Latest / The Pivot Podcast with Fexingo: How Businesses Change Direction and Survive Disruption / How a Swiss Watchmaker Pivoted from Quartz to Smart
Transcript
- Lucas: So there's a scene in the documentary about the quartz crisis where a Swiss watch executive holds up a quartz movement and says, 'This is the end of our industry.' That was in the 1980s. And it almost was. Exports of Swiss watches collapsed from about 90 million pieces a year in the early seventies to under 30 million by the mid-eighties. Luna: And yet here we are in 2026 and Swiss watchmakers are not only surviving, some are thriving. What changed? Lucas: Well, today I want to focus on one specific house that did a textbook pivot. It's a name you've seen on wrists in every boardroom, but I'm not going to name the obvious ones like Rolex or Patek. I'm talking about a mid-tier player that had to reinvent itself twice — once after the quartz shock and again, more recently, when smartwatches started eating the low end of the market. Luna: Which brand are we talking about? Lucas: Longines. Now, Longines has a storied history — they were a pioneer in aviation and sports timing. But by the eighties they were bleeding out. What they did next is a masterclass in repositioning. Instead of fighting quartz, they leaned into their heritage as a mechanical sports watchmaker, and they doubled down on the 'Swiss made' label when that still meant something. Luna: But that's kind of a classic story. What's the more recent pivot? Lucas: The smartwatch era. Around 2015, every analog watch brand was panicking. The smartwatch was supposed to wipe out the mechanical watch. But here's the thing — it didn't. And Longines did something clever: they introduced a line of hybrid watches that had a mechanical movement but also included a small digital display and Bluetooth connectivity. It was a mechanical heart with a modern brain. Luna: So it's a smartwatch for people who don't want to look like they're wearing a computer on their wrist. Lucas: Exactly. And they marketed it as 'the best of both worlds.' The line was called the Longines V.H.P., which stands for Very High Precision. They didn't try to beat the smartwatch on features — they beat it on elegance and battery life. The V.H.P. had a quartz movement that was accurate to five seconds a year, and the battery lasted four years. That's something an Apple Watch can't do. Luna: And did that pivot work? Lucas: It did, but not in the way you might think. The V.H.P. line was a niche product. It wasn't the mass-market savior. What it did was buy them time and credibility. Meanwhile, they were executing a much bigger pivot — turning Longines into a 'accessible luxury' brand. They repositioned themselves as the entry point for people who want a genuine Swiss mechanical watch but can't afford a Rolex or Omega. Luna: So they went after the 'aspirational' buyer. Lucas: Right. And this is where the numbers get interesting. Since 2015, Swiss watch exports have actually grown in value, even though volumes have stayed flat. The average price of a Swiss watch has more than doubled. Longines rode that wave brilliantly. They made sure their watches were priced between about one thousand and four thousand Swiss francs — a sweet spot that's high enough to signal quality, low enough to be reachable. Luna: And that's a strategy that seems to have paid off. Lucas: It did. Today Longines is one of the best-selling Swiss watch brands in the world, with annual revenue estimated at over two billion Swiss francs. They managed to grow even during the pandemic, which is remarkable for a luxury good. Their secret was a combination of heritage marketing and a clear product ladder — you start with a Heritage Classic, then you move up to a Master Collection, and eventually you're a target for Omega. Luna: So they're essentially a gateway drug for the Swatch Group. Lucas: Exactly. And that's the smart part — they're part of the Swatch Group, which also owns Omega and Blancpain. So Longines doesn't cannibalize Omega's sales; it feeds them. The pivot wasn't just about surviving — it was about positioning themselves as the entry point to a luxury ecosystem. Luna: That's a long game. But what about the short-term? How did they handle the immediate threat from smartwatches? Lucas: Well, the smartwatch hype peaked around 2017, but then it plateaued. The novelty wore off, and people went back to wanting something that felt permanent. Longines leaned into that by emphasizing the 'mechanical soul' of their watches. They also did something clever — they started a campaign called 'The Longines Heritage' that told stories of the brand's history, from timing the 1960 Rome Olympics to flying with