Apple’s iWatch disrupted the venerable Swiss watch industry, but it rebounded

February 2026

Today’s article focuses on how the Swiss watch industry, renowned for its craftsmanship and prestige, withstood the challenge posed by Apple’s launch of the iWatch in 2015 and how it has rebounded to achieve new heights in total revenue.

The Swiss watch industry underwent significant turmoil upon the launch of the iWatch. Unit sales declined to about 13 million units in 2025 from the peak of about 25 million units in 2015 just before the launch of the iWatch. However, revenues grew from US$23 billion in 2015 to a new peak of US$29 billion last year!

It’s a story of adaptation in face of overwhelming disruption to expose the core of what the Swiss watch stood for — high-quality craftsmanship, exotic materials, engineering prowess and brand marketing.

Like our past stories, we will delve into the origins of the Swiss watch business, understand the implications of the launch of the iWatch during 2015 and identify the key strategic levers employed by the industry to rebound.

Origins

To understand the current wristwatch industry, let’s retrace the development of the modern mechanical wrist watch. Let me take you back to the 13th century. Here time is measured using sundials, hour glasses and candles.

Enter the invention of two mechanical devices, the foliot and verge escapement in this century, and the first large mechanical clocks appear. They are large, expensive and usually show up in town halls, monasteries and churches (to guide the faithful to prayer). These large clocks were powered by weights (which needed to be reset at regular intervals). Their display of time was regulated by a foliot, a horizontal bar with adjustable weights at the ends that oscillated back and forth to control the clock’s movement, and the verge escapement, which combined to control how the energy of the weights was displayed on the face of the clock.

The foliot and verge escapement mechanism

Image credit: Wikipedia

Fast forward to the 15th century, and in the German town of Nuremberg, a jeweller invents the mainspring. This is a coiled piece of metal, which stores energy when coiled, and that is regulated as it uncoils thus allowing its stored energy to be dissipated to display the passage of time. This facilitated the development of smaller mechanical timepieces like pendant or pocket watches.

Internal schematic of a pocketwatch

Picture credit: Wikipedia

The religious persecution of the Protestant Huguenot population in Catholic France leads to some of them migrating to Switzerland. Around the same time, French philosopher, lawyer and priest developed the Christian theology of Calvinism, and in 1541 he banned the creation of ornamental jewellery as anti-Christian. This forced the jewellers in Geneva to develop mechanical watches and by the early 17th century a Watchmaker’s Guild was formed in Geneva.

The Isles of Scilly disaster and the marine chronometer

The beginning of global colonization by European powers in the 15th century like the Dutch, the English, Spanish and Portuguese led to a push for more precision in watch making, especially the development of the marine chronometer. Traditionally navigation was done by hugging the coast as a wayfinding navigation method — which was not suitable for crossing oceans.

By the 17th century, sailors could determine latitude fairly well by measuring the sun or stars at noon, but longitude remained extremely difficult at sea. The key insight was that longitude could be found by comparing local time (determined by the sun) with the time at a fixed reference point (e.g. home port or Greenwich). If a ship could carry a precise clock (that was undisturbed by temperature changes and the ship’s motion) that accurately kept the home time, the difference between local noon and that clock would generate a precise longitude.

It is the 18th century Scilly naval disaster, when four English major warships struck rocks off the Isles of Scilly (South Western tip of the United Kingdom) in 1707 and almost 2,000 sailors lost their lives, which prompted the English Parliament to promulgate the Longitude Act of 1714 offering a large financial reward to develop a marine chronometer. Such an accurate marine chronometer, which withstood temperature and ship’s motion, was finally developed by an Englishman, John Harrison, in 1735.

John’s chronometers invented the bimetallic strip (for temperature compensation) and caged roller bearings (to minimize friction), both of which are still used in high-precision mechanical watches today.

The standards of accuracy and reliability set by Harrison’s marine chronometers inspired the development of chronometer certification for watches, ensuring that only the most precise timepieces received the designation. This certification became a hallmark of highest quality timekeeping in the wristwatch industry.

