# Girard Perregaux: A Reason Why Retained Value is so Poor...



## Borys Bozzor Pawliw (Apr 8, 2012)

Just got back into Sydney this weekend and headed over to Westfield in Bondi (an upper-middle income shopping complex) to see if any post Easter discounts were still around (note to my American friends: retail discounts in Australia are what you call "Damn ripoffs!"), when I caught this in a jewellers window...









(sorry if orientation is wrong: can't figure out why it's displaying like this...)

Last time I looked at this window was just before I left Sydney almost 4 months ago, and those prices were the non-discounted black ones...

Just look at the price differences (in Australian dollars, figure about USD 0.75 for AUD 1.00). And I didn't capture some of the bigger ones sadly: there was a Vintage 1945 XXL Moonphase where the discount was 50%...

And then I thought..."OK, walk in and have a chat, it can't hurt, you're just browsing, killing a bit of time..."

Well, actually, that's pretty much how half my watch purchases have occurred...But not this time, simply because I wondered how low would they go? Well, after a bit of tooing and throwing, if I wanted the blue faced steel Laureato, they were willing to go to $9990...and I left them with a standing offer of $8500.

I realise luxury watch retailers in Australia have bigger markups compared to the US and Europe...but somehow, I don't seem to remember them offering discounts of this sort. It looks like "Wow!" to passers by, but it is a prime example of why retained value for GP is so poor: discounting is not only a matter of private discussion between you and the dealer, but is advertised for all to see.

That is not the way things should be done at the luxury end, IMHO.

I expect this with yearly / half yearly clearance sales with Seiko, Citizen and Casio stockists, but GP is one of the worlds most prestigious brands, the brand name itself being over 150 years old and the company itself going back to 1791: it has a history that includes the Giromax and multiple technical innovations, with annual production numbers of around 20,000 units, or ~3% of Rolex. These are beautifully, beautifully made watches.

It should be a coveted elite brand that has waiting lists for every model stretching into the 3-5 year mark, with 2nd hand values that are Rolex like, simply because demand is strong and way outstrips supply.

But no. Here is a great Swiss brand being whored out, a luxury item being treated like a commodity, where the lowest price wins. No wonder resale values cause tears for buyers.

I don't know if GP knows about this, or if this is approved, or common. But is is an indication of something very, very wrong with pricing at GP, and perhaps many other Swiss brands.


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## Jpjsavage (Dec 2, 2011)

Folk are very quick to criticise Rolex for limited supply but I, for one, are pleased that they protect owner's investments and the reputation of the brand through rigorous pricing and careful supply.









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## B79 (Apr 27, 2014)

Thanks for posting. Interesting read. 

A bit off topic but I had no idea that shops in a Westfield Centre showcased such high end watches. I’ll be visiting Sydney soon and I will definitely be looking for Westfield Bondi and not just bouncing from AD to AD in the city. 

Cheers.


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## Borys Bozzor Pawliw (Apr 8, 2012)

LOL! I was just chatting with a friend who works in high end retail property: Westfield and their ilk are becoming similar to what high end department stores were prior to the 1970s: a central location of many "departments" in a relatively compact space. But a mall like Westfield now allows many specialty shops to be there at once, so the complex itself becomes the department store, but with a massive selection of brands and truly expert sales staff. The department stores in Australia - and in a few other locales - are now struggling to match that model.


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## Borys Bozzor Pawliw (Apr 8, 2012)

The funny thing is that Rolex produces roughly 40 times as many watches as GP: GP should be supplied constrained but Rolex marketing - in both scope and quality - is genius and exceptionally effective. Rolex used to be an impeccable quality tool watch, not a luxury item. But that has changed now...



Jpjsavage said:


> Folk are very quick to criticise Rolex for limited supply but I, for one, are pleased that they protect owner's investments and the reputation of the brand through rigorous pricing and careful supply.
> 
> 
> 
> ...


