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Watches - UK - August 2015

Watches - UK - August 2015

“As the smartwatch market develops, the smartwatch could become the latest desirable fashion accessory, posing a direct threat to the fashion watch market as both attract a young demographic. While uptake of smartwatches has been slow due to caution surrounding first editions of new technologies, this is likely to change as more companies enter the market and as people get used to their functionality.”

This report looks at the following issues:

What is driving growth in the watches market?
How can watch specialists compete with fashion brands?
How are smartwatches impacting the watches market?


OVERVIEW
What you need to know
Products covered in this report
EXECUTIVE SUMMARY
Watches market grows 4.5% in 2015
Figure 1: Best-and worst-case forecast value sales of watches, 2010-20
Michael Kors benefits from associations with style and quality
Figure 2: Attitudes towards and usage of selected brands, June 2015 and December 2014
One in ten affluent ABs owns a smartwatch
Figure 3: Ownership of watches, June 2015
Watch self-purchasing peaks among under-25s
Figure 4: Purchasing of watches, June 2015
Argos is the preferred watch retailer
Figure 5: Preferred retailers for watch purchases, June 2015
Designing watches that women want
Figure 6: Most important factors when buying a watch, June 2015
Young women prefer fashion watches
Figure 7: Attitudes towards buying watches, June 2015
A quarter don’t use their watch to tell the time
Figure 8: Attitudes towards wearing watches, June 2015
21% plan to buy a smartwatch
Figure 9: Attitudes towards smartwatches, June 2015
What we think
ISSUES & INSIGHTS
What is driving growth in the watches market?
How can watch specialists compete with fashion brands?
How are smartwatches impacting the watches market?
THE MARKET
What you need to know
Market grows 4.5% in 2015
Watch sales to reach £1.3bn by 2020
Changes to Swiss franc impacts watches market
Declining youth population poses a threat
Over three quarters own a smartphone
Swiss watchmakers’ output sees marginal rise
Market size and forecast
Market grows 4.5% in 2015
Figure 10: UK value sales of watches, 2010-20
Watch sales to reach £1.3bn by 2020
Figure 11: Best-and worst-case forecast value sales of watches, 2010-20
Market drivers
Changes to Swiss franc impacts watches market
Declining youth population
Figure 12: Trends in the age structure of the UK population, 2010-20
ABs account for 22% of the population
Over three quarters own a smartphone
Figure 13: Personal ownership of mobiles, basic versus smart, November 2014 and April 2015
Swiss watchmakers output
Figure 14: % share of all COSC certificates accounted for, by leading Swiss-watch brands, 2013 and 2014
Figure 15: Number of Swiss watch certificates issued by the COSC, 2013 and 2014
Figure 16: Number of Swiss watch certificates issued by the COSC, three leading brands, 2010-14
KEY PLAYERS
What you need to know
An array of smartwatches are set for release
Swatch targets the fashionable man
Michael Kors benefits from associations with style and quality
Swatch users describe their experience as excellent
Rolex is the biggest spender
Watch retailers by sales
Luxury watch brands hit by falling demand in Asia
Launch activity and innovations
An array of smartwatches are set for release
Figure 17: Apple watch range
Cartier pops up in Harrods
Time zone switching watches
Swatch targets the fashionable man
Figure 18: The Swatch shoe-shine at London Collections: Men, 2014
Designer experiments with 3D printed watches
Chopard makes the move online
Watch store offers personalisation area
Figure 19: Larsson & Jennings’ Seven Dials boutique with espresso bar, 2015
Brand research
What you need to know
Brand map
Figure 20: Attitudes towards and usage of selected brands, June 2015 and December 2014
Key brand metrics
Figure 21: Key metrics for selected brands, June 2015 and December 2014
Figure 22: Attitudes, by brand, June 2015 and December 2014
Figure 23: Brand personality – Macro image, June 2015 and December 2014
