Basel Show Marks 30th

Despite sluggish global economies, optimism and strong sales marked the international watch and jewelry show. But some exhibitors are threatening to leave in 2003.

By William George Shuster, Senior Editor -- JCK-Jewelers Circular Keystone, 6/1/2002

The Basel World Watch and Jewelry Show marked its 30th anniversary with strong sales, 4% fewer visitors, and optimism about the next 12 months, especially among upscale watch and jewelry exhibitors.

René Kamm, general manager of global exhibitions for the show's parent company, MCH Swiss Exhibition Ltd., noted that despite a slowdown in worldwide trade, "sales held up remarkably well, and all indications are this trend will continue."

The annual fair (Apr. 4-11) also is making changes to remain what its officials call "the world's premier luxury goods event." One—sending national delegations to Zurich in 2003 to gain needed space in Basel—was strongly protested by the foreign groups; some have threatened to leave the show.

Less and more. There were 2,195 exhibitors and 82,500 visitors. Both figures are lower than 2001. Show officials blamed the drop on firms' sending fewer people (to control costs) and some foreign buyers' reluctance to fly since the terrorist attacks in the United States. A 31% jump in press attendance (to 1,966) underscored the show's importance as a global showcase for the watch and jewelry industries.

The drop in exhibitors was a deliberate move by show management to, as they put it, "enhance the quality of the show experience." The biggest change (from 318 to 86) took place in the prestige jewelry section, due to redevelopment and reorganization. The section now covers the top floor of the jewelry building.

Reorganization and fewer vendors increased booth space 9% per exhibitor overall. Many, especially in the watch building expanded significantly. The 249 watch exhibitors now occupy 45% of the total exhibition space.

Changes. Reorganization of the jewelry halls is just one of many changes taking place in a multi-year program. According to Kamm, the changes are designed to "enhance and strengthen" the fair against growing competition from shows in America, Europe, and Asia and to offset the effect of slowdowns in world markets on business and attendance.

Other changes this year included a new Web site; an in-show interactive electronic information system; a business center for attendees; redesigning the show catalog as a reference book and yearbook for watches and jewelry; hundreds of new booths; reorganizing and renovating buildings used for gems, pearls, displays, and machinery; and a 31-story tower to house show management and a hotel.

There's a local imperative to the changes, too: The trade fair brings in $80 million annually to the Basel region.

Building business. The impact of the weak global economy in 2001 and early 2002, plus Sept. 11's economic and psychological effects on business, put the brakes on the recent rush of mergers and acquisitions in the watch and jewelry industries. Officials of several firms say they're now concentrating on building up business and widening markets. One sign of that trend is the continuing expansion by watch brands into jewelry and vice versa. Several more watch companies—from mid-priced ESQ to luxury brand Breguet—added jewelry this year, and others extended lines. Jewelry and fashion brands adding watches included Gant, Alessi, and Damiani (which will create men's diamond watches), while designers David Yurman, Henry Dunay, Repossi, Staurino Fratelli, and Guy Ellia added new models.

Many industry officials expect business to pick up in the second half of 2002, pulled by recovery of the U.S. economy. "There's a general consensus at an international level that initial signs of a [global] recovery are emerging," said Hugues-Olivier Borès, president of the Swiss exhibitors committee. "A sense of well-being prevails in the world of watchmaking, especially in top-of-the-range products which are supporting the entire sector."

Many exhibitors also expect trading conditions to improve, leading to a more robust 2003. Most were pleased with the unexpectedly strong sales, especially for luxury watches and jewelry. Mid-price, fashion, and even mass-market watches also did well, but jewelry less so. Business for mass-market jewelry in particular, lagged behind 2001 figures.

Go or Stay?

Many national delegations at Basel 2002 opposed a plan that would send them to Zurich in 2003, and some have threatened to leave. Fair officials say lack of space mandates the move. This year, exhibitors occupied 95,197 square meters (50% more than in 1990), close to the limit of usable space.

Under the plan, individual watch and jewelry brands as well as support industries will exhibit in Basel, and national pavilions will be housed in a new Zurich exhibition center owned by MCH Swiss Exhibition, which runs the Basel Show.

Moving national groups was "one of the most difficult and contentious decisions we've had to make," admitted Jacques Duchêne, president of the Basel exhibitors committee. "[But it's] a direct result of pressure [for] more exhibitor space, first-class facilities, and more hotel accommodations [in Basel]." Adding 16,000 square meters of space in Zurich, he said, outweighed the move's disadvantages.

Many foreign vendors disagreed. Despite the promise of show shuttles for the hour-long trip to Zurich, they fear they'll see fewer buyers and less business. The Hong Kong delegation, which did $71 million in jewelry and watches at Basel 2001 and is one of the largest groups (325 vendors), threatened to bolt. Their leaders met with René Kamm, general manager of global exhibitions for MCH, and with Duchêne, who said the plan is final. Later, representatives of Hong Kong, Spain, Italy, Taiwan, South Korea, and Thailand informally agreed to leave—provided their associations' members agree—if they are forced to move. Show officials later met with affected exhibitors (more than 600) to explain the plan in detail.

Jewelry for the Heart

Luxury watches and jewelry that monitor health? So suggested the Basel Forum 2002: "Designing the Future." Panelists Michael Hawley, MIT professor of media technology; John Naisbitt, author of Megatrends; and Tyler Brûlé, creative director of Wink Media, debated how technology and design affect the global $19.8 billion luxury watch and jewelry industries. Key players from hundreds of watch and jewelry firms attended the forum.

Luxury brands must consider how technology is changing our lives and integrate new technologies in product designs to stay relevant to customers, the panel warned. Naisbitt spoke of "technology with soul," and Hawley noted the social and health benefits that could result from a marriage of technology and luxury goods.

Hawley urged watch and jewelry makers to incorporate life-saving technology such as "a watch that measures things about your health, [shows] how you're doing day-to-day, and spots trends," or earrings that record blood pressure levels and pulse rates.

The technology is here, said Hawley. He and Ronald Winston of luxury U.S. jeweler Harry Winston, recently created a brooch of simple LEDs (colored red to resemble rubies) that flash with each heartbeat and record heart data. "Watches and jewelry are worn close to us at all times," Hawley noted, "so why not use them?"

The panel also discussed the social responsibility of brands as well as the value of authenticity as technology is used increasingly to create simulations.