London could become the ‘primary target’ for luxury watch retailers to open their own monobrand stores as the city’s growth potential exceeds other global markets.
That’s according to new research from estate agency Savills, which examined the presence of 45 luxury watch brands with their own stores in 11 gateway cities.
The analysis revealed that Singapore is the top global market with 37 brands present, followed by Paris with 33 and Hong Kong with 30. In contrast, London and New York ranked the joined lowest with 22 luxury watch monobrand stores each.
However, the report claims London’s growing tourist numbers and “affluent profile” is making it increasingly attractive to luxury watch brands. Some 11 brands have opened their first monobrand stores in the city since 2010, and a further six are expected to open this year.
The firm states the cheaper visas for Chinese nationals could help increase visitor spend in the capital, which, combined with an exchange rate that is currently favourable to international visitors, will further boost London’s appeal to luxury watch brands.
Latest West End sales data found luxury retailer reported a 13% increase in sales in June 2016 compared with the same month last year, despite overall sales being down by 5.9%.
Marie Hickey, commercial research director at Savills, said: “The growth in luxury watch boutiques over the last 10 years has focused on Asia Pacific markets due to strengthening demand and cheaper property costs.
“By contrast, the high cost of opening a monobrand store in London and New York has seen many brands take space in department stores or specialist watch stores instead, explaining why the number of boutiques in these cities is so much lower.
“However, the preference for Chinese tourists to acquire luxury purchases overseas could result in some luxury watch brands refocusing their attention on more established markets and driving significant growth, albeit off a low base, in the case of both London and New York.”