New York Times writer flags the Audemars Piguet Royal Oak Offshore, A. Lange & Söhne Lange 1, Vianney Halter Antiqua, F.P. Journe Chronomètre à Résonance, Richard Mille RM 001, Ulysse Nardin Freak, Urwerk UR-103, MB&F HM4, Bulgari Octo Finissimo Tourbillon and the Apple Watch. As they say on Sesame Street . . .
One of these things is not like the other. The question facing the traditional watch industry – at the lower to middle of the market – will the Apple Watch lead watch-wearing newbies into the world of traditional horology?
In 2019, the Apple Watch outsold the entire output of the Swiss watch industry. There’s no reason to believe the Apple Watch’s market share will diminish when the world economy staggers back to life. So the future of the entire mainstream traditional watch industry depends on a simple calculus: Apple Watch -> traditional watch.
Ms.
For mechanical watchmakers, the Apple Watch’s most significant legacy may be its role as a gateway to traditional watch consumerism.
“Back in 2015, 44 percent of U.S. adults wore a watch,” said Reginald Brack, watches and luxury industry analyst at the market research company NPD Group. “Flash-forward to 2019 and 55 percent of U.S. adults wear a watch.”
The statistic may actually be bad news. It doesn’t tell us what percentage of new watch wearers are wearing a traditional watch, and what percentage are wearing smart watches.
Or how many traditional watch wearers traded their traditional watch for an Apple Watch, and whether the switch killed their interest in traditional watches. And, crucially, are Apple Watch initiates tomorrow’s traditional watch buyers?
Back in September, Ulysse Nardin CEO Patrick Pruniaux shared his quasi-religious faith in this Apple -> traditional watch transition.
The smartwatch is bringing in millions of customers who were not wearing a watch. One day, they will discover a smartwatch is good but most of their functionality is already on the phone. Smartwatches are an opportunity. We compete for the piece of real estate that’s your wrist, but that’s it.
Let’s set aside Mr. Pruniaux’s apparent obliviousness of the Apple Watch’s intrinsic appeal and focus on his message: we’ve losing the battle, but we won’t lose the war! Absent hard numbers, common sense tells us it ain’t necessarily so.
If you think of a traditional watch as a snifter of bourbon, the Apple Watch is crack cocaine. Once you’ve acclimatized to its ever-expanding capabilities, ditching the AW for a simple time-teller is like throwing away the TV remote. Literally.
There’s only one thing an Apple Watch can’t do that a traditional watch can: stunt and floss. Some percentage of the watch-wearing population will still want a traditional watch for style points.
Style-driven designer-branded watches helped the Swiss watch industry back in the 80’s and 90’s (after SWATCH paved the way). Fossil, one of the biggest beneficiaries, has tanked. This despite jumping into the smart watch business with both feet.
But the watch world has undergone a profound shift. It’s no longer designer brands competing with each other. They’re all competing against an endless wave of tech-savvy horological disrupters: Apple, Garmin, FitBit and the like. Software makes their smart watch competitors a constantly moving target. Traditional watchmakers don’t have the skills or culture to compete.
Traditional watches aren’t competing for wrists as much as they’re competing for time. The Apple Watch and its ilk are far too useful, too addictive, to leave on the charger. Once worn, they become indispensable for daily use. All that’s left is “social” wear: predominantly nights and weekends.
That’s not a data-driven assertion, but I’d bet dollars to donuts that an increasing number of Ulysse Nardin’s well-heeled buyers are Freaking out at night.
How many watches do buyers need for occasional social use?
Immersed in the watchblogosphere, it’s easy to forget that most watch buyers don’t treat timepieces like women treat shoes. That’s doubly true for Apple Watch wearers, who regularly upgrade to the latest model. Or not.
Traditional watchmakers are fighting for business in a decreasing market for their product, wooing consumers who may well be buying a smaller number of watches.
The upside: traditional watch buyers are set to benefit from a combination of burgeoning supply and diminishing demand. And high horology will always remain a thing. The downside: the traditional watch industry is heading for a major contraction. The golden age of the traditional wristwatch is coming to an end.
I think this is mostly right. If you To ultra-generalize, the consumers who make up the greatest bulk of luxury watchbuying (i.e. not the collectors), have mostly already made up their minds about smartwatches, The ones who have adopted them are generally going to wear them for the majority of the time because they value the functionality. Wearing a trad watch would be for signaling or style, neither of which are generally needed during the workday.
