April 27, 2006
Young Shoppers Unstrap Fashion Watches
Younger consumers are foregoing wristwatches as both fashion accessories and a way to tell time, resulting in a dramatic drop in the sales of mid-priced watches, according to an article in the Los Angeles Times.
Market research shows a 12% decline in mid-priced watch sales in 2005 compared to the previous year. Meanwhile, brands that cater to teens and younger shoppers are feeling the effects. Fossil Inc. reports an 18.6% fall in wholesale U.S. sales, while Oakley Inc. says sales declined 11% in 2005.
The Times article says that many under-30 consumers use their cell phones as their primary timekeeper and research shows that will become true for older shoppers as cell phone manufacturers make the clock display on phones bigger. "It will very quickly replace the fashion watch as the No. 1 timepiece," chief industry analyst Marshal Cohen of NDP Group told the paper.
Piper Jaffray investment bank, in its biannual report on teen trends, found in its recent study that 59% of teens said they never wore a watch, up from 48%. Only 13% of teens said they wear a watch every day, compared to 18% in the fall of 2005. And, 82% of respondents said they do not plan to buy a watch in the next six months, up from 76% last year.
The Times reports that some watchmakers are developing new technologies to appeal to younger people, including a watch currently in development by Fossil, Swatch Group and Microsoft that would deliver Web data to a watch for a monthly fee.