Swatch Watch creator thinks Swiss watchmakers missing the boat?

Discussion in 'Apple Watch' started by Cassady, Sep 12, 2014.

  1. Cassady macrumors 6502a


    Jul 7, 2012
    Interesting read this...

    TL : DR >> Swiss watchmakers ignoring the Apple Watch, could be synonymous with the same Swiss watchmakers choosing to ignore the development of the Japanese Quartz watch industry, with near disastrous consequences...

    Elmar Mock, co-inventor of the Swatch watch, believes the Swiss watch industry ignores the Apple Watch at its own peril. He sees it repeating the mistakes from the 1970s, when it underestimated competition from Japanese quartz watches.

    In 1970, Elmar Mock invented the Swatch along with Jacques Müller and Ernst Thomke. It was designed as an affordable product that could compete with the cheap Japanese quartz watches that flooded the market. Currently the director of Creaholic, an innovation consultancy, Mock shares his views on the Swiss reluctance to enter into the smartwatch fray. Many predict the Apple Watch will be as disruptive to the market as the Mac, iPhone or iPad. Do you share this view as well?

    Elmar Mock: The big deal is not the Apple Watch itself but the fact that an electronics giant like Apple has entered the watch market. It makes total sense to have a communication tool on the wrist and, in my view, this strategic space has enormous market potential.
    The biggest challenge lies in the digital environment and the consumer experience that a smartwatch can offer. There is a lot to learn in this new area but it’s only possible to learn by creating. This is where I think electronics giants like Google, Samsung or Apple are winning the battle. But are consumers ready for such products that some dismiss as mere gadgets?
    EM: The Apple Watch is by far the most attractive of the smartwatches. I would definitely wear it. Don’t forget that the early smartphones did not immediately replace conventional mobile phones. When the iPhone first launched, Blackberry was sure that consumers would notice the lack of a keyboard and Nokia was convinced that the big screen would put users off… Should the Swiss watch industry fear the smartwatch invasion, as suggested by Apple’s chief designer Jonathan Ive?
    EM: Switzerland has already lost the wrist war. Only one of every 200 watches produced [worldwide] is a Swiss watch. However, the profit made on that one Swiss watch is greater than that of the other 199 combined. So, we’ve won the profit war.
    Swiss watchmaking has transformed a watch into mechanical jewellery that represents the ingenuity of manual craftsmanship. It has also excelled in design, marketing and communication. Smartwatches are not going to completely replace mechanical watches just like the Kalashnikov assault rifle is not going to make samurai swords any less desirable.
    On the other hand, Switzerland has missed a tremendous opportunity and it is shocking that the leaders of the watch industry do not find the smartwatch market a tempting prospect. This market could be worth $30 billion (CHF28 billion), assuming a realistic figure of 100 million smartwatches sold every year. This amount would benefit the entire Swiss watch industry. Is Nick Hayek, head of the Swatch group, an example of this nonchalant attitude towards smartwatches?
    EM: Clearly! It’s understandable why [luxury brands] Breguet, Rolex, Cartier or Patek Philippe are disinterested. Swatch, on the other hand, should be taking a leading a role. Swiss watchmakers seem to have forgotten how they underestimated Japanese quartz watches in the 1970s as mere gadgets and not real watches. That mistake led to the near collapse of the watch industry.
    However, through Swatch, we eventually succeeded in creating a stylish quartz watch. But we then failed to follow up and re-conquer the global watch market through investment in industrialisation. Obsessed by short-term gains, the Swatch group did a complete U-turn towards luxury watches. Instead of investing in ideas, the group chose to invest in luxury watch brands and showrooms all over the world. Does the Swiss watch industry lack diversity?
    EM: It is definitely a risk. The industry is beginning to resemble a Native American reservation. It has deliberately refused to be a part of recent changes, not through a lack of creativity or innovation, but due to strategic choice.
    Unfortunately, Switzerland lacks a Steve Jobs who can drag the watch industry into the future. It doesn’t necessarily mean the industry is on the wrong path, but it does mean that it has missed the boat as far as smartwatches are concerned
  2. NewbieCanada macrumors 68030

    Oct 9, 2007
    Apple is also familiar with losing the volume battle and winning the profits battle.

    Like anyone else, Mock may end up wrong in his predictions about the future, but unlike many he at least understands the past!
  3. solo118 macrumors 65816

    May 16, 2011
    I do not see a problem for the Swiss watchmakers. Rolex, Omega, Patek, JLC etc etc will have no problem continuing to sell their watches!

    A $300-$500 digital watch is just a toy compared to a $10k-and up masterpiece.
  4. hollandog macrumors regular


    Mar 13, 2014
    I wear Rolex and I don't think I will want a $400 watch that looks like a toy to replace my Rolex.
  5. Patriot24 macrumors 68030


    Dec 29, 2010
    Are high-end watchmakers in trouble? No, not yet.

    Are medium-to-low priced watchmakers in trouble? Yes, absolutely.
  6. Dwalls90 macrumors 601


    Feb 5, 2009
    I would say Apple is surely winning both the profits and volume battle in the US (in terms of marketshare)

    I agree, but I also think the most premium Apple Watch will far exceed the introductory price of $349.
  7. solo118 macrumors 65816

    May 16, 2011
    Sure absolutely, but I am talking about the "Steel" models. I am just trying to say that curiosity will get some sales from watch lovers. It doesnt need to be worn every day, it can just be part of the rotation.
  8. Dwalls90 macrumors 601


    Feb 5, 2009
    Really curious about the "18-Karat Gold" - won't that be easily in the $1,000 range?
  9. solo118 macrumors 65816

    May 16, 2011
    Easily! I would not be surprised if its actually double or triple that (assuming the entire case is gold and it is not just plated)
  10. Cassady thread starter macrumors 6502a


    Jul 7, 2012
    Someone made the point about who would spend the $$$ on buying an AW001, when a few years later version 002 is released. But is an AW (top of the line) comparable to a phone or other tech in that sense - or would it be the equivalent of buying a Rolex/PPatek etc., where a different model (update??) is released a few years later?

