Developments in technology are changing industries faster than ever before. One market trying to keep up with the pace is the traditional watch industry. An onslaught of new “wearables,” including the Apple Watch and an assortment of fitness trackers are slowly but surely reducing interest in traditional Swiss timepieces. The real estate on people’s wrists is now occupied by technology that does more than just tell the time. As a result, traditional watch makers must adapt or run the risk of becoming obsolete.
Fossil CEO Kosta Kartsotis recently stated that he believes, “technology and the whole idea of wearables . . . has taken some of the oxygen out of the Swiss business.” He does recognize, however, that the buzz generated by the wearable technology found in the Apple watch, FitBit and other gadgets can help the watch industry. Kartsotis acknowledged that, “The watch industry is a $65 billion industry, and if you look at the tech industry, it’s trillions of dollars in consumer spending a year. If just a small percentage of that would come into our category, it will change the industry.”
Kartsotis also pointed out that “[Fossil] also see[s] technology emerging as the latest trend in fashion, with the growing interest in wearable technology inspiring new entrants into the watch space.” He predicted wearables will give birth to a device category that looks like jewelry, such as bracelets, that do not sport the displays found on smartwatches.
Right now, it is unclear exactly what impact smartwatches and other wearables will have on the long term sales of analog watches. Some financial and tech analysts predict that consumers are presently interested in purchasing sensor-equipped devices that, in addition to telling time, track a person’s movement, calories burned and sleep. Last week, the market research firm NPD Group issued a report claiming that interest in the Apple Watch was somewhat to blame for the greatest slump in United States watch sales since 2008.
In response, Fossil is planning on entering the wearable race. It is developing three product categories surrounding the technology. It is developing a smartwatch with Google called the Android Wear that will launch this fall. Fossil also plans to develop wearable technology with jewelry designs. The final category is labeled by Kartsotis as “smarter watches.” He feels this category will have the greatest impact long-term at Fossil. These devices will incorporate the features of traditional analog watches with sensors that will track movement, sleep, etc.
Kotsis further predicts that in the near future, every Fossil watch will have some level of technology incorporated within.