Positive Mood Prevails at Baselworld 2012

While economic pundits continue to talk about the listlessness that clouds the global economy, there was little evidence of it at Baselworld 2012, with a high turnout of visitors from around the globe, particularly the new markets in Asia, Russia and Middle East, and positive reports from watch and jewellery exhibitors, especially those at the high end.

Two trends were evident – on the one hand buying at the top end of the luxury spectrum has revived after the near stagnation of 2008-09, and on the other, manufacturers in the medium to high bracket have adapted their product and design strategies to better suit the current mood among consumers. Theme based collections, lighter designs and even alternative materials were clearly in evidence. There were over 1800 exhibitors from 41 countries spread across multiple halls and the final figure of those who attended the 40th edition of the world’s premier show for watches and jewellery is expected to cross 100,000.

The purchase of a US$5 million Hublot watch, believed to be the most expensive piece on display, by an Asian luxury retailer, perhaps best symbolized the mood at the show. The $5 Million Watch, as it was named, carried a total of 1,282 diamonds, including more than 100 carats of baguette diamonds, along with six square emerald cut stones, each weighing more than 3 carats.

“The fact that increasing numbers of trade visitors are travelling to Basel from Asia, and China in particular, serves to underscore our observations: namely that BASELWORLD is also a reflection of the world market and its development with regard to the purchasing side,” says Sylvie Ritter, Managing Director of the show.

Exhibitors across the high end jewellery and watch brand segments seem to have concurred with the observation that retailers from newer markets were the force that drove business at the show. The watch segment was particularly buoyant with the participation of over 400 Swiss brands most of whom launched exquisite new products. This reflected the strong growth that the industry reported in 2011 with exports touching $21 billion. Asia accounted for 55 per cent, with China (up 48.7 per cent), Hong Kong and Singapore (both up by about 28 per cent) all registering strong growth.

Harry Winston unveiled its Opus 12 and Chanel launched a one piece limited edition watch studded with Mozambique rubies. Other brands too had new offerings including pieces that used complex and innovative designs to out-of-the-ordinary materials like feathers, unscratchable gold, bamboo and even straw. Designer pieces were also in demand in the high-end jewellery segment. Alok Kotahwala of Royal India noted that American buyers were again showing an interest in purchasing, but demand from Europe remained slow.

Salil Shah of Diamrusa felt that walk-in customers are rare at European shows, where an attractive product line and pre-show appointments are necessary to make an impact.

Not too many transactions were seen in the loose diamond section. Buyers were hesitant to pay higher prices and sellers were reluctant to sell goods at discounts since they would be difficult to get replacement at those price levels. Vimal Lakhani, Director of Kiran Exports BVBA said that the company has received good inquiries in pointer size diamonds in VS clarities and in fancies.

Interest in emeralds remained strong, according to a representative of MUZO, one of the oldest mines for the green gem. In the pearl section too, demand was strong, buoyed perhaps by some speculative purchases over recent weeks sparked off by rumours that the Qatar royal family is accumulating stocks to launch a pearl museum.

As has been the case in previous years, the traffic to Hall 6 where the national paviIions, including the Indian one, were located was slow in the earlier half of the week though it picked up a bit as the show progressed.

A lot of attention was focused on the changes that are being introduced by the management. From Baselworld 2013, there will be a rearrangement of the exhibition space. National pavilions will move to Hall 4 which is on the main square and hence attracts better visitor traffic. Similarly the participants from Hall 3 will move to Hall 5, and Hall 3 will become part of Hall 1, the watches section.

However as the organisers have hiked booking rates by 30-40 per cent, quite a few jewellery participants have expressed doubts over whether they will be able to afford the extra outlay. An underlying question that is being asked – are the organisers not too keen on having large number of jewellery companies so that the show becomes even more of a ‘watches-focused’ event?