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As a leading business fashion authority, Vogue Business in China is dedicated to understanding the dynamics of the Chinese luxury industry, meticulously examining hierarchical structures, local lifestyles and consumer behaviours.
In line with the development of the digital economy, the consumer behaviour and purchasing power of the younger generations across China have evolved and grown in influence. Gen Z and millennials are currently among the most valuable consumer groups for luxury products, and thanks to the strategic presence of international luxury groups in the Chinese market, local familiarity with such goods has also increased in the past year. In addition to the success of handbags, ready-to-wear and shoes, which fall under relatively accessible categories, hard luxury items such as fine jewellery and watches have rapidly garnered attention, according to data from the Federation of the Swiss Watch Industry.
Owing to the economic uncertainty that remains following the pandemic, high-end products have adopted heightened value as investment pieces. Hard luxury sits firmly at the centre of that ecosystem while representing present and future opportunities for the industry in China.
While maintaining a continuous appreciation for traditional fine watch brands, Chinese luxury consumers are also paying attention to fashion watches (and their corresponding lines) from the same luxury groups. This discerning category of consumers demand watches that align with their personalised aesthetics, cater to their emotional needs and exemplify their social status.
Alongside design, branding and production refinement have become important considerations for potential customers assessing both current and future value, while exclusive price points offer up an opportunity for luxury watchmaking brands in a low-penetration, high-growth consumer market. Yet the status of this market remains in flux, strongly urging brands to engage in timely strategic planning.
This white paper, Decoding China’s Young Luxury Watch Consumer, focuses on fine watches within the realm of hard luxury, providing readers with forward-looking and profound industrial insights. We conducted a quantitative survey on luxury consumption among the younger generation of readers of Vogue Business in China. The sample size consisted of 500 participants, with Gen Z accounting for 40 per cent and millennials comprising 60 per cent. Notably, 80 per cent of the participants reported spending more than RMB 30,000 (£3,337) on luxury goods in the past 12 months. The survey included questions concerning consumer lifestyles, luxury consumption behaviour and watch-wearing preferences, purchase motivations, brand preferences and product needs.
Additionally, Decoding China’s Young Luxury Watches Consumer includes insights from a China market research questionnaire conducted by Vogue Business and Barclays Research in September 2023. The sample comprised 506 Chinese luxury consumers. The research questions covered luxury purchase preferences, consumption habits, travel patterns and future consumption plans.
Key insight preview
High-spenders in China aged 18 to 24 have adopted a more sensible and pragmatic attitude towards luxury consumption. Vogue Business and Barclays Research conducted a study into Chinese luxury consumption in September 2023. Based on the research result, more than 50 per cent of China’s high-spending demographic would put their money into a savings account, with close to half investing in stocks and shares and the other in luxury goods. The findings reveal a strong knowledge of investment portfolios across this group.
According to open data from the Federation of the Swiss Watch Industry, Swiss watch imports into China have risen substantially as of September 2023, with an average growth rate of 8.7 per cent since 2021. Within the context of China’s pandemic-related quarantine measures in 2022, there was a remarkable surge in demand for Swiss watch products within the local market, reaching a 155 per cent increase in June 2022. This speaks to the enduring appeal of Swiss watches even under challenging circumstances.
Amidst economic uncertainty, it is high-value preservation across luxury watches that has brought this category to the fore.
Since the commencement of 2023, the luxury watch market in China has exhibited consistent growth and according to Vogue Business and Barclays Research, the purchasing power of Chinese consumers in the luxury goods sector rose steadily from Q1 to Q2, with middle-tier spending falling behind that of the highest spenders in Q3. More than half of respondent spending exceeded RMB 22,500 (£2,500) during the third quarter of 2023 on luxury items such as clothing, footwear, watches and jewellery, with 28 per cent of respondents purchasing luxury timepieces within this period. Consumer spending is expected to rebound in Q4, ahead of the gifting period, with 62 per cent of consumers expecting to spend over RMB 22,500 (£2,500), with close to a quarter (23 per cent) expecting to spend above RMB 52,500 (£5,840).
