# The perfect storm



## valmak (May 29, 2010)

I believe the luxury watch market is about to hit the perfect storm. The combination of smart watches becoming mainstream thanks to the introduction of the Apple Watch and slowing growth in China will hit the watch industry hard. That market has been growing fast over the last few years with many companies like Rolex, Omega, Patek and Jaeger-LeCoultre opening their own boutiques. Now they are going to retreat hard and go into hiding until the next wearable tech (Apple's glasses) is introduced in 10 years. (Side note: Yes I know that Google already tried this but you have to remember that Google Glass was designed by nerds with no clue about fashion. Apple's version will likely succeed. I can already see Gwen Stefani wearing the all gold version on The Voice.) So you will probably see some of these boutiques close down and their products will re-enter traditional watch stores in the next couple of years. I also expect watches like Rolex and Omega to be heavily discounted in a year or two which will be nice. Maybe they will start introducing some cheaper, possibly quartz, models to win the young crowd over from the smart watches. This is of course all speculation. Just making some predictions for fun. It will be interesting to see what happens.


----------



## tiger roach (Dec 27, 2012)




----------



## tiger roach (Dec 27, 2012)

I still expect the impact of smart watches on luxury watches to be minor, even if Apple Watch really takes off (followed by the non-Apple counterparts).

The impact on more affordable watches could be profound.

I seriously don't expect to live to see a day when Rolexes and Omegas are "heavily discounted."


----------



## BarracksSi (Feb 13, 2013)

The counter argument that "mechanical watches survived the quartz crisis" will pop up as usual, except that we've forgotten that most makers of mechanical watches flat-out vanished. I had a mechanical Timex with Snoopy on the dial, but the brand only survived by embracing quartz; Rolex survived by repositioning itself into a price tier untouched by the ever-cheapening quartz market. Name any other current mechanical watch brand, and I'll bet the senior WUS members will be able to name another ten dead watch brands.

I mention this (again) because people often equate luxury watches with mechanical watches. It was only one or two generations ago that the standard watch anyone used was mechanical, though.

What's different now is that smartwatches do things a lot differently than either mechanical or quartz watches. They're not only competing on price and reliability anymore. Any buyer is going to weigh the extra functions against any drawbacks.

The problem with this question on WUS, however, is that we're a little weird. We won't give an unbiased, or even a knowledgeable, answer about smartwatches. We pay hundreds, or thousands, of dollars (or euros or yen or whatever) for a technologically outdated piece of machinery simply because we enjoy it. We're the kind of people who will favor a steam locomotive over a diesel engine because we think it has more character. We already favor a no-date Rolex Sub over a Timex Ironman despite the Sub having fewer functions, less accuracy, and more fragility.

Assuming this thread keeps going, keep in mind the context and audience of this forum.


----------



## umarrajs (Oct 18, 2012)

+1 to BarracksSi


----------



## Blancpain (Jan 29, 2014)

Meh....we will see, but I think smart watches will be gone in about 4 to 5 years. As least the Apple watch will be a has been....Newton anyone?

Fossil, Tag and other real watch makers will all join the smart watch ranks with Android wear which IMHO is better than the A Watch software. They will actually come out with good designs unlike Apple.. Which is just a copy of an old Samsung gear. Innovative? Fashionable? Laughable.



As for Apple glass...that's too comical. Google glass was just a beta test, it was never sold to the public. They pulled back the public beta test to work with actual glass makers, when their concept is finalized, you can be sure that they will put out an excellent product. I'm actually waiting for smart contacts instead. Then you can have personal holograms like in the movies.
Smart watches are a fad until Google glass and later contacts gain traction.

It's a great time...
Two California giants fighting it out in the consumer electronics space.


----------



## zetaplus93 (Jul 22, 2013)

Blancpain said:


> As for Apple glass...that's too comical. Google glass was just a beta test, it was never sold to the public. They pulled back the public beta test to work with actual glass makers, when their concept is finalized, you can be sure that they will put out an excellent product. I'm actually waiting for smart contacts instead. Then you can have personal holograms like in the movies.
> Smart watches are a fad until Google glass and later contacts gain traction.


Keep in mind the way both companies introduce products. Google thinks more like scientists in that they like to release not-so-ready products and get validation in the market (and then rapidly iterate or kill products).

Apple, on the other hand, think more like artisans; they try to perfect products in-house, then release it. Mind you, not everything is perfect (i.e. Apple Watch V1), but they are more perfected than google products generally speaking (i.e. Google glass).

