Image source: Apple.
The great Swiss watchmaking tradition dates back to the
1400s, so the industry's general dismissal of smartwatches as a
passing fad shouldn't come as surprise. They probably heard the
same thing about
calculator watches in the '80s.
As smartwatch shipments are expected to explode in the
coming years, a number of Swiss watchmakers, like
's Tag Heuer and
's Tissot, have slowly
waded their way
into this budding industry. And with the overall smartwatch
market expanding, and industry leader
preparing its second-generation smartwatch, the Swiss
watchmaking establishment is quietly preparing to further its
own presence in this space.
Recently, at the Baselworld watch industry fair, members of the
Swiss watchmaking elite gathered to discuss, among other
things, smartwatches -- a topic the industry has approached
with a mix of skepticism and interest. According to reports,
though, the sands are slowly shifting in this typically sleepy
space, and a number of major industry leaders have loudly
broadcast their intentions to vie for a larger share of this
Image source: Tag Heuer.
Speaking about his company's growth plans to expand deeper
into the smartwatch space, LVMH's Tag Heuer CEO Jean-Claude
Biver told Reuters
"We totally underestimated demand, we were too cautious... Next
year, we'll have a real collection, a new version with six to
The LVMH subsidiary CEO also noted: "Nobody knows what will
happen with smartwatches. Of course, we could just watch this
train from afar to see where it goes, but I prefer to be on
board." Similarly, Swatch Group's Tissot also used Baselworld
to preview the company's first smartwatch, which it named the
Tissot Smart Touch.
LVMH's Tag Heuer reportedly hopes to sell somewhere between
40,000 and 50,000 smartwatches this year, far greater than its
initial smartwatch production
. Similarly, Swatch's Tissot said it believes the company can
sell between 20,000 and 40,000 units of its smartwatch. Both
numbers lie well below the estimated 11.6 million smartwatches
that research firm IDC estimated Apple shipped in 2015.
However, for an industry that, at one time rejected the
competitive threat posed by smartwatches, interest from players
like LVMH's Tag Heuer and Swatch Group's Tissot clearly signals
that thinking among the Swiss watchmaking establishment has
indeed begun to shift.
A threat to the Apple Watch?
Though the Swatch Group subsidiary's website frustratingly
lacks any information on the Smart Touch at the moment,
commentary from Baselworld by Tissot's CEO demonstrates the
Smart Touch was designed as a watch first, and a piece of
technology second. As its CEO Francois Thiebaud stated, "Other
smartwatches are miniature smartphones on the wrist, while our
product's first purpose is to indicate the time." I'm not
necessarily sure that such a strategy will play well in gaining
mass-market adoption, but especially considering the shipment
estimates above, it seems more likely that Swiss watchmakers
like Swatch's Tissot and LVMH's Tag Heuer intend for their
smartwatches to perhaps retain old customers rather than
attract new ones.
Looking at the LVMH Tag Heuer Connected smartwatch that
launched late last year, the device falls well short of the
technological capabilities of the Apple Watch, or other
Android-wear devices, and that's to be expected. The rarified
air of the Swiss watchmaking establishment is about as far away
from Silicon Valley, both geographically and technologically
speaking, that the products powered by the tech elite should be
expected to outperform their European counterparts.
However, the user willing to spend well over $1,000 for a
smartwatch likely isn't motivated by technology alone. As such,
it seems to me that these Swiss smartwatches are more likely to
keep Swiss watch enthusiasts within the market for Swiss
watches, rather than to outright steal market share from the
likes of Apple.
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Can Swiss Watchmakers Take Down the Apple Watch
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