The recovery of the Chinese luxury goods market is primarily driven by high-net-worth individuals. It is expected that their enthusiasm for luxury consumption will continue to rise, while the middle-class segment may continue to lose enthusiasm with growing concerns around the country’s economic conditions, according to Barclays Research. For the sensible and experienced younger generation of luxury consumers, buying luxury items is not just a lifestyle choice but also a form of investment. As a result, luxury consumption will increasingly focus on premium market categories and products with strong investment potential. The high-end watch market is poised to benefit.
In professional settings, the practice of wearing watches remains pervasive. A substantial 53 per cent of dedicated professionals indicate that business occasions and meetings are their most frequent excuses for wearing luxury watches. Additionally, 42 per cent of the enthusiasts opt for these watches during formal events, while 39 per cent choose to wear theirs daily, swapping them out according to specific context.
The Chinese luxury watch wearer clearly appreciates how to leverage the unique appeal of this category. They demonstrate a keen ability to select products that seamlessly align with various situations, enhancing their individual sophistication.
Purchasing for functionality declines, with rises in aesthetic concern
In discussions about the rationale behind luxury watch purchasing, the role of luxury watches as mere timekeeping tools is gradually decreasing. For a growing cohort of consumers, the significance and value of luxury watches extend beyond their function, serving as a means to establish societal value and self-identity.
Sixty per cent of consumers regard watches as fashion accessories, using them as a medium to express individuality and discerning taste. Forty-eight per cent of consumers acquire watches exclusively for personal gratification, viewing luxury watches as a means of self-reward and motivation. Additionally, 33 per cent believe that donning luxury watches can effectively reflect their social status.
Among the factors influencing the purchase of luxury watches, the brand's prestige (45 per cent) and exterior design (43 per cent) are the most important considerations for consumers when making these purchases; often bound up in the unspoken fact that the social and aesthetic attributes of watches hold weighty significance.
Nevertheless, remarkable high-level craftsmanship and brand legacy, which is valued by 29 per cent of consumers, contribute significantly to their choices. The meticulous heritage also underscores one of the enduring factors behind the sustained success of Swiss-made watches in the domestic market.
Meet the three Chinese luxury watch consumer personas
Vogue Business conducted comprehensive research into luxury consumption behaviours, high-end watch usage patterns, brand preferences, and product demand among China’s younger consumer demographic, which covers both Gen Z and millennials. This research unveiled three distinct consumer personas that express substantial influence within the high-end watch market.
Comprehending the luxury watch market is a gradual process. The high value associated with such timepieces largely relies on the financial status and life experiences of watch enthusiasts. When considering China’s income distribution and demographic characteristics (including gender, age, and social status) clear and consistent segments emerge among young watch investors.
These segments mainly comprise the traditional, male-dominated Watch Connoisseur, who represents the core of the socioeconomic landscape; the financially prosperous Aspirational Elite climbing the career ladder; and the economically independent, socially experienced millennial woman known as the Fashionologist.
Additionally, these young Chinese consumers hold unique perspectives and exhibit diverse product preferences, which forecast the future market landscape.
The Watch Connoisseur primarily comprises professionals from the finance, legal, and IT industries. They are influential figures in both business and social circles, demonstrating a profound passion for luxury watches and jewellery. Despite their corporate focus, they prioritise the highest levels of quality when it comes to their wristwear, radiating an aristocratic aura in their demeanour and effortlessly embodying elegance.
Over the past year, a significant 69 per cent of this consumer type allocated the majority of their luxury expenditures to watches, while 58 per cent regarded wearing luxury watches as a symbol of their identity and social status. As dedicated watch collectors, they emphasise the importance of collecting, investing in, and preserving family legacies. When selecting watches, 78 per cent prioritise the brand’s reputation, with 34 per cent valuing brand prestige. Beyond collecting, luxury watches serve as indispensable daily accessories. Nearly half of Watch Connoisseurs regularly switch between different styles to align with life’s various moments, reflecting diverse tastes and personalities.
The Aspirational Elite represents a unique blend of wealth and youth aspirations, with a strong passion for luxury watches. Comprising about half of the Gen Z consumers surveyed, the Aspirational Elite confront traditional stereotypes associated with watch collectors, showcasing a thoughtful approach to luxury watch purchase.