Both companies serve the market well in their capacities, and they have improved the lives of people in the world. We're very lucky to have them exist, instead of companies that keep churning out the same old thing while increasing prices...


----------



## Blancpain (Jan 29, 2014)

I'm sure Apple will continue to make boatloads of cash as will Google. Either way, it is a fun time for gadget freaks.

Man, I wish I had these watches and phones when I was in HS. All we had were these things you wrote on with a stick like object that had graphite embedded in the center. Crazy!


----------



## BarracksSi (Feb 13, 2013)

valmak said:


> (Side note: Yes I know that Google already tried this but you have to remember that Google Glass was designed by nerds with no clue about fashion. [snip] )


Worse than that -- it was designed (or at least green-lighted) by nerds who were socially inept enough to forget that a person walking around with a camera up to their face makes everyone else feel awkward (at best) or under constant surveillance (at worst).

All the side functions didn't count towards credibility, because everyone knew about the camera in Glass, and nobody wants to feel like a random stranger is pointing a camera at them all the time. It shouldn't have been a surprise to anyone that Glass was quickly despised by the general public.


----------



## Blancpain (Jan 29, 2014)

valmak said:


> I believe the luxury watch market is about to hit the perfect storm. The combination of smart watches becoming mainstream thanks to the introduction of the Apple Watch and slowing growth in China will hit the watch industry hard. That market has been growing fast over the last few years with many companies like Rolex, Omega, Patek and Jaeger-LeCoultre opening their own boutiques. Now they are going to retreat hard and go into hiding until the next wearable tech (Apple's glasses) is introduced in 10 years. (Side note: Yes I know that Google already tried this but you have to remember that Google Glass was designed by nerds with no clue about fashion. Apple's version will likely succeed. I can already see Gwen Stefani wearing the all gold version on The Voice.) So you will probably see some of these boutiques close down and their products will re-enter traditional watch stores in the next couple of years. I also expect watches like Rolex and Omega to be heavily discounted in a year or two which will be nice. Maybe they will start introducing some cheaper, possibly quartz, models to win the young crowd over from the smart watches. This is of course all speculation. Just making some predictions for fun. It will be interesting to see what happens.


Apple watch doesn't look very appealing to me. It still looks too geek tech to me. Certainly not a fashion icon. In fact here are what actual fashion designers had to say about the Apple watch.

http://www.complex.com/style/2015/0...+04+2015&utm_source=twitter&utm_medium=social


----------



## JohnGo (Jan 24, 2014)

I do not think it will have the impact that Apple is going for. It will maybe create a market for itself within its own segment, but I do not see it as a killer for classic watches.

another, more professional opinion:

https://www.linkedin.com/pulse/heres-why-youll-hate-apple-watch-important-business-lesson-nir-eyal


----------



## AAMC (May 25, 2011)

Blancpain said:


> Apple watch doesn't look very appealing to me. It still looks too geek tech to me. Certainly not a fashion icon.


Will see, fact is that Apple wants it to be perceived as a luxury/fashion product instead of a tech gadget. That's why they went for a completely different route for the launch, you have this try/test and pre-order concept instead of the cues at Apple's doors, the exclusive AW for high profile personalities like Karl and Beyonce and they selected a few high end fashion shops (like The Corner or Colette) where the product can be first purchased


----------



## Blancpain (Jan 29, 2014)

AAMC said:


> Will see, fact is that Apple wants it to be perceived as a luxury/fashion product instead of a tech gadget. That's why they went for a completely different route for the launch, you have this try/test and pre-order concept instead of the cues at Apple's doors, the exclusive AW for high profile personalities like Karl and Beyonce and they selected a few high end fashion shops (like The Corner or Colette) where the product can be first purchased


Having the Apple logo or a high price does not make it a beautiful product. The square form factor, cheap glass and funky crown just screams techy nerd.

Rich people wanting it will not make it look good to me. I really couldn't care less what Beyonce wants to wear.

I felt the same way about Google glass too. Many high profile people paid over a grand to look like a tech tool. I didn't think....wow, celebrities are wearing glass....I think it looks cool now.

Unfortunately, people will buy the Apple watch just because they see a celebrity wearing it. Just like all these girls trying to puff up their lips using shot glasses to look like Kylie Kardashian.


----------



## AAMC (May 25, 2011)

Blancpain said:


> Having the Apple logo or a high price does not make it a beautiful product. The square form factor, cheap glass and funky crown just screams techy nerd.
> 
> Rich people wanting it will not make it look good to me. I really couldn't care less what Beyonce wants to wear.
> 
> ...


