This really is a bit bonkers, I agree.
M.
I have been concidering buying a speedy pro for some time, I even put a deposit down, but the delay in delivery made me cancel. Deep down I'm struggling to part cash for the speedy at its current price.
Don't get me wrong it's a lovely watch, but it hasn't changes much over the years which is the appeal, and it's hardly in short supply, but the price has shot up.
I came across this article this morning which made for interesting reading.
http://www.watchprojects.com/essays/...ster-standard/
However there are some waches I didn't think twice about paying for even though they have also has price rises, bought a subc ND and PAM312.
Would be interested to hear if any of you havw wanted a watch but for whatever reason just couldn't pull the trigger because you couldn't justify paying the price.
Sent from my SM-G935F using Tapatalk
This really is a bit bonkers, I agree.
M.
I would really like to see something similar with Rolex prices comparisons etc.
I guess it is a trend in the industry not just omega..
Sent from my iPhone using Tapatalk
...and this is why anything over £1000 is pre-owned in my collection :)
It is a trend in the SWISS!! main steam 'luxury' brand watches with mechanical engines.
Come on it is hardly news that the Swiss industry is by and large taking the mickey with their pricing but hey as long as the buyers pay for it; good for them and their ever increasing mega profits.
Just have a look at the Seiko mechanical chronographs from the 6139 to the current Brightz crop and do take into account that the Brightz is higher up in the model range.
And with Japan made quartz it is shocking to see that the prices have hardly gone up.
Very close to home have a look at Eddies offerings!!
But, as long as the buyers are content with the added brand value they pay for, it all keeps floating up. Just like with hot air balloons, the sky itself being the limit.
It's not a Swiss thing - it's a worldwide luxury goods thing!
It's just a matter of time...
My 5513 from 1968 was around £100 new which in todays money is around £1300... presuambly the nearest equivelant Rolex is a non date sub and these retail for approx £6k so ~ 4.5x increase.
Keith
I would have thought that the price of luxury items would be more closely related to the earnings of the top 30-40% of society. Given inequality has increased markedly in the last 20 years and Pareto's 80:20 law, it is hardly surprising that compared to inflation or average wages that prices of watches have risen excessively.
Also, If a luxury item isn't expensive it isn't as desirable (look up Veblen goods) so in effect, to keep high demand, luxury goods have to be expensive...
Sent from my iPhone using TZ-UK mobile app
I think the problem with the Speedy is that it is a classic watch on a old pricing strategy in comparison to the other/newer Omega models in my opinion. It almost seems the Speedy is a bargain in comparison and so by adding a bigger box etc, the price gap with the other models is being reduced. I remember the Speedy was approx. £1500 when I took a greater interest in watches. I turned down a Snoopy Speedy for £1500 and a Moon to Mars for £1100 a few years ago. What was I thinking.
Wow, love the advert!
Is it just me that can't look at a speedy without noticing the 'cock n balls' 12 marker?
Mechanical watches used to be... mechanical watches. Now they are luxury goods. Why wouldn't the pricing change?
The extension of free/cheap credit to absolutely everyone is surely playing a major role
Actually is was the object.
Begin eighties the mechanical watch was an anachronism in the perspective of quartz accuracy. It was no longer an accurate time piece, obsolete as such.
Then Biver and Hayek came up with the brilliant idea to reinvent the mechanical movement as someting else than an accurate time piece. They marketed the obsolete as something desirable.
The movements were at least as much automated mass produced but that did not stop them hallowing the craftsmanship of the Swiss gnomes filing away at gears.
As that succeeded the price was detached from the hardware as it increasingly became just mage. The rest is price increasing image. The more the price increased the more desirable the .... obsolete. Mission completed, humongous profits on low tech realized.
Low tech doesn't mean cheap to produce. Aston Martin used to hand wheel their sheet metal. That's the most basic way to form metal. It's also time consuming. If you have some proof that making a mechanical movement isn't much more time consuming than producing an IC for a quartz, I'd love to hear it.
