Watchmakers and luxury jewellers blur the lines

One of the biggest stories in the watch industry this year was Graff Diamonds, the London-based jewellers, releasing the US$55 million "Hallucination". Behind the 110 carats of rare diamonds and the extraordinary price tag, however, the Hallucination was the clearest illustration of a shift in priorities for both the watch and jewellery industries, and the increasingly blurry distinction between the two.

Of course, there have been companies that, for much of their history, straddled the line between watchmaker and jeweller. Cartier first found fame as a jeweller and today it is highly respected in both categories. Similarly, Piaget and Chopard have strong reputations in both watches and jewellery, and, over the past decade or so, Harry Winston has also gained credibility in both disciplines.

Historically, however, a company that operated in both fine watches and high jewellery was more the exception than the rule with sales often helped by being specialists rather than generalists. What's changed in the past five years is the sheer number of fine watch companies now pushing into jewellery, with a steady stream of jewellery brands pushing back in the opposite direction.

"The jewellery business is the least exposed to luxury brands," says Jean-Marc Pontroue, CEO of Roger Dubuis, at a round-table discussion at January's Salon International de la Haute Horlogerie in Geneva. Roger Dubuis launched a jewellery collection in 2010, but Pontroue is keen to ramp up that side of the business given the undoubted potential of the market. "Less than 10 per cent of jewellery sold is branded compared to, say, 70 per cent in leather goods. So, jewellery is something we've identified as something that could be a great opportunity," Pontroue says.

The motivations of predominantly masculine and technical brands such as Roger Dubuis and Richard Mille putting more focus on jewellery is an obvious strategy to attract more female buyers who are not as enamoured by tourbillons and other complications. Indeed, Richard Mille himself declared 2014 as the "year of the woman" at his eponymous brand. "[There is] a really rich array of models and materials of all kinds, specifically for women. So, one could say that 2014 is a bonanza year for the fairer sex," says Mille.

With the crackdown on luxury gifting by the Chinese government still proving a drag on fine watch sales both in Hong Kong and on the mainland, watchmakers have looked to broaden their businesses with complementary products.