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## PJ S (Apr 29, 2013)

Could it be that the AD in question here has been told their contract will not be renewed when it expires (presumably this year)?
Watch prices are absolutely daft, with some brands taking the absolute piss with their MSRPs.
In respect of being a luxury item — yes, but it’s still just a commodity at the end of the day.
If you watch any of the Bovet’s Pascal Raffy videos, you’ll get his definition of true luxury — none of which are residual value or mass production.

Unlike Rolex, and Patek, Girard–Perregaux is not manipulating the market and lets it decide what the true value of its products are, which is exactly as it should be — the other two have just twisted that for their own agendas, which has absolutely nothing to do with being altruistic.


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## Alysandir (Jun 29, 2016)

While no one will accuse Rolex of poor quality, there are a lot of brands with similar quality, and perhaps even a better value proposition. But Rolex has its hooks in the emotional psyche of the watch-buying population. Emotions are why we spend more money than what is sensible, and why Rolex continues to foster such incredible demand. In short, GP may be in every way the equal of Rolex in terms of build quality, but lacks the emotional component necessary for value retention.

Regards, 
Alysandir


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## Toothbras (Apr 19, 2010)

You are looking at this the wrong way. If discounts can be had and no waiting lists, if you find a model you love you can get it for a fair price and have right away


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## Robotaz (Jan 18, 2012)

I agree it’s a problem. They need to either lower MSRP or stick to their guns. People who buy watches like these don’t want to see them discounted.


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## dbostedo (Feb 26, 2014)

Assuming there's nothing else going on (like the AD losing GP), if you're the brand, you can't necessarily just decide to operate like Rolex. Or rather, you can, but it might hurt you financially. 

They really have three options :

1) Price high and stick to it 
2) Price high and sometimes offer discounts
3) Price lower

Each of these needs to be analyzed for what they think will make the most revenue/profit. You can't just stick to the high prices and try to become Rolex unless they're willing to take the risk of going out of business. Most high end brands without name/brand cachet wind up with #2... while trying to build the brand to enable them to do #1. Some may try #3 but that has other marketing impacts as well. 

So when someone complains that their watch doesn't hold value (I'm never sure why they would expect it to in the first place, personally), it's not an arbitrary thing. It's watch brands trying to survive and grow. It's not done out of malice or stupidity.


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## Watchbreath (Feb 12, 2006)

"no one", I always like to bring up that slock Jubilee bracelet that Rolex put out for years, 'The Droop'. Then there's the clasp, a pair of Needle Nose pliers was needed 
close at hand.


Alysandir said:


> While no one will accuse Rolex of poor quality, there are a lot of brands with similar quality, and perhaps even a better value proposition. But Rolex has its hooks in the emotional psyche of the watch-buying population. Emotions are why we spend more money than what is sensible, and why Rolex continues to foster such incredible demand. In short, GP may be in every way the equal of Rolex in terms of build quality, but lacks the emotional component necessary for value retention.
> 
> Regards,
> Alysandir


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## heb (Feb 24, 2006)

GP has had a goofy pricing structure for a long time. Their policy seems to be to recoup their expenses for a new model with the first one sold. However, they've used their rather mundane 3300 modular movement for the last 20+ years as if it was God's gift to horology AND price it like their first watch. For some reason GP still emotes a much higher horological reputation than it deserves.


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## Alysandir (Jun 29, 2016)

Watchbreath said:


> "no one", I always like to bring up that slock Jubilee bracelet that Rolex put out for years, 'The Droop'. Then there's the clasp, a pair of Needle Nose pliers was needed
> close at hand.


Guess my entire argument is invalidated now. Oh well.

Regards,
Alysandir


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## arcadelt (Apr 25, 2010)

heb said:


> GP has had a goofy pricing structure for a long time. Their policy seems to be to recoup their expenses for a new model with the first one sold. However, they've used their rather mundane 3300 modular movement for the last 20+ years as if it was God's gift to horology AND price it like their first watch. For some reason GP still emotes a much higher horological reputation than it deserves.


