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Swiss Watch Sales On The Slide, Apple Watch Biting

Reuters is reporting on a massive fall in Swiss watch sales, revealed in the latest data from the country's trade association.
Over the three month period to the end of October sales had fallen 10%, 9.9% and 8.5% respectively.
Regionally the falls were most obvious in Asian markets, with South Korea taking 35% fewer Swiss watches. The lower end sector of the market (defined as 200-500 francs by the federation) was worst hit, seeing an overall fall of 14.5% this month.
Clearly smartwatch sales are starting to bite.
Android Wear and Apple Watch devices both start in that price sector, and there's an obvious relationship between the tech hungry Asian market and wrist-worn technology that suggests those sales numbers are going to decline further.
Whilst the talk in Switzerland is about developing smartwatches of their own, reacting to what Apple does when it disrupts your market is never a winning plan - look at Nokia, Palm and Motorola for perfect examples.
Having failed to get ahead of the game its unlikely that brands like Swatch will be able to recover their lost market and for now the best strategy may well be to develop Android Wear devices that at least retain some of that market.
For the names at the premium end of the market it's unlikely that the smartwatch will damage their sales, for now. However in the longer term I have no doubts Apple will do a better job of releasing premium versions of its Watch that do threaten the traditional watch makers.
That's when the trouble really starts.


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