Wearables smothering Swiss watch business, Fossil CEO says

Fossil will start selling an Android Wear smartwatch in October or November, said CEO Kosta Kartsotis

Fossil's CEO is looking to make the company's traditional watches smarter by adding sensors to monitor a person's physical activities and sleep patterns.
Fossil's CEO is looking to make the company's traditional watches smarter by adding sensors to monitor a person's physical activities and sleep patterns.

Wearables are reducing interest in Swiss watches, with those highly regarded timepieces losing some of their luster as technology is incorporated into what people wear on their wrists.

"I think technology and the whole idea of wearables ... has taken some of the oxygen out of the Swiss business," Fossil CEO Kosta Kartsotis told analysts on a call to discuss the watch maker's second quarter results.

Without mentioning Apple or its smartwatch by name, Kartsotis implied the arrival of tech companies in the fashion world means the industry needs to incorporate technology into its products to stay trendy.

"We also see technology emerging as the latest trend in fashion, with the growing interest in wearable technology inspiring new entrants into the watch space," he said.

These new competitors, along with other factors like a strong US. dollar, contributed to Fossil's quarterly revenue decline, Kartsotis said. For the quarter ending July 4, Fossil recorded revenue of $US740 million versus $US773 million for the year-ago period.

The Apple Watch, meanwhile, went on sale during that time frame. Starting in April, the wearable could be ordered only from Apple's website before the company began carrying the watch in its stores in June.

It is unclear what impact smartwatches will have on the sale of analog timepieces. Some analysts predict that consumers are more inclined to purchase sensor-equipped devices that do more than tell time. Last week, a report from market research firm NPD Group claimed the Apple Watch was partially behind the largest slump in U.S. watch sales since 2008.

Fossil sees wearables as a key component of the industry's future and the company is developing three product categories around the technology.

First, there are smartwatches, like the Android Wear model Fossil is planning on launching in October or November, Kartsotis said. When Google announced its OS for wearables last March, Fossil was listed as a partner that would make watches running Android Wear.

Since then, not much has been heard about the effort. Fossil, though, has said development is taking longer than anticipated, and that the watch will include Intel sensors.

Kartsotis also predicted wearables will spawn a device category akin to jewelry, such as bracelets, which lack the displays found on smartwatches.

The final category, which Kartsotis labelled "smarter watches," will have the greatest long-term impact at Fossil. These devices will be existing analog watches with sensors added to perform functions like tracking activity and sleep, he said. Fossil is on track to release those watches this year, Kartsotis added.

Some day, every watch Fossil makes could have technology in it, he said.

In addition to meeting market demand, incorporating technology into its watches gives Fossil access to user data that can be fed into the company's CRM software and used for marketing efforts, Kartsotis said.

Fred O'Connor writes about IT careers and health IT for The IDG News Service. Follow Fred on Twitter at @fredjoconnor. Fred's e-mail address is fred_o'connor@idg.com

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Show Comments

Blog Posts

Data has the power to build or burn brands

A brand can be severely wounded by use or misuse of any of its assets and you could say data has the greatest power of all to inflict damage.

Lucy Acheson

Head of data strategy and customer experience, LIDA

Totto and your inorganic future

At Cannes Lions this year we’ve been treated to many artificial intelligence (AI) insights. It’s one of the major discourses of our time.

Richard Brett

CEO, opr

Personas of one and the rise of ‘always there’ marketing

I’ve got some bad news. The ‘always on’ marketing approach that many companies have only just fully implemented is already out of date.

Nigel Roberts

Founding partner and strategy lead, Yell

Promotion is difficult. You should be able to do it. Sometimes it turns out bad, and when you turn to professionals, it turns out well - ...

Jordan Samuil

Village Roadshow partners with Lion for pourage rights and promotional partnership

Read more

This is very good news for Australian SMEs as ActiveCampaign is an very powerful marketing automation / email marketing tool that costs a...

Lawrence

SMB marketing automation provider sets up Asia Pac HQ in Sydney

Read more

Thanks for the info! If you are looking for commercial real estate in Mumbai, visit us at Jagaha.com! We have over 20,000 verified proper...

Gizelle

Salesforce ups the Marketing Cloud ante with Datorama acquisition

Read more

Completely agree! For the best commercial properties in Mumbai, visit our website - Jagaha!

Gizelle

Salesforce ups the Marketing Cloud ante with Datorama acquisition

Read more

Carisoprodol is used for treatment of pain.so it has some amount of drug use it carefully . Get its complete usage and prescription from ...

jensons henry

CMO profile: The strategy behind Cash Converters brand and customer experience reboot

Read more

Latest Podcast

More podcasts

Sign in