There’s little doubt in my thoughts we’ll look again on 2023 as a turning level within the story of wristwatches: quartz-based, sensible and mechanical.
It has been eight years since Apple unveiled its smartwatch in 2015, a launch that many within the conventional watch world thought would end the job that the Japanese began with quartz-based tickers taking down Swiss watch maisons that had survived for hundreds of years.
However the arc of this story is incomplete.
A era pondering there was no want for a watch in any respect, given they already had the facility and omnipotence of a supercomputer of their telephones, are discovering they need one of the best of digital and analogue.
So, whereas Apple, Samsung, Huawei and Google might need thought the world would transition to smartwatches as shortly and irreversibly as folks moved from vinyl information and CDs to steaming, they’ve truly steered us from assuming wristwatches can be consigned to historical past to a perception at present that the heritage and sustainability of mechanical timepieces is a pure counterbalance to the disposable, break-neck pace of an ever-advancing tech world.
Measuring in items, the rise of smartwatches will proceed, however there may be nonetheless a vibrant future for mechanical timepieces, which seem able to promoting their heritage and model values at ever-higher costs.
These value rises for mechanical watches, I consider, should be curtailed this yr.
Now we have seen cooling demand up to now six months, and this must be addressed and hopefully reversed.
Each model has skilled this downturn within the western world because the summer season of 2023, and so they should react.
If the watches launching at Watches and Wonders this yr don’t take into consideration the broad sweep of falling demand we can be confronted with over-priced merchandise that too few folks wish to purchase from authorised sellers.
They may find yourself discounted or dumped on the gray market. This can have a damaging impact on even the world’s finest manufacturers and retailers, that are the companies finest geared up to achieve good occasions and dangerous.
This can be a considerably totally different place to the place we have been firstly of 2023, which we now know was the excessive watermark of the post-covid growth.
It’s fascinating to chart the progress by means of final yr within the information and views aired on WatchPro, which is why a stroll by means of the historical past of the previous 12 months and a sit up for the entire of 2024 is a invaluable train.
Right here, we take a look at the most-read articles of 2023 and their significance to the modern watch market. We add a bit context, with the advantage of hindsight, the place we predict a helpful lesson is there to be realized.
January 2023
We entered 2023 within the expectation that covid restrictions have been in our rear-view mirror and the temper was virtually euphoric because of a world document yr for Swiss watch exports totalling CHF 25 million in 2022.
Celebrities have been serving to to drive demand with Rolexes, APs and Pateks wrapped up in a zeitgeist of rampant consumerism for luxurious items.
Certainly one of WatchPro’s most learn tales in January was an amusing take-down by Latin pop singer Shakira who roasted a former lover with a tearing that described him as a Casio pretending to be a Rolex.
Though there have been apparent storm clouds gathering, not least due to a nine-month decline in costs on the secondary market by the top of 2022, British watchmaker Bremont secured funding of just about £50 million from a funding spherical dominated by American billionaire investor Invoice Ackman.
WatchPro reported that MoonSwatch gross sales since launch in March of 2022 have been on monitor to shift 1.5 million items. Rolex elevated common costs by a mere 2.5%, regardless of wider inflation nudging in direction of double figures.
February 2023
WatchPro’s reporting in February was speculating on whether or not secondary market costs for luxurious watches had reached a flooring or had additional to fall, and the way that may impression new watch gross sales. There was no apparent reply.
There was speak of Europe’s most respected firm, LVMH, shopping for rival luxurious powerhouse Richemont. Nothing, to this point, has come of it, however it might not shock me if there are offers in 2024 — not essentially for whole multi-billion-dollar teams altering possession, however for manufacturers inside teams discovering new properties.
March 2023
The large new forward of Watches and Wonders in March, and a WatchPro world unique, was that Patek Philippe can be lowering its point-of-sale community by round 30%. Some retailers had already realized their destiny, however others have been ready in purgatory questioning if they might get the dreaded name.
In a yr of big business information, this was some of the essential due to its broader implications.
Authorised sellers which may have felt snug enjoyable on the Patek Philippe gravy prepare have been both axed or given a brief sharp shock to enhance.
Those who misplaced the enduring model had vital sq. footage of their shops to fill, which created alternative for rival luxurious marques.
On the finish of the month we had the brand new product splurge of Watches and Wonders, with Rolex dominating column inches and social media with the launch of the OP bubble and an ultra-exclusive Day-Date emoji watch.
