This is so....boring.

Why would you buy a 7g Rolex when you can get a 4k Omega? Why indeed? unless you want a Rolex and not an Omega.....

On that note why would I buy an Omega when I can get a Casio....unless I want an Omega.

On the rest. Their company, their profit...or their funeral. I really don't understand why us as consumers feel like we can dictate the direction of a business. You like it support it, you don't, don't.

 

Lucky. I was on the list for this at the two closest Rolex AD, where I have bought at least 1 watch at one, and 4 at the other, ever since the SS Pepsi announcement ages ago, with no luck. I finally broke down and paid out the nose for a 6-week old Pepsi GMT SS ceramic on the re-sale market last month.

 

A classic example of how to alienate a good customer, the retailer and brand is tarnished. The staff member needs to find another job, there are marketing opportunities here that have just been ignored, incredible ignorance.

 

If you don’t mind waiting longer, any chance you’ll sell me that one with a small headache tax on top and get back on the list?

 

one of the theory is that Rolex want to limit the supply of ss steel, and people have no choice but to buy demi and full gold watches from them. well maybe a joke but recent craze is just getting out of hand, every Rolex sport getting swooped up quite fast not only daytona, gmt, sub..

 

I find this immensely hard to believe.

Would anyone here do this? We have testimonies from prospective buyers of Submariners who bought Seamasters instead and I would suggest that other brands have experienced the same. This means fewer sales net to Rolex - this is a documented consequence of the low supply.

One the other hand, if the tactic really is to goad buyers into purchasing precious metal Rolexes instead, then you would have to look at the profit margens of precious metal watches as opposed to steel models. Are they higher? I would suggest so, but are they high enough to cover the lost provenue of the lost customers who may or may not return at some point? Seems like a major gamble.

Then comes the question of how the Rolex value chain is managed (excuse me if some marketing terms are incorrect, it's been some time since I studied). AFAIK, the stock at the various ADs is bought from Rolex and the cost of stocking them is therefore at the dealer's expense. That means that unless the dealer is actively restocking those precious metal Rolexes he now - supposedly - sells more of, Rolex themselves have no increased revenue from these sales. Rolex doesn't make more money from customers buying up the stock at the dealerships, the only effects are:

1) the dealerships can present a smaller stock of watches from either lack of supply (steel watches) or from increased demand (precious metal/non-sports). This is either good or bad from a dealer perspective, but Rolex themselves do not benefit from it. See @Foo2rama's comment on this.

2) the dealerships will lose customers to other sellers who can supply what the customer wants, which is either a steel sports watch (other brand) or a steel Rolex sports watch (grey market).

It also creates frustration and lessens brand loyalty with both dealers and buyers.

As a part of the equation of deciding whether or not this is a smart move by Rolex is hidden (we have no way of knowing what profit margens, etc. Rolex operates with), the above is the only marker we have of measuring the direct effect. Fewer sales, less commission. And I'd be surprised if the commissions for the sports watches are lower than for the other pieces.

Having worked at various places in sales related positions, I can guarantee that no matter if you are talking watches, automobiles, commercial vehicles, jewelry or otherwise, the vast majority of sales guys are in it for the sale, not for the love of the brand or the business. Working for a brand they love will not be enough; they need to make the deals to be happy. And in some countries where the commissions make up a major part of the pay check, they really need to make the deals...

 

I do not think my AD would appreciate it if I did this. The next time I want something special they may not put me as high on the list. Sorry.

 

Not sure how other people feel, but if I buy a watch for thousands of dollars, I want to be treated accordingly. Sorry that there have already been 20 customers before me asking for a ss pepsi on that day, that's still not a reason to laugh at me/ roll your eyes/ give a rude answer. It's simply not my fault.

I've read about a lot of bad experiences at rolex ADs now and I've experienced a similar situation in which the salesman made me feel uncomfortable for even asking about a "hot" model. I could imagine that this kind of behavior spoils the brand Rolex for a lot of potential buyers. The idea of customers buying gold watches instead of their desired ss model seems unlikely for me.

 

@ConElPueblo - All very sensible arguments. However, the X factor with Rolex is that their ownership and structure are very unique in the corporate world - they don’t have to operate by ‘normal’ rules, and their motivations are opaque, to say the least. My thinking is that this is some kind of ploy to elevate the brand clearly above and beyond the likes of Omega etc. they have already succeeded in placing every one of their new SS models in the same realm as a Patek 5711 (at least in terms of buzz, desirability, % markup for ‘immediate delivery’ etc.). May be this is their way of muscling into the holy trinity + Lange? Leaving Tudor as the everyday ‘basic’ brand ?