Wow, that's a tough assessment.


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## arcadelt (Apr 25, 2010)

PJ S said:


> Unlike Rolex, and Patek, Girard-Perregaux is not manipulating the market and let's it decide what the true value of its products are, which is exactly as it should be - the other two have just twisted that for their own agendas, which has absolutely nothing to do with being altruistic.


I agree with your final assessment of Rolex's and Patek's, but altruism is hardly a word I would ever associate with the luxury goods industry (I guess you meant with respect to supporting the retained value for previous purchasers of their products). With respect to GP, however, they are not letting market forces play out, because if they were they would be dropping their MSRP to be somewhat closer to the average sale price. Unfortunately they still set overly optimistic (or perhaps even opportunistic) MSRPs across their collection.


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## Robotaz (Jan 18, 2012)

heb said:


> GP has had a goofy pricing structure for a long time. Their policy seems to be to recoup their expenses for a new model with the first one sold. However, they've used their rather mundane 3300 modular movement for the last 20+ years as if it was God's gift to horology AND price it like their first watch. For some reason GP still emotes a much higher horological reputation than it deserves.


I've owned 4 JR models with the JR version of the GP 3300 and they are amazing performers. I don't know if you've owned any, but beating up on the best movement I've owned and verified is impossible to let pass without saying something. They have all run +2 s/d or better with virtually no effects from orientation, power reserve, etc. Really amazing movements.


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## Borys Bozzor Pawliw (Apr 8, 2012)

PJ S said:


> Could it be that the AD in question here has been told their contract will not be renewed when it expires (presumably this year)?
> Watch prices are absolutely daft, with some brands taking the absolute piss with their MSRPs.
> In respect of being a luxury item - yes, but it's still just a commodity at the end of the day.
> If you watch any of the Bovet's Pascal Raffy videos, you'll get his definition of true luxury - none of which are residual value or mass production.
> ...


A great point, I looked at the GP website, and Gregory's jewellers of Bondi are not listed as an authorised dealer, but given how sporadically some watch companies update their websites, it may not be a full list.

Speaking for myself, luxury to me is in great part desirability and timelessness (ha!). Significant depreciation in my little head triggers a warning along the lines of "Hmmmm...have I been ripped off? No one else values this after I have barely used it. It is not really that desirable, perhaps?..."

I know its not perhaps a fair view, but it is the one I can't shake...


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## Borys Bozzor Pawliw (Apr 8, 2012)

Toothbras said:


> You are looking at this the wrong way. If discounts can be had and no waiting lists, if you find a model you love you can get it for a fair price and have right away


I know, I know: I did the begging routine to Rolex in Sydney over the weekend also, as I did in Seattle, Chicago and New York: please put me down for the GMT II Master SS with the jubilee. They were polite, but their eyes said "Join the club, loser: how many dozen watches have you purchased with us over the years..."

Touche.

There is a very nice GP Laureato blue dial waiting for me to love it...at the right price.

I know its not fair to other brands, but it does have an impact on you when the Stainless Steel Coke GMT Master II a 20 something bought 1996 in Copenhagen for about AUD 4,200 equivalent was gracing the arm of a middle aged guy who turned down constant offers from dealers of circa AUD 7,000 for it, and another 3-4,000 on top of that from the average man in the street...

That to me is a key aspect of luxury in watches.


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## Borys Bozzor Pawliw (Apr 8, 2012)

heb said:


> GP has had a goofy pricing structure for a long time. Their policy seems to be to recoup their expenses for a new model with the first one sold. However, they've used their rather mundane 3300 modular movement for the last 20+ years as if it was God's gift to horology AND price it like their first watch. For some reason GP still emotes a much higher horological reputation than it deserves.


