Categories of Watch Manufacturers: A Perspective

Thread: Categories of Watch Manufacturers: A Perspective

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  1. #1
    Member iim7v7im7's Avatar
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    Categories of Watch Manufacturers: A Perspective

    Hi,

    I was discussing watches with my brother last night at dinner. He is not a watch person, so I was trying to explain differences between different companies, some of which he knew and others not. I began to think of ways to categorize companies based on manufacturing volume, finishing methods and movement technology.

    I divided the market into 4 major categories based on combinations of this criteria to describe companies products. The categories obviously overlap. I wanted to see if this made sense to you WIS in this forum.

    1) High-Volume, Machine Finished Watches based on ETA, ETA COSC or ETA customized movements

    Examples: Breitling, Longines, Omega, Sinn, TAG Heuer

    2) Low-Volume, Machine & Hand Finished Watches based on ETA Custom & In-House Movements

    Examples: IWC, Panerai, Omega, Ulysse Nardin

    3) High Volume, Machine Finished Watches based on In-House Movements
    Examples: Rolex

    4) Low-Volume, Machine & Hand Finished Watches based on In-House Movements

    Examples: A Lange & Sohne, Audemars Piguet, Blancpain, Choppard, Girard-Perregaux, Glashutte, Jaeger-Lecoultre, Patek Philippe, Vacheron Constantin, Zenith

    What struck me (I think graphically) is now Rolex stuck out. If you picture the X-axis being movements: ETA, ETA COSC, ETA Custom, In-House from left to right, and the Y-Axis as high-volume machine finish, Low volume machine & hand finish to Low-volume hand finish from bottom to top.

    Categories 1, 2, and 4 progress from lower left to upper right diagonally (I hope you can picture this). Only category 3 (High Volume, Machine Finished Watches based on In-House Movements) stands out in the lower left region of this chart. It really made me think what a unique animal Rolex is from all other watch companies. No one else makes high-volume machine finished watches based on custom technology like they do.

    There are some small watch companies/individual makers that may comprise a 5th category (Low-volume, machine-hand finished based on ETA movements) Companies/Makers like Jorg Schauer, Rainer Brand, Sothis etc. fall into this niche arena. This category is located in the upper left region of the chart.

    The point here is not the "rate" who is better, but to find common manufacturing philosophies that are useful for grouping companies. The categories obviously overlap and some manufacturers span into two categories with some models.

    Do these generalizations make sense as a way of categorizing watch manufacturers to you? It makes sense to me, but I wanted to see what you thought.

    Bob
    __________________________________________________ __________________

    AUDEMARS PIGUET | BLANCPAIN | DAMASKO | GRAND SEIKO | ROLEX

  2. #2
    Moderator Public Forum Eric L.'s Avatar
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    Re: Categories of Watch Manufacturers: A Perspective

    I wouldn't put Sinn as a high volume manufacturer - it certainly doesn't have the retail penetration that others on your list in that category (Omega, Tag, Breitling) do.
    Lots of dive watches.

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    Re: Categories of Watch Manufacturers: A Perspective

    Quote Originally Posted by Eric L. View Post
    I wouldn't put Sinn as a high volume manufacturer - it certainly doesn't have the retail penetration that others on your list in that category (Omega, Tag, Breitling) do.
    Have to agree.

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  5. #4
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    Re: Categories of Watch Manufacturers: A Perspective

    Your overall grouping makes sense.
    The only part I do not fully understand is the ETa custom/customised bit. do you mean ETA with added complications by Soprod etc?
    ETA does manufacture movements up to the Elaboree standard, but even that one is standard, ie a grade any watchcompany can buy.

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    Member RJRJRJ's Avatar
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    Re: Categories of Watch Manufacturers: A Perspective

    Quote Originally Posted by Janne View Post
    Your overall grouping makes sense.
    The only part I do not fully understand is the ETa custom/customised bit. do you mean ETA with added complications by Soprod etc?
    ETA does manufacture movements up to the Elaboree standard, but even that one is standard, ie a grade any watchcompany can buy.
    I think he means the ETAs that are finished in-house, a la Breitling Omega etc.

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    Re: Categories of Watch Manufacturers: A Perspective


  8. #7
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    Re: Categories of Watch Manufacturers: A Perspective

    Doesn't Seiko belong in "Category 3" also?


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    Re: Categories of Watch Manufacturers: A Perspective

    I can never really come to terms with any of these categorization systems, simply because single brands have different sides to them. Take IWC, which has a lot of sales based on modified ETA pieces, but has several manufacture movements, some of which are grande complications.

    At the end of the day the only simple categorization system I can think of is a combination of price range and volume of sales.

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    Re: Categories of Watch Manufacturers: A Perspective

    Quote Originally Posted by SquishyPanda View Post
    Doesn't Seiko belong in "Category 3" also?
    And Citizen and Orient... yes, I'd say so.

  11. #10
    Member Ray916MN's Avatar
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    Re: Categories of Watch Manufacturers: A Perspective

    Looks okay, but this in my opinion is increasingly a legacy way to look at watch manufacturers.

    At another level, the market can be roughly divided into holding companies with multiple brands and assets, like LVMH, Swatch, Seiko and Citizen and singular brands which make their own movements, Rolex. Swatch with it's ownership of ETA could be said to make their own movements, and movements for a whole lot of watch brands it doesn't own. LVMH isn't as deep in movements, but its use of Zenith in movements in Tag and placement of Lemania in Breguet isn't trivial either.

    Given the preceding look what you see is the watch scene is dominated by large companies with significant vertical integration. Most market players are competing in all levels of the market to varying degrees with the exception of Citizen, which is really focused at the low and low end of the mid-market and Rolex which is really focused at the upper end of the mid-market or bottom end of the premium market. All major players use in house movements to varying degrees, with varying degrees of exclusivity.

    The biggest companies, package their products/brands and market them to different levels of the market, while Rolex is unique in having a singular brand and market focus. Swatch supplies alot of other brands, reaping profit from some of its competitors and implicitly controlling them.

    The net of the preceding is another way to look at the watch market is how different businesses organize, utilize different strategies and deploy their assets to be the most successful in the overall watch market, and usually not at a single market level.

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