Chrono24 is celebrating its 20th anniversary this year, and looking back, so much has happened in just two decades. If we consider luxury watches themselves, we can list countless innovations both in terms of technology and materials. Outside the hallowed halls of production, digital transformations have forever changed the way we buy watches, releasing us from the confines of brick-and-mortar stores. All in all, the global watch industry is thriving and employs hundreds of thousands of people worldwide. In this article, we’re taking a look at some of the important achievements in the luxury watch sector over the last 20 years.
The Importance of the Global Luxury Watch Industry
Luxury mechanical watches have never been more popular. Sales figures have risen sharply since 2003, solidifying the luxury watch market as an extremely important economic sector the world over. Leading the way, of course, is Switzerland, which has a workforce of over 60,000 strong within the industry. In 2022, the export value of Swiss watches amounted to a remarkable $22.6 billion – a record figure. The luxury watch hub expects further growth in 2023, as the export value for 2023 had already reached almost $15.4 billion by June.
Japan’s forecast for 2023 is also commendable; the country is expecting a global market volume of almost $9.4 billion (+4%). Germany, with an expected share of around $1.7 billion (+1.4%), is lagging behind, but is nevertheless an important segment.
The cultural significance of traditional watchmaking and the passion for innovative timepieces shared by manufacturers and watch collectors should not be underestimated. The watch industry also exerts a considerable influence on the luxury and lifestyle sectors, as evidenced by product placement in movies and the fascination with celebrities and their preferred timepieces.
Digital Transformation in the Luxury Watch Industry
The watch industry is often accused of being old-fashioned. Anyone who has visited a longstanding retailer or roamed around a watch trade show may very well agree with this sentiment to some extent. But as with other industries, the digital transformation is not bypassing the watch industry. In any case, a lot has happened in the past 20 years to adapt to the demands of the digital age.
The steady advance of digitalization has turned new business ventures into established pillars of the industry. I’m thinking, for example, of the many commercial watch blogs and forums, where watch enthusiasts can discuss the ins and outs of this model or that brand, etc. Mainstream blogs like Hodinkee and Fratello have even managed to collaborate with manufacturers to create their own models. This would have been unfathomable just a few years ago.
Over on social media, there are plenty of watch influencers advertising their favorite timepieces. All of this translates into greater public awareness of luxury watches and an increased interest in high-end timepieces. Other examples:
- E-commerce and direct sales: The rise of e-commerce has revolutionized the way watches are sold. Most established watch brands have upped the ante for their online presence and launched online stores to sell their products directly to consumers around the world. This slashes the capital needed for retailers and is also a response to secondary markets.
- Secondary markets: Watch manufacturers and physical retailers still had a firm grip on their markets and clientele 20 years ago. This has changed significantly with the rise of online secondary markets like Chrono24. Today, retailers have far more leeway when it comes to pricing and can offer their watches online in a matter of minutes, independent of the manufacturers.
- Watchmaking technology: There has been a digital transformation in watchmaking technologies as well. Numerous watch brands have incorporated advanced engineering tools such as CAD (computer-aided design) and CAM (computer-aided manufacturing) to develop and produce their watches. New technologies both optimize the production process and improve accuracy.
While we’re on the topic of e-commerce, would you like to know the most popular watches on Chrono24 over the last 20 years? Pascal Gehrlein’s article has the details.
Since Chrono24 was founded in 2003, the watch industry has made some major technological advances. The way watches are manufactured, operated, and used has evolved dramatically in recent years. Manufacturers also began to focus on sustainability and conserving resources. Here are some of the most important developments:
- Mechanical watches with silicon components: The use of silicon as a material for certain components in mechanical watches has been on the rise since the 2000s. Silicon is lightweight, anti-magnetic, and resistant to temperature fluctuations, which improves both the accuracy and durability of the movement.
- Co-Axial escapement: Omega‘s Co-Axial escapement is protected by patents and has been around since before 2003, but it only really had its big break in the last twenty years. With Co-Axial technology, a watch’s escapement experiences less wear, in turn increasing the movement’s power reserve and accuracy. There is also no need to lubricate individual components.
- Smartwatches: The development of smartwatches by companies such as Apple, Samsung, and Garmin changed the industry at a physiological level. Even traditional watch manufacturers have begun to incorporate digital features into their watches, one example being TAG Heuer’s Smartwatch Connected series.
- Improved and innovative materials: Significant advances have also been made in terms of the materials that are used. For example, ceramics, carbon fiber, and other composite materials are now commonplace in the production of watch cases and their components. Besides mesmerizing visual effects, watches have become lighter and more durable. One of the leading brands in this sphere is Richard Mille.
Sustainability in the Watch Industry
Sustainability has become somewhat of a buzzword in recent years. When applied to the luxury watch market, sustainability means that manufacturers strive to make their activities and production processes more environmentally friendly, socially responsible, and ethical. Over the past 20 years, for example, more and more recycled and certified materials have found their way into watchmaking. Examples include plastic watch straps made from recycled plastic bottles or fishing nets from ocean clean-ups. When it comes to buying precious metals and diamonds, many brands like Chopard and Cartier have been paying more attention to where these materials are sourced.
Criteria for Sustainability in the Luxury Watch Market
- Environmental impact: Watch brands that are serious about environmental protection such as IWC, Panerai, and Oris go to great lengths to reduce their impact on the environment by opting for production processes that conserve resources, minimizing energy consumption, and using renewable energies and environmentally-friendly materials. Reducing waste and emissions and promoting the circular economy are also important goals.
- Ethics and social responsibility: Sustainable watch brands are mindful of the social conditions at their production sites and along their supply chains. They are committed to providing fair working conditions, ensuring that human rights are respected, and combating child and forced labor. In addition, they are often involved in social projects in their local communities.
- Transparency and certifications: Sustainable watch brands tend to be transparent about their practices, where the materials they use come from, and their supply chains. They are often awarded with certifications and quality seals that support their claims.
The Big Players in the Luxury Watch Market
We took a closer look at the Chrono24’s international data and compiled a list of the top-10 luxury watch brands that hold the largest market share on the marketplace. The ten brands are all traditional manufacturers that have been producing watches for decades or even centuries.
Top-10 Watch Brands and Their Global Market Shares on Chrono24
|Brand||Market share (approx.)|
As expected, Rolex holds the number one spot by quite a margin. Rolex’s biggest competitor, Omega, trails far behind with a market share of 10%. It may come as a surprise to some that Breitling, despite their prominence and vast product range, only rank fifth worldwide, with a market share of just 3.8%.
The luxury watch industry has covered a lot of ground over the last 20 years. These decades were marked by technological advances, digitalization, and an increased emphasis on sustainability. Supported by an enthusiastic community of aficionados and collectors, the appeal of premium watches remains strong, and we have a lot to look forward to.
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