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Old 24 April 2010, 12:21 AM   #1
petespendthrift
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Strategy at Rolex HQ?

Rolex spent decades building their reputation as a maker of classic, high quality, simple and understated watches in which form followed function. Their efforts are probably what led many of us to like them so much now.

Then during the quartz era Rolex were forced to become more exclusive and raise prices. They then compromised their tough steel watches (although continued to make them) for the sake of earning extra revenue by making gemstone and all gold dress versions of their sports watches. Presumably these were aimed at parts of the world where shows of conspicuous wealth were part of the culture (eg. Middle East) but were actually sold to people of dubious tastes worldwide. In the longer term this has damaged Rolex's brand image and there are many who see them as a symbol of the flashy nouveau riche and people with more money than sophistication. It also made them perceived more as brand for older generations.

Now in the 2000's after a period of a few decades of stability during which the reputation was slowly but surely recovering (due to the popularity of the iconic steel sports watches) there has been another change. Production of the remaining classic models are finishing. The replacements are clearly designed to look a lot more showy and opulent, echoing the mistakes of the 70's and 80's but this time with the steel models included as well. Why has the Yachtmaster II (with it's clever movement) been given such a terrible design incorporating a bezel with it's model name in massive writing on the bezel insert? - unsubtle over-branding. Why have the cases of nearly all new models been made so blocky? Why are they using ceramic bezels that look like they are made out of plastic and with oversized fonts for the numbers? And generally including more polish and bling all round and a sudden desire to conform to fashions rather than create their own. There seems to be no plan to leave any classic models in the sports line up. Other than higher quality bracelets there are very few actual practical improvements, nearly all are cosmetic and these give the brand a very different look and feel.

So what happened at Rolex HQ? Someone new in the job with a very different idea for the brand and little respect for the heritage? Or do they regard the most important markets to be outside the traditional western hemisphere and are tailoring their models to increase sales in the other parts of the world that have different tastes? What's going to be the outcome and is abandoning the classics that first made them so popular going to be bad for Rolex in the long term? Omega seem to be making some effort to bring back their vintage looks. Stopping the Submariner in it's classic form is like Omega ceasing production of the Speedmaster Moon watch. My favourite quality in Rolex was that you could buy a new "vintage" style icon and I find it hard to believe that sales were slow so I feel they are making a rather serious mistake. What's happened?
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Old 24 April 2010, 12:24 AM   #2
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Bottom line -

Consumers dictate market trends, not brands.

Business 101- give the customer what they want, else you won't have a business.
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Old 24 April 2010, 12:32 AM   #3
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Bottom line -

Consumers dictate market trends, not brands.

Business 101- give the customer what they want, else you won't have a business.
That pretty much says it!
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Old 24 April 2010, 12:34 AM   #4
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I agree with you on some of the points you are making.

While not everyone enjoys the new look and feel of super cases, maxi dials and ceramic bezels, I do think that Rolex still makes the best-looking and more importantly comfortable wrist watches.

The GMT and the Sub are still timeless classics that have been given a facelift - that's what a manufacturer needs to do to stay abreast of design and in tune with the times we live in.

Look at how cars, buildings, advertising etc have all evolved over time, and Rolex are only trying to catch up with the era we live in.

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Old 24 April 2010, 01:04 AM   #5
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It may well be that tastes are changing, and Rolex has to follow the money, whether it's new or old. I've seen the same thing with cars. Cadillac was slowly going out of business catering to its traditional (and aging) clientele. Over the last few years they've become trendy, with looks and performance that are radically different from their traditional designs. Same thing with Jaguar. They finally cut the connection to the designs of the '60s, though it's too early to see if this will resurrect the brand. Personally, I would only buy a resurrected version of the E-type I had back in the '60s, but I know I'm not the market that Jaguar is aiming for.
Similarly, I'm very happy with my classic Datejust, but the market has moved on to the DJ II.
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Old 24 April 2010, 01:18 AM   #6
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Hummmph............it seems that the great unwashed masses want bling & hoopla.....you know what a watch curmudgeon says....."bah humbug" to that & them.
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Old 24 April 2010, 01:19 AM   #7
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Rolex still sells a lot more watches than any other Swiss luxury brand but
it has been losing ground. This is its effort to recover market share, or to
at least slow down, if not reverse this. While some of us might not like the
change in styling mindset that Rolex has made, we will at least always have
the vintage/classic designs to fall back on, and maybe some other brand will
step forward and calls us. I can see why they have to change and not go
on as before - but I don't really like most of it .

