ST.-IMIER, Switzerland (Reuters) - Swatch Group (UHR.VX) will have to work hard to achieve its goal of increasing sales this year to 8 billion Swiss francs ($8.50 billion) from last year's record high of 7 billion, its chief executive told Reuters on Thursday.

Nick Hayek, chief executive of the world's largest watchmaker, cited slowing growth in China and the euro zone crisis as the reasons for why hard work was needed.

"We still try to reach the 8 billion Swiss franc target, but we have to fight," Hayek said on the sidelines of an event to mark the anniversary of Swatch brand Longines.

Shares in Swatch were down 2.2 percent at 373.6 francs by 1028 GMT, their lowest level since late July and underperforming a 0.1 percent rise in the Stoxx Europe 600 personal and household products sector index <0#.SXQP>

Yet Kepler Capital Markets analyst Jon Cox said the sell-off might be hasty: "Hayek has been saying that they're going to fight for this goal all year long. I don't think there's anything new, really."

Famous for its colorful plastic watches and also owner of 18 other watch and jewelry brands including Omega, Longines, Brequet and Tissot, Swatch Group beat its sales goal last year.

The Asia-Pacific region, mainly driven by China, is the fastest-growing luxury market in the world, buoying watch and handbag makers as shoppers in Europe, the world's biggest luxury market, reduce spending due to the economic crisis.

However, after figures showing China's red-hot economic growth is cooling somewhat, signs are emerging of demand for ultra-pricey timepieces are diminishing.

"The market is nervous about luxury companies generally and any sign of a profit warning," Cox also said.

Yet booming demand for mid-priced watches in China is more than offsetting a cooling at the top end of that market, Swatch said in July.

(Writing by Catherine Bosley in Zurich; Editing by Greg Mahlich)