The majority of monobrand watch boutiques are “not economically viable” and their presence on their high street could diminish, leading figureheads from the watch industry have claimed.
The number of monobrand watch stores in the UK has been growing but in a panel discussion at SalonQP last week executives questioned the profitability of the model.
Mike France, co-founder of internet watch retailer Christopher Ward, believes that with a few exceptions, the “Regent Street model cannot be economically viable”.
He said: “Ultimately they will die. Some of them will remain, but most of them will die. At the moment stores are flags for the brands; most of them lose a fortune.”
President of independent brand Urban Jürgensen, Søren Jenry Petersen, agreed that monostore brands can rarely be profitable, with only “one or two” brands being able to do so.
He said that retailers need to make a choice: “Either you’re going to just be a real estate manager, because the large brands will do everything for you – the marketing, the bookkeeping, the reordering – what you’re left with is a retail shop and then you’re in the real estate industry. Or, you really curate your collections and you offer some individual experience in the shop. Luckily there are many of those left in the industry.”
SalonQP’s James Gurney said that watch stores have to become better and more experiential.
He noted: “A big store on Bond Street, unless you’re a millionaire, walking in can be intimidating. Get people talking away from the credit card machine in the hope that the credit card machine would get action down the line.”
Data recently published by Savills shows that London remains the primary UK market for monobrand watch stores. Eleven monobrand stores have opened in the city since 2010 with another six expected to open before the end of 2016.
Although the research shows that London ranked joint lowest with New York, with just 22 luxury watch monobrand stores each, growing tourist numbers and affluence profile in the capital make it increasingly attractive to luxury watch brands, according to the firm.