Editorial The Royal Pop Doesn’t Damage Audemars Piguet’s Brand Image, But A Release Like This Does

I was out the front of Swatch's Carnaby Street store in London, but for that morning Carnagey Street would be a more appropriate name. The store opened for one or two customers before crowds rushed the doors and they were shut for good. Queuers stuck themselves to the side of the store, not willing to accept the fact that Swatch would not be reopening that day, until moving along thanks to the presence of a police van and threat of a dispersal order. Around the corner, Swatch's Oxford Street location never even bothered to open the doors and removed the display Royal Pop box from the window, multi-day queues be damned.

Similar stories were seen around the world on Saturday morning for the release, taking some of the shine off the much-anticipated and hotly debated pocket watch and lanyard watch that combines AP Royal Oak design DNA with some bioceramic Swatch whimsy. Scenes in Milan were particularly grim, for example, although things were a little less fraught back home in Sydney.

To be clear, I think the Royal Pop is a fantastic strategic move from AP, and I’m very excited for the potential of the Royal Pop. I like the product itself too - I don’t see it as a threat to their brand equity - but I really do worry that retail releases like that of the Royal Pop may not only threaten to undo some of the potential of the watch, but may also cast a negative public light on watch enthusiasm itself. The events of last weekend are hardly a good look for the watch industry, one that is often fighting an uphill battle for appreciation in a financially struggling world where people are continuing to examine their relationship with expensive, unnecessary luxuries.

So, how did we get here? First, we need to remember the MoonSwatch.

By all industry accounts I’ve heard, the MoonSwatch’s popularity totally blindsided Omega and Swatch. Each Swatch boutique was carrying roughly between 20 and 50 individual MoonSwatches total. They simply didn’t expect to have such a cultural moment on their hands. We were uniquely placed here in Australia to see the extent of the hype: as Australian and New Zealand boutiques opened first in the world, lines swelled, and many scalpers descended at the opportunity to make a quick buck.

As the sun continued to rise around the rest of the world, the fever spread across Asia, Europe and the US, resulting in similar lines, store closures, flippers flipping and unprecedented demand, probably just behind the scale that we just saw at the Royal Pop release.

Swatch combined its fun, whimsical, approachable product strategy with the design DNA of an expensive watch, which created an incredibly alluring value proposition for not just enthusiasts but the broader consumer base, especially when (broadly speaking) watches are so frequently distilled to no more than just their price tag, design silhouette and value as a social signifier of wealth.

The Omega x Swatch Bioceramic MoonSwatch Collection, branded as an official Omega collaboration that was just 1/32 of the price of the real deal, led the average non-enthusiast watch-curious buyer that the MoonSwatch was aimed at to perceive it as the bargain of the century. That buyer is going to disregard the difference in craft, movement, lifespan or history of the original Speedmaster Moonwatch versus the MoonSwatch unless you educate them on that difference. Swatch created a perception of value, which created demand, and ended with hype.

Swatch did educate the watch-curious buyer, and the MoonSwatch has been an incredible tool for expanding the fold of watch-collecting cognoscenti, as well as encouraging a nice little boost in Omega Speedmaster sales. The MoonSwatch gave curious buyers a new ladder to climb, and helped them reach the first rung they may have otherwise missed.

The Moonswatch is a genius product, as is the Royal Pop... In a vacuum. We’ll get to that shortly.

Whilst the MoonSwatch’s goal was to create an easily reachable rung on the ladder of watch enthusiasm and collecting, the goal of the Royal Pop is to create new physical real estate for watches to occupy: around the neck, the keychain, clipped to a bag, hung from your car's mirror and in many more creative places that watches have never occupied. And of course, back in the pocket again. AP’s CEO Ilaria Resta stated to GQ:

“The idea of this lanyard is smart because it's a very premium way to attach it around your neck or to a bag. I really see many more expressions as we will not be able to tell people how to use it. We want people to tell us how to use it so we want people to play with it.”

