Which watch brands won over Chinese consumers in 2023?

    Morgan Stanley’s latest watch market report tracks the most sought-after brands in China and further afield.
    Rolex outperformed in the hard luxury category last year. Photo: Shutterstock
    Shilpa DhamijaAuthor
      Published   in Hard Luxury

    What happened

    Buyers from mainland China accounted for nearly 30% of global Swiss watch sales in 2023, despite a subdued post-pandemic recovery, according to a recent global watch market report released last week by Morgan Stanley.

    Omega was the top-selling brand in China, followed by Longines and Rolex.

    Rolex reigned as the top watch brand globally, capturing a 30% share of the luxury timepiece market. It also became the first Swiss watch brand to cross the CHF10 billion ($11.32 billion) sales mark in 2023, surpassing that level by some CHF100 million.

    Rolex outperformed every other brand in the hard luxury category, including Louis Vuitton, the report found.

    Its best performing market last year was the US, which is perhaps unsurprising as the US is the world’s leading importer of Swiss watches.

    Over the past six years, Swiss watch imports to China expanded at a 1.8% CAGR, while cumulative sales grew 9%. By comparison, exports to the US increased at 13.3% CAGR, and sales expanded 87% over the same period.

    Jing Take

    One of the reasons cited for the Swiss watch market’s subdued performance in China, post-lockdown, is that other hard luxury segments like bags, shoes, and ready-to-wear items took precedence over watches in terms of discretionary spending. These categories saw sales grow over 30% YoY in China, according to the report.

    Another notable reason for the slow growth of Swiss watch sales in China is that in the past few years, leading luxury brands have been trying to diversify their geographical reach and reduce their dependence on China.

    For example, Chinese nationals contributed 50% of global sales at Vacheron Constantin in 2017. However, after the appointment of a new CEO that same year and a revamped executive committee, Vacheron Constantin gradually shifted its focus to the US and the local Swiss market. Today, Chinese consumers account for around one-third of the brand’s global sales.

    Omega has also dialed back its dependence on China by trying to capture a larger share of the US market, which is currently dominated by Rolex. Currently, Omega depends on China for around 29% of its sales, which is much higher than its peers – Cartier and Rolex have a 15% and 12% dependency on mainland China, respectively, according to the report, which was co-produced by Switzerland-based consultancy LuxeConsult.

    In the lower price watch segment, Longines – with an average retail unit price of about CHF1,060 ($1,201) – suffered a 6% drop in global sales over 2022. This is a meaningful decrease, considering Longines depends on China for nearly 69% of its global sales. And as middle-class Chinese consumers held back on discretionary spending last year, Longines was more exposed than many of its direct competitors.

    While some luxury watch brands are lessening their dependence on China, brands that are reliant on the US market are looking at China to diversify and cater to a still-growing appetite for hard luxury. Breitling, which had negligible distribution in China around four years ago, is estimated to have collectively gained 10% of its global sales from mainland China and Hong Kong in 2023.

    Last year, the luxury market’s recovery in China disappointed many observers, but 2024 is expected to be better. According to the Morgan Stanley report, the appeal of Swiss watches for Chinese consumers cannot be taken lightly going forward, as China will remain the growth engine for the luxury goods sector for the foreseeable future.

    The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.

    Discover more
    Daily BriefAnalysis, news, and insights delivered to your inbox.