Here's an extract from a recent news report from a couple of days ago:

" To check the market share of high-end watches, analysts often
collect data from COSC, the Swiss agency that certifies accuracy. During
the decade of 1999-2008, Rolex had grown only 32 per cent to 769,850
watches in 2008. During the same period, Omega's certified mechanical
watches had almost tripled to 377,514 in 2008. It would, therefore, appear
that in high-end chronometer watches, Omega has steadily grabbed market
share from Rolex. "


Link to full report:- http://www.thehindubusinessline.com/...2250080300.htm
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Old 24 April 2010, 01:29 AM   #8
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...a paradigm shift
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Old 24 April 2010, 01:31 AM   #9
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Disagree with a lot of your concerns. Rolex certainly makes...

its fair share of gaudy monstrosities, (based on demand), but the thrust of their engineering and design seems always to be in the direction of better performance, better comfort, better reliability and more classic form.

The bracelets are continuously moving in the direction of higher quality and better comfort, the ceramic bezels are designed to be impervious to the common causes of aging and fading, the new maxi dials are more readable, the new maxi cases, so far as I can see, adhere to the Pythagorean Golden Ratio, considered the ideal proportion to the eye. The new 'chunkier' cases, as someone pointed out earlier, also are amenable to more polishing/refinishing cycles for better longevity over the decades. Where is the evidence for expedient, short-term thinking? I don't see it.
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Old 24 April 2010, 01:51 AM   #10
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This is more proof of humans aversion to change.

It's called evolution and keeping up with the modern designs and innovations in materials to use.

I prefer the newer designs and materials (maxi dial, big case, ceramic bezels, etc).

Change is hard but inevitable. You can't please everyone and there will be many who prefer the older styles...
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Old 24 April 2010, 02:00 AM   #11
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Truth be known Rolex, as well as others, have always had versions of their SS sport models geared to those that want a little something extra.

Here's one I've always thought was pretty cool.



This is pretty sweet too.

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Old 25 April 2010, 02:30 AM   #12
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Truth be known Rolex, as well as others, have always had versions of their SS sport models geared to those that want a little something extra.

Here's one I've always thought was pretty cool.



This is pretty sweet too.

Mike are those from your personal collection? Stunning!
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Old 25 April 2010, 03:41 AM   #13
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Some interesting points made so far,

I think Rolex has to seriously up their game, I honestly feel thier design house is down right lazy and when they do finally bring out some new stuff more than likely it will be pretty hideous.

I am completly happy with the 2 Rolex's I currently have but to be honest nothing really in the current line up takes my fancy, there are a lot of other Swiss makes out their that are bringing out some awesome time pieces.

I know one of the reasons we all like Rolex is because they don't make drastic changes every year, but come on how about bring out some new models not just updated ones. We only have one Chronograph (different metal types, don't count) to choose from for a start. How about a Sub Chrono?? dare a say some PVD'ed models? These would just compliment the current line up IMHO. Perhaps next years Basel won't be such a let down.

If you prefer the older models ther are tons of them still available, so there is no need to worry on that front. Rolex has been sitting on their laurels for years and releying on their name to carry them.

There is only so many times I can look at a photo of a Sub or GMT with out getting bored, so I do hope Rolex actually bring out some totally new models. I just hope they sack the current design team before they bring any thing new out.
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Old 25 April 2010, 11:04 AM   #14
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Mike are those from your personal collection? Stunning!
Ha! Boy I wish. The first photo is a Rolex photo from the era and the second is from another collector I had in my files. I just can't remember where I found it to give credit.
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Old 24 April 2010, 07:48 PM   #15
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This is more proof of humans aversion to change.

It's called evolution and keeping up with the modern designs and innovations in materials to use.

I prefer the newer designs and materials (maxi dial, big case, ceramic bezels, etc).

Change is hard but inevitable. You can't please everyone and there will be many who prefer the older styles...
Yes I agree 100%.

