The onset of the COVID-19 pandemic in 2020 affected luxury timepieces negatively as Australia closed its borders and the country went into lockdown to slow the transmission of COVID-19 leading to the halting of tourism and closures of a large range of businesses and non-essential shops. These occurrences as well as the ongoing economic and social anxiety linked to the pandemic have prevented Australian shoppers from engaging in their normal shopping habits causing a decline in sales of watches like many other discretionary items.
The cancellation of major events such as watch fairs also had an impact on demand for luxury timepieces in 2020. The organisers of the world’s largest watch fair, Baselworld, announced that the majority of the show’s key vendors pulled their support for the show permanently and will exhibit their wares at online trade shows such as Virtual Watches and Wonders events for now.
Competition from smart watches are increasing especially as people are more interested in taking care of their health and wellness by tracking various health indicators such as heartrate, number of steps taken, and their sleep cycle. Luxury smart watches, tracked as luxury wearables, are gaining in popularity and there has been a number of new high-end products introduced such as watches from the Garmin MARQ® collection that range between AUD2,500-4,000.
The instability caused by the pandemic has accelerated the consumer movement towards more careful and meaningful purchases and although consumers are spending less on luxury goods as result of COVID-19, products such as luxury timepieces, which are perceived to be timeless, will likely recover to reach 2019 growth levels at the end of the forecast period. In addition, as social distancing measures persist and consumers continue to spend more time at home until the roll out of the COVID-19 vaccine, for those luxury timepiece players who are successfully able to capture consumers on digital platforms such as Instagram and through e-commerce, will likely fare better with wealthy consumers looking how best to spend on discretionary purchases.
As affluent consumers seek out rare and exclusive timepieces, many of them are looking to the online second-hand and pre-owned market for luxury watches. This segment has been growing significantly and is expected to increase post-COVID-19 as many customers wish to buy luxury timepieces but are looking for more affordable watches.
Digital innovation has become more important than ever. Many luxury brands make use of influencers and brand ambassadors to reach more people.
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Understand the latest market trends and future growth opportunities for the Luxury Timepieces industry in Australia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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This report originates from Passport, our Luxury Timepieces research and analysis database.
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