All in good time: how the Swiss smartwatch is complicating the watch industry

CC image courtesy of Endemoniad on Flickr 

Watch enthusiasts are interesting folk. Watch collecting, and watch admiration, is kind of like stamp collecting for the mechanically and fashion inclined. Adorners of this industry are attracted to timepieces for their sociological and historical impact, exquisite craftsmanship, and enduring design. It’s an addictive hobby. I know. First, you discover the elegance and beauty of watches. Then after you’ve bought one or two, you delve into the movements and engineering that goes into each device’s construction. Timepieces begin to take on an artistic character. Each has a unique personality. They become a part of you, a reliable companion that’s always got your back. It’s miniaturization at the purest level – undertaken by brilliant watchmakers long before the circuit board was invented. It’s the ultimate combination of art and science…

Then smartwatches came along and screwed everything up…

 

Swiss watchmaker Tag Heuer is now releasing a smartwatch – blurring the lines between traditional mechanical Swiss timepieces and smart devices. What OS does it run? Well, Tag Heure’s latest creation is a Carrera design running Google's Android Wear platform. But, like all other Android Wear devices, this $1500 device does little to differentiate itself from other Android Wear watches, with the exception of some custom (and very striking) watch faces. In addition to Tag’s entrance into tech, the watchmaker is also pursuing a new marketing tactic. Customers who purchase the “Tag Heuer Connected” can upgrade to a mechanical version of their Carrera watch for an additional $1500 after two years.

This is a bold move from Tag Heuer, as not only does it help justify the cost of the watch but it allows the company to transition the younger audience they hope to reach with the “Connected” model to another quality Tag Heuer product (Russel Holly writing in Android Central)

Tag’s entry into the smartwatch market has the potential to seriously shake up the industry. Swiss watches in the $500 and under category might disappear, as technologist Kevin Rose has speculated, since smartwatches have considerably more functionality. Given the relatively inexpensive price of other smartwatches, however, many of which have a variety of environmental and health sensors, are luxury Swiss smartwatches a sustainable category? Swiss watchmakers excel at creating elegant designs and mechanical movements, but they don't have the expertise to create competitive wearable software. In this context, it makes sense why Tag Heuer has adopted Google’s platform. But, this puts the watchmaker at a disadvantage. By adopting Android Wear they forfeit control of the user experience to Google.

So the question remains, should Swiss watchmakers get into the smartwatch industry? On the one hand, entering the smartwatch game makes Swiss companies look desperate to catch up. On the other hand, there could be many benefits for the watch industry as a whole.

In some ways the smartwatch is the antithesis to traditional watches. Patek Phillip’s slogan is “You never actually own a Patek Phillip, you merely look after it for the next generation.” Mechanical watches, in theory, are infinitely repairable. Complications like moon phase indicators are accurate for thousands of years. Swiss mechanical watches, even at the $500 to $1000 range can be handed down for generations. By contrast, smartwatches are obsolete within a couple years, which makes it hard to accept Tag Heuer’s value proposition that its $1500 Android Wear watch is a sensible investment. Smartwatches can exude quality, but not longevity. Swiss watchmakers have the challenger of managing expectations – as their heritage is deeply rooted in quality and longevity. By making high-end smartwatches, Swiss makers could damage their reputations – leaving customers feeling frustrated for dropping thousands on a short lived smartphone accessory. It’s worthwhile noting that Apple’s high-end smartwatches are no better an investment. But, Apple has the advantage of being a recognized luxury electronics brand, not a watchmaker.

On the other hand, the watch industry has greatly benefited from smartwatches. Apple is the first company that has clearly used horological concepts to sell the Apple Watch. The company has used terms like “complication” (which refers to the various face features of a watch) to communicate the historical importance of timekeeping to customers. It’s likely that many people are learning about these traditional watchmaking terms for the first time, and gaining appreciation for the industry, through Apple’s marketing. The opportunity here is incredible. While the average consumer might use an Apple or Android Wear watch as his/her daily wearer, these devices could serve as a gateway product into watch collecting. It’s not unfeasible for users to think “I want to know more about this watch stuff,” and then go start exploring what Tissot, Hamilton, Tag Heure, and Omega have to offer. Watchmaking is a niche industry, and Swiss watchmakers haven’t clearly communicated why their products have more value than a smartwatch or a Timex. By introducing horological concepts to users through wearables, we might even see a resurging interest in traditional watches, just like we’ve seen a continued interest in paper notebooks and print books. A good case study that illustrates the demand for quality made analog watches is Shinola, which produces hand assembled watches in Detroit. 

So who then are smartwatches for? I personally think the expectations are different. A smartwatch is much more than a watch. The only thing these devices have in common with traditional watches is the ability to tell time. Similarly, we use the term smartphone but we are more likely to send messages, listen to music, or browse the internet than make phone calls. Smartwatches fill a technological niche – especially for those interested in health tracking. Convenience is also a factor. And, while digging a smartphone out of your jeans isn’t the end of the world, it’s important to remember that wrist watches became popular because it was a more convenient than digging a pocket watch out of one’s shirt. There are many parallels between the the evolution of watches and smart devices, perhaps more than Swiss watchmakers are willing to admit. It’s all technology after all.  

To divide the world into watches that are smart and ones that are not is a bit a false dichotomy. Hybrid designs could reconcile this. Timex is taking a different approach to smartwatches with the Metropolitan+, which incorporates sensors into more traditional analogue watch 

Timex Metropolitan+ 

Timex Metropolitan+ 

Final thoughts

It’s probably a faux paw for an admirer of mechanical timepieces to say, but I think the Swiss watch industry could actually learn a lot from Apple and Google and visa versa. For luxury smartwatches to gain a foothold, I think a clear upgrade option for customers is essential. While Tag Heuer’s smartwatch isn’t the most feature rich, the ability for customers to upgrade to a mechanical watch two years down the line (for a much lower cost) is an interesting approach.

Another potential upgrade path could be accomplished with standardized electronics and component sizes – much like current mechanical watch movements. Allowing customers who own a two or three-year-old smartwatch to simply upgrade their internal hardware and keep their watch case could be revolutionary. It may seem impractical to design upgradable mobile electronics, but it’s a problem watch companies have already solved. American watch companies pioneered mechanical watches with interchangeable parts to facilitate easy repair. Swiss watchmakers are experts at repairing (and rebuilding) older watches. Swiss conglomerates like Swatch use high-quality ETA movements across its subsidiary brands. Unlike phones – which have little sentimental value – watch aficionados keep their timepieces for a long time. When repairing a watch, Swiss companies leave the cases untouched (unless instructed otherwise) because the scratches, nicks, and chips make up the unique character of the watch. Wear and tear gives a watch character.

Fashion products are sentimental, electronics less so. To appeal to the fashion conscious and watch lovers, luxury smartwatches (Swiss or otherwise) need be designed with longevity in mind. While customization via straps and made-to-order parts is a step in the right direction, smartwatches and traditional watches are still very different product categories. If the two are to be reconciled, the best of both worlds need to be combined into one compelling product.