. In that spirit, I will never wear bracelets, ring, and what have you. But I will wear watches. So like diamond r girls bestfriend, wristwatch are men's bestfriend.

 

Exactly

the problem is that the vast majority of the players in this new luxury space are not entirely comfortable with explaining to today's "roof" why they need to spend 41k-$10k or more on said luxury item

It could be why there have been so many CEO swaps around the traps in the last year.

Modern digital marketing seems to have eluded the majority.

Seeing a celebrity like like Simon Baker standing next to a horse with a picture of a Longines doesn't do the job. Even Rolex is getting a bit lazy with this type of thing

Those next generations of luxury consumers need to know why they should spend their money and they need to hear about it in their moset often access media.

Glossy magazine ads and bus stop billboards ain't gunna cut it no more

There's only so much us and watch advocates can do amongst our kids, relatives and peer-groups children.

That and the over-supply issue will likely see the glut and sales slump continue for a bit.

 

And the result is...

http://www.reuters.com/article/richemont-layoffs-idUSL8N1DF608

 

Yes, there is - winos drink their cheap wine. Fine wine, and I mean the real blue chip bottles of Burgundy, Bordeaux, and some California Cult Cabernet Sauvignons, are going up in price because people are willing to pay it. Here's why: the new release prices are going through the stratosphere. Some brands have doubled or even tripled in price for their latest releases (most California high end bottles coming on the market now are from 2013 which was an excellent vintage) over the last 4-ish years. If somebody has a properly aged bottle and offers it for a few dollars less than current release, they would make a pretty penny because they only paid half or less than the new inventory hitting the market now. There's also speculation. If you get lucky and have a hot selling wine from a producer that ONLY sells direct via their mailing list, the secondary market can really bring you some fast $$$. For instance, Caymus 40th Anniversary sold for $55 - $63 on release. Now, they're selling for over $100 anywhere you look. Maybach Materium sold for $180 for their 2013 release to their mailing list customers. Nobody has any trouble selling it on the secondary market for over $300. Actually, that's about the OPENING bid with most bottles selling closer to $400. And don't get me started on Lokoya or Harlan. High end wine is a hot commodity right now.