Swatch in No Hurry with Smartwatch, but It Is on the Way
Bohs Hansen / 3 years ago
Swatch Group is in no hurry to join the smartwatch wagon and don’t want any outside help either. They are happy to go the route alone and are planning for a launch of their own watches with smart features next year.
We’ve already seen all the big technology companies like Apple, Motorola and Samsung, as well as some smaller yet unknown companies, leak, present and release their own smart watches. Swatch doesn’t see this as a threat but rather a huge opportunity with a market that’s potentially worth $93 billion.
Swatch Chief Executive Nick Hayek said these new watches might allow the wearer to count the number of steps they take and calories they burn. He continued, “and there will be a few other cool Swatchy things on offer via latest Bluetooth technology.” “All the big technology firms want to work with us and I don’t rule out that we are or could be collaborating in some areas. But we can also do many things on our own.”
Smartwatches and other wearable gadgets are expected to be the next big thing in the tech-world, allowing the users to monitor their health, fitness and on-line statuses when connect to their smartphones. Smartwatches themselves are seen as the biggest threat for the traditional watch makers, as less and less people even wear watches and just use the phone’s build in clock instead. So it is no wonder that Swatch is betting on the new era as well, just not yet.
“For Swatch, this could mean a 2 percent hit to revenue and earnings before interest and tax for each 10 percent share that the iWatch was able to gain in its addressable market,” Bernstein analyst Mario Ortelli said in a study in July. Ortelli has a “market perform” rating on Swatch’s shares.
While the spotlight is on Apple at the moment with their special invite event next month, where everyone expects the iWatch to be officially introduced, Swatch’s stocks are dropping. The possibility of an iWatch launch is partly responsible for Swatch shares losing almost 15 percent so far this year, lagging a 3 percent rise in the European sector.
Many in the industry, as well as customers, have spoken out for an alliance between Apple and Swatch. But Swatch has no interest in this relationship, as they say, “they sell watches and not technology”. Swatch is about fashion, branding and style.
“Our first message for customers is the watch. If they like it, they might also be interested in the extra functions,” Hayek said. “It is a problem if you only define a product by its technology. Technology alone doesn’t sell, not in watches.”
Thank you Reuters for providing us with this information.
Image courtesy of Swatch.