Will Ground Floor Watch Shops Go Extinct?

During a recent visit to a watch shop I was reminded of my state capitol building.

A ground floor boutique in a major US city.

The two wouldn't seem related: a capitol is the seat of government while a watch shop is a retail setting. But the shop I visited and my state capitol have one architectural feature in common: a mantrap for entering and exiting (also known as a sallyport).

A mantrap is a "neutral zone," or buffer, separating a secure space from the outside world. It features two doors but each door will only unlock if the other door is locked (in other words, both doors will not simultaneously unlock except under extreme circumstances). Entering or exiting a space secured by a mantrap goes something like this: press a button for the door in front of you and someone buzzes it open. You enter the mantrap and the door you just used closes behind you and locks. You're "trapped." Then, provided conditions are right (you present ID or pass some kind of check or the like) the second door is unlocked and you can enter the secure space.

The mantrap is arguably a standalone character in the movie Uncut Gems.

The scene from the movie Uncut Gems in which Adam Sandler's character (left) holds three other characters in the mantrap to the right.

Early in the movie, Adam Sandler's character becomes quite distressed when he can't unlock the mantrap doors and some of his highest profile customers are stuck in the trap. And, in the film's final scene, Sandler's character intentially holds three others in the trap while he waits for a game result (see screengrab).

Mantraps serve a few purposes. First, they prevent "tailgating attacks" in which one person is "buzzed in" but someone else (or a number of people) follow that person in through the unlocked door. With a mantrap, all these folks would be stuck and confronted with a second locked door. Second, if a thief grabs an item and manages to pass through the innermost door leading to the mantrap, they will be stuck with the stolen item in the mantrap until, presumably, law enforcement arrives.

AI generated image of an office space layout..

In general, mantraps are a good theft deterrent since a potential thief "casing" a store may move on once they realize their potential target is "hardened." In general, since mantraps can increase the security of any space, they make perfect sense for luxury watch shops. There is a well-documented recent spike in watch-related crime and corresponding need for added security in shops. For example, in an article from last week, watch recovery specialist Chris Marinello delves into why London has so much watch theft.

In some ways, then, it is actually surprising that I've only encountered mantraps in two watch retail settings. One of these was a real surpise because I believe that, less than five years ago, the store did not have a mantrap. That made me wonder: is watch retail beginning to morph into a new configuration due to watch-related crime? I believe the answer is probably yes. I also believe that one of the biggest shifts is the decision by retailers to "move on up" to higher floors in buildings and abandon the ground floor.

I've visited or seen announcements of seven luxury watch retailers located on the second floor of a building or higher. This relates to store security in a number of ways. First, similar to a mantrap, thieves will find it far more time-consuming to flee from a store if it is located on a higher floor (side note: I find elevator rides generally awkward and I can't even conceive of how weird it would be if someone who just knicked a Rolex was riding along to the lobby, and I'm pretty certain the music would never fit the circumstances).

Watchbox's location in NYC, at the time located on an upper floor adjacent other luxury retail locations.

Travelling from an upper floor gives police more time to respond and catch a thief. Knowing this, a thief is less likely to attempt theft on higher floors of a building vis a vis the ground floor.

Upper floor retail space is also safer due to the use of a so-called "crash and grab" or "ram raiding" tactic by thieves. In general, such thefts involve stealing a car first (these days made easier by a flaw in Kia cars, in particular), crashing the car into a storefront on the ground level and then taking valuables. Earlier this year, watchmaker Breitling fell victim to such a theft in Basel, Switzerland. In 2023, a Louis Vuitton store in Chicago was similarly looted. Of note is the fact that criminals presumably find it more lucrative and less risky to fence luxury products obtained through use of a stolen car rather than just selling the stolen car in the first place (in other words, a car is probably much harder to fence, easier to track back to the thief, and the proceeds may not be as large).

Of course, as an economist, I often wonder why owners of valuables go to such lengths to prevent theft assuming that they have adequate insurance coverage. In the insurance industry, the disincentive to invest in retail security due to insurance coverage is an example of "moral hazard": insured parties may not spend money or effort to avoid bad results because they know it will not cost them, financially (another example of moral hazard is dangerous driving by those with automobile insurance). My guess is that watch retail insurers offer premium discounts if a retailer adopts certain security precautions, like mantraps or upper-floor location. The second of these options offers an additional financial benefit to a retailer: there is evidence that ground floor space is more expensive. Moving to a higher floor may well offer savings on rent.

It remains to be seen if there will be additional major or widespread changes to watch retail design in the near future. Arguably, the biggest loss from moving away from ground floor siting is the "billboard" effect: ground floor retail likely allows more people to see products and branding due to foot traffic. Otherwise, it is unclear if any of the aforementioned novel security measures actually degrade the retail experience. The view from higher floors is better, after all, and I'm sure that both sales staff and collectors have a more enjoyable experience when they know that a store is safer.

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