Watch Industry Resilience Series during the Pandemic
In a flash, the COVID-19 pandemic has continued for nearly half a year, and the situation in Hong Kong seems to be easing. Citizens are starting to go out and gather, as if the days of removing masks are just around the corner. However, this experience is not something easily forgotten; the various changes have left unpredictable impacts. It is worth pondering how to move forward in the coming days. Carson Chan, a renowned independent watch critic and Chief Chinese Professor at the Fondation de la Haute Horlogerie (FHH), points out that the public’s mindset and behavior patterns have changed. It’s no longer just about whether watch exhibitions can be held or if retail is sluggish. “The high-end watchmaking industry must examine its future development path in order to sustain itself,” says Carson.
The first online watch exhibition is launched.
Due to the pandemic, the Watches & Wonders event originally scheduled to be held in Geneva was canceled, replaced by the first online version of Watches & Wonders. Many people have imagined that one day watch exhibitions would move to the internet, allowing everyone to view new watches online, but no one expected it to happen suddenly and without warning. In reality, it was merely a rushed effort, lacking the excitement of past exhibitions. “The pandemic first emerged in Asia, and by February, a wave of outbreaks occurred. FHH had only about 6 to 8 weeks to decide to cancel the exhibition and move online. The preparation time for the online exhibition was indeed too short, and there is a lot of room for improvement, especially in terms of virtual technology.” Regarding the approximately one-third of participating brands that did not showcase new products in the online exhibition, Carson explained that this was due to the rushed timeline and that some brands adjusted their release strategies. Additionally, some manufacturers halted operations, making it impossible for production lines to align with the April release of new products. Overall, Carson stated that most brands were still pleased to have launched this online platform.
Moving from Basel to Geneva.
If we are to discuss the greatest impact of the pandemic on the watch industry, we once thought it would be the absence of watch exhibitions this year. However, the true impact is that we cannot predict how next year’s exhibitions will unfold. Rolex, Tudor, Patek Philippe, Chopard, Chanel, and the LVMH group have all announced their withdrawal from Baselworld, opting to collaborate with FHH for a new product launch in Geneva next April. The question remains: will these heavyweight brands’ launch events be combined with Watches & Wonders, merged, or held concurrently? It remains a mystery.
“The issues with Baselworld did not arise overnight; the pandemic acted as a catalyst that intensified the conflicts between brands and Baselworld, leading to a collective withdrawal. The collaboration between these brands and FHH was not premeditated, nor was it initiated by FHH. How they will ultimately collaborate is anyone’s guess,” Carson remarked. He humorously noted that the only certainty now is that the exhibition venue is large enough to accommodate more brands. Additionally, Carson emphasized that Watches & Wonders is a high-end watch exhibition, and to become an exhibitor, brands must meet the standards of “HH” (Haute Horlogerie), whereas Baselworld is not only a watch exhibition but also a jewelry exhibition, making the positioning of the two exhibitions completely different. Carson believes this change will transform Baselworld’s exhibition model and also pointed out that Watches & Wonders will differ from SIHH’s B to B model, shifting to a B to C approach, which will be more beneficial for participating brands to allocate resources and reach diverse customers, ultimately a positive development for collectors as well.
The value of high-end watches lies in craftsmanship.
During the pandemic, the distance between people widened, and lifestyle and consumption patterns changed. Compared to the commercial impact, Carson is more concerned about the shift in people’s attitudes toward high-end watches. “Mechanical watches have undergone a transformation from practical items to luxury goods, and they are now regarded as accessories. Without luxury goods, people’s lives would not be affected.” Carson further pointed out that many young people show little interest in high-end watches and cannot understand their value. The pandemic will reinforce these views, so high-end watches must recognize their role.
“The value of a famous painting has never been in the paint or the dimensions used, but in the story behind it and the emotions expressed in the image; high-end watches should be like renowned paintings, focusing not on functional specifications, but emphasizing craftsmanship and narrative.” Carson lamented that “the skills of watchmakers are extraordinarily refined, yet some brands fail to convey the technical and spiritual aspects of their watches to their sales staff and public relations teams, making it difficult to communicate this to the media and consumers. Often, when buying and selling, they do not understand the true value of the watch.”
Adjusting the direction and continuing forward.
High-end mechanical watches are often priced in the five or six figures, and people frequently ask: what value do they really hold? What purpose do they serve? Carson candidly admits that they may not have practical use, but neither does a 700-horsepower supercar. “When someone asks this question, it indicates that they fundamentally do not understand.” Carson believes that purchasing a luxury item is akin to embracing the philosophy behind it, but one must possess the relevant knowledge to truly comprehend.
“To learn to appreciate high-end watches, you don’t need to understand watchmaking, but you should look at and engage with them more to cultivate your taste. Don’t pursue value retention; understand what you are actually buying. Brands should also place greater emphasis on the craftsmanship value of their watches and find ways to effectively communicate the stories and significance behind them.” Carson believes that the pandemic has set development back, and now is a good time for watch brands to rethink their direction: “Perhaps this is a blessing in the sky.”