Lol at the shot glasses, insane stuff. They are doing everything by the book, I mean there are "pasted parts" on their marketing plan that were copied from Hermes' marketing plan. However, there are a few differences between markets and nobody knows (only the OP lol), how this will end in a couple years.


----------



## Blancpain (Jan 29, 2014)

AAMC said:


> Lol at the shot glasses, insane stuff. They are doing everything by the book, I mean there are "pasted parts" on their marketing plan that were copied from Hermes' marketing plan. However, there are a few differences between markets and nobody knows (only the OP lol), how this will end in a couple years.


I for one will wait for V2 of the Apple watch....if they make a good looking one that is...with a round face. Just look at the progression of Apple products...the first iPhone was butt ugly with that black bottom, look at it today. I'm sure the 🍎 watch will follow the same suit.


----------



## NathanielGoodtimes (Jul 22, 2014)

In reference to the Apple watch if it does effect the luxury watch market, and I say luxury not mechanical, my guess is it will effect Rolex and on a softer level Omega. I state these brands because they are worn by many people with no watch knowledge, but rather people looking for a status symbol which may be effected by Apple. If you disagree with me fine, feel free to say so but dont start a whole Rolex protection league because of this comment, thank you! 

On a greater level I am intrigued by China weakening. I dont actively follow the Chinese market but if it is weakening in the long run it may effect watch prices. The strength of the Chinese market has drastically effected the mid - high watch market over the last 5-10 years. I would imagine eventually the market would have to adjust prices, though it would take a bit. As we see with gas the price will fly up, but when it decreases the trickle down to the consumer takes ages. I dont think we would ever see drastic discounts, but if the market moves downward either the watch companies would have to scale down production or lower prices, and my guess is most would lower prices.


----------



## AAMC (May 25, 2011)

NathanielGoodtimes said:


> In reference to the Apple watch if it does effect the luxury watch market, and I say luxury not mechanical, my guess is it will effect Rolex and on a softer level Omega. I state these brands because they are worn by many people with no watch knowledge, but rather people looking for a status symbol which may be effected by Apple. If you disagree with me fine, feel free to say so but dont start a whole Rolex protection league because of this comment, thank you!
> 
> On a greater level I am intrigued by China weakening. I dont actively follow the Chinese market but if it is weakening in the long run it may effect watch prices. The strength of the Chinese market has drastically effected the mid - high watch market over the last 5-10 years. I would imagine eventually the market would have to adjust prices, though it would take a bit. As we see with gas the price will fly up, but when it decreases the trickle down to the consumer takes ages. I dont think we would ever see drastic discounts, but if the market moves downward either the watch companies would have to scale down production or lower prices, and my guess is most would lower prices.


The China (Asia) effect on the luxury watch industry is a given fact, then there's Russia also with all the currency predicament and Brazil is falling short from estimates. Everyone on the Swiss Watch industry knows that watch prices in general can't go higher and I'm expecting some market adjustments based on the socioeconomic environment. Regarding the AW effect alone on these watch brands I would say it will be marginal, Apple will be selling in one month the same number of watches as Rolex, Omega and Cartier (combined) in one year (lol) at a completely different price point....how exclusive the AW will be? What status? With every Walmart Joe and high school grads wearing them? 
Higher income market will still show their think even if they also bought an AW for certain activities or just for the fun of it.


----------



## edhchoe (Mar 2, 2010)

I just don't have the desire to own an Apple watch. My iPhone 5 serves me well.


----------



## Blancpain (Jan 29, 2014)

The 🍎 watch have been delayed as hardware flaws have surfaced. Apple stocks are down as investors are not impressed with the watch. 
Fashionista are not impressed with the watch either even though they love iphones. 
More importantly, women are bored with the watch and have no desire to get this watch.

Only 26% of 18-34th year old men even want this watch. Other age group percentages are even lower.

This rollout isn't so much a storm but a dribble.

Is this the next Apple tv? Only Time will tell.


----------



## BarracksSi (Feb 13, 2013)

I wish 26% of any demographic would want my product.


----------



## edhchoe (Mar 2, 2010)

edhchoe said:


> I just don't have the desire to own an Apple watch. My iPhone 5 serves me well.


Well, 2.5 years after this post I have converted to Apple Watch entirely. My iPhone stays home and I go to work with my Android phone and Apple Watch LTE on the wrist.


----------