Oris might need hoped it might steal the present with its Kermit ProPilot, but it surely was taking a knife to a gunfight.
Morgan Stanley with the assistance of LuxConsult launched its annual report on the Swiss watch business and confirmed Rolex extending its lead and, controversially, Audemars Piguet overtaking Patek Philippe for fourth spot within the league desk.
This was an estimate of turnover on the headquarters stage, and mirrored the upper margins AP receives in comparison with Patek as a result of it sells most watches on to customers. At retail, Patek Philippe was nonetheless round CHF 200 million forward.
April 2023
The fallout from Patek Philippe’s ongoing discount in its world community of doorways was nonetheless the dialog at and after Watches and Wonders, however there have been different vital tales shifting markets.
Discontinued watches have been a speaking level, together with Rolex’s Cellini and Milgauss, however even the top of manufacturing for such iconic collections couldn’t reverse declining costs at auctions and on-line marketplaces.
Pre-owned sellers have been operating out of runway as they hoped for a lift-off in costs that proved elusive all through 2023.
Watchmaster, considered one of Europe’s largest merchants, went into administration following a serious prison raid on considered one of its storage amenities. It might need succumbed with out that bust as a result of the worth of its stock had been tanking for a yr.
For brand spanking new watches there was a sense of retrenchment in Europe, though American markets continued to energy forward, and there have been indicators of life from Asia as onerous covid restrictions started to ease.
Might 2023
Though everyone was speaking about headwinds for the worldwide watch market, there was little signal of the business responding and adjusting for weaking demand.
The Federation of the Swiss Watch Trade continued to report document figures, however the state of affairs on the sharp finish of retail was deteriorating.
Within the UK, following document gross sales within the first quarter, GfK reported a year-on-year drop. For the subsequent seven months we noticed retail gross sales declining within the UK whereas Swiss watch exports to this nation have been rising.
Sure, the most popular manufacturers had enormous ready lists for watches, however provide exceeding demand for an prolonged interval will not be a great place to be for a luxurious watch market that’s buoyed by shortage.
June 2023
When the market is gentle, the very last thing it wants is a serious controversy that additional erodes confidence. However that’s precisely what arrived in June final yr when an Omega Speedmaster auctioned by Philipps turned out to be a cobbled-together Frankenstein watch.
Worse nonetheless Omega’s personal museum was allegedly concerned within the scandal, which got here to be generally known as Speedygate.
There are ongoing courtroom proceedings that we might not wish to prejudice with extra hypothesis, however the furore across the Phillips public sale was each a symptom of how overheated the marketplace for sure forms of watches had turn out to be, and a warning that excesses have been beginning to skew folks’s ethical compasses.
One other signal that the market had gone mad got here from the US, the place an authorised seller for Patek Philippe was sued as a result of, in line with the lawsuit, it had promised a extremely prized Nautilus if the shopper purchased a lot of very costly watches and jewelry items.
Once more, the authorized course of is ongoing, however WatchPro got here down firmly on the facet of the retailer as a result of we have now seen numerous model of this shake-down over latest years.
The retailer might have overstepped the mark by way of what it may promise a buyer (notably after it had misplaced the Patek Philippe company), however sending within the attorneys felt like one other kind of intimidation that ADs of scarce watches have confronted in latest yr.
July 2023
Maybe it was a fallout from the Speedygate scandal, however two of the highest three most-read articles on WatchPro.com have been about how one can spot pretend luxurious watches.
Within the main market, Razny Jewelers, a powerhouse multi-generational retailer headquartered in Chicago, gave a captivating interview about how subtle again finish methods linking manufacturers like Rolex and Patek Philippe have turn out to be.
Unappetising as it might appear, a fairly dry topic about buyer relationship administration software program is instrumental in shaping the luxurious watch market.
A decade in the past, manufacturers merely bought to retailers and allow them to get on with discovering finish customers for his or her watches. If these watches didn’t promote, retailers would supply reductions and incentives to clients or, if that didn’t work, supply even deeper reductions to gray market sellers.
Both manner, model values have been broken.
At the moment, manufacturers have virtually good oversight over what’s promoting by means of from retailers to customers, and are much better at adjusting provide to demand. In addition they incentives their gross sales group extra intelligently, so a rush to shut 1 / 4 with watches shoved down the throats of unwilling retail companions is much less frequent at present.