I've been collecting Rolexes for almost 25 years now and am a big fan of the old as well as new designs. I think the ceramic bezel is a fantastic upgrade (looks great and turns with beautiful smoothness), as is the Glidelock - especially when compared to the previous flimsy Oyster clasp.

I also think people forget that Rolex has been making sports models for only 50-odd years but the company has existed for 100+ years. If it stuck to its heritage or roots as some people think it should, it'd be making mainly 34-36mm dress watches with porcelain/enamel dials, perpetual calendars and moon phases today. Change and evolution is what brought about the Subs, GMTs, Exps, YMs and Daytonas.

Final thoughts - if a new design doesn't appeal, then we don't have to buy it. Rolex's job is to offer its customers as wide a range of choices as possible, not limit itself to the small handful of designs that carry universal appeal, like the Sub or Datejust.
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Old 24 April 2010, 02:16 AM   #16
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Rolex is making the necessary changes to balance both tradition and modern tastes. Asia , China in particular, as well as the middle east IS in fact where the consumers with the most disposible income willing to spend on watches reside. Their tastes and penchant for the conspicuous no doubt influenced the new designs and the resultant 'blingy' look that more traditional western caucasians may find too 'showy'. At the end of the day, it is all about consumer demographics, marketing and SALES.
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Old 24 April 2010, 07:07 PM   #17
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Interesting points by people. The reduced growth in numbers of sales must be offset against the larger profit margins created by the recent massive price increases and are to be expected.

It seems Rolex is far less popular (compared to Omega) in the East where a large growth in watch sales is being experienced and as posted by Traveller, this probably has a lot to do with it. It seems strange that Rolex don't appear interested in covering all bases and offering something for everyone. European tastes in particular lean more towards understated and many of us prefer the vintage look to modern. Some people say this is evolution but the number of quite radical changes indicate a revolution and are not typical of Rolex.
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Old 24 April 2010, 08:09 PM   #18
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After death of Enzo the successors in Ferrari changed the cars looks in th 1970's to a more
of a box shape. Now they are returning to the elegance of the early 1960's. The consumers are kings. In 1970's they hated anything to do with 1960's and so on. Hence to survive a manufacturer needs to keep in tune with public demand. No matter even if they think it's stupid. Leica is one camera company who stood by it's mechanical design and refused to budge where as others like Nikon and Canon kept changing and researching. Now when Leica starts making a digital camera years later it finds that there are many problems.
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Old 24 April 2010, 08:23 PM   #19
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Rolex is one of the slowest changing watch manufacturers on this planet. It seems for some hard-core Rolex owners even this very slow pace of change is too drastic and unnecessary. Rolex did those improvements since 2000 to provide technically up-to-date pieces to both existing and new customers. Let's face it: compared to a Breitling or Omega bracelet & clasp, the old hollow center linked FlipLock bracelet is a joke. It surely did its functions, but for a watch that costs between $5000 and $30000, it wasn't appropriate. Rolex fixed that.

As for the ceramic bezel: Rolex says it helps to fight fading and generic aging of its watches over time, but it's actually there to make Rolex watches more unique, to make it look more durable, and most of all, it shines. Bling is an important factor that draws quite a few customers to brands like Breitling. Quite a few WIS guys hate bling, but I bet amongst non-WIS guys little or a lot bling is preferred over all-brushed look.

As for the supercase: it was a necessary move to make Rolex watches look bigger. The watch case trend in the past few years have been oversizing. It would make Submariner or GMT look weird if it was pumped up to 44+ mm, but with making the case slightly wider, the same 40mm diameter case looks bigger. Just like when your body height stays intact, but you build your arms and shoulders up, you'll look bigger overall.

As for PCLs: I know a lot of guys believe it is a scratch magnet, but let's be honest, it's a lot easier to polish up the PCLs than an all-brushed bracelet. Surely, an all-brushed bracelet requires less care, but when it does get scratched up, it is a lot tougher to properly refresh the brushed finish on it, keeping it matching with the brushed finish of the case, etc. Polishing up a mirror-like surface is very easy.