Figure 24: Brand personality – Micro image, June 2015 and December 2014
Brand analysis
Figure 25: User profile of Michael Kors, December 2014
Figure 26: User profile of Rolex, June 2015
Figure 27: User profile of Omega, June 2015
Figure 28: User profile of Swatch, June 2015
Figure 29: User profile of Links of London, June 2015
Brand communication and promotion
Falling adspend on watches
Figure 30: Recorded above-the-line, online display and direct mail total advertising expenditure on watches, 2011-14
Rolex is the biggest spender
Figure 31: Recorded above-the-line, online display and direct mail total advertising expenditure on watches, by advertiser,
2011-14
Press advertising dominates among the media types
Figure 32: Recorded above-the-line, online display and direct mail total advertising expenditure on watches, by media type,
2014
Figure 33: Recorded above-the-line, online display and direct mail total advertising expenditure on watches, by media type,
2011-14
A note on adspend
Retail competitor analysis
Watch retailers by sales
Figure 34: Watch retailers, by revenue, 2010-14
Watch retailers by operating profit
Figure 35: Figure 36: Watch retailers, by operating profit, 2010-14
Companies and products
Aurum
Figure 37: Key financials for Aurum Holdings Limited, 2010-14
Swatch
Figure 38: Key financials for Swatch Group (UK), 2010-14
LVMH
Figure 39: Key financials for LVMH (Europe excl. France), 2010-14
Richemont
Figure 40: Key financials for Richemont, 2010-14
Casio
Figure 41: Key financials for Casio Electronics (UK), 2010-14
Seiko
Figure 42: Key financials for Seiko (UK), 2010-14
Breitling
Figure 43: Key financials for Breitling (UK), 2010-13
THE CONSUMER
What you need to know
Watch self-purchasing peaks among under-25s
One in ten affluent ABs own a smartwatch
Argos is the preferred watch retailer
Designing watches that women want
Young women prefer fashion watches
Men favour specialist watch brands
21% plan to buy a smartwatch
Preference for smartwatches sold by technology specialists
Appealing to women
Ownership and purchasing of watches
Nearly three quarters own a watch
Figure 44: Ownership of watches, June 2015
One in ten affluent ABs own a smartwatch
Figure 45: Profile of watch owners, by gender, age group and socio-economic group, June 2015
Watch self-purchasing peaks among under-25s
Link between healthy financial situation and watch purchasing
Figure 46: Purchasing of watches, June 2015
Watches for gifting peak among 25-44s
Figure 47: Profile of watch buyers, by age group, June 2015
Preferred retailers for buying watches
Argos is the preferred watch retailer
Figure 48: Preferred retailers for watch purchases, June 2015
H Samuel popular among women and parents
Figure 49: Preferred retailers for watch purchases, by gender, June 2015
Over a quarter of under-25s buy watches from fashion stores
Most important factors when buying a watch
Designing watches that women want
Figure 50: Most important factors when buying a watch, June 2015
A third look for discounted watches
Figure 51: Most important factors when buying a watch, June 2015
Attitudes towards buying and wearing watches
Young women prefer fashion watches
Figure 52: Attitudes towards buying watches, June 2015
Men favour specialist watch brands
Figure 53: Attitudes towards buying watches, by gender, June 2015
Young men want to personalise their watch
A quarter don’t use their watch to tell the time
Figure 54: Attitudes towards wearing watches, June 2015
Men aged 45+ favour watch brands
Figure 55: Attitudes towards Watches – CHAID – Tree output, June 2015
Attitudes towards smartwatches
21% plan to buy a smartwatch
Figure 56: Attitudes towards smartwatches, June 2015
Preference for smartwatches sold by technology specialists
Appealing to women
Figure 57: Attitudes towards smartwatches by gender, June 2015
APPENDIX
Data sources and abbreviations
Fan chart forecast
Consumer methodology
Abbreviations
UK Research Methodology
Sampling and weighting
Face to Face Surveys
Definitions
Brand & Social Media Research
Trade research
Desk research
Statistical Forecasting
The Mintel fan chart

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