Resta has also stated the Royal Pop is aimed squarely at Gen Z, a generation that places paramount importance on self-expression and individuality (speaking as one myself). With this in mind, it doesn’t feel far-fetched that Swatch and AP have seen recent crazes (looking at you, Labubus), and found real estate opportunities beyond the wrist.

The choice not to release a wrist strap is calculated, and one that will increase product lifespan. Whilst there are many kids out there who hoped the Royal Pop would be a Bioceramic Royal Oak "Jumbo", over time, I’m certain they’d be drawn to a different watch and disregard their Swatch. The Royal Pop doesn’t compete for wrist time: it occupies its own wearable real estate where there are no competitors (yet). Those who choose the Royal Pop for its function or AP connection are likely to interact with it for longer than if it were wristworn.

For some, however, the natural location to express their Royal Pop will be the wrist, a desire which third-party strap makers are all too eager to fulfil. Some allegedly had prototypes ready to fit a Royal Pop to by the morning of release, showing we should never doubt the speed of third-party manufacturing. I’d be surprised if Swatch and AP didn’t see this as a possibility - as Resta said, they want people to play with how they use the watch. Perhaps this is the cost of doing business when you create a product this modular.

As the cryptic announcements played out pre-debut, expectations were high for a Bioceramic Royal Oak wristwatch, buoyed by a plethora of AI-generated images of plastic, colourful Royal Oaks overflowing on our social feeds. These AI images took over the driver’s seat in forming consumer expectations, leaving the official brand communications to live up to impossible standards.

These expectations instantly revived the same concerns that existed for the Moonswatch - that the Royal Pop would damage AP’s brand image. Online, I read some Royal Oak owners voicing their concerns, questioning the point of spending upwards of A$60,000 on their AP Royal Oak when now anyone with A$630 to spend could get a Royal Pop wristwatch.

You and I know that the Royal Oak and Royal Pop are not comparable products, even if the Royal Pop were a wristwatch. The difference in movements, materials, finishing and craft place them at opposite ends of the industry, sharing nothing but a brand name and a silhouette.

Sure, if you value watches purely for their silhouette and value as a social wealth signifier, you may perceive the Royal Pop as a threat to the reason you bought the real deal. However, notice that when the Royal Pop was revealed to be a pocket watch with no wrist strap, the conversation that it will damage the AP brand instantly stopped?

The Royal Pop is also arguably overengineered. It's got a sapphire crystal and display caseback, showing the movement to an audience learning about mechanical watchmaking. It has a Nivachron hairspring and a respectable-for-the-price +5/-15 seconds a day accuracy.

The Sistem51 movement is also manually wound, which is a genius decision. Previous Sistem51 movements have all been automatic, so it's clear the choice to go manual is to make owners wind their Royal Pops every three days and learn more about how mechanical watches work.

Why overengineer a 'toy watch'? Because it's a mechanical appetiser to those from my generation (or younger) who don’t yet have the watch bug. Gen Z have largely been disregarded by the watch industry, primarily due to rising prices. The Royal Pop is a way to get some small skin in the game, with a product that's open to customisation in how you style and wear it.

Once the Gen Z target audience clips them to their bags and belt loops, an entire generation is going to learn how a mechanical, manually wound watch works when they all stop working three days later. It’s a brilliant first step in educating more customers that what's on the inside of a watch matters too, adding a layer of depth to watches beyond their societal distillation as status objects.

Not everyone who buys a Royal Pop as their first mechanical timekeeper will go on to buy an AP, but if it puts even just 0.5% of buyers onto the path of watch enthusiasm, it’s a lot of new people aware of AP. The Royal Pop is massively widening the sales funnel right at the beginning of the watch-collecting journey, something AP would do well to try to capture beyond this launch. AP’s ultimate mic drop was the announcement that all profits from this collaboration will be donated to initiatives for preserving watchmaking. Resta said:

“This is something that is endangered and this is a way where pop culture can support high end watchmaking. We don't see this as a commercial activity; rather we leverage the scale of Swatch to reach more younger people. Audemars Piguet is exclusive when it comes to the number of watches we can produce because we preserve our philosophy of handmade finishings and complications. But at the same time, we don't want to exclude people. That's where Swatch came in.”