The movement is well made and basically sound, but it is long in the tooth indeed. Perhaps the most damning thing I have heard about the GP Laureato is that it is priced as a cheaper alternative to the VC Overseas and and AP Offshore but attempting to claim the same pedigree...but the reality is that it is a more expensive, technically inferior and more raffish competitor to the Rolex Datejust...

Unfair...but still ouch.


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## Robotaz (Jan 18, 2012)

Borys Bozzor Pawliw said:


> The movement is well made and basically sound, but it is long in the tooth indeed.


What more could you possibly want? Why fix something that isn't broken?

All four of these movements I've owned functioned identically. That alone is amazing. The fact that their performance was incredible is even more amazing.


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## heb (Feb 24, 2006)

If you remember back when these JR models first came out, they too were priced using the GP model. They probably were not the best selling watch at that price point due to the heavy discounts over the last few years at one of our favorite gray markettiers. This must have provided GP with sufficient cash flow so they could keep their GP ones at very high prices. I've listened to what you have said about them and checked that dealer last night. Someone bought them all out at that terrific deal.

How long have you had yours and over how many months have they maintained that +2 s/d? Rate stability is much more important than a good rate measured over a few days or one week. As an example: I've worn my IWC Tribute watch for 24 consecutive weeks and have carefully measured its average daily rate over each of those weeks. Every one has been well within COSC values and over the last week it read +0.7 s/d! Great, right? Well, consider what the rate was three months ago: +2.4 s/d, and that it has consistently slowed each consecutive month to the current value. I roughly figure that 4.5 years hence, when it will be due a service, it will optimistically be chugging along at -45 s/d. So, today I have an "accurate" watch that is unstable; prognosis: poor. It is my fault though, if I wanted a stable watch I should have purchased a Rolex.

heb

heb



Robotaz said:


> I've owned 4 JR models with the JR version of the GP 3300 and they are amazing performers. I don't know if you've owned any, but beating up on the best movement I've owned and verified is impossible to let pass without saying something. They have all run +2 s/d or better with virtually no effects from orientation, power reserve, etc. Really amazing movements.


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## WTSP (May 6, 2012)

The problem with GP is that brand-wise they have a level of equity similar to Zenith, JLC or IWC, but they aim for a market segment that is more in line with AP and VC. If they designed and priced watches that were more in line with their brand equity they wouldn’t have to discount. 

Their standard movements are nice and accurate, but somewhat unremarkable. I just got my 3200 back from servicing and it’s running at -2 seconds over five days, which is great. However one can get the same from Zenith, JLC, Rolex and other mid tier luxury watches with plain vanilla movements that have similar specs to the ETA 2892 (Elite, 899, etc.).


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## Robotaz (Jan 18, 2012)

heb said:


> If you remember back when these JR models first came out, they too were priced using the GP model. They probably were not the best selling watch at that price point due to the heavy discounts over the last few years at one of our favorite gray markettiers. This must have provided GP with sufficient cash flow so they could keep their GP ones at very high prices. I've listened to what you have said about them and checked that dealer last night. Someone bought them all out at that terrific deal.
> 
> How long have you had yours and over how many months have they maintained that +2 s/d? Rate stability is much more important than a good rate measured over a few days or one week. As an example: I've worn my IWC Tribute watch for 24 consecutive weeks and have carefully measured its average daily rate over each of those weeks. Every one has been well within COSC values and over the last week it read +0.7 s/d! Great, right? Well, consider what the rate was three months ago: +2.4 s/d, and that it has consistently slowed each consecutive month to the current value. I roughly figure that 4.5 years hence, when it will be due a service, it will optimistically be chugging along at -45 s/d. So, today I have an "accurate" watch that is unstable; prognosis: poor. It is my fault though, if I wanted a stable watch I should have purchased a Rolex.
> 
> ...


Well I'm an engineer and was taught accuracy versus precision the day I walked in the door. That said, they are extremely accurate and precise. All four literally identical to my senses.


