Quick notes on Swatch

1) Omega is trying to move upmarket, having:
       - increased prices dramatically (~30 to 50%) in the past few years, with
       - more marketing: Olympics and James Bond, and
       - pulling stock from third party stores while relying on their own boutiques.  Who no longer give the expected 20% off MSRP.

If successful, they will end up like Rolex: widely known to the general public as an expensive watch to buy when you've 'made it'.  Instead of 'the watch for when you cannot afford Rolex'.  I think it will take 5-10 years for the general public's perceptions to change, but Swatch (being family controlled) should be disciplined enough to pull it off.

Those buyers priced out can always buy a cheaper brand instead: its common here to see am Omega boutique next to a Longines or Tissot one.  I love Swatch's long term branding strategy, market segmentation...and their profit/cashflow numbers.  Just wish they would give more transparent: giving breakdowns between their high end and low end segments, make conference calls available, and give a better breakdown in their P&L statement.

2) In late March, HSBC downgraded Richemont to neutral on fears that high-end watch demand may be starting to see a downturn (poorer sales and rising inventory at Hengdeli), partially due to a decline in 'gift giving' due to China's leadership transition.  They were more optomistic on Swatch due to its lower end brands.  HSBC turned out to be a a bit early, but still take note of this to see how accurate their reading of the (Chine) watch market was.

I still like Richemont, and would buy on any serious downturn.