The Swiss Luxury-Watch Slump in the United States Is Over - Bloomberg - 0 views
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The three-year luxury-watch slump in the United States is over. Swiss luxury-watch sales in the U.S., Switzerland's second largest export market, jumped substantially in the first half of 2018 versus the same period in 2017, according to three indicators, two for wholesale sales, the other for retail sales. The retail data came from the NDP Group, the market research company whose widely respected watch retail tracking service collects point-of-sale data from thousands of stores in the United States. "We're reporting that U.S. sales for watches above $1,000 are up 13.5% in value year-to-date," Reg Brack, NPD's watches and luxury industry analyst, told HODINKEE. Swiss watches dominate the market above $1,000.
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The Swatch Group boasted that it had "the best first semester sales in the history of the group," CHF 4.27 billion, a 14.7% increase over the same period in 2017. The company reported a 66.5% jump in net income to CHF 468 million.
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The main drivers of this year's boomlet, according to the FH, were Asian markets, mechanical watches, and relatively affordable steel watches.
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Mechanical-watch exports grew by double-digit percentages in both volume and value. Unit exports increased 13.6% to 3.8 million pieces. In value, mechanicals rose 11.3% to CHF 8.14 billion. That amounts to 82% of total export sales by value. Exports of electronic watches rose 6.4% in value, but dropped 3.8% in units to 7.85 million, continuing a steady, five-year decline.
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Watches with export prices in the CHF 500 to CHF 3,000 range showed the strongest growth, up 14.8% in volume and 16.9% in value. Overall, steel watch exports enjoyed a "steep rise," the FH said, up 500,000 units (it didn't give the total number).
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While global Swiss watch sales this year are strongest in the $1,000 to $5,000 retail range, according to the FH, that's not the case in the U.S. Here watch sales are strongest at the very top of the price pyramid, according to NPD. Watches priced $5,000 and up accounted for nearly half the sales of the entire U.S. watch market in value.
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In general, Swiss brands that are less well known have difficulty competing in the U.S. market. That's particularly true in the $1,000 to $3,000 price range, Brack said. That price range is extremely competitive: "A lot of brands are struggling for [consumer] awareness."