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## Borys Bozzor Pawliw (Apr 8, 2012)

Robotaz said:


> What more could you possibly want? Why fix something that isn't broken?
> 
> All four of these movements I've owned functioned identically. That alone is amazing. The fact that their performance was incredible is even more amazing.


I think at this price point, I would like a longer power reserve, closer to about 70 hours. But no major technical wishes aside from that.


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## Robotaz (Jan 18, 2012)

Borys Bozzor Pawliw said:


> I think at this price point, I would like a longer power reserve, closer to about 70 hours. But no major technical wishes aside from that.


Fair complaint considering the competition.


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## Borys Bozzor Pawliw (Apr 8, 2012)

I will be walking back into this shop on the weekend and phrase a question: "Will you be honouring the warranty for the full 2 years yourselves?". That should get the truth out...


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## PJ S (Apr 29, 2013)

Maybe the question should be one of whether the existing pieces (presumably the last this AD will receive from G-P, bar any outstanding HH orders) will be provided with a full manufacturer’s warranty.
My hunch is that current stock held will be honoured by G-P, when the store stamps their name on the card, or retains access for an agreed period of time, if the mechanism is electronic – after which time, there is no longer any warranty, or the buyer has to contact G-P with proof of purchase, in order to claim the warranty.
Again, we’re presuming all this as a result of the store no longer (going to be) an AD, irrespective of who dropped whom – assuming it’s not a simple case of price reductions to shift slow moving stock.


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## WTSP (May 6, 2012)

In many countries, including Australia, it’s illegal for a manufacturer to force a reseller to maintain a certain price or to cut off supply to the reseller if pricing levels are not maintained. Companies that do this expose themselves to antitrust lawsuits. In effect, it leaves little room for GP or other watch companies to put pressure on the AD. The best they can do is hope that the AD is smart enough to figure out that it makes no sense to purchase stock which will be resold at a low or non existent margin.

Brands that have a lower level of recognition are sometimes hard pressed to find distributors. Once they are approached by a distributor they may perform less due diligence and be less stringent in their requirements than Rolex or the Swatch Group tend to be. If the AD turns out to be incompetent at selling watches and/or the brand turns out to be a dud with no demand in the AD’s market, the supplier and the AD may be forced to awkwardly amble along together selling watches at a discount for the term of the agreement, followed by a big selloff toward the end. I imagine that this process is pretty common in the industry.


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## Borys Bozzor Pawliw (Apr 8, 2012)

Fair point: I have to admit I am always a bit wary of out of pocket expenses for high end watches. Rolex is not cheap, but service centres are all over the place and many decent watchmakers are able to service the movements well. The truth will be revealed soon...


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## Borys Bozzor Pawliw (Apr 8, 2012)

The old resale price maintenance - any students of trade practices law may want to read this...

https://www.accc.gov.au/business/anti-competitive-behaviour/imposing-minimum-resale-prices

A way around this is for GP to actually still own the watches, or impose a relatively high wholesale price to dealers (and even then that may be done by a third party) then work out a rebate system - that latter one is more common than many realise for in-demand goods.


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## manofrolex (Jul 9, 2012)

Big fan of the blue Laureato. At 50% off I would take it but that is just me 


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## Borys Bozzor Pawliw (Apr 8, 2012)

And here's the other watch which I think would be especially painful for someone who just bought it recently...









(Again, apologies for the orientation, I must be borderline moronic enough to run for Congress...)

I'll ignore the diamond bezel price discounted watches just because I was told that those things can fluctuate a fair amount due to the going price for typical stones (probably not really the situation here, but I digress...).

The GP Vintage 1945 is all steel, but with a massive discount that would burn the blood of anyone who bought it just before. This is just madness with pricing policy for what is a high end watch: with precious metal watches costing $40K+, an $8K price drop would be really annoying, but for a watch half that price in steel, it's a clear sign of...well, I don't know what they're thinking.