I think that's a cause we can all get behind.

The MoonSwatch was a learning opportunity for Swatch: a combination of perceived value for money with a social wealth signifier is irresistible to a general public who have been trained to value watches for little more than their design silhouette and price tag. As mentioned before, both the MoonSwatch and the Royal Pops are fantastic products, in a vacuum. Once exposed to market forces, their launch strategies buckled under pressure.

The scenes on Saturday morning were a result of not implementing learnings from the MoonSwatch launch, plus turbocharging perceived value for money by combining Swatch with the most lauded and hyped flex watch on the planet, the Royal Oak. Unprecedented demand was inevitable, even despite its lack of a strap, because the perception (and reality) is that the third party will overcome that hiccup.

We know that the Royal Pop is a serially-produced watch, so the flippers know they will only be valuable for a short period and will cash out immediately. The bubble exists for now, but will pop as soon as the market saturates.

To paraphrase Nick Hayek, CEO of Swatch, flippers are an "unavoidable" part of the game. Sadly, it’s the reality of a world grappling with a cost-of-living crisis and ever-present economic disparity. Whilst they no doubt ruin the fun for enthusiasts and the watch-curious who just want the product for themselves, I can understand the mindset of a flipper who sees an easy paycheck scalping shoes, concert tickets or Swatches. We have to accept that the hypebeast sneaker culture of the 2010s has made its way into watches.

An obvious solution was available, but sadly not implemented: oversupply. From reports about the launch, most stores were estimated to have between 20 and 50 individual Royal Pops in stock, yet lines stretched into the thousands at many stores. If stores were carrying enough stock to saturate demand, then flippers wouldn’t be able to capitalise on low supply to profit off the watch, popping the bubble before it even inflated. Better yet, those flippers would have inadvertently raised more money for these watchmaking preservation initiatives on the day of launch.

Now I know it's not as easy as saying “just make more”, but Swatch is a manufacturing powerhouse capable of producing six Sistem51 movements every minute, so manufacturing to outrun supply shouldn’t be a problem. And if it is, stockpile before announcing the watch to stay ahead of the demand curve! At the end of the day, Swatch is in the driver's seat and had the previous MoonSwatch launch to learn from.

Also, a proper queue system needs to be implemented. From where I was observing Swatch Carnaby Street, it looked more like a riot than a democratised, whimsical watch release. Queue jumpers muscled in, no barriers or line monitors were present, and a lot of very confused passersby certainly weren’t impressed when they were told it was “people trying to scalp a pocketwatch”.

Eventually, police swooped in as concerns of a crowd crush grew and dispersed the area with a police van. In the US, police used pepper spray to quell rowdy customers. Smashed up tents and camp chairs blocked street access, spilled food and rubbish piled up, broken glass strewn across the pavers, all as the public walked past.

This is one of the rare times when watch enthusiasm spills into the public eye, and whilst most of the blame for nasty behaviour can be laid at the feet of the flippers, I don’t know if the general public discerns a difference between flippers and enthusiasts. I can’t see this being a positive look for the watch industry. (Editor's note: I also feel sorry for the other businesses that have to deal with this mayhem interrupting their trading during these launches. I suspect Swatch isn't making their landlords very happy.)

Swatch doesn't need to reinvent the wheel to solve queueing. Apple did that in the days of midnight iPhone releases. A scheduled pickup time for those queued up could solve it, or better line infrastructure and monitoring. When stores sell out instantly and turn away thousands of customers, close due to safety concerns or can’t even open at all, the crux of the matter is this: no Royal Pops sold, no money raised to preserve watchmaking.

We’ve seen this story before with the MoonSwatch. Stores will reopen with replenished stock, and as more Royal Pops circulate, the hype bubble will burst quickly, and actual buyers will be able to experiment with the Royal Pop as intended.

The question is this: will the Gen Z or Gen Alpha watch-curious target market stick around to experience the fun and mechanical joy of the Royal Pop, or has a product release that's unintentionally brought out the worst in our consumer behaviour left too bitter a taste in their mouth to even give it a shot?