As the global recovery begins to take hold, perhaps it’s not too early to begin contemplating how such a development would affect the Swiss watch industry. It’s a fairly well-known fact that consumer spending accounts for approximately 70% of GDP in first-world, developed nations. Economists have conjectured that until this figure recovers, we’re unlikely to see much of a rebound.
Additionally, as long as unemployment remains high or concern remains regarding the jobs problem persist, household earnings will not increase and thus neither will spending. These worries have forced high-end watch manufacturers to refine and refocus their strategies. An excellent example was that of the brand Chronoswiss. Though the company seemed to be having issues with its retailers before the recession, the last two years have compounded and magnified this reality.
Chronoswiss took some steps that are concurrently being put into place across the industry. The makers of these luxury goods have dramatically slashed prices well into the double digits. Some Chronoswiss watches cost thousands less now than they did before the recession. The hope is that companies will be able to maintain their images and retain loyal customers during this difficult period. No doubt there are some that hope to actually gain customers by using discounts to lure individuals away from other brands.
Chronoswiss also took the step of firming up its relationships with its retailers. Retailers are the direct interface with the final customer, and it’s important that they can act as excellent representatives. Without a comfortable connection between retailers and the manufacture, the brand suffers. As Chronoswiss fine tunes its marketing strategy to align with these troubled times, it’s consolidating its efforts with U.S. retailers. Though the brand is considerably less visible than it was several years ago, look for Chronoswiss to do a better job this time defining its core market segments and finding the right retailers to target them going forward.