Has anyone ever secured a discount like this with a high end brand? I have known Omega to do around 20-25%...?


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## WTSP (May 6, 2012)

That Vintage 1945 skeleton dial with big date is fabulous. I’m a huge fan of the 1945 line and own one of the originals (rerelease, not actually from the fourties) from the early 2000s. That being said, it just goes to show how far off the mark they are on pricing. The new Zenith Defy Classic Elite is being released in multiple versions, including one with skeleton dial in steel. The MSRPs range from $6000 to $7000. The Elite and GP3300 calibres are somewhat similar. Granted the GP has a big date complication, but that’s not worth a five figure price. It will probably sell for around or under ten grand in the end.


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## PJ S (Apr 29, 2013)

I have what I think is a novel idea… instead of standing outside the store, licking the windows, how about actually venturing inside and having a chat with the staff/manager, and ask what the situation is!
I’m not sure what your complaint is – did you buy a G-P from them a while ago, at full retail?
If not, then I don’t fathom why you’re even giving a flying f..k what price someone else paid – the next owner will benefit from the depreciation, or the current owner will decide just to keep it… win for G-P or second user (whichever it is).
Seriously, stop working yourself up into a tizzy, and go do something more useful, like helping a little old lady cross the road safely!


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## WTSP (May 6, 2012)

PJ S said:


> I have what I think is a novel idea&#8230; instead of standing outside the store, licking the windows, how about actually venturing inside and having a chat with the staff/manager, and ask what the situation is!
> I'm not sure what your complaint is - did you buy a G-P from them a while ago, at full retail?
> If not, then I don't fathom why you're even giving a flying f..k what price someone else paid - the next owner will benefit from the depreciation, or the current owner will decide just to keep it&#8230; win for G-P or second user (whichever it is).
> Seriously, stop working yourself up into a tizzy, and go do something more useful, like helping a little old lady cross the road safely!


Personally I think that scrutinizing the pricing strategies of watch manufacturers is a valuable exercise. With so much smoke and mirrors in the industry it's a crucial part of being a collector or even just a regular one time buyer.


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## Borys Bozzor Pawliw (Apr 8, 2012)

Actually I did go in and have a chat months ago prior to this event, and with senior staff not available when I visit, not going to get the full story. And retail pricing strategy is a considerable interest of mine, both ranging from FMCG, durables and luxury. Brand equity, retained value and discounting are related issues, especially with the sheer magnitude of the discount and the public, open nature of it, which is extremely uncommon with high end luxury goods.


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## PJ S (Apr 29, 2013)

On the assumption that the G-P website is up to date, then it seems as if (presuming this is Gregory’s) they are no longer an AD – therefore these are priced to shift what remains of their stock.
Whether they intend to replace with another brand, invest in more stock of existing brands that sell more readily, or simply just returning money back into the business (assuming it’s not being redirected to jewellery) as they’ve more than enough brands to contend with and offer, only they’ll know.

I’m still not seeing the purpose of being even remotely pre-occupied with it – luxury timepieces are nothing more than a mere commodity, designed to part people from their money at whatever price can be achieved.
Some brands’ models are more successful in getting people worked up into a lather over, but then they’ve simply got more money than sense!
Throughout history, a fool and his money have often been easily parted, and will continue to be so.


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## temple (Aug 23, 2017)

I'm in America, so my perspective is probably different. I love GP's timepieces, but I have definitely noticed that on the pre-owned market, their values drop like a rock compared to MSRP and compared to other more mainstream brands like Rolex, Breitling, Omega, etc. Maybe what you pointed out is part of the reason why.


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## dbostedo (Feb 26, 2014)

temple said:


> I'm in America, so my perspective is probably different. I love GP's timepieces, but I have definitely noticed that on the pre-owned market, their values drop like a rock compared to MSRP and compared to other more mainstream brands like Rolex, Breitling, Omega, etc. Maybe what you pointed out is part of the reason why.


