As Covid-19 began to spread across the world, life as we knew it changed dramatically. This caused events to be cancelled, meaning brands were unable to showcase their shiny new toys to the rest of the word.
New watches were, unfortunately, being put on hold as the world, country by country, went into lockdown, shops and stores were forced to close, and trading stopped. In doing so, the watch market has changed over the course of the pandemic, drastically, with long term effects.
The watch industry has worked a very antiquated system for many years now. Many big brands have not been open to moving their products available to buy on an online store. Part of buying their watch was the experience that came with it, being looked after by the best sales staff, sipping on champagne as they choose the best fit for their wrist. Getting onboard the digital world has not been an option.
For this reason, due to the pandemic, brands were forced to launch watches hastily in organised events held online. This includes Breitlings Summit Webcast and a digital version of Geneva’s cancelled event ‘Watches & Wonders’ show.
Some traditional watch brands such as Rolex stuck to their guns and refused to sell their products online. However, moving with the times, other brands such as Patek Philippe, for the very first time, chose to allow their retail partners to sell their products via e-commerce channels.
(Graph showing watches’ revenue growth. Source: Statista)
Although this is good news for the brand, one for the downsides of this is that because the brand never developed their own capabilities in the area of e-commerce, they had to allow for their products to be sold via a third party.
Richemont, the name of the umbrella that brands such as Cartier, Panerai and many other luxury brands sit under, online selling was already part of their business and one they were already familiar with. Their products can be brought on both their brand’s e-shops and market places of third parties. During the course of the pandemic, they have raced to uphold their position in the watch market, finding alternative ways to deliver their products and services to their customers.
Due to the pandemic, luxury watch buying can now be done at the comfort of your own home, and that is how the pandemic has changed the watch market forever. Brands will no longer be able to sell customers experience due to Covid restrictions and social distancing. The pandemic has also seen sales of a variety of luxury goods increase, which included watches, increase over the course of the pandemic. This means that consumers have not exactly stopped spending; they have just changed the way they shop.
However, some argue that despite the strong digital sales, online will never be able to replace the bricks and mortar experience, especially for high-end luxury items such as watches. One of the other added barriers which are preventing luxury brands such as Rolex from moving and embracing digital commerce is that they are forced to offer price transparency across countries.
The pandemic has offered luxury watch brands the opportunity to demonstrate how adaptable and flexible they are. Those that are open to moving to e-commerce will most definitely see greater sales and better interaction with customers in comparison to those who are more rigid.
Although it could be argued that these watch brands will only suffer for a short amount of time, there’s no knowing how long lockdown restrictions will be in place. There is no denying the fact that even after the restrictions lift, consumers are less likely to physically go to stores, reducing the amount of footfall they receive.
Although there is optimism that retail will pick up, the watch industry, as a whole, is past the point of no return in relation to e-commerce. Not only does the luxury brands have to battle to get in front of consumers in an online platform, which will be new to them, they also have to fight off smartwatch competitors who’s watches have better features and who own the space of e-commerce, and who are familiar with the space and how best to market and present their products and their brand as a whole.