It's an interesting summary, and I agree with most of it. Watches are way overpriced thesedays. I think the last 10-11 years have been crazy. Ironic that the Swiss did a great job of saving their watch industry in the face of quartz competition back in the mid-late 70s and kept the size of their market share whete it needed to be. I think they've grossly overplayed their hand by pushing the prices up to the current level and
I shall not be sorry to see them struggle. Even the watch enthusiasts are wincing at the current prices, and the majority of the public simply wouldn't dream of paying a few £k for a watch.
The likes of Patek and Rolex may continue to get away with it, but the brands like Omega and Breitling will struggle to sell in volume at their current price point. A few of the Omega models are just on the cusp of being sensibly priced, but much of the range just doesn't look credible.
Paul
You are correct.
In this case however we are talking about mass produced sixties tech and designs. The only progress in say an ETA2824 is the automation of the production machinery.
At Rolex the only hands on is dropping the balance mechanism in.
The current Speedy movements cost less to produce than 40 years ago.
This whole cost argument is totally beside the point though and just delusion by buyers.
The topic was price development and the price development for the Swiss luxury watches is development of the perceived added value. We all know that if you need an accurate timer, you get something quartz digital costing beer money.
The point is that when you wear that on your wrist all know it cost you beer money.
Strap on something with huge brand added value all know you spent an arm and a leg. Very few will realize that it is for mass produced obsolete time keeping tech so that and the production costs are irrelevant: It is about the image and you do get what you pay for.
It is what it is and as long as customers are happy, all are happy.
I think the fact that Seiko and Citizen can make them so cheaply proves the point. There's very little correlation between production costs and selling prices with the expensive watches. I guess the really top-end watches made in small numbers will be far more expensive to produce, but the Rolex and Omega stuff is mass-produced.
Paul
Is it?
"The assembly and regulating of the movements are carried out entirely by hand, by highly skilled operators and watchmakers."
The dial markers whether precious gems or white gold batons / numerals are still applied by hand. As is the final case polishing and inspection.
Also if so fully automated why do they need to employ 6000+ people in their 4 production plants?
Did you guys receive the batch of Seikos with metal shavings in the case? There were a bunch sent to the USA that Seiko didn't bother cleaning the case after machining.
I'm not arguing that these watches are priced in any way that has something to due with their cost of production - they're luxury goods. However, a $300 Seiko isn't even in the same galaxy as a modern Omega or Rolex. Even the now $2,000 MM300 is clearly long in the tooth compared to a low end Omega diver.
I like Seiko, but even those are expensive. Is $2000 for a quartz Grand Seiko really a great deal? I don't think so. What about their absolutely horrible looking ceramic watches? $10,000. They make a "Dark Side of the Moon" look like a deal.
The ironic bit being that they funded the marketing campaign reinventing the mechanical tech by .... selling cheap quartz watches; the Swatch funded the revival of mass produced mechanical movements. Have a look at the 7750. It was designed for cheap mass production. Than scrapped because movements with a qco were ever so much more accurate if more expensive to produce. Come the marketed appreciation and the 7750 is recreated using Swatch watch generated money.
Automated mass produced the 7750 is so much more profitable that ETA winds down production of their qco controlled chronos. That has the added benefit of not showing up the limited accuracy of mech tech. Omega is a clear case in point. The brand added value basically forced them to phase out qco. No issue as the mother company also owns brands with less brand value. Profit is still profit after all.
Good examples of the brand adde value are Breitling and say Tissot. You can find the same haq in both yet the Bretiling blurp adds 2 or 3 K Euros.
Another one? The TAG-Houer Conected.
You pay for the brand image and so what? You do get what you pay for!
Just don't show lack of savvy by claiming that the engines are better engines with brand added value.
Unless you're Seiko (which is impossible, since you're a person), or derive some sort of self worth from Seiko (which is possible, but sad if true) I can't imagine how my comment could possible be construed as throwing mud.
The Crooklyn Bridge is the greatest moment in Richemont's illustrious journey of ruining all their brands.
All is relative.
You may not LIKE what they are doing but they make stunning profits.
Take a look at what they did with the MontBlanc brand. Totally created image and selling at eye watering prices. Very good example in this thread too: They are selling as jewelry not as accurate watches.