Établissage system

The growth in demand for cheaper and more precise mechanical watches meant explosive growth in the Swiss watch industry in the 18th century. The industry was exporting almost 60,000 watches annually at the end of that century. This growth spurt was accommodated through the development of the Établissage system, whereby hundreds of small workshops were set up by entrepreneurs specialised in specific parts of a watch in the Jura mountains in the North West of Switzerland, which enabled rapid scaling of output and innovations such as miniaturization producing thinner and lighter watches which were aimed at the retail consumer. This and the fact that they stayed neutral through two major conflicts of the 20th century allowed them to continue to invest and innovate these mechanical devices.

Locations of Swiss watch making industry centers

Image credit: Jura Tourism Authority

It is estimated that the Swiss industry controls almost half the market in wristwatches by revenue, and more in the premium segment, with the vast majority of wristwatches by numbers being cheap quartz and digital watches made by Asian manufacturers.

Source: Federation of Swiss Watch Industry data

This is the heart of the Swiss mechanical watch industry which produced about 25 million watches in 2015, its best year ever.

Apple’s disruption

By the middle of the decade of 2010, Apple’s iPhone was already mature since its launch in 2007 and it was facing intense competition from the Android range of phones. Apple was strategically exploring the next “platform” for personal computing and had decided that wearable devices would drive that growth and explored a range of devices in the 2010 (headphones, watches and eye glasses).

Apple positioned the wristwatch during its launch in 2015 as a health and fitness companion device to the iPhone and was originally designed to be always tethered to the phone. It also intended the iWatch to further embed the Apple ecosystem into the consumer’s day-to-day activities thus making the switch to Android that much more difficult.

By 2019, just four years after launch, Apple had shipped 30.7 million watches globally, representing a 36% increase from the prior year. The entire Swiss watch industry, meanwhile, produced only 21.1 million units that year, a decline of 13% over the previous year, and sharp decline from the hey days of 2015.

It also tried to position the iWatch as a luxury watch (there was a US$17,000 version), but its frequent obsolescence as new electronic chips made existing versions unable to accommodate new features soon disputed that branding.

Industry transformation & flight to quality

The Swiss watch industry initially dismissed the threat from the iWatch which mirrored the pattern of incumbents facing disruption. The technology conglomerate had redefined the wrist device from a chronometer to an integrated hub for health monitoring, notifications, and digital payments. Younger consumers, whose media consumption and purchasing patterns diverged sharply from older watch enthusiasts, were gravitating toward Apple’s connected lifestyle proposition. The disruption, however, proved not to be a binary replacement. Instead, it catalyzed a fundamental bifurcation of the market.

The strategic insight underlying this shift is known in luxury product management as the “flight to quality.” During periods of economic and social uncertainty, consumers do not stop spending, they redirect expenditure toward brands perceived as safer, more iconic, and likely to retain value. This behavioral shift was amplified by the pandemic, aided by economic aid, which normalized remote work and accelerated the transition of watches from functional timepieces to alternative investment assets.

The mid-range segment (watches priced between CHF 500 or US$645, and CHF 2,000 or US$2,575) contracted, as smartwatches captured younger consumers seeking digital connectivity and affordable price points. Brands like Swatch, Tissot, and Longines suffered sales declines.

Source: Federation of Swiss Watch Industry data

However, the top end of the market, categorized by watches costing more than CHF3,000 (approx. US$3,900), flourished. By 2024, the top four brands — Rolex, Cartier, Omega, and Patek Philippe — controlled over 50% of the global luxury watch market, up from 43.9% in 2023.

