Bloomberg: Mid-priced Swiss Watches Struggled In 2015

Andrea Felsted and Shira Ovide reporting for Bloomberg in a piece titled Don’t Mock the Apple Watch:

Bloomberg Intelligence estimates that exports of mid-priced Swiss watches (those costing between 200 francs and 500 francs) struggled the most in the first 11 months of 2015, falling 9 percent. That’s the price point of the basic Apple Watch, and suggests that for all the Swiss mockery, the U.S. upstart is putting a dent in sales.

Two-thirds of Swatch sales are from products that cost less than 1,000 francs, according to Exane BNP Paribas.

In other words, while some may laugh or want to call the Apple Watch a flop, there’s some indications that it’s effecting sales of popular Swiss brands. Not good.

Interestingly, the report also suggests that Apple’s iPhone is also effecting the watch industry:

And it’s not just Apple’s timepieces that worry the industry. Fossil makes watches for brands such as Michael Kors, DKNY and Marc Jacobs, which also compete with the Apple Watch on price. But Michael Kors’ CEO says the iPhone 6’s popularity is having as much of an impact on sales, as younger customers use its clock rather than own a watch at all. (Fossil shares fell 67 percent in 2015, making it the worst performer in Bloomberg Intelligence’s luxury peer group.)

A few months ago NYU Stern’s Professor Galloway also made the correlation that people are putting there $600 towards an iPhone rather than towards a purchase of a bag or watch from the brands mentioned above.

Lesson to be learned: If you’re a mid-priced bag or watch maker, you should be worried. Between the iPhone and the Apple Watch, Apple looks to shift those spending dollars into their pockets and so far it looks like it’s working.