Fixing Advertising’s Broken Revenue Model: Lessons from the Quartz Crisis

Corporate consolidations, the shocking disappearance of legacy companies and mass layoffs triggered by a technological revolution? I’m talking about the Swiss watch industry in the ‘70s and ‘80s, of course.

Why looking forward isn’t always helpful

It’s that time of year again. Time to stop and take stock of the year that’s just passed and cast our gaze into the hazy middle distance of the year ahead, trying to predict what it might hold.

There will always be a vulnerable hubris to making big “you heard it here first” bets because we now live in an archived internet age, where hot takes can be resurfaced years later and proclaimed to have “aged like milk!!” Think of all the “here’s what to expect in 2020” prediction pieces that were thoroughly researched, beautifully written, and probably genuinely insightful, yet turned to lumpy rancid sludge less than a third of the way through that year.

So, rather than gazing into a crystal ball, what if we looked to the past for guidance? Might it make more sense to look back at how another industry survived a similar technologically-induced economic shock to the one that we’re all collectively facing?

The Quartz Crisis as an economic analog

For over three hundred years, time was kept mechanically by teeny-tiny cogs and springs, and the Swiss were the preeminent force in this endeavour. Accuracy mattered, heritage mattered and so did the quiet romance of a machine that could live and breathe on your wrist without ever needing a battery.

Then, in the late 1960s, quartz arrived. 

Quartz watches replaced cogs and springs with circuit boards. They were cheaper, more accurate, and possible to produce at massive scale. No centuries of accumulated skill necessary, they just worked. And because they worked better by the narrowest definition of timekeeping, people flocked to them.

The impact on the Swiss watch industry was seismic. Hundreds of brands disappeared through bankruptcy or consolidation as production halved between 1974 and 1983. Employment in the watch industry as a whole collapsed from 89,450 to 32,000 in just fifteen years. For a period, it looked as if mechanical watchmaking might fade away entirely.

If a watch was defined purely as a device for telling the time as accurately and cheaply as possible, the commercial conclusion wrote itself: quartz had settled the matter.

Advertising’s broken revenue model

Advertising faces a similar crisis. Strategy, ideas, and creative judgment are increasingly being treated as units that can be scaled, optimised, and squeezed in the same way as media impressions or production hours. Fees and margins reflect this logic, and so does the erosion of stable employment across the industry.

The greatest value that advertising produces depends on context, experience, judgment and taste. It relies on people seeing something others have missed and articulating it clearly enough to matter. Yet it is routinely priced as if it were repeatable and abundant. 

Our revenue model is broken. We’re selling handmade mechanical watches at quartz prices.

AI didn’t cause this. Like the proverbial frog in the saucepan, we’ve been swimming in water being gradually heated for some time now. AI simply cranked up the gas so high and so fast that we’re finally starting to feel the water getting very noticeably hotter.

When a technology appears that can generate passable advertising quickly and at scale, the economic logic becomes difficult to ignore. If advertising is framed purely as the efficient production of messages, fees will continue to fall, roles will continue to disappear and the work will continue to be treated as interchangeable. This is why the current moment feels so destabilising. It wasn’t AI that strained advertising’s revenue model, but it might well be the cinder block that breaks the camel’s back.

The overlooked lesson: value redefined

A glimmer of hope: quartz didn’t wipe out mechanical watchmaking.

Instead of trying to out-quartz quartz, the Swiss reframed mechanical watches as expressions of craft, artistry, and human ingenuity. Watchmaking moved away from functional necessity towards being a salient cultural signal of value and values.

And this was no Luddite response, modern tools played a vital role. Computer-aided design, new materials and advanced manufacturing technologies pushed the envelope of what was mechanically possible. The difference lay in the emphasis: technology elevating the craft, rather than replacing it.

Today, most watches sold globally are quartz, up to 97% by some estimates. At the same time, the global Swiss mechanical watch industry is booming, valued at approximately $49.2 billion in 2025 (Metastat, October 2025). Conceding the mass market freed them to focus on doing what they could do better than anyone else, better than ever before. This is why the story has relevance beyond watches.

Bifurcation as the solution

The Swiss watch industry survived by separating different kinds of value. Mass-produced quartz watches met functional needs quickly and cheaply. Mechanical watchmaking focused on craft, artistry, cultural caché and symbolic value. It thrived once it started articulating this distinction clearly.

Advertising can do the same. A large portion of communications exists to perform straightforward commercial tasks: promotions, tactical messages, always-on content. Speed and cost efficiency matter here. AI will become the default tool, and that is appropriate. This is progress.

Meanwhile, the kind of work that shapes culture, builds trust, and creates long-term brand equity deserves protection. Ideas that rely on insight, taste, and experience can’t be replicated at scale. They require humans, they justify a premium and they sustain employment. They allow agencies to price work proportionally to the value it creates rather than by the lowest common denominator.

Purpose emerges naturally from this distinction

We know that young people yearn to connect with brands that serve a social impact role. And, adhering to the most fundamental law of youth, hearing older folk declaring that “purpose is dead” only hastens their embrace of responsible brands that behave in the best interest of humans, animals and the planet.

In a rising sea of slop, high-craft campaigns are a powerful signal of a brand’s faith in human judgment and its commitment to participating in culture and shaping it for the better. Investing a bit of time and effort (and yes, money) in communication shows that a brand fundamentally respects its customers. This manifests as a confident swagger – aura farming, as the kids might say. 

Unlike fast, disposable, energy-intensive content, this work endures. It leaves a lasting impression that transcends a single campaign and compounds over time. It’s the kind of work that made us want to get into this industry in the first place, the stuff we point to and wryly ask, “could AI have done that?”

A bifurcated future

For our clients, bifurcation clarifies what they are actually buying and what returns to expect from each tranche of spending. AI can deliver fast, functional campaigns at low cost. Great. Mind-made work builds cultural relevance, trust, and long-term growth. Even better. Premium pricing reflects genuine value as campaigns freed from having to do too many different things all at once become more memorable, meaningful and effective.

The Swiss watch industry learned that conceding the mass market did not mean conceding relevance. It did not mean extinction. They took the high ground, not out of principle but because everywhere else had flooded. And in the end, the view from up there turned out to be really rather good. Advertising now faces the same choice. We can continue selling mechanical watches for quartz prices, or we can get clear on what we are truly selling: big ideas that make good money.

Only time will tell whether this prediction ages like a pint of half-and-half or a bottle of ‘82 Latour. Go easy on me in five years’ time if it’s the former because I won’t have a job (not in advertising, at least).

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A special thanks must go to Joe Thompson, the author of HODINKEE’s excellent ‘Four Revolutions’ series which offers the most engaging and accessible account of the Quartz Crisis that I’ve come across. If you’re a watch nerd like me and interested in going deeper into the history, it’s well worth your time.