For the first time, smartwatches have surpassed Swiss watches in popularity. Global smartwatch shipments totaled 8.1 million in in Q4 2015, beating the Swiss watch industry’s 7.9 million. However, L2 research suggests that luxury watches could retain their edge by bolstering their digital presence.
With 63% market share, Apple dominates the smartwatch sector: more consumers search for its signature timepiece than for leading Swiss products. In the run-up to the 2015 holiday season, “Apple Watch” generated 4.1 million monthly searches – nearly 20 times more than the average brand in L2’s Digital IQ Index: Watches & Jewelry.
The smartwatch threat has made Swiss watch executives gloomy about the sector’s economic outlook. One in four acknowledged smartwatches as a competitive threat, up from 11% in 2014.
However, brands could reduce that threat by providing more information online, following the lead of their tech-savvy competitors. More than half of luxury consumers research products online before making a purchase, yet watch brands often fail to provide relevant information – driving consumers reluctantly into the hands of gray market retailers. For example, only 53% of watch brands provide pricing information. As a result, gray market channels control 38% of ad real estate across watch-centric brand queries.
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