Well you have a chicken/egg scenario with brand value and pricing... are the pre-owned prices low because stores discount too much from MSRP? Or do the stores have to discount, because people know the pre-owned prices are low? Really, it's probably both...

Building a brand and having it retain value is _hard_ .


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## temple (Aug 23, 2017)

dbostedo said:


> Well you have a chicken/egg scenario with brand value and pricing... are the pre-owned prices low because stores discount too much from MSRP? Or do the stores have to discount, because people know the pre-owned prices are low? Really, it's probably both...
> 
> Building a brand and having it retain value is _hard_ .


Agreed! One of the biggest factors is limiting supply, which is easier said than done. Maybe GP produces too much inventory.

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## dbostedo (Feb 26, 2014)

temple said:


> Agreed! One of the biggest factors is limiting supply, which is easier said than done. Maybe GP produces too much inventory.
> 
> Sent from my iPhone using Tapatalk


Limiting supply only props things up if demand is high enough. If GP decided to only produce and sell, for example, half the watches they currently do, and it didn't drive up demand, then their revenue would fall. There's no guarantee that limiting it _would_ drive up demand enough to let them increase revenue per watch or total revenue, so it would be an interesting attempt.


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## temple (Aug 23, 2017)

dbostedo said:


> Limiting supply only props things up if demand is high enough. If GP decided to only produce and sell, for example, half the watches they currently do, and it didn't drive up demand, then their revenue would fall. There's no guarantee that limiting it _would_ drive up demand enough to let them increase revenue per watch or total revenue, so it would be an interesting attempt.


Even if demand is low, if they produce less watches than there are buyers, it might not skyrocket demand or price, but maybe they'd avoid the values plummeting as they seem to be. I don't know, I like GP and it's just kind of sad to see.

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## Borys Bozzor Pawliw (Apr 8, 2012)

This is one of the tough discussions in business schools across the world...brand value, production numbers and luxury. Rolex makes ~800K+ watches a year, yet its incredibly strong and sustained marketing campaign means this is way below actual demand, thus making it a "scare" luxury, relative to demand. GP, by contrast, theoretically has a more desirable pedigree than Rolex, makes a fraction of that, but relatively limited brand awareness means I get to start a thread like this...


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## d3javu96 (Feb 6, 2011)

Watches are not quite the commodity yet, segmentation etc are what's driving the resale value. There are people who purchase watches (Rolex omega) and there are also people who purchase watches ( Phillipe dafour Roger Smith ). First group have certain traits for example has money but not into high horology but bling ie all Rolex are closed caseback, so more of a status symbol and everything else ie durability accuracy and utility are secondary. Second group appreciates haute horology which needs no introduction here - we lust over it but not necessary to first group.

Maybe an extreme example as most of us falls between both groups (ie ap patex ) but point being Rolex cornered the first group so well, and segmented the first group so well by successfully attracting the top $$ ( rainbow Daytona anyone? Yearly price hike anyone?) - not to mention vintage Daytona been going off the roof ( more luck I think but very well capitalised - I called all ad in Australia and none can get me a new Daytona )

So, in the end, rolex subs become as good as money, ie a commodity, because it represents those traits ( $$ and bling) so well without mistake anywhere in the world.

Second group and anything in between has twenty brands or more running different marketing campaigns and pricing / distribution policies with different goals and philosophy. This weaken the supply side of the economics tremendously, ie incoherent marketing message to the target audience.

Obviously we know who is more sucessful.. production number need to be compared apples to apples ie first group vs second group, same thing with demand, not everyone on the street understand what is an escapement, but everyone knows Rolex.

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## scorpius73 (Mar 25, 2008)

As much as I loved the Competezione Stradale by GP I could not figure out the pricing. I thought it was a bit too high.


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