India, the new El Dorado for the Swiss watch industry?

India, the new El Dorado for the Swiss watch industry?
India, the new El Dorado for the Swiss watch industry?

The Rolex boutique is located just a few hundred meters from the Cartier dealership for Western India, Art of Time, a boutique shop-in-shop which also represents Panerai, Omega and IWC. Silence reigns in this boutique which, with its glass facade, is reminiscent of a watch aquarium. This is not a bad sign because there is no need to enter the store: in addition to online sales, Art of Time offers a home-shopping exclusive. Watch brands nevertheless continue to attach great importance to their address and the layout of their points of sale.

More and more millionaires

The Swiss watch industry considers India a market of strategic importance. By 2026, the number of millionaires is expected to rise to 1.6 million. The consulting company Deloitte forecasts exports of Swiss watches to India worth more than 400 million francs for the next four years. The country would thus climb into the top 10 export markets (it is currently 22nd). The latest analysis devoted to this gigantic country of 1.4 billion inhabitants highlights that three-quarters of watch sector leaders expect the market to grow. For Indian customers, it is above all the image of the brand that counts, even before the design and the price.

Read also: Watch exports fall 16.1% in March

Note that in India, purchasing a watch remains relatively expensive because, since 2018, Swiss watches pay a customs duty of around 20%. But this should change following the free trade agreement signed last March. Customs duties will be gradually dismantled over a period of seven years. “This agreement has created a basis on which we can now build,” said Yves Bugmann, president of the Federation of the Swiss Watch Industry (FH). He calls for the abolition of customs duties but also the protection of intellectual property, in particular the protection of the brand, design and the “Swiss made” label. The free trade agreement should constitute a positive dynamic for India which will attract investments to the country, thinks the president of the FH. In India, Swiss manufacturers are well positioned in all price segments.

On the marketing side, in India, we like to focus on celebrities. Actor Hrithik Roshan, 50, is one of them: he has represented the Swiss brand Rado, one of the best-selling in the country, for more than ten years. It even has its own limited edition. Last year, Bollywood star actress Katrina Kaif, 40, was added, as Rado CEO Adrian Bosshard hopes she will attract more female customers.

Swatch Group well positioned

Rado has extensive experience in India, which is one of the brand’s three main markets: it has more than 250 authorized resellers there. Adrian Bosshard compares India to China: as an accessible luxury brand, the goal is to cover the market as best as possible. Including in medium-sized cities like Agar in the north or Vizag in the south.

The Rado brand is part of the Swatch Group. It is to him, present in India for twenty-one years, that Switzerland owes a good part of its exports to the subcontinent. Five of the ten best-selling brands in India belong to the Swatch Group, said its CEO Nick Hayek at the company’s last annual press conference. And he added: “We also have watches in other segments, for young people. We are investing, since we also have less expensive models. There are large volumes for brands like Swatch, Tissot and Rado.”

Swiss watches have become a status symbol

Breitling also discovered India’s interest in watches a long time ago. The brand established its first subsidiary there in 2014. According to its CEO Georges Kern, the brand is experiencing growth in India that exceeds the competition and is still gaining market share. “We plan to open a store in each of the eight to 10 largest cities in the country.” Besides Delhi and Bombay, Hyderabad, in the south, is also in the sights. He notes a trend: enthusiasts prefer to buy in India rather than abroad, so it is essential that watches are available locally, otherwise consumers would quickly look to other brands.

In India, it is very common to wear jewelry and watches. Gold has a very great meaning in dowries and during religious festivals. And serves as a financial reserve in the event of economic setbacks. According to Deloitte, in India the majority of people wear traditional watches, 27% wear smartwatches and a quarter wear both.

A watch in case of advancement

Vaibhav Wade received a superb gift for his 22nd birthday: “My father gave me a Rado,” rejoices this public relations specialist from Bombay. Adding that his grandfather had already given his father valuable watches, it was tradition. For Indian collector Karan Madan, Swiss watches are inseparable from special occasions: “At weddings, where the gift takes on great importance, branded watches are appreciated, they underline status.” But the opportunity to offer it can also be of a professional nature: advancement, a promotion.

Karan Madan is a doctor in Delhi. In 2015, he founded the country’s largest collectors club, the ‘Watch Enthusiasts India’. His passion was born from an indigenous model, an HMT Limited [abréviation de Hindustan Machine Tools Limited, ndlr]. Since then, he has primarily collected Swiss watches. “They represent the quality label par excellence among branded watches,” he notes. It seems that the hobby of collecting and trading watches has now infected the Indian middle class.

A glance at recent history indicates that the desire to own beautiful watches is not new in India. “Already in the 1960s and 1970s, wealthy Indians were going abroad to acquire watches. Or some, emigrant workers, brought them back to the country,” comments Karan Madan. With the free trade agreement, it is now hoped that the supply of well-known brands will increase.

Read also: Swiss watch exports have already broken their 2021 record
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