> I’d bet dollars to donuts that an increasing number of Ulysse Nardin’s well-heeled buyers are Freaking out at night.
I would agree. I think I said this on another thread but it bears repeating – my guess is that smartwatches force the trad watchmakers further upmarket to survive, concentrating on the collectors, signalers, and dandies. This is a pretty common occurrence when there’s a disruption in the market; we’ve seen it in everything from video games (where AAA studios have gone after hard-core gamers with ever more expensive games and powerful hardware, ceding the casual market to phones) to photography to audio equipment.
The problem with this strategy is of course the customer base is a lot smaller and success often is a result of trends/fashion or brand. Everything becomes a lot more hit-oriented and precarious. Which means only the strongest and best survive.
As someone who’s going to buy his first watch, I can tell you it’s not going to be an apple watch. I just don’t see the point of getting constant notifications on my wrist, when my phone is fine for that. I enjoy the mechanical part especially when I’m outdoors and no way to plug an apple watch in. There’s something to the mechanical watch that the apple watch can’t do.
I totally get that. Obviously. But do yourself a favor. Don’t try an Apple Watch first. Or maybe even second. And do NOT read my article Apple Watch – Why You Need One.
I read that article, but everyone I know has convinced the 20% in me that wanted an apple watch, to not get one. TBH, I only want an apple watch for exercise. Other than that, after 2 years of hard work in getting 2 masters degrees plus working a job, I’m getting a real watch. 1 is a Sinn 6012, a Weiss and the other is between 3 divers at the moment.
Sinn for the win! Anyway, unless I woke up in Communist China this morning (as thousands of infected Chinese won’t), you’re free to buy an Apple Watch AND a traditional watch. And congrats on the masters. You’re a smarter man than I Gunga Din.
People who keep saying « I don’t want notifications on my wrist » have obviously never used an Apple Watch. The notifications are just one possible feature (completely and easily customizable and you can entirely turn them off) among sooo many that are way more useful IMO. It monitors your health over years. It gives the weather with a glimpse. It does timer. It takes phone calls. It Is a remote control for your music/podcast player. It gives directions by gently tapping on your wrist. This is just to name a few features that I personally love. People who badly judge the Apple Watch on it’s utility make no sense to me. The things the Apple Watch lakes of IMO : elegance, romance, stories, timelessness. That’s why I think mechanical watches are eternal and will remain so for at least a long time.
Hi Robert! Fancy meeting you here! 🙂 I knew you from TTAG, and we’ve corresponded by email a few times.
Until recently, I had two watches… a Breitlling Colt Ocean Automatic and a Rolex Yachtmaster. The Breitling has been dead for several years. The Rolex crapped out a few months ago (again), and I haven’t sent either in for service. I delayed due to the cost “during these difficult times.”
But, I got tired of digging out my phone (android) to see the time / date. I decided to put something on my wrist to hold me over. I thought, “a cheap Casio.” Just one!
I started looking at G-Shocks and Pro Treks. Next thing I knew… in three weeks time…. I’ve got 12 of them! I fell deep into the rabbit hole! The Breitling and Rolex can wait.
There is a LESS-THAN-ZERO chance I’ll ever get a “smart watch.” I don’t want to be MORE connected to my phone.
Smart watches do not interest me for a number of reasons:
1. I don’t want to have to charge my watch every night. Don’t have to do that with a traditional watch.
2. Smart watches go obsolete by design. Eventually, software updates or phone updates will render them obsolete. Watches have lasting value and function.
3. I have NO interest in my watch telling me (notifications) I have a call, text, email, etc. I just don’t care to be THAT connected.
4. Smart watches, by design, are meant to be worn every day to the exclusion of other watches if you want to benefit from its full functionality.
5. Most smart watches (especially the Apple watch) are EFFEMINATE in their design. Yeah, I said it. 🙂 I could never wear the delicate, thin, “bracelet” that is most smart watches that I’ve seen.
Hope you are doing well, Robert! Nice to run into you here.
Hey! Glad to hear from you again. Mind if I post this? And I need a writer for G-SHOCK reviews. Send me your number via the email on the site.