Friday, February 24, 2017

A Few More Minutes on Connected Watches

Peter Stas was kind enough to answer a few specific questions that I sent his way -

Courtesy of Frederique Constant

Tempus Fugit -
While it does seem that the connected watch trend is growing, it still seems that there is a hesitation by many (both traditional watch folks and non-watch people) to totally embrace it.  Do you see that starting to shift?

Peter Stas
Yes, it is slowly changing. The Fossil Group is at a hundred thousand connected watches.  MMT based Horological Smartwatches are also growing fast.  The most interesting feedback is the SWATCH Group's Announcement of February 4th  that they will start to develop their own Connected Watch OS with CSEM.  It seems that Mr. Hayek finally understands the future and is joining the trend! Please note they expect to be ready only by the end of 2018 (source Swatch Group website) whereas MMT already has a full platform available to watchmakers, including a secure cloud protected under Swiss Privacy rules.

TF - I was at the MMT launch in San Francisco two years ago, and the understanding that I had at that time was that in order for new features to be updated/adapted, the watch itself would receive a physical upgrade whereby a new module would be swapped out.  Has the process for this update/upgrade begun with new options possibly available?

PS - So far, we have been able to upgrade everything OTA (Over The Air), so no hardware upgrade has been necessary or foreseen.

TF - With new smart watches coming out more rapidly, where do you feel Frederique Constant fits into this new category?

PS - Horological Smartwatches now represent 10% of Frederique Constant's volume.  We will continue to develop new models and drive this category.

TF - Frederique Constant was certainly one of the first to launch a connected / smart watch.  Judging from the dearth of Mondaine connected watches that found their way to the grey market here in the US, they might not have fit in the demographic.  How have FC and Alpina done with the first generation of connected watches?

PS - Frederique Constant and Alpina have done very well.  Positioning at CHF 995-1395 probably better fit the overall brand positioning of Frederique Constant and Alpina.  We have also done intensive trainings to make retailers comfortable with the new product category.  Sales increased significantly in 2016 versus 2015 and we forecast further growth in 2017.

TF - As the Frederique Constant models use (as far as I understand it) the same modules as those sold to other watch brands, is there a plan to make a module with features unique and specific to Frederique Constant and/or Alpina?

PS - Currently only Frederique Constant and Alpina sell watches with the new 281 (ladies HSW caliber) and 282 (4 years battery life caliber). These watches were introduced in November of last year, and we expect more brands to incorporate these calibers.  In the future, we expect to have a specific Alpina caliber with special functions for the brand.

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