The news that Swiss watch exports fell in the first half of 2009 is not going to be a surprise for anyone. Take a look at the table to the left and its a fairly predictable, if worrying set of numbers.

Well, unless you happen to run a watch business in Seoul, in which case you had a very good year (which in itself is staggering when you consider the appalling state of the South Korean currency and economy last year).

The decrease was pretty much across the board- mechanical watches fell at about the same rate as quartz watches. Also not surprising is the fact that the least impacted sector were those watches with an export value of between CHF200-500.

So the fact that sales are down isn’t news, and nor is the fact that markets like Hong Kong and Singapore are now very important markets- but did you realise just how powerful these markets are in the overall context of watch production? Take a look at the following table for a surprising picture.

The table to the right shows the population of each of these markets and then calculates an annualised spend per capita in US Dollars- in other words, a good proxy for how much each of these markets spends on Swiss watches each year for every man, woman and child.

Again, the rankings are not surprising, but the scale of the spend is- this tells us that Hong Kong spends more than 2.5X as much per year on watches than Singapore and almost 70X what is spent in the US…Seventy times!

Now I accept  that not all of the dollars being spent on watches in Hong Kong comes from locals, but there are lots of tourists in other countries as well. Anyone who has been to Hong Kong can tell you how much people here love their expensive designer goods. Watches here are not cheap either- the days of cheap shopping in Hong Kong for these types of goods are long gone.

As further evidence of this, I went into an Omega shop a month back looking for a Quartz Seamaster, only to be told that Omega had phased out the sale of quartz watches in Hong Kong and Singapore because they wanted to push the brand upmarket. Now, I’m not sure if this is true of all outlets, but its not something I could imagine happening in Western markets where quartz is an important price-point to have in the market.

The other number to keep an eye on is China, with a current annualised spent per capita of only 36 cents.

These markets are the great hope for the Swiss watch makers and it means that it is enivitable that the tastes and preferences of these markets will dictate the style of Swiss watches in the years to come. Be honest- how many of you could find Hong Kong or Singapore on a map? (I can, but probably only because I live in HK…).

Amazing  that such small places geographically will have such a large influence on what we see in future watches.