Over the past year, the luxury watch industry has had to come to terms with the new and ever-changing luxury landscape and the realisation that in order to survive these changes, it must adapt its strategies to keep pace with trends in the market.
While the beginning of the year offered a hopeful start to the year – the luxury market returned to growth in the first quarter of 2021, compared to 2019 (the last comparable year viewed by the industry) according to the latest update from Bain and Altagamma - the outlook still remains uncertain.
In light of this, DLG and Launchmetrics hosted a webinar on the subject, with key speakers Julien Tornare, CEO of Zenith Watches, Alain Zimmermann, Managing Partner of DLG (Digital Luxury Group), Pascal O. Ravessoud, Director of External Affairs of Fondation de la Haute Horlogerie and Alison Bringé, Chief Marketing Officer of Launchmetrics, discussing the wider issues facing the luxury market, why brands are taking more ownership of their content and communication and how to reinvent the customer experience.
Some of the biggest themes that came up during the webinar included how the luxury watch industry adapted to the changes it faced over the past year, the importance of sustainability and growing popularity of resale and second-hand watches, building up a brand’s digital toolkit and the importance of collaboration with other brands and retailers.
Here, we summarise the main themes and issues discussed. For a replay of the event, please click here.
One of the biggest changes seen over the past year is how brands now connect with their customers. From the creation of virtual boutiques and virtual tours of watchmaking manufacturing to broadcasting summits and educational series, many luxury watch brands have built up an impressive digital toolkit to communicate and keep in touch with their clients and audiences.
“There have been a lot of activities, a lot of initiatives, which we haven't seen before and I'm sure they will stay in place,” said Alain Zimmermann, Managing Partner at DLG, noting that while nothing can replace the physical experience, how brands balance out their new digital capabilities will be interesting to watch.
“It’s the new way, it's the new normal on how to connect with clients, and I think it will last for years to come,” he added.
Two of the biggest shifts that Launchmetrics has seen in the past year is the increase in impact from partner voices (like other brands, retailers and second hand sites) and celebrities. According to data from Launchmetrics, it saw a 65 percent increase in impact from brand partners in the last year and an even greater increase of 143 percent from celebrity partners over the same time period.
“Partners are either other brands or other retailers that help drive the conversation, drive performance and drive media impact around your brand,” explained Alison Bringé, Chief Marketing Officer at Launchmetrics. “What these retailers have done is complement what brands are doing. They have used the last year to really beef up their editorial news coverage and they are doing a great job of engaging the customers… what they are doing is driving a lot of attention and eyeballs.”
“Whether we love it or hate it, it's quite interesting because they're driving a lot of the conversation, they're getting a lot of customers interested in products that potentially can still be bought directly from brands, and these customers are just looking for ways to explore what is happening in the market,” added Bringé.
The past year also saw one of the industry’s biggest events - Watches and Wonders - hold its second edition online that merged online and physical, starting in Geneva and finishing in Shanghai. The total reach for the event was an estimated audience of 500 million to date, and generating $26.9 million in media impact value, according to data from Launchmetrics.
With more preparation time, Watches and Wonders was able to experiment with its format more, as seen with the dedicated “Morning Show” it hosted and the live discussions on social media platforms like Clubhouse, as part of its efforts to create a more social atmosphere to the online event.
“All of a sudden we had to rethink from scratch about what we could do, to have a show that was running and how we could help the brands showcase and create a momentum for this show to happen,” said Pascal O. Ravessoud, Director of External Affairs of Fondation de la Haute Horlogerie. “It was very stimulating to find ways to keep the business running.”
While there are no plans at present to allow second-hand retailers into Watches and Wonders, sustainability is fast becoming a hot topic among consumers that brands need to consider in their future plans, one that Tornare is already beginning to address with the brand’s Icon programme – a curated collection of rare and highly sought after vintage Zenith watches that have been sourced, restored and certified by the brand.
“We talk a lot about circular economy, we talk a lot about sustainability,” said Tornare. “In a way, there is no better product than a mechanical watch. When you buy mechanical watches, it’s forever. Our responsibility is to make sure that our watches will basically have multiple lives and live forever, and I wouldn't have any issue in the future to show some of our vintage watches. As a brand, it's great.”
On the digital transformation, Tornare described the past year as an earthquake for the industry that forced brands to rethink their business model and the ecosystem as a whole.
“It was a big trauma, a big earthquake for everyone and we had to adapt very quickly,” said Tornare recalling having to shut down the company and reassess its business and communications. “That was a big, big question in a big transformation, so we had to move into this digitalization in a much faster way than we were ready to do,” he said.
“The watchmaking industry has not been the most advanced in this digitalisation and suddenly to stay alive, we had to catch up,” he continued. “Alain mentioned a few great examples of brands that showed a lot of dynamism and a strong reaction. And I believe during these few months, you could really see which brands were immediately reacting and bringing new ideas and new ways of working, and those that reacted less, and at a certain point, it has made a big difference.”
For more on this subject and to watch the webinar in full, please click here.