Geneva watch fair opens its doors in uncertain times
Published: Monday, Apr 8th 2024, 14:20
Updated At: Tuesday, Apr 9th 2024, 01:59
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On Tuesday (tomorrow), Geneva's "Watches & Wonders" opens its doors as the world's largest watch fair following the closure of "Baselworld". For one week, 54 brands will be presenting new products and bestsellers from the world of timepieces in the Palexpo halls at Geneva Airport. The industry is on a high, but the upswing is losing momentum.
There will be large crowds at the pompously furnished exhibition stands of brands such as Rolex, Cartier, IWC and Patek Philippe in Geneva. The organizers are expecting around 45,000 visitors after around 43,000 last year.
The trade fair is primarily aimed at invited watch retailers and journalists. However, a limited number of tickets will once again be sold to the general public for the last three days. "On these public days, we have recently noticed a growing interest from young people," said Matthieu Humair, head of the fair, in a statement. "That is encouraging."
Outlook clouding over
Younger buyers were one of the reasons why the luxury goods industry enjoyed a strong revival in the wake of the coronavirus pandemic. Last year, Swiss watch exports climbed by 8% to a record CHF 26.7 billion.
Although export figures continued to rise slightly at the beginning of 2024, the market environment has recently become tougher for watch manufacturers. Geopolitical uncertainties, the rise in interest rates in recent years and economic concerns are dampening consumer spending moods around the globe. In addition, the strong Swiss franc and higher raw material prices are eating into the profitability of companies producing in Switzerland.
In this mixed situation, it is becoming increasingly difficult for watch manufacturers to maintain or even increase their high sales. Although watch exports rose again slightly in January, they fell again in February for the first time in a long time. The declining propensity to buy on the part of Chinese consumers was particularly noticeable.
Return to normality
For watch expert Olivier Müller, however, the somewhat gloomier outlook for the watch industry comes as no surprise. "The years 2022 and 2023 were exceptionally good for all brands. Now we are just seeing a return to normality," he said in an interview with the news agency AWP.
Vontobel watch expert Jean-Philippe Bertschy shares this opinion: after the coronavirus restrictions were lifted, there was so-called "revenge spending" - in other words, consumers spent more money than usual. "We are currently experiencing a normalization of growth with sales above the 2019 level," he told AWP.
However, both experts also attribute the weakening growth in the watch industry to the dark clouds gathering on the global market. The wars in Ukraine and the Middle East as well as inflation are primarily responsible for this.
Swatch Group still lacking
The Geneva Watch Salon is held for the 24th time. Richemont launched the showcase for luxury watches with its "Maisons" Cartier, Piaget and IWC. After the last "Baselworld" in 2019, industry leader Rolex and major players such as Patek Philippe and the LVMH companies Hublot, Zenith and Tag Heuer moved to Geneva.
Big absentees in Geneva are the Swatch Group brands, including Omega, Tissot and Longines. Swatch has been relying on its own presentations and digital formats for the presentation of new products for several years. Swatch's withdrawal from "Baselworld" was the beginning of the end for the Basel watch fair.
"Even though brands are increasingly relying on digital and social media, 'Watches&Wonders' remains an important event for them to strengthen relationships with stakeholders and present themselves as a unified sector," says Bertschy with conviction. The trade fair allows visitors to see the products up close and touch them, adds Müller.
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