 

That's certainly also a possible motive, but why not just raise prices then? As it is there is a price gap between AD and grey market at the moment, this suggests that Rolex should adjust their prices accordingly. As it is, they occupy a place of public recognition that other brands - and not only watch brands - envies massively, so raising the prices to a higher level would raise margens without losing custom. Then they could raise them even further until they occupy a place in the price/brand value schematics that is similar (or in fact better) than the typical high end brands. I obviously have no idea, nor do I really care, I only commented on the commonly read opinion that this is being done deliberately to raise sales figures of "less desirable" models, which I find to be a fairly implausible motive.

If Rolex wanted to do as you suggest, I believe that they would probably do a reverse Tudor instead, perhaps by taking over an existing company that has a profile more compatible to the high end spectrum of horology and then add the Rolex cachet to that brand.

 

Hi all,

Like many I love a good conspiracy theory and after reading a post on another forum where someone had wandered into a shopping mall somewhere in Honk Kong to be greeted by shop after shop displaying multiple examples of these highly desired Rolex SS models all of course at a high mark up over RRP this thought suddenly struck me.

Well just maybe Rolex actually does not know exactly what it is doing and is letting all these grey dealers load up with as many watches as they can and all at over RRP and is actually making and stockpiling lots of these models and when it feels the time is right will release them on mass to their dealer network. In doing so they would swiftly destroy the premium over RRP. Can you imagine the effect that would have on all the grey dealers carrying all that stock and now looking at huge loses on so many watches? I know its highly unlikely but as the saying goes anything is possible and expect the unexpected. As I seriously can't believe that having all the Rolex authorised dealers with empty display cabinets and waiting lists of years can really be a good bushiness model, but what do I know.
Marc

 

So I just walked out from a duty free Rolex boutique in Korea. I kindly asked for any SS models and if they were getting anytime soon. The girl at the bq asked me which model I was looking for so I mentioned any GMT, but she was shocked that I even asked for the GMT. Younger guy next to her told me its not possible to get one because of “other foreign buyers”.
They could have simply said “you have to be here at the right time” or something

 

Give it time - IMO getting people "used" to the higher grey market prices is the first step, then bringing back production of those models to normal levels, and then cashing in when they jump the prices. Rolex doesn't have shareholders to please every quarter, and by many accounts has cash reserves up the wazoo, so they can play the long game if it gets them where they want to be.

There are two things you can be sure of about Rolex as a company - they have a plan, and they are ruthless.

 

I've heard the same idea through the watchmaker grapevine, but I'm not sure this is really a reason for anything going on with the sales side of the business. There's no doubt that the increase to a 5 year warranty period has created a resource struggle at the service centers, but they are making other changes to compensate for the increased demand for warranty claims, and for overall service center load. More and more work will be done with people hired off the street and given specific training, rather than properly trained watchmakers.

Rolex is currently purging a significant number of the remaining parts accounts with independent watchmakers in the US. Back in 1999 there were approx. 2000 part accounts, now the word is they want to limit it to 10% of that so 200. Reports from many watchmakers who received a clean bill of health on their last shop inspection, then getting the dreaded green letter a few weeks after. Not just one or two watchmakers, but 30 and 40...

If the lack of servicing ability was a real driver in limiting the sales of watches, I don't think they would be pulling part accounts with watchmakers, because those watchmakers help take load off the service center.

 

how is that any of their business

 

100% this. I really believe they are using this "shortage" to socially engineer their customers to pay 2-3x retail. Then when that becomes normal, a 50%-100% increase with availability at any AD will seem like a bargain.

 

And perhaps this will coincide with some new models/movements/technologies. If they are going to roll out some improvements, it would make sense to avoid having a large back inventory of the old obsolete models.

 

Exactly. Salesperson is very shortsighted. The customer she laughed out the shop today she’ll be gagging to sell to when the market corrects itself.

 

I agree. It's possible that their goal was to achieve more sales by bundling "undesirable" watches with SS sports models, but it would've been more efficient to slowly switch production resources to the latter. So far it's worked great (and as somebody pointed out, the rise of social media certainly played into their hands). Who knows if it works out in the long run... Personally I've lost interest. I appreciate Rolex' history and their iconic models, most notably the Explorer and the GMT-Master, but it's been about status symbols more than about watches for a long, long time.

 

I don't understand the "getting customers used to a higher price" arguement.
Since the 70's inflation issues, prices of most things increase regularly, sometimes substantially.
Customers would rather cop an annual 30% increase for a few years, than pay 2-3 times after market. Especially if they were told there would be another 30% increase the next year.