I don't understand the recent Rolex SS craze/shortage. What am I missing?

MTROIS

In simple numerical terms, yes, but with the advent of social media and the expended interest into wristwatches, it is quite clear that demand has exploded, especially for sport SS models.

A decade and a half ago, I was fully satisfied with one (1!!!) watch... and now, I collect them.

I would have never thought I would acquire one Rolex, and now I have a couple.

How many people around here are now hoarding such watches.... when they might not have so long ago??? 👎

sleepyastronaut

I'm sure your AD would be happy to source you a PM Rolex. Doesn't necessarily mean he's going to have it on display.

Jockywilson1

The Rolex Condrum. I thought about it many a time and it’s full of contradictions but I think the fault lies in the eye of the beholder.

Rolex are a not for profit, whatever that actually means, but you can safely assume that brand identity means more to the company than out and out profits. Look what happened to Burberry in the 2000s when the flooded the market, it became a chav haven and subsequently lists its cache. So how do you keep a strong brand identity in the luxury world, advertise massively, limit demand and charge more than the items true ‘worth’. This is how Rolex operate and very successfully.

And to a certain extent it keeps everyone happy, the ADs are happy as they can shift watches, people who get to buy the watch are happy as they are special, and Rolex are happy as they maintain there brand identity.

Omega might make just as good a watch but every other day, there is a thread asking will the old moon watch go up in value. The short answer is if there is supply that meets demand then no, Rolex’s increase because there isn’t the supply. A tiny part of the watches value is how well it tells the time, luxury items value is far more complicated than that.

Adding to the above, interest rates are at an all time low, people look to put there money into other areas, in Rolex’s traditional increase in value year on year then that’s a good investment.

STANDY

But when you are on a site with some crazy collectors and hoarders like here and Rolex forum that are not getting watches it makes you stop and think.

Yes, it’s a supply and demand thing. But supply was cut a few years ago and demand has grown.

2-3 years of every Rolex boutique being empty. This is Rolex playing games nothing more.

Meyrin

Thank you, you've made some very good points here! I´d like to add that one thing keeping Rolex´s brand identity and value very strong, I think, is the fact that they haven't fallen into the trap of making endless (and imho mostly superfluous) "limited editions" of this watch or another, like Omega and Seiko do, all for a quick buck and very tiresome! Rolex has never operated this way. Cheers!

Burr

Your point is better than the one you quoted with regards to marketing. At the end of the day, what amplifies and takes your marketing to the highest level is having a great product. Rolex has an amazing product which takes their marketing to the highest level.

mbeast

There are a multitude of factors contributing to the current madness but it seems to me there was a sort of 'great awakening' sometime around 2016 where social media, particularly Instagram, started getting a new generation interested in watches. When I say watches, I really mean the Rolex, Audemars Piguet and Patek Philippe sports models, as these are the only watches worthy of consideration for most of the new generation. An Omega is simply not an option, regardless of the price disparity, as it is not a status symbol nor an 'investment'. I'm still relatively young and there lots of guys my age and a little younger who previously had no interest whatsoever in watches who now know the full Rolex catalogue, RRP and current grey market prices by heart. Around 2016/7, sports Rolexes suddenly became 'must have' items for these guys.
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Your analysis is spot on. The influence of social media in this era in undeniable and unfortunately there are a lot of sheep out there who just want what everyone else is into. FOMO. Social media has created a generation of people who need the approval of their peers all the time and if having a Rolex gets you more "likes" then I gotta get one. No different to a popularity contest in a schoolyard.

I seem to also recall that around that time Paul Newman's Daytona sold for a ridiculous sum of money at auction, sparking interest in Rolex watches as investments. The coronavirus pandemic has also restricted travel and made the share market more volatile, so rich people started looking for somewhere else to spend their money. Add flippers into the mix and you've got a perfect storm.

Like any craze, I feel that it will eventually run its course and situation will stabilise once people start moving on to the next big thing. In the meantime, just be patient and check out some of the other great watches from other brands out there.

Jockywilson1

A great product will only take you so far, of course Rolex make great watches, but so do loads of other brands. What they excel at is marketing them, their history has always been about making the customer believe what they are buying is the best. It’s human nature to want to be associated with having the best, it doesn’t really matter if it is the best as long as the public perception is that it is.

MTROIS

I really don't think it is stupidity to want a Rolex or any high end watch in these uncertain times. Are there more prominent "problems" to address for humankind? Certainly!!

But buying such a watch can be anything such as: a memento to give to your loved ones some day, a mechanical wonder to admire, a very fine piece of aesthetics and design, it could be an investment for some, but it can also be the buying a piece of timelessness, of immortality which, especially in these uncertain times can be reassuring for some people.

And then, let's not even start mentioning other aspects (that some will deem "shallow") such as the image that people want to project, the on-line competition on social media platforms, etc.

So, no, not all this behavior is stupidity.

Jockywilson1

A great product will only take you so far, of course Rolex make great watches, but so do loads of other brands. What they excel at is marketing them, their history has always been about making the customer believe what they are buying is the best. It’s human nature to want to be associated with having the best, it doesn’t really matter if it is the best as long as the public perception is that it is.

Burr

Agree, I’ll also mention that what they really excel at is understanding why customers like their products. They understand the “feeling” their watches give customers when they wear them.

It all comes back to the product and customer relationship. In all the professional marketing work I’ve done, it’s always come back to this.