I personally would never buy a Rolex "of the old school" (FlipLock, hollow center links, non-maxidial). After owning a few Breitlings, Tags and Omegas, I cannot go back in time and get watch for a huge pile of money that -- on the technical side -- belongs to the past, and feels like tinfoil. I'm a huge supporter of the technical improvements of the GMT IIC and Sub-C, and even though I would buy them with the old bezel too, I'm glad Rolex put a ceramic bezel on them. I love how Rado looks on women's wrists (I strongly believe it shouldn't be worn by men), and I'd be happy to put a shiny ceramic bezeled watch on my wrist.
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Old 24 April 2010, 08:41 PM   #20
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I personally would never buy a Rolex "of the old school" (FlipLock, hollow center links, non-maxidial). After owning a few Breitlings, Tags and Omegas, I cannot go back in time and get watch for a huge pile of money that -- on the technical side -- belongs to the past, and feels like tinfoil. I'm a huge supporter of the technical improvements of the GMT IIC and Sub-C, and even though I would buy them with the old bezel too, I'm glad Rolex put a ceramic bezel on them.
Couldn't agree more with you on those points. If I'm honest, if we're talking about feel, then the clasp on my £150 Seiko Monster feels better than the one on, say, a 14060m, which costs £3300. Yes, the movement is far superior in the Rolex, but the bracelet is an integral part of wearing a watch. People equate quality with solidness and weight, which the previous generation clasps and bracelets didn't have. It felt flimsy, and, dare I say it, cheap.

I can't emphasise enough how much of a fan I am of the new Rolex bracelets. They've gone from having some of the weakest to arguably the best in the market in the space of a couple of years. I, for one, like the new design ethos - a concession to the big watch trend without actually making them any bigger - a good call in the long term, I feel. In 30 years time, I don't think they'll look as out of place as, say, a 50mm Breitling.

I thnk what a lot of people don't realise is quite how many people the new designs have brought to the brand. Rolex is transforming its image from an "old person's" brand to a young person's, and that, in my opinion, is a very shrewd thing to do. Rolex had to cultivate a new generation of owners, or simply fade away, and I believe they've succeeded magnificently.


Here's to the new generation of Rolex watches, and long may they reign
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Old 24 April 2010, 08:51 PM   #21
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All very good points and opinion ............ however, Breitling is Rolex's biggest threat. I walked into one of the largest Rolex AD's in S. Florida recently and was surprised. There were only Rolex timepieces in the showcases. I asked what happened to the other brands and was told that Rolex gave them a choice of either continuing to sell Rolex and lose the other brands (Breitling was a big concern) OR continue selling the other brands and lose Rolex. I think competition/choice is good for all products and consumers.
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Old 24 April 2010, 10:31 PM   #22
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however, Breitling is Rolex's biggest threat.
I think Breitling and Omega are equally big threat to Rolex, but in a different way. Omega is pushing hard to rise onto the same level as Rolex, in terms of quality, prestige and most importantly: price tag. As long as a competitive brand is significantly cheaper than Rolex, people would never believe it is equally great and equally appealing. I know it may sound a bit weird, but both Omega and Breitling have to rise their prices if they wanna sell more watches. Omega is doing it more rapidly, with introducing very competitive products to Rolex, e.g. PloProf vs DSSD, Planet Ocean vs Sub, Speedmaster Pro vs Daytona, Aqua Terra vs DateJust. Even on the class and heritage field Omega is very strong, with e.g. cleverly keeping the Moon Watch almost intact for over 40 years. They "copy" most of Rolex's strong points, e.g. introducing in-house movements, adding ceramic bezel and meteorite dial, etc.

While Breitling is focusing more on looks and trends, and figuring out what people would want to put on their wrists. Some say there's no way Breitling would be a real threat to Rolex, but by introducing very fashionable watches with a huge bling factor and in fashionable sizes (read: LARGE), while keeping the build quality and attention to detail levels very high, and keeping the price tag relatively low, a lot of people would buy two Breitlings for the price of a Rolex. Here in Hungary a lot more guys buy Breitling than Omega + Rolex put together -- and I was told it's not very different in other parts of Europe.

