Pricing ‘sweet spot’ catches UK watch market by surprise

Customers look into the window of a jewellery shop advertising a sale on the Strand in central London on January 16, 2012. Many economists now believe that the British central bank could increase its emergency stimulus plans next month to boost flagging economic growth while borrowing rates could remain on hold for the rest of 2012. Inflation is forecast to fall back much closer to the BoE’s 2.0-percent target during 2012 but the British economy is still struggling to mount a recovery from the vicious 2009 recession under the pressure of government spending cuts and the eurozone debt drama. AFP PHOTO / JUSTIN TALLIS (Photo credit should read JUSTIN TALLIS/AFP/Getty Images)

A surge in demand for watches priced between £500 and £1,000 could provide an unlikely sales boost for UK retailers that get their product mix right, it has emerged.

This price bracket has traditionally been the smallest area of the UK watch market, with relatively less product and brand offerings available as suppliers have focused on pushing into the luxury sector.

However, new data from GfK made available to WatchPro this week reveals a “significant development” in the performance of this category over the last four months.

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Since September 2015, sales values have risen by a “market-leading” 20% year-on-year and bucked the overall market trend of declining volumes by registering 17% unit growth in the same period.

While it must be stressed that the £500-£1,000 price point accounts for a small part of the total market, the appetite for watches that fall into this range suggests a trend that retailers would be ill-advised to ignore.

“This sector might only be worth 5% of the total sales market value but continued growth rates like this over the coming 12 months could put this price point firmly on the road to even greater opportunity in the future,” predicts GfK’s Jonathan Hedges.

The UK watch market is currently worth £1.3 billion. As we revealed yesterday, overall shipments of watches in 2015 fell 2% year-on-year, but strong growth in the luxury segment led to the value of the market increasing.

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