Introduction and Abbreviations  Definition Consumer research ACORN Advertising data Abbreviations Executive Summary Men’s attitudes fashion are changing Market witnessing steady growth Women’s watches growing faster Rolex dominates Strong brand image requires heavy media spend Independents dominate Consumers are more receptive Portents for the future Market Drivers Attitudes towards fashion, style and dressingFigure 1: Attitudes towards style and fashion, 2000-04 Men want to stand out in the crowdFigure 2: Attitudes towards style and fashion, by gender, age and socio-economic group, 2004 Accessories and style Growth in 15-24-year-olds providing a favourable operating environmentFigure 3: Trends in the UK population, by gender and age group, 2000-05 Growth in ABs providing a rich and productive body of consumersFigure 4: Trends in socio-economic groups, 2000 and 2005 More women at workFigure 5: Trends in workforce, by gender, 2000-05 Economic healthFigure 6: PDI and consumer expenditure, at constant prices, 2000-05 Skills base Counterfeits Market Size and Trends Figure 7: UK retail sales of watches, 2000-05 Volume continuing to outstrip valueFigure 8: UK retail sales of mainstream and luxury watches, by sector, 2000-05 Luxury watches account for only 3% of the watch market in volume…Figure 9: Luxury watch sales as a proportion of total watch sales in the UK, 2000-05 ...but 55% in value Healthy growthFigure 10: UK retail sales of luxury watches, 2000-05 Increase in unit price Younger buyers Change and innovation Style Size and simplicity Diamonds Limited editions Gift purchase Celebrity association Watchmaking and jewellery Market Segmentation Mechanical watches dominate Men’s watches are most importantFigure 11: Luxury watch sales, by gender, by volume and value, 2001-05 Women’s growing importance Femininity and fashion Women and mechanicsFigure 12: UK retail sales of luxury watches, by type, by volume and value, 2001-05 Mechanical interest and affordability New Product Developments  Spring Drive movement Technology and the future Materials Technology as protection? The Supply Structure Imports The Swiss name Swiss exportsFigure 13: Swiss watch exports, by leading countries of destination, 2000-04 The UK as an importer Brand shares GroupingsFigure 14: Major groups and their watch brands, 2003 Figure 15: Brand shares in the UK luxury watch market, 2002 and 2005 Companies and brands The Rolex Watch Company The Swatch Group of brands Omega Longines Rado Other Swatch brands The LVMH Group of brands TAG Heuer Zenith Other LVMH brands Gucci Group Gucci The Richemont Group of brands Cartier Baume & Mercier IWC Jaeger-LeCoultre Other Richemont brands Raymond Weil Oris Maurice Lacroix Breitling Other companies Advertising and Promotion Figure 16: Main monitored advertising expenditure on watches and luxury watches, 2000-04 High advertising-to-sales ratio Print media International mediaFigure 17: Largest luxury watch advertisers, 2002 and 2004 Rolex TAG Heuer and Breitling Omega and the Swatch Group Goldsmiths Group Other advertisers Sponsorship Trade events Other below the line Distribution Figure 18: UK retail sales of luxury watches, by type of outlet, 2002 and 2005 Retail change Independents - a clear competitive advantage General jewellers Dedicated jewellers and watchmakers Other independents Multiples The MW Group The Goldsmiths Group The Signet Group The Consumer Ownership Figure 19: Ownership and potential ownership of luxury watches, 1999-2005 Upward trend for ownership Potential ownership also up The gift element Non-buyer trends suggest growing interest in category Favourable shift in attitudes Desirable features Figure 20: Features sought in a luxury watch, April-May 2005 General qualities Branding Functionality Men look for more conspicuous added functions Holding value ABC1 consumers look for Swiss heritageFigure 21: Consumers who look for the Swiss-made feature of a luxury watch, April-May 2005 Brands appeal to under-25s Desirable Features - Detailed Demographics Figure 22: Features sought in a luxury watch, by gender, age and socio-economic group, April-May 2005Figure 23: Features sought in a luxury watch, by presence of children, lifestage and Mintel’s Special Groups, April-May 2005 Figure 24: Features sought in a luxury watch, by marital and working status, April-May 2005Figure 25: Features sought in a luxury watch, by region and ACORN category, April-May 2005 Figure 26: Features sought in a luxury watch, by media usage, commercial TV viewing and supermarket usage, April-May 2005 The Future Omens are good Favourable demographics provide a fertile background to growthFigure 40: Projected UK population, by age, 2005 and 2010 More women in work delaying families for longerFigure 41: Forecast trends in UK labour market, 2005-10 Innovation will remain key Luxury watches must maintain their exclusivity Forecast Optimistic future growthFigure 42: Forecast of UK retail sales of luxury watches, 2005-10Figure 43: Forecast of UK volume sales of luxury watches, 2005-10 Amicable future conditions underlie positive growth On the perception of luxury watchesFigure 44: Forecast of UK retail sales of luxury watches, by value and volume, 2000-10 Factors incorporated in the forecast