Watches of Switzerland says online sales grew by more than a quarter as strong demand continued for luxury watches and jewellery. Sales of brands that did not have limited supply were particularly strong, while average selling prices rose across all brands. The retailer says that its multichannel business model is a “key competitive advantage and underscores our ability to react with speed and agility to a rapidly evolving consumer environment”.
Watches of Switzerland today reports group revenue of £586.2m in the six months to October 31. That’s 44.6% up on the same time last year. Group ecommerce sales were 28.7% up on last time. Pre-tax profits of £64.7m were up from £36.2m.
The retailer says it has achieved that growth by consistent investment in marketing, stores, and systems and has now spent £19.1m on opening eight new stores in the first half, while digital engagement introduced during the pandemic lockdown are now permanent features. A ‘by personal appointment’ booking system operates alongside a luxury watch and jewellery virtual boutique, now “significantly expanded due to the continued customer demand of this channel.” In the first half of the year, Watches of Switzerland had an average monthly digital social media reach of 40.1m and 2.9bn digital impressions in the UK alone.
Brian Duffy, Watches of Switzerland chief executive, says this “enables us to continue to maintain high engagement levels with our customers whilst providing an exceptional experience and delivering attractive returns.”
He adds: “Our success in both the UK and the US has been testament to our robust multichannel business model, the enthusiasm and commitment of our people, and the attractive dynamics of our category where demand continues to outpace supply. We have started the third quarter with continued strong momentum and are well positioned heading into the holiday period.
“Through a consistent investment programme, we have further strengthened the business, paving the way for continued success as we advance our Long Range Plan objectives to strengthen our luxury watch leadership in the UK, become the clear market leader in the US and capitalise on the growth potential in the EU market.”
The retailer says its travel retail business has started to show signs of a post Covid-19 recovery but yes not expect tourism and airport business to return to pre-pandemic levels this year, rather seeing it as a “significant medium and long-term growth opportunity”.
Commenting, Russell Pointon, director, Edison Group, says: “Performance was driven by good demand for luxury watches, sales of which grew by 40.5%, but also by increased consumer activity across regions. US revenue saw an increase of 50.2% against H1 FY21, whilst UK revenue rose by +42.3% to reach £418.6 million. It is interesting to note that UK revenue was also up 31.8% versus two years ago, when 33.6% of income came from tourists and airports. As suggested by management, this indicates towards a booming domestic client base.”
Watches of Switzerland is ranked Top500 in RXUK Top500 research.