Watch volume sales may be down, but overall the market continues to grow with people spending more money on their timepieces. Total United kingdom market sales volumes for timepieces was lower by 1.8%. In absolute terms this signifies 167,460 less watches sold compared to 2014. By having an average value in 2015 of £142 per product sold sales increased by £105m within the last 12 months. The United kingdom watch marketplace is now worth just below £1.3bn per year consequently.
In the last five years there has been a 30% rise in value of each watch sold and this despite 1.3m less models being offered. A look at the marketplace you’d be pardoned in believing that the luxury segment is driving value increases. Although there’s truth to this it is not so straight-forward.
Luxury watches selling for more than £1,000 had a 15.4% rise in sales in 2015, a rise in purchase volumes of 16.2%. Luxury brands and merchants did it by growing the amount of watches they offered, not by growing the typical value. Although not all brands may have shown this trend, the general picture indicates a particular degree of cost adjusting along with a greater concentrate on watches with a much more commercial focus than formerly seen. Clearly, the customer has responded accordingly.
Watches selling for less than £100 did see volumes decline, by over 3%, however this was counter balanced by a rise in average value of 7%, producing a value development of 4.3% within the last 12 months.
The basic price point level shows the health of the marketplace for the long run even though a 3% decline in volume doesn’t seem too harmful, in tangible terms this really is 220,000 less watches within this segment this past year. With ever growing markets from fitness trackers and smartwatches this part of the market may see see further contractions in volume for 2016 as customers potentially look for more technology focused items. Consequently, brands at greater price points may need to continue to work harder to create these customers.
This then will be the goal of brands selling watches between £100-£500. So would selling less volume but at a bigger price point be the way forward?
The ultimate sector is for watches selling between £500-£1,000. However, there’s been significant development on the market here, especially in the last quarter with a volume development of 17% in the same time frame period.
So although watches selling for less than £100 have experienced volumes decline, value sales are positively robust so when searching for watches listed in excess of £500 and also over £1,000, both volume and values are rising every year. These combined price points make up 75% of the total market. However it is the £100-£500 price range which is worth nearly 25% of the market and that is decreasing and that will need to be challenged by the brands who sell at that price point if 2016 is going to be another record breaking year.