    Sincere question - don't know much about the watch collecting...
  11. NewbieCanada macrumors 68030

    Oct 9, 2007
    I wouldn't. They don't ship the most phones in the US - the most premium smartphones, yes, but not the most phones. Same thing with computers.
  12. solo118 macrumors 65816

    May 16, 2011
    Funny thing is in the watch world with Rolex/PP etc, usually older means better. In this case its the opposite. With all tech usually i would try selling on ebay/CL to recoup some of the cost to buy the newer version. I never keep old tech around the house.

    However it wont be a few years as usually Apple releases a new desigin within 2 years.
  13. NewbieCanada macrumors 68030

    Oct 9, 2007
    A difference, I think, is that these analog watches gain new designs, but not new capabilities. There will be new apps that the first generation :apple:WATCH won't run. They aren't heirlooms you pass on in your will, but you will pass it on to your kids while you're still alive and kicking. (Or sell on Craigslist)
  14. JayLenochiniMac macrumors G5

    Nov 7, 2007
    New Sanfrakota
    They'll still be in trouble in the long run, because Apple will have bred a generation of people who won't consider a Rolex, Omega, etc. as they're using a smartwatch instead.
  15. 556fmjoe macrumors 65816


    Apr 19, 2014
    Yes and no. The quartz and digital watches in the $400 and under range might be in trouble. The automatic and manual watches in that price range are not. They appeal to two completely different types of people.
  16. Cassady thread starter macrumors 6502a


    Jul 7, 2012
    Good point - thanks.
  17. NewbieCanada macrumors 68030

    Oct 9, 2007
    True, but just as increasing features and convenience persuaded some people to give up their landlines in favour of cell phones, there may be some who currently buy those watches who say, "You know what? This looks good enough and does so much more."

    People used to buy TVs and stereos in ornate wooden cabinets that looked like high end furniture. They don't anymore. You can't even buy them.
  18. cube, Sep 12, 2014
    Last edited: Sep 12, 2014

    cube macrumors G5

    May 10, 2004
    Isn't it true that Swatch will release a smart watch next summer? If so, this kills the credibility of the article.

    I would expect that to be more of a real watch than a gadget, with much more acceptable battery life.

    You cannot compare phones to Swiss Made watches, not even Vertu.
  19. rans0m00 macrumors 6502

    Jun 21, 2010
    I don't think it's really a this does so much more thing. I like the nicer watches because they do their intended task without crossing into other areas. It's simple, it tells me the time. I have a phone for the rest of the stuff. I don't really want the distraction on my wrist. So for me I would avoid it because is does more. Also it's appealing to different crowds... I don't know anyone that is thinking of giving up their rolexs for the Apple watch. So far I have just heard the usual comments of its bulky... It looks cheap compared to my omega... I don't want to mess with another device I have to plug in daily.... It looks like a toy. The list goes on for a few more things but you get the idea. It's hard to convince someone that collects watches that gain value over time to really put much value into something the just decreases. In a couple of years you will be sitting there with a piece of tech that is dated and have to buy another one... A dated piece of tech that you are showing off to the world on your wrist... Nope I think classics are better to be worn like that.
  20. Wishbrah macrumors regular

    Oct 20, 2013
    Remember what happened when the iphone was ignored? And 64 bit? Yeah....
  21. NewbieCanada macrumors 68030

    Oct 9, 2007
    No one saw a 1st generation cell phone and envisaged it becoming their only phone - let alone replacing the computer they didn't even own yet because they couldn't imagine needing one of those either.

    A tiny, increasingly small percentage of the population will continue to collect watches. Much like people collect stamps and coins. And just like those collectors weren't the target market for email and credit card providers, watch collectors aren't the target market for this.

    There are an awful lot of watches being made and the type you refer to are a minor segment. And clearly, with 1.2 billion watches being made yearly, an awful lot of people are buying watches they don't see as being permanent.
  22. kdarling macrumors demi-god


    Jun 9, 2007
    First university coding class = 47 years ago
    Depends on where most of those watches are sold.

    Remember, Apple's entry only works with iPhones.


    Besides, people who have been buying real watches don't seem like the target audience for this.

    And it sure doesn't look like one of those military / pilot chronographs that men love to buy.


    If jewelers were smart, they'd be making custom cases and straps for the Moto 360, LG-R, etc.

    Plus, dagnabit, where the heck are the smartwatches with a rotating bezel to electronically enter in analog information like a slide rule? You could make a very cool and useful pilot watch out of one of these computerized gizmos.
  23. Rogifan macrumors P6


    Nov 14, 2011
    Why do smart watches have to compete with expensive Swiss timepieces? Why can't there be room for both? This zero sum game that some play (especially in the smartphone market) drives me nuts. There's room for lots of players and lots of products at different price points.
  24. MarcoCapa macrumors regular

    Jun 16, 2013
    Because is difficult to justify wearing an apple watch and another watch ( an automatic one for example) together...
    I tried to convince me that this is a doable option, but every time I think how stupid is...
    From a rational point having an automatic watch is very comfortable because it doesn't need charge and when the smart watch is discharged let you to know the hour rapidly... From a "fashion" point of view it doesn't sound good and look too nerd...
    Maybe the "haute horologerie" brands will find a way to convince people wearing two watches at the same time ( smart watch+ analog)
    Please share me what do you think
  25. Pistol Peto macrumors member

    Pistol Peto

    Oct 9, 2013
    West of Toronto
    You'd look like a giant douche.

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