Anyone interested in the industry of watch-making may be forgiven for thinking that there are not many players in the field. In actual fact, there are a small number of big firms that have acquired most of the watch brands over the years.
Why Has This Happened?
The reason that many watch firms have been snapped up is that horology is a complex business, especially when you are working at the elite end of the scale. Not only is there ever-increasing competition, but there are also continual challenges involved, such as sourcing the right components from suppliers, global distribution, executing successful marketing campaigns and constantly having to come up with innovative designs and technological features.
When a big brand name acquires other brands, it can help to control all of these processes. Many of the big players have also acquired companies that manufacture the parts used to make the watches.
The Demise of the Independents
As more and more watch brands have been acquired by the multinational giants, the number of independent watchmakers has started to dwindle. Trying to survive in a very competitive market makes it extremely tough for independents, although one of the few big well-known brands, Rolex, is still managing to hold out.
Is It a Good or Bad Thing?
There are both pros and cons to the scenario of having just a few stakeholders controlling the watch-making industry. The power and knowledge behind the big names means greater availability of products, a more stable and reliable business and improved distribution processes. On the negative side, there may be internal politics and competition involved with different brands under the same umbrella which could impact on levels of innovation and lead to a less distinctive brand personality. As each family member needs to adapt to a specific marketing image, it can take away the sense of individuality.
The Biggest Companies
The leader in the field of watch-brand acquisitions is clearly the Swatch Group, which, to name but a few, owns the likes of Omega, Longines, Tissot, Breguet and Rado. As well as ruling the roost amongst watch-making brands, it has a number of other companies that are involved with producing watch parts or movements, such as ETA and Nivarox. The second-biggest group after Swatch is The Richemont Group, which has bought names such as Cartier, IWC, Roger Dubuis and Baume & Mercier. LVMH is also a big player, having acquired TAG Heuer, Bulgari, Zenith, Dior and Hublot, to name but a few. The Kering Group is also making its mark in the watch-brand acquisition industry, as it continues to increase its portfolio. Some of its brands include Gucci, Ulysse Nardin, Boucheron and JeanRichard.
Are There Any Independents Left?
Despite the big names dominating the market, there are still a handful of independent brands around who are successfully managing to avoid acquisition. The most well known is Rolex/Tudor, which has one of the most respected names in the horology industry. Other key independent brands include Breitling, Patek Phillipe, Hermes, Chanel, Chopard and Audemars Piguet. Whether these brands continue to remain independent in the future remains to be seen.