Following the significant drop in demand in 2020, watches is on track to start recovery in 2021, although it will be regarded as a transition year. As with spectacle frames and jewellery, the pandemic and subsequent lockdown caused wealthy consumers to gravitate towards premium items as they sought to treat themselves with luxury items.
In addition to suffering from consumers reducing spending on discretionary items, mid and lower-priced watches will continue to be impacted by the ongoing consumer shift towards smartwatches. Indeed, pre-pandemic overall demand for watches was already starting to wane as younger consumers increasingly relied upon their smartphones and wearable electronics for time-keeping purposes.
E-commerce made strides into the world of high-end watches in 2020, with online availability only increasing in 2021. For example, Birks already offered e-commerce for brands such as Tag Heuer, Breitling and Jaeger LeCoultre pre-pandemic, but Birks expanded its online shopping selection to include Tudor watches.
Following the start of recovery in 2021, watches is set to see even stronger current value growth in 2022 before demand normalises and growth rates slow over the rest of the forecast period. It is expected that pent-up consumer demand and spending by domestic wealthy individuals will buoy the market for high end watches while watches in lower price brands are expected to recover at a slower pace.
Due to changes brought upon by the pandemic, e-commerce will continue to serve as an important channel for high-end watch brands in the forecast period. Pre-pandemic, many high-end brands were not available online as consumers liked to visit specialist retailers to try on different models of watches, especially as they were spending a significant amount of money.
Since consumers view watches as discretionary items, players will have to find unique ways to differentiate themselves from their competition to maintain consumers in the forecast period. Indeed, apart from watches designed for exercise, watches tend to serve a purpose similar to jewellery, especially for men.
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Understand the latest market trends and future growth opportunities for the Watches industry in Canada 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 Watches research and analysis database.
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