London and New York are biggest luxury watch opportunities says Savills
Luxury watch brands looking for expansion opportunities need to keep an eye on London and New York this year and beyond with international real estate advisor Savills saying in a new report that these two destination cities are where the big growth potential lies.
And while it might seem that most brands already have stores there, Savills said that 44% of the luxury brands that operate standalone boutiques globally aren't yet present in either city. Contrast that with Paris where 73% of the brands currently have at least one boutique.
Perhaps the absence of many brands from London and New York is unsurprising given that total new luxury watch store openings fell globally in 2017, with 37 compared to 44 in 2016.
But those that did open certainly seem to have got the message about where the potential is with openings veering away from the traditional Asia Pacific markets such as Hong Kong and Singapore to focus more on core ‘destination’ markets in North America and Europe. Tag Heuer opened in London last year while Blancpain opened in New York.
Anthony Selwyn, head of London & International Retail at Savills, said there may not be the same level of watch brand store openings in the next few years as we saw up until 2016, but brands will replace quantity with quality, focusing on “key destination markets.” He said this means that in particular, “those where ‘gaps’ remain could provide opportunities for expansion” even cities like London and New York that are generally seen as highly developed.
Savills said the greater concentration of boutiques in Paris is clearly because many of the luxury watch brands are French and would, of course have a domestic base. But it’s also because of the importance of Paris when it comes to Chinese tourists.
And with Chinese (and other Asian) luxury shoppers increasingly buying their luxe items abroad, this has driven a general increase in stores opening in North America and Europe rather than Asia. There were 19 North American opening last year (up 138%) and 15 in Europe (up 25%).
Brands also seem to have been focusing on under-developed cities in North America with five openings in Toronto and three in Vancouver last year. In fact, Toronto was the top city globally for luxury watch store openings in 2017.
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