The industry employed four strategies to achieve this result:

1. Emphasis on premium — This involved raising prices on existing lines, discontinuing entry-level models, and concentrating innovation and marketing spend on high-margin luxury segments. Brands moved away from entry-level quartz movements toward mechanical watches involving complications like chronometer-certification, perpetual calendar, multiple alarms and devices like tourbillon (an ornate mechanism that regulates the unwind of the spring even more precisely). One Swiss luxury watch brand, Richard Mille, even offered a watch customized to the owner — it would have an inbuilt mechanical calendar that would remind them during the year of wedding anniversaries, birthdays and other important events pre-programmed in a mechanical watch — the price tag, only CHF 200,000 (about US$257,000).
2. Supply management — The Swiss watch industry, recognizing the growth of China as an immense market for luxury watches, intentionally managed the supply of high-end watches into the marketplace. Rolex has kept its supply of watches below a million units annually creating a deep secondary marketplace for second-hand watches. Buyers of certain new Rolex models have to negotiate to be put on waitlists maintained by specific Rolex authorized retailers and showrooms who prioritize those who already own multiple Rolexes. In 2023, Rolex acquired the world’s largest watch retailer, Bucherer, thus enabling it to better control the customer experience, gain access to Bucherer’s famous Very Important Customer (VIC) list, and also offer its Certified Pre-Owned (CPO) watches through the channel.
3. Leveraging the secondary market — By limiting supply and also price increases, the excess demand from China and as well during the COVID-19 pandemic was absorbed into the secondary luxury watch marketplace where prices of used luxury watches have soared. Adding to this frenzy is Gen-Z emphasis on sustainability (hence forgoing new watches) and their FOMO (Fear Of Missing Out) behaviour that emphasized purchasing luxury items since larger ticket items like real estate seemed out of reach. Brands have also launched a Certified Pre-Owned (CPO) program, whereby they capture a piece of the resale value in return for ensuring the new owner acquires a genuine and well-maintained watch.
4. Leveraging the power of social media — Some brands opted for a very unique strategy — leveraging the social media presence of Gen-Z to market watches known more for their photographic presence versus mechanical complications. Between 2015 and 2025, Cartier’s strategy focused on its “shaped icons” (Tank, Santos, Panthère) rather than pursuing technical complications. This resonated with Gen Z’s preference for “heirlooms-in-the-making” pieces that photograph well for social media and carry emotional weight. By 2024, Cartier had become the second-largest watch brand by revenue, with its market share among Gen Z on secondary platforms like Chrono24 increasing fourfold.

Future

The Swiss watch industry enters the mid-2020s facing new headwinds, including a marked decline in the Chinese market, US tariffs and the continued strength of the Swiss franc. In 2024, exports to China fell by 25.8%, forcing brands to look toward emerging frontiers like India and Mexico for growth.

On the other hand, Apple’s global smartwatch shipments declined by 19% year-over-year in 2024, marking the company’s second consecutive annual drop and the fifth straight quarter of falling sales. This could be indicative of its extensive penetration into the iPhone user base, and limited customer upgrade momentum (due to absence of innovation, though Apple has introduced new health features continually over the past decade) as also the bursting of the pandemic bubble in purchasing it.

However, the Swiss watch industry has proven its agility. While the mid-range faces pressure, the high-end (models > CHF 50,000) remains an indicator of growing global wealth and its appetite for Veblen goods (this economic term, coined by American economist, Thorstein Veblen, in 1899 identifies goods that defy the logic of higher prices reducing demand).

The newest competitors are the Chinese watch industry, which is fast developing the technology to build complications like the tourbillon and sell them at a fraction of the price point of the Swiss.

The lessons of the “Apple iWatch disruption” are now being applied to new challenges — brands are sticking to what made them great in the first place — high quality, scarcity and engineering prowess — something the technology business was unable to replicate.

This article is for informational purposes only. The author does not hold any position in companies mentioned in the article. The opinions expressed in this article are those of the author and not of any organization that he is affiliated with.

Sources:

• Donze, Pierre-Yves. History of the Swiss Watch Industry: From Jacques David to Nicolas Hayek, Peter Lang AG, Internationaler Verlag der Wissenschaften, ISBN: 9783034316453, 2015.
• Schwarz, David. Swiss Made: History Behind World’s Finest Watch Industry, ISBN-13: 979–8342974103, 2024.