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What comes to mind when you think of Switzerland? 

A beautiful (and expensive) holiday destination? Featured extensively in Bollywood movies.

Or the Swiss Banks? Popular among the wealthiest for their secrecy.

Or if you are a history buff then you might recall the Swiss War neutrality? After all, the last time the Swiss fought militarily was almost 500 years ago.

Or the cheese and chocolates, and even knives? Considered to be the finest in the world. 

Some of you might also think about watches! This article is about the last bit – Swiss Watches.

Switzerland is known not for ‘just watches’, rather it is known for ‘luxury watches’. The crème de la crème of timepieces. 

Like with most other things, the better the quality the more expensive the product gets. But this gets to an altogether different level in horology – the art of making clocks and watches. A normal mass-market watch can be found for as low as $10, on the other hand, the export value of an average Swiss watch was more than $1750 (~INR 1.5 Lakhs) in 2023. 

The total watch market is estimated to be an odd $100B. Out of that, the luxury watch market is estimated to be almost $50B globally. At 26.74B Swiss Francs (~$30B), Switzerland alone contributed to around 60% of the luxury watch market.

How prominent the watch industry is in Switzerland can be seen via the below infographic:

Watches and the Swiss Economy GDP and Exports
Watches and the Swiss Economy

The Jura Mountain range of Switzerland is referred to as the ‘Watch Valley’, contributing to 90% of Switzerland’s watches. A handful of luxury brands dominate the market. The most popular ones being the most prominent ones. 

Image Courtesy: Visual Capitalist

Rolex – the synonym for a luxury watch amongst the general audience, stands quite true to its reputation. The Rolex Group, which also has the sister brand Tudor under its umbrella, is responsible for almost 1/3rd of the Swiss Watch Industry and 1/5th of the global luxury watch market. 

It is noteworthy that all the analyses in this article include only new watch sales. The secondary luxury watch market is an altogether different industry and deserves a separate article of its own.

Is the Luxury Watch Market Growing?

A traditional quartz or mechanical watch tells you the time, some also tell the day and the date, but that’s mostly all that they can do in terms of utility. A smartwatch on the other hand can track your activity, pick up calls, read messages and some even do an ECG.

Given that they pale in comparison to smartwatches in terms of utility, you might wonder, are people really buying these expensive watches anymore? 

While the growth of the smartwatches and smart bands market cannot be ignored, the luxury watch industry has broadly been unaffected by their introduction.

Swiss Watch Exports by Value over the years

The value of watch exports from Switzerland was about 10.3B Swiss Francs (CHF) in 2000, much before smartwatches and even before the advent of smartphones. In 2023, the same number reached 26.74B CHF. 

Here’s a snapshot of the compounded annual growth rate (CAGR) of the Swiss Watch Market during the course of the 21st century:

PeriodCAGR
Past 23 Years (2000-2023)4.23%
Past 18 years (2005-2023)4.36%
Past 13 Years (2010-2023)3.95%
Past 6 Years (2017-2023)5.05%
CAGR of Swiss Watch Exports Revenue

So in the past half a decade or so, when smartwatches have advanced leaps and bounds in terms of technology as well as market penetration, the luxury watchmakers of Switzerland have held their ground strong and the business is growing steadily. 

It could be because luxury products are not built on utility. Sure the Swiss watches are made with precious metals, high-grade raw material, and take hours of labor. But customers also associate more than just quality with them. Timelessness, heritage, exclusivity, craftsmanship, rarity, and customers as believers are some other ingredients on which a luxury brand is built. 

A similar trend where digital versions couldn’t beat the traditional method is quite prominent with books. Physical books still outsell ebooks worldwide. Read our special on books: Vellichor: The smell (spell) of books

Top Markets for Swiss Watches

10 countries make up for 70% of the Swiss Watch sales. The USA and China account for 25% of the imports. China with its rising wealthier class is a rapidly growing market. 

Top 10 Swiss Watch Markets
Top 10 Swiss Watch Market Countries

When we are talking about China and Watches, it is noteworthy that China and Hong Kong combined are the leaders in watch exports by number of units. China alone exports over 500M pieces of watches each year as compared to just 17M by Switzerland. But due to the average price of just $4 vs Switzerland’s $1750, Switzerland outperforms by a hefty margin in terms of exports by value.

India and Swiss Watches

The most populous country in the world imported $218M worth of Swiss watches in 2023, making it the 22nd largest customer of the industry. While this may be less than 1% of total Swiss Watch sales in the world, the watchmakers in Switzerland are extremely optimistic about India.

From 2021 to 2023, in just two years, the value of Swiss Watch imports in India has exploded by 40%. With rising disposable incomes, India is seeing a lot more first-time buyers as well as existing buyers upgrading to higher ticket-size watches.

It’ll be interesting to see how quickly India climbs from the 22nd spot. 

What are your views on spending top dollar for wristwatches? Do let us know if you have some favorite timepieces. 

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