Will probably be attention-grabbing to see whether or not this principle holds up in 2024 when publicly-listed teams want to point out their shareholders that gross sales and earnings are stable.
August 2023
European, and notably Swiss corporations are inclined to decelerate over the summer season, however there was no relaxation for the media class when Rolex broke the information that’s had purchased Switzerland’s largest and most historic jeweller, Bucherer. This was the largest story of the yr with probably far-reaching implications.
It meant that, whereas Rolex had intentionally steered away from competing with its tons of of authorised seller retail companions, it was now head-to-head because of its possession of the mighty Bucherer, notably in Switzerland, the US and Britain.
The business deliberated whether or not Rolex would use Bucherer as a bridgehead into bringing retail in-house and jettisoning its authorised sellers.
WatchPro’s editor-in-chief Rob Corder took a unique view, suggesting that Rolex had been chosen as a purchaser for Bucherer forward of Watches of Switzerland Group as a result of it didn’t desire a large retail firm to have an excessive amount of energy.
Rolex would favor a stability between a handful of mega retailers — Bucherer, The Hour Glass, Seddiqi, Watches of Switzerland, and so forth — and one of the best family-owned unbiased retailers.
September 2023
If WatchPro readers have been requested to guess the most-read story of the yr, few would go along with a courtroom case in Geneva which may settle a long-running dispute over the possession of a Patek Philippe watch owned by John Lennon.
It’s a grail watch spoken about with the identical pleasure because the lacking Omega Speedmaster worn by Buzz Aldrin for the very first moon touchdown. If it ever involves public sale, consultants consider it’ll promote for over $10 million.
Greater than 250,000 folks learn our story concerning the John Lennon watch, proving the significance of provenance in terms of the desirability of classic timekeepers.
Swatch Group hoped to rekindle the hype across the unique Swatch X Omega MoonSwatch launch in 2022 with the creation of a Blancpain Fifty Fathoms in the identical bioceramic materials.
If WatchPro.com’s site visitors was a barometer for the success of this initiative, it was a bust. The story didn’t even make the highest 10 most-popular within the month of its launch.
October 2023
There was a particular chill within the air as we entered October. Retail gross sales for watches in any respect costs had been falling because the spring, and the prospect of a pre-Christmas bounce was trying distant.
As with all downturns, not all companies have been affected equally. Retail companions for manufacturers with lengthy ready lists may contact individuals who had been ready years for his or her watches and inform them that their fortunate day had arrived.
However the mid-market with plentiful inventory suffered. On the peak in 2022, shopping for a Breitling, Omega, TAG Heuer or a chunk of high-priced jewelry from an area jeweller was seen as an effective way to maneuver up a ready listing for Rolex. That delusion ended final yr.
October was the month when the advertising and marketing started for the massive autumn auctions. Marlon Brando’s $2m Apocalypse Now Rolex Submariner was put again up on the market by its millionaire Omani proprietor. Few foresaw the controversy that may engulf that resale when it was dealt with by Christie’s in Geneva.
November 2023
The Marlon Brando Rolex bought for $5 million, a wholesome revenue over the $2 million that was paid for it in 2019.
However the proprietor was not happy.
In response to WatchPro’s sources, he had been advised by rival auctioneers that they might have carried out higher, so all he wanted to do was cease the Christie’s sale continuing and relist the watch with them.
Because the yr ends, all of the watches bought that day by Christie’s have been impounded whereas a courtroom works out whether or not they need to go to the successful bidders on the public sale or returned to the Omani proprietor.
December 2023
And so we come to the yr finish, and it’s ending because it began with costs falling for essentially the most traded watches on the secondary market. Essentially the most-read story to this point in December issues Rolex Submariner costs cratering, however the identical correction is being seen throughout the marketplace for watches that noticed costs soar in 2021 and 2022, after which drop.
This would possibly go some method to explaining one of many largest tales of the yr, the acquisition of three main family-owned unbiased jewellers in the US by the proprietor of WatchBox, a secondary market specialist, to create The 1916 Firm.
Ripples from information of a second hand watch dealer buying historic and venerable jewellers — all of them longstanding Rolex companions — are being felt internationally.
A number of years in the past it might have been unthinkable for Rolex to provide the inexperienced gentle to such a deal. It ought to simply how a lot the watch world has modified this yr.
