China watches sales were not spared during the COVID-19 pandemic, as non-essential goods and watches sales were hit hard in early-2020. This is a product area that relies heavily on store-based retailing channels, especially watch specialist retailers.
High watches witnessed double-digit growth in 2020, due to the beneficial impact of luxury spending returning from overseas to China, while a favourable tariff policy is also encouraging domestic consumption. The purchasing power of the main consumer group for high watches in China faced very limited impact from the COVID-19 pandemic, with affluent consumers typically still seeing positive growth in incomes.
Basic and mid watches faced a growing challenge from smart wearables prior to the COVID-19 pandemic and will fail to return to pre-pandemic levels in current value terms in 2021. Both price bands registered significant current value decline in 2020 and the share of domestic watches brands in these price segments continues to shrink as a result of weakened brand identity and outdated designs.
Watches, especially luxury watches, is been among the industries proving slow to embrace digitalisation, given the trade-off this can imply against closer integration with consumers and also concerns over a diluted brand image. 2020 however proved a milestone for high watches on their way towards a digital era.
A sense of individuality and growing national identity, along with a focus on local inspiration, are increasingly being seen in today’s Chinese consumers, especially the young generation. Forward-thinking international brands are thus already leveraging on this trend to reinterpret their brands’ value proposition.
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Understand the latest market trends and future growth opportunities for the Watches industry in China 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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