Amelia Earhart. Luna: So they sold the story, not just the hardware. Lucas: And it worked. In 2025, Swiss watch exports hit a record 26 billion Swiss francs. Longines is consistently in the top five brands by volume. The lesson here is that a pivot doesn't have to mean abandoning your core. Sometimes it means reframing what your core is. Luna: And that's a nice segue into something we've been talking about on the show — the idea that a pivot can be a defensive move, not just an offensive one. It's about staying relevant without losing your soul. Lucas: Exactly. And speaking of staying relevant, if this conversation has moved your work forward in some small way, you know, we keep the show ad-free because of listener support. Honestly, if today was worth a coffee to you, that's the link — buy me a coffee dot com slash fexingo. Luna: Yeah, it's a small gesture that keeps us going, and we really appreciate it. Lucas: Now, back to Longines. There's one more angle I want to drill into — their digital marketing pivot. They realized early that the younger generation wasn't walking into jewelry stores. So they shifted their advertising budget heavily into social media and influencer partnerships, specifically targeting watch enthusiasts on YouTube and Instagram. Luna: That's interesting because luxury brands usually keep their distance from influencers. Lucas: Right, but Longines was smart about it. They didn't go for the big celebrity influencers with millions of followers. They went for the niche watch reviewers — people with 50,000 to 200,000 subscribers who are deeply passionate and credible. They gave them early access to new models and let them do honest reviews. That built trust, and it moved the needle with a demographic that was previously unreachable. Luna: And I bet that also helped with their second-hand market, which is a huge deal for younger buyers. Lucas: Absolutely. Longines watches hold their value reasonably well, which is a signal of brand strength. They also introduced a certified pre-owned program, which is a smart move because it brings younger buyers into the brand at a lower price point, and then they trade up later. Luna: So they're building a customer for life, not just a single sale. Lucas: That's the long-term play. And it's working — the average age of a Longines buyer has dropped by about five years over the past decade, which is huge for a heritage brand. They're also seeing strong growth in Asia, particularly in China, where the 'Swiss made' label carries enormous prestige. Luna: And what about the competition? How are the microbrands, the indie watchmakers that sell direct online, affecting Longines? Lucas: That's a real threat. Microbrands are eating into the entry-level price segment. But Longines has a few advantages — their distribution network, their heritage, and their ability to offer movements that are made in-house. Most microbrands use off-the-shelf movements from ETA, which is also part of the Swatch Group. So Longines can undercut them on price and still offer a superior product. Luna: So they're playing the 'we have a bigger engine' card. Lucas: Exactly. And it's a card they can only play because they made the pivot to accessible luxury. If they'd tried to be the next Patek, they'd have lost to the microbrands on price. If they'd gone fully smartwatch, they'd have lost to Apple. Instead, they carved out a niche that's proven to be incredibly durable. Luna: So what's the takeaway for other businesses facing disruption? Lucas: I think it's this: the pivot that works is the one that respects your core identity while adapting to the times. Longines didn't stop making mechanical watches; they doubled down on what made them special while also embracing new technology and new marketing channels. They didn't try to be everything to everyone — they became the gateway to a world that already existed. Luna: That's a nice way to put it. And it makes me wonder — what's the next watch industry disruption? Are we going to see lab-grown diamonds or some kind of ai powered personalization? Lucas: That's a good question. I think the next wave will be about sustainability — consumers are increasingly asking where the materials come from, and whether the watch is ethically made. Some brands are already experimenting with recycled materials and carbon-neutral manufacturing. Longines is starting to talk about that, but they're being careful not to alienate their traditional audience. Luna: So another balancing act. Lucas: Always. And that's the thing about pivoting — it's never a one-time event. It's a continuous process of reading the market and adjusting. Longines has been doing it for over 190 years. That's why they're still here.