Jewellery set to bring sparkle to Swatch sales

Swatch hopes to grab a chunk of the $150 billion jewellery market (Swatch) swissinfo.ch

The Swatch Group, which owns some of the world's leading watch brands, is setting its sights on the huge potential of the jewellery market.

Swatch is hoping that its diversification into branded jewellery will make up ten per cent of sales within the next four to five years.

The company hopes to grab a chunk of the global jewellery market, estimated to be worth about $150 billion (SFr225 billion) per year.

“One of the reasons we’ve entered this new market is because the watch and jewellery businesses are very similar,” Arlette Emch, Head of Dress Your Body, the company’s new jewellery division, told swissinfo.

“The metals are similar, the stones are similar and the size of the objects is the same as well.

Swatch is creating rings, necklaces and other adornments to complement its watch brands in style and price.

Brands are everywhere

And Swatch thinks the potential for branded jewellery, which makes up only about ten per cent of the jewellery market today, is huge.

“Historically jewels were most bought by either husbands or fathers,” Emch said. “But today women are buying their own jewellery. And when they buy, they want something branded. They are much more aware of brands than men are.

“It’s trendy now to go into branded jewellery. Everything is branded. Your wash powder is branded,” she commented.

Last year, Swatch opened upmarket boutiques in several cities, including London, Paris and New York, where its branded jewellery is displayed next to its watches. “All watch shops sell jewellery and we wanted to offer both to our customers,” Emch said.

Swatch hopes its branding strategy will win over customers with big money to spend. Its Brequet brand at the top end of the market targets consumers willing to spend from SFr1,500 to SFr100,000.

Bottom end

But the company isn’t ignoring the customers that buy their mass market Swatches. In the high-end segment, the group is elbowing brands like Cartier and Tiffany, but downmarket there is hardly any competition.

“It’s easier in the lower end market [because] there’s virtually no branded competition that is internationally recognized,” said Emch.

Under its Swatch brand, the company is selling “fun” jewellery starting at SFr30.

For the time being, the company has only extended the Swatch, Omega and Breguet brands into jewellery lines. However, Swatch sees room for growth in developing its other watch brands. “This is only the beginning,” says Emch.

Men are back

Although most jewellery is targeted at women, Swatch also has men in mind, and is offering everything from cufflinks to rings to bracelets.

“Men are very much in fashion this year. Men are big consumers who have been forgotten for a long time,” Emch says. “And men want to wear jewels – of course adapted to them and their style. I think this market has great potential.”

Although profit margins in jewellery are thinner than in timepieces, the market is bigger at about four or five times that of watches.

And Swatch is convinced that it can cut itself a slice of the jewellery market cake. “There is enough space in this market. As you need different designers in the fashion industry there is also room in the jewellery industry because women want choice and brands,” Emch says.

by Karin Kamp

Key facts

Global jewellery market valued at $150 billion per year.
Ten per cent of jewellery is branded.
The Swatch Group is the largest watchmaker in world.