Thanks for posting an interesting article. I do think that any analysis of the reasons for the exponential price rise has to factor in the general increased demand for luxury items due to the worldwide increase in the number of relatively rich people who can afford them. A watch is a relatively easy to acquire status symbol and today there are more people with a few thousand dollars available for watch purchase than in 1995. No matter how clever their marketing companies like omega and Rolex would not be able to sell so much expensive product if there weren't more and more people each year who can afford them.
Sent from my iPhone using TZ-UK mobile app
All the hallmarks of a classic bubble imho.
+1. I'd add in the increasing costs of servicing and reducing/cutting off parts supply to third part watchmakers another wince point.
The history of personal timekeepers has been a drive to reduce the costs of production so that the market could grow(the Americans were the first to do it and the Swiss followed). In the days when pretty much everyone had, or needed a watch lowered production costs made that happen. It makes the best business sense.
Sure JP, the average quartz movement is going to be cheaper to produce than the average mechanical that's for sure*, but the price difference at point of sale between the two is far larger. If we take the Speedy as an example, it will be significantly cheaper to produce the movement today than it was with 1960's production technologies. Same goes for standard ETA movements and the like. Cases, dials and all the other sundries that make up a watch are also cheaper to produce than ever before. Now the very high end stuff is still more hands on and that is part of the appeal, but even there a marque like Patek is able to produce 40-50 odd thousand watches for the market a year.
*down from when they were far more expensive than mechanicals when they first came out. Another example of the drop in production costs over time.
When Hayek and Biver came up with the idea to remarket the Swiss mechanical watch as a luxury product instead of as an accurate time piece, they sidestepped the competition and started selling a newly created image.
This disconnected the price form the tangible, made the intangible the product and it took off big time.
The luxury watch market has a pricing strategy that is set by what the market accepts which in turn is set by marketing of the image.
The not so brands, the not such watches, are operating in a different world where prices are set competitively by tangible product plus economically viable margin.
Thus we see electronics with luxury prices because branded with Breitling or TAG-Heuer and perfecly ok mechanicals assembled with lots of human hands on selling for beer money because branded Vostok or Seagull.
Thanks for that. That made me laugh out loud:
It is 'only a Seiko', 'digital cr@p' and it was 600$ when introduced; TimeFactors price range.
Furthermore it was stamped 'Made in China' even though some relatively costly bits (sapphire crystal and the qco) came from Japan. Applying Swiss rules it would easily have qualified for 'Japan Made'.
One of the appealing things about it for me was and is that I can wear it on a local farm produce fair where it blends in with the F91-W and family watches.
I.e. NOT ostentatious
You are partly correct about the inexpensive parts. However, electronic watches are rather expensive to design and manufacture initially. This can be recovered over higher production runs.
Seiko made a mistake there. The EPD watch never caught on and Seiko binned the model range, making every model go for more now than new.
This is heading only one way
Sent on the run.
"Once is happenstance. Twice is coincidence. The third time it's enemy action."
'Populism, the last refuge of a Tory scoundrel'.
I'm not sure that I follow the argument that only Rolex and Patek can get away with high prices.
I see loads of people wearing Breitling and Omega every day. The differential between Rolex and the other makes is important. As most brands will keep a bit of value differential so giving a customer a choice of price point.
People are still buying houses though the real cost is massively higher than in the past. To a degree people are doing this with watches. If you could buy a Rolex new for a grand I suspect interest would start to wain.
I read somewhere that Seiko are deliberately moving upmarket, so their prices may well be going North. With regard to Citizen, I have noticed that many Eco Drive models are nearly double the price of what they or their equivalents were 5 or so years ago. I don't think that the collapse in the value of Sterling against other currencies can explain all of that increase. Citizen (and Seiko) are still good value, but maybe not as keenly priced as they once were.
And clearly what the market will bear is also determined by the ability to pay. Living standards have also risen.
My dear departed father quietly fancied a BMW 3 Series for many years but never did get one. In the same road they are now like a rash.
On Windermere, Mastercraft were once exotic, but now the default ski boat.
That plan was born at the end of the past century.
They flew past the goals set.
Spring Drive was one of the tactics to change perception about the brand value.
Going international with Grand Seiko was building on the changed perception.
The current removal of 'Seiko' form the dial is on the same road.
But don't worry, there is also quite a lot of affordable coming from Seiko and furthermore they have the Orient brand.