Brand owners take a more professional approach and compel newcomers to come up with a tangible value proposition.
I have been studying the watch industry for the last 25 years and I have been working with entrepreneurs for the past 5 years. From what I have seen, the equation of price, proposition and promotion has changed.
Even if the name doesn’t ring a bell, everyone has read about Filip Tysander, the founder of Daniel Wellington, whose acumen for branding and digital marketing made creating a watch brand look as effortless as looking good…
Until that point, small watch brands were mostly the brainchild of cognoscenti such as Ken Sato, Eddie Platts, Bill Yao and of hobbyists.
Above: the Dreadnought made by Eddie Platts is one of the earliest community driven and micro funded watch projects.
Tysander was one of the first professionals from the business management or marketing field to set foot in, and he represents a pivotal point in History, after which watch brands run by professionals from other fields have been surpassing the ones run by hobbyists.
Tysander established a successful formula for promoting a fashion brand like a luxury brand, and for harnessing the potential of social media. A lot of aspiring entrepreneurs are trying to extract guidelines from the Tysander business model and to emulate it. This has led to the creation of so many copycats that someone decided to put together a mock tutorial on How to create a unique/successful minimalist watchbrand.
One of the consequence of this professionalization of small brands is that there are people willing to compete on price (by being cheaper), and willing to compete on digital marketing (by using the same methods). For a new brands this makes it very hard to compete on price and promotion.
This view is corroborated by Blair Nicole Nastasi in her article Winning High-End Customers in a Luxury Market: don’t compete on price, focus on the exclusivity factor and use the right marketing channel.
That leaves aspiring entrepreneurs to be creative with proposition, and it seems that the trend is now to step up when it comes to design and pedigree. So my advise to aspiring entrepreneurs is to pick a brand style that doesn’t follow any mainstream trend, and to develop products that offer more than just utilities: every one uses 316L steel, sapphire crystal and Italian leather, so one needs to find other ways of making a brand stand out.