This story originally came out on June 1 in the print version of South China Morning Post’s Baselworld special report
The biggest story to come out of this year’s Baselworld – a trade fair of the international watch and jewellery industry held in March in the city of Basel, Switzerland – wasn’t about watches, but about the fair itself; more specifically, what its future might be – and whether it even has one.
Only 650 exhibitors showed up this year, a 50 per cent fall from the 1,300 who exhibited last year. A decade ago, the fair had boasted 2,087 exhibitors.
The dramatic decline occurred despite news that the watch industry is recovering.
A report by the Federation of the Swiss Watch Industry showed Swiss watch exports worldwide in 2017 at 19.92 billion Swiss francs (US$20 billion) – a 2.7 per cent increase from 2016.
Hong Kong was the biggest export market with 2.52 billion Swiss francs, a 6 per cent increase from 2016. It is still, however, a significant decrease from the 3.18 billion Swiss francs it recorded in 2015. China ranked third with 1.54 billion Swiss francs, an 18.8 per cent jump from 2016.
Baselworld, nevertheless, was cut short by two days and the space inside the venue, Messe Basel, was decreased, with watch brands taking up only the first two floors of Hall 1, and half of Hall 2 gone.
The grumblings of last year grew into full-throated complaints this year, ranging from the organisers’ inattentiveness to exhibitors’ needs, to the high hotel and food and beverage prices charged during fair dates.
“When you want to get a hotel, it’s very difficult and expensive,” says veteran fair attendee, Dr Jimmy Tang, group chairman and CEO of Prince Jewellery & Watch. He cites “sky-high prices, three to four times more than regular”.
Tang has retired from attending the fair, but continues to send sales representatives who keep him informed.
Exhibitors are also watching their costs. Baselworld “is a big part of our budget; it’s the only way to be able to present so many collections to so many people”, says Christian Lattmann, CEO of Jaquet Droz.
“But what people don’t like about Baselworld is the organisation used to be too arrogant about prices.”
Some brands recently turned to Geneva-based Salon International de la Haute Horlogerie (SIHH). Ulysse Nardin and Girard-Perregaux were part of SIHH last year, while Hermès joined this year.
While it is perhaps not fair to compare the two shows, SIHH was, nevertheless, part of the conversation. SIHH is an invite-only show organised by the Richemont group, while Baselworld is a 101-year-old trade show open to the public.
“[At SIHH], independent brands and smaller brands have the opportunity to showcase their products in a very high-end environment ... Baselworld is very good as well,” says Marco Tedeschi, CEO of RJ, the new name for Romain Jerome. “[But the Fondation de la Haute Horlogerie] provides a full integrated experience [and helps organise] lunch and media sessions.”
Tedeschi says RJ plans to downgrade its presence at the fair in the future. “Maybe we’ll go in a more casual way just to meet our partners informally,” he says.
The problem is that the Baselworld organisers “need to adapt” says Raynald Aeschlimann, CEO of Omega, who adds that what made Baselworld special was the brands that occupied the halls, not the organisation or Basel.
“The whole concept [of] Baselworld is [that it's] about the world of brands,” he says. “It’s not about Basel with brands.
“We don’t need Basel to organise what we have here. But the concept of meeting with everybody [from clients to journalists] and having this kind of salon – I like it very much.”
Even on the retailer side, the relevance of Baselworld is shifting. Tang points to the rise in pre-Baselworld presentations, leading to a significant number of watch orders placed even before landing in Switzerland – a phenomenon that started just five to eight years ago.
“The purpose [of Baselworld for us] is different – now we give [trips to the fair] like an incentive to high performers in our sales team,” he says.
“[We visit Basel out of] respect only – it’s not like before. Before, if we didn’t go, we didn’t have any products for the coming year.”
Despite complaints, many brands remain optimistic.
“The brands that have left represent a very small part of the business,” says Hublot CEO Ricardo Guadalupe. “The brands remaining represent over two-thirds of the watch industry.”
He adds: “Baselworld is still the biggest fair by far, much more so than the Geneva fair. What counts are the real actors, like Swatch Group, Rolex, Patek Philippe, LVMH – [they] are here. And if these [brands] stay here, Baselworld will still be the number one show in the world.”
Suggestions for improving the fair focused on capping hotel rates and improving the overall exhibition experience. Another idea was to bring the SIHH and Baselworld dates closer together.
“Retailers and journalists can go to Geneva, and after come to Basel [or vice versa],” Guadalupe says. “That would be more intelligent, because [currently] our retailers have to come [to Switzerland] twice.”
Despite the downbeat tone, there were notes of optimism. The fair ended with a silver lining: major watch brands had committed to return next year, including Rolex, Patek Philippe, Breitling, Hublot, Zenith and TAG Heuer.
And in May, Baselworld organiser MCH Group announced changes in the event's management.
Sylvie Ritter, managing director of Baselworld for the past 15 years, has stepped down, making way for Michel Loris-Melikoff, who started on July 1, and brings fresh new strategies to reinvigorate the jewellery sector; improve catering; hospitality and event services, and create a day for the media.