They come from fields like media, advertising, and the arts, appreciating artistic creations and artists. They take pleasure in various art forms, including music, dance, and film production, and have a particular interest in niche activities such as equestrianism and fencing. Their pursuit of individuality over conformity leads them to favour lesser-known brands with deep legacies over mass-marketed, celebrity-endorsed ones. Aligned with the contemporary cultural trends embraced by the younger generation, around 34 per cent of these individuals also prefer gender-neutral watches.
When it comes to watch history, nearly half of them prioritise traditional mechanical watches, with a special admiration for brands known for their exceptional expertise, like Patek Philippe and Rolex.
The Fashionologist represents accomplished urban women in top-tier cities. These independent professionals embrace life with freedom and joy. One of their fundamental practices is embodying a distinct personal style through the selection of unique ready-to-wear and specifically handbags. Eighty-two per cent of them prefer the quiet elegance of watches as a means of subtly expressing their refined taste and lifestyle.
Rather than focusing on a large collection of watches, they prioritise pieces that harmonise with their personal style. They also appreciate the practicality of interchangeable watch bands for seamless coordination. Seventy-nine per cent of this group consider watches an integral part of their fashion accessories, with 84 per cent prioritising appearance and design when choosing a luxury watch.
While they value romance, these women also value their freedom. Guided by the principle of self-indulgence, they view watches as rewards and sources of motivation for themselves, encapsulating the essence of self-gratification within their intimate relationships.
Voices from industry leaders
To further address the research depth and credibility of Decoding China’s Young Luxury Watches Consumer, Vogue Business conducted interviews with executives from luxury watch industry giants, including Catherine Rénier, the global CEO of Jaeger-LeCoultre; Guido Terreni, the global CEO of Parmigiani Fleurier; Georges Kern, the global CEO of Breitling; and Edouard Meylan, the global CEO of H. Moser & Cie.
Below are excerpts from the Industry Voices section of this whitepaper, featuring luxury watch entrepreneurs’ valuable insights.
Jaeger-LeCoultre originated from a movement manufacturer, and our initial intention was to provide watchmakers with powerful movements. We have consistently contributed to the development of the entire industry. That’s why Jaeger-LeCoultre has always been nicknamed “the watchmaker’s watchmaker” in the industry, meaning that Jaeger-LeCoultre is like the heart of the watch industry, delivering fresh blood and nourishment to everyone. We possess comprehensive movement manufacturing technology and expertise and can provide the industry with movement materials that meet the requirements of chronometers or tourbillon precision. This is how we view ourselves. We hope to be truly recognised by the public and to drive innovation and progress forward.
— Catherine Rénier, the global CEO of Jaeger-LeCoultre
When you wear Parmigiani, you’re not showcasing how much money you have in the bank; you’re really making a statement of knowledge, refinement, sophistication, and not really caring about what other people think of what you’re carrying on your wrist. Because you’ve made a personal choice, you’re beyond the status. And so it’s an evolution of excellence. Luxury shouldn’t be an evolution of excellence because it’s not about replicating. The customer who is evolving towards luxury is more discreet, profound, and less ostentatious. This is what we are trying to express.
— Guido Terreni, the global CEO of Parmigiani Fleurier
China remains the biggest luxury market in the world. The Chinese consumer, at the end of the day, is exactly the same as the English, the French, the American, or the German consumer. Chinese consumers buy luxury products and watches in the same way when the brand identity matches their personal values and principles. Once again, fundamentally successful brands are global brands. An influence that goes beyond geographical identification, highlighting the widespread recognition and establishment of a true global brand.
— Georges Kern, the global CEO of Breitling
We try to eliminate everything we consider unnecessary. We have a very minimalistic style. We’ve introduced many innovations in the industry, aiming to be both modern and classic simultaneously. We’ve also embraced a strong human dimension. I love to think that we aim to surprise people and show them something unexpected. For us, it’s more about creating something that people don’t anticipate, believing that eventually, they will appreciate the added complexity. We established our style 10 years ago, and today, many brands are trying to emulate the Moser style because it’s trendy. However, we were there before, and I’d like to believe that this is partly why there are now more independent brands like ours.
— Edouard Meylan, the global CEO of H. Moser & Cie
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