According to TRENDS, sister publication of AMEinfo.com, with 50 per cent of its population aged 30 and below, the Middle East is home to 500,000 HNWIs, with assets exceeding $1.8 trillion, resulting in the MENA region standing as a fertile ground for major watchmakers.
Speaking to CNN, Stephen Urquhart, CEO of Omega at Baselworld, says: “The business that we are in, everybody thinks about luxury. For me it is more than just a luxury market. The watch business is something more emotional. There is lasting value involved; it’s relatable to personality and the lifestyle we are leading today. It surprised everyone in the business who thought two to three years ago that business would have difficult years ahead.”
The Swiss watch industry recorded an increase of 1.9 per cent in 2013, compared with 2012, reaching $24.6 billion. Yet, exports in January and February of 2014 have already reached $3.6bn, an increase of 6.8 per cent from the same period last year, reports Trends.
Sylvie Ritter, the MD of Baselworld, who spoke with CNN during the trade show, explains that most of the Swiss watch making community which is present at the event does 50 to 90 per cent of their year’s turnover during the eight days of Baselworld.
“For me, the key is investing in technology and innovation, and always pushing things a little bit further. If we do that, and don’t forget it’s a handmade product with an industry behind it, I think we can keep the competitive edge,” says Marc Hayek, CEO of Breguet.
The luxury watch industry has focused mainly on the male market in the past, with the female market accounting for approximately 25 per cent of sales. “Women had to wear men’s watches before, so it was difficult to identify who would wear what watch. This year I saw all the most famous brands dedicate a lot of collections to women,” says Ritter.
According to the Chalhoub Group, the local population spends an average of $1,300 on fashion in the region, six times more than their local peers, proving that the Middle East is an accessible and positive home for luxury brands.
Focusing on emerging markets for the luxury industry, previously a final frontier for watchmakers, China tends to be the main player on the list for the next emerging market.
“In 10 years it has exploded to be a market like the US and Europe with ups and downs, with some brands more down than others, but anything against corruption is always good for business,” says Marc Hayek, CEO of Breguet.
“Greater China; the mainland, Hong Kong, Macao, Taiwan, millions of tourists and thousands of workers give me over 50 per cent [of our] turnover and a very stable turnover that hasn’t been affected this year with the anti-corruption measures,” says Walter Von Kanel, CEO of Longiness.
While Jean-Claude Biver, Head of Watches at LVMH, says that “The world is in better shape. America is coming back. Japan is developing. Even Europe is developing. Even France. All in all, some people believe we will be up between 7-8 per cent.”
And Nick English, co-founder of Bremont, explains that, “There has been a huge revival in the interest in British luxury in the last 10-20 years and also in the last five years we have been seeing British brands like Burberry, Jimmy Choo, and Jaguar Landrover competing on the global stage profitably and successfully. For us, there is huge potential for brands other than Swiss to make their mark on the global mechanical watch stage and that’s hopefully what we are going now.”
With regards to challenges forecasted for the coming year, Jean-Claude Biver explains that “The challenges are, and I’m talking about our brands, will be able to deliver. It’s always very good to say we can do much more but at the end of the day we need to perform.”
All interviews were conducted by CNN.
Published first on luxurymena.com