Moving with the times – Tag Heuer

October 31, 2012 at 9:00 am 5 comments

I often wonder about the longevity of watches as a category and whether they will eventually suffer the same fate as the humble typewriter, either in a few years or a few decades. Two close friends of mine have already stopped wearing a watch on a regular basis – their logic is that they carry a phone all the time and can see the time on their phone. What’s worse – for the global watch industry, that is – they find the watch doubly redundant when at their desk in office where they can also see the time on their laptop.

Undoubtedly, the trend towards wearing a watch as an accessory will extend the category’s life-span, but for how long ? And does the watch industry have any other tricks up its sleeve or will it fall prey to marketing myopia in a decade or two ?

[Note : We’d mentioned marketing myopia once in an earlier post; the subject of this post is somewhat similar – an attempt made by a firm to adapt to a changing market, though in this case it’s early days yet and the market verdict is not  clear.

Marketing Myopia : The term refers to the short-sightedness that leads companies to focus on their own organisation and product – line rather than on customers’ needs and wants. It leads to reluctance to change, and a failure to adjust to a changing market environment.] 


In this context, I felt that the launch of the Tag Heuer Smartphones by the luxury watch brand was an interesting experiment (you can read articles about the launch here, here , here and here). Tag Heuer started retailing luxury mobile phones in India from 2008. It has since launched three such devices – first the Tag Heuer Meridiist and Link, and recently the Racer. The Tag Heuer Racer Smartphone (pics on extreme right in the image above) was the one launched a few months ago; in keeping with the Tag image, the phone looks top-end  – really sleek, it’s supposedly styled after race cars. Buyers can customize their phones’ cases in a variety of materials, from rose gold to titanium,  just as they would a TAG watch. They can even add Calfskin-leather trim, or a sprinkling of diamonds, for good measure.

One fly in the ointment could be the fact that while consumers buy a watch for a lifetime – or at least to last for many years, they tend to change their phones to the latest model fairly often; at the price tag of a Tag Smartphone, that’s a bit heavy on the pocket. Will be interesting to see how this pans out. Meanwhile, kudos to Tag for not burying their heads in the sand, trying to adapt to changing consumer habits and being bold enough to experiment. A good effort, for sure.

  • Zenobia Driver

Entry filed under: Business Strategy, Consumer Trends, International Trends, Luxury Goods, Marketing, New Product Launch, Product Innovation. Tags: , , , , , .

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5 Comments Add your own

  • 1. RJ  |  November 1, 2012 at 7:38 am

    I believe that demand for branded and luxury watches will be on the rise. However, I agree with your point, that people would continue to purchase time pieces as accessories and less for their utility. As more and more women move their focus on having careers, they would prefer to purchase steel, gold and diamond studded watches instead of jewelry. It would not be practical to wear a lot of jewelry at work. But that same amount of money spent on a high end watch would look professional and still give women a sense of wearing something valuable. The same goes for men. A lot of successful professionals prefer wearing Rolexes, Cartiers and other high end watches. It is something that they are willing to splurge on. It makes an understated statement and gives men a sense of success. Time pieces are also increasing in popularity as gifts because there is a value and quality assurance, and is something that people can have for a long time. High end phones are a fad. That is the same reason why the Vertu has also not gained much popularity either. The fact that people change phones often would make them apprehensive to spend a lot on a branded phone.


    • 2. escapevelocityblog  |  November 2, 2012 at 5:34 am

      Hi Rahul,
      As mentioned in the post, totally agree with the point that the fact that people change phones often would make them apprehensive about spending a lot on a luxury branded phone.

      Yet, overall, I think the watch market – branded or unbranded – is going to take a hit in terms of volumes as fewer and fewer people will wear watches for utility. In the premium and luxury segment, watches may continue as accessories, but their fate in other segments is uncertain. I’m talking about a timeline of decades here, so watch companies have plenty of time to prepare for it.



  • 3. escapevelocityblog  |  November 2, 2012 at 5:37 am

    Hi Robert,
    Glad you liked this blogpost. Do keep visiting the blog.
    Looking forward to hearing from you in the comments section too.


  • 4. RJ  |  November 3, 2012 at 12:14 pm

    The point I wanted to make was that in the premium and luxury segments watch sales have increased over time as people move away from buying jewelry. Also, I have noticed that a lot more counterfeit watches are being sold now than ever. This reflects on people’s appetite for them- how people aspire to own a high end watch even though they can’t afford it.

    An interesting read would be this article in the Business Insider –

    I agree with you that other segments might be feeling a pinch which is why mid-segment brands have begun to rebrand themselves. Swatch, for instance, has gained popularity in recent months because of the loud colors they have introduced. Swatch has been running ads in luxury magazines to make people associate it with luxury goods. Titan has also come out with more attractive watches especially under the brand of Xylys and spent a lot in marketing it.


    • 5. escapevelocityblog  |  November 4, 2012 at 4:47 am

      Hi RJ,
      Good points all.
      Think I need to flesh out my earlier post in more detail – will write a second one comparing and contrasting the fate of watch brands operating in different segments.

      Still stick to my initial point though – unless they change, and fast, they are doomed. I guess that’s why they are all running campaigns and developing products that position the watch more as an accessory / luxury good than a basic timepiece.

      The move to mobile phones though is one that no one other than Tag has tried yet, wonder why. That’s the logical next step. There are enough mid-range phones out there for these guys to try out an experiment, maybe a co-branded phone first to test the waters.




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