Who are the brands’ main competitors? Themselves!

January 2018

Who are the brands' main competitors? Themselves!

The sale of a Paul Newman Daytona for 17 million dollars is just the tip of the iceberg. The vintage (and second-hand) market is stealing a march on the contemporary watch business. What we are now seeing in the watch market has already transformed the art market.

On the one hand, you have sales by the big auction houses, which are sustained by a variety of phenomena: genuine collectors, genuine investors… This has all conspired to generate a new kind of customer – more mature but equally wealthy – who is looking for that rare pearl of great price. And on the other hand, person-to-person and agency-to-consumer sales are exploding on platforms such as Chrono24, eBay and Amazon. While you’ll no doubt find it impossible to get rid of your iPhone 4 in a few years’ time, a 1970s watch in good condition offered for sale by some guy in Dallas, may well catch the eye of a budding young collector in London.

When it comes to watches, every Homo sapiens is faced with two questions (and most will spend very little time pondering them...). First: should I wear a watch? And second: should I get one from a local shop, or should I order one (perhaps second-hand) online?

To be cynical, Swiss watchmakers have been honest to a fault. They have never subscribed to the built-in obsolescence adopted by Apple and Samsung, because back in the day that concept would have been unthinkable. High-quality watch movements were built to last a lifetime. Historically, that was the creed of the industry. The result is that that fifty-year-old construction of cogs and gears, if it has been correctly maintained, can still be passed down from father to son, as the adverts suggest – or from person to person online. All these sales completely bypass the brand whose name is on the dial. E-commerce is fast becoming a fact of life, even where watches are concerned. Leading the charge are vintage watches, which younger generations are buying with increasing confidence, in terms of both authenticity and condition. There’s a whole new sector of the market, defined by the marriage of a new technology (the internet) with a very old one (mechanical watchmaking), which lies completely outside the purview of contemporary watch companies.

You may be feeling quite smug about your new iPhone X right now, but in ten years’ time we’ll all be laughing at them. But who will be laughing at your lovely El Primero? Certainly not Zenith... particularly if you sell it to someone who, if you hadn’t placed your online ad, might have made the effort to go and buy one from a brand boutique. Some initiatives are beginning to see the light of day, although they are still few and far between. Vacheron Constantin is one of the few brands with its own vintage department, enabling it to set the terms of how its own back catalogue is marketed. Will others join the fray? It’s unclear. Second-hand watch sales are something of a digital jungle today, and it’s difficult to know where to start. More and more retailers, however, are beginning to offer second-hand watches, sometimes alongside contemporary collections. They’re hoping to get themselves a slice of the action.

Source: Europa Star TIME.BUSINESS/TIME.KEEPER Chapter 5/2017