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Jun
2015

Watches & Jewellery May 2013

Watch market is under the ‘red campaign’ in China

As a result of eight new regulations issued by the central government of China, labeled as a ‘red campaign’ aimed at cracking down on extravagance and waste, there has been a significant downturn in the fortunes of the luxury watch sector in China. According to the data released by the Swiss Watch Association recently, the export of watches from Switzerland to Mainland China declined by 25.6% in the first quarter of 2013, and 31.4% in March this year.

“The new policy restricting the use of public money by government officials and the advocation of diligence and thrift has caused a great impact on luxury industry, especially the watch sector”, according to a sales professional working in a luxury watch brand, “during the Labour Day holiday recently, only a few sales were made every day, while the previous year at the same period, our brand could sell seven to eight watches each day at an average price of over 50,000 RMB each.” According to the same source, luxury watch stores have adjusted their strategy to reduce the stock of high priced watches over 500,000RMB, and those exhibited in cabinets now are normally approximately 100,000RMB.

China is still the market the big luxury groups want to capture

In 15th April, LVMH Group released its first quarter results of 2013, the performance of its jewellery and watch division, that had done a great job in 2012 with a 141% increase in sales, now reported a 1% decrease in that reporting period. LVMH explained that this was caused by the prudent purchase of multi brand retailers.

In the twelve months to 31st March 2013, the total sales of the Richemont group increased by 14% to 10.15 Billion Euro, compared to last year’s figure of 8.868 Billion Euro. The Asia Pacific region remains its largest market lead by Hong Kong and Mainland China, representing 41% of total sales, a 13% year-on-year growth.

However, compared to the 43% increase in 2012, there has been a significant slowdown.

The president of Swatch group Mr. Hayek stated in an interview recently, that they plan to further explore the watch market in China. According to him, the two key points of focus for the Swatch group in 2013 are to shorten the lead time for clients who make a reservation and to strengthen the promotion of Breguet in the China market.

Store opening

In March, Blancpain held the official opening of its new two-floor flagship store in Shanghai, that has a club on the second floor that is exclusive for the brand clients. On 29th March, Jaeger-LeCoultre opened a direct store in the Shenyang Plaza66, which is the first direct store in North East China and its second in the Mainland. Qeelin has begun to explore the Mainland Chinese market by opening new stores in Tianjin in March and Shenyang in April respectively. On 11th April, Omega opened a new direct store in Chengdu. On the 18th DAMIANI, one of the top jewellery brands in the world, unveiled its largest boutique store in China in Shanghai’s Peninsula Hotel. And on the next day, the tenth direct store of Hublot opened in Kunming.

Events

On 16th April, Italian jewellery brand Damiani held a jewellery exhibition in Beijing attended by celebrities from Italy and China, and the Rolex Deep Sea Challenge show presented in The Rolex Experience store on the Bund in Shanghai from 17th April to 20th May. A Graff jewellery exhibition has displayed in the Shanghai IFC from 22th to 26th May. To coincide with the opening ceremony of the Cannes Film Festival, Chopard announced that Fan Bingbing, a famous actress in China, was to become one of their new brand ambassadors. And from 15th to 30th June, Jaques Droz will hold an exhibition in Shanghai to celebrate its 275 anniversary.


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