There will always be a niche market for just about everything so long as it is profitable for the brand.
Heck, there are people who would love to buy a new 8-Track tape player but there's just not enough people to make it profitable.
The sale of Smart Watches now easily exceeds the number of mechanical watches sold each year, but many watch brands are still alive and doing well like Rolex, Omega, etc.
Do they really? I think that's a bit of apples and oranges tbh, maybe I'm biased but I think there's more overlap between $450-1,500 phones and $500-2,500 cameras than in the watch analogy... The average smartwatch is prolly something in the $100-250 range, and the luxury mechanical watch market might thrive well above that (AFAIK, I imagine most people just don't wear cheap watches anymore)...
My question is genuine btw, feel free to educate me... I've only owned two decent Victorinox/SAK watches in my lifetime, I was quite fond of the second one since it was all titanium and super light... But over the last 9 years I've not worn a watch at all or I've worn one of three different $200-300 Android Wear smartwatches. Using a Pixel right now which finally seems about as smooth and long lasting as I wished my previous Moto & ASUS watches had been...
Somehow I've ended up buying a bunch of traditional bands for each of them, heh, usually after figuring out a way to adapt them. Maybe there's more parallels to the camera market after all...

I'm 40 FWIW and while I never owned an 8-track I do now have about as much vinyl as my parents had in the 70-80s, which is to say I'm prolly an outlier in between generations, heh.