IMHO Omega will soon raise their prices to match Rolex's, and they will much more quickly spread out their in-house movements on the entire range than Breitling would. Hence Omega will keep its status/class higher than Breitling, and if they play their cards right, they could constantly be the strongest competitor to Rolex. But Breitling can anytime accelerate their efforts to catch up with in-house movements and material trends, and offer the same quality & feel in a more appealing (read: more blingy) and more fashionable package than the other two giants.
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Old 25 April 2010, 12:10 AM   #23
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I don't know much about Breitling but agree with regards to Omega. I recently got an Omega Seamaster and I would have to say that I like it more than my Rolexes overall . . . granted it's a new toy so that's part of it, but the bracelet and especially the clasp seem much more substantial and appealing on the Seamaster . . . I don't have a Rolex with the new glidelock clasp though so I might have a different view if I did.

Quote:
Originally Posted by Fiery View Post
I think Breitling and Omega are equally big threat to Rolex, but in a different way. Omega is pushing hard to rise onto the same level as Rolex, in terms of quality, prestige and most importantly: price tag. As long as a competitive brand is significantly cheaper than Rolex, people would never believe it is equally great and equally appealing. I know it may sound a bit weird, but both Omega and Breitling have to rise their prices if they wanna sell more watches. Omega is doing it more rapidly, with introducing very competitive products to Rolex, e.g. PloProf vs DSSD, Planet Ocean vs Sub, Speedmaster Pro vs Daytona, Aqua Terra vs DateJust. Even on the class and heritage field Omega is very strong, with e.g. cleverly keeping the Moon Watch almost intact for over 40 years. They "copy" most of Rolex's strong points, e.g. introducing in-house movements, adding ceramic bezel and meteorite dial, etc.

While Breitling is focusing more on looks and trends, and figuring out what people would want to put on their wrists. Some say there's no way Breitling would be a real threat to Rolex, but by introducing very fashionable watches with a huge bling factor and in fashionable sizes (read: LARGE), while keeping the build quality and attention to detail levels very high, and keeping the price tag relatively low, a lot of people would buy two Breitlings for the price of a Rolex. Here in Hungary a lot more guys buy Breitling than Omega + Rolex put together -- and I was told it's not very different in other parts of Europe.

IMHO Omega will soon raise their prices to match Rolex's, and they will much more quickly spread out their in-house movements on the entire range than Breitling would. Hence Omega will keep its status/class higher than Breitling, and if they play their cards right, they could constantly be the strongest competitor to Rolex. But Breitling can anytime accelerate their efforts to catch up with in-house movements and material trends, and offer the same quality & feel in a more appealing (read: more blingy) and more fashionable package than the other two giants.
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Old 25 April 2010, 12:51 AM   #24
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Rolex is one of the slowest changing watch manufacturers on this planet. It seems for some hard-core Rolex owners even this very slow pace of change is too drastic and unnecessary. Rolex did those improvements since 2000 to provide technically up-to-date pieces to both existing and new customers. Let's face it: compared to a Breitling or Omega bracelet & clasp, the old hollow center linked FlipLock bracelet is a joke. It surely did its functions, but for a watch that costs between $5000 and $30000, it wasn't appropriate. Rolex fixed that.

As for the ceramic bezel: Rolex says it helps to fight fading and generic aging of its watches over time, but it's actually there to make Rolex watches more unique, to make it look more durable, and most of all, it shines. Bling is an important factor that draws quite a few customers to brands like Breitling. Quite a few WIS guys hate bling, but I bet amongst non-WIS guys little or a lot bling is preferred over all-brushed look.

As for the supercase: it was a necessary move to make Rolex watches look bigger. The watch case trend in the past few years have been oversizing. It would make Submariner or GMT look weird if it was pumped up to 44+ mm, but with making the case slightly wider, the same 40mm diameter case looks bigger. Just like when your body height stays intact, but you build your arms and shoulders up, you'll look bigger overall.

As for PCLs: I know a lot of guys believe it is a scratch magnet, but let's be honest, it's a lot easier to polish up the PCLs than an all-brushed bracelet. Surely, an all-brushed bracelet requires less care, but when it does get scratched up, it is a lot tougher to properly refresh the brushed finish on it, keeping it matching with the brushed finish of the case, etc. Polishing up a mirror-like surface is very easy.

I personally would never buy a Rolex "of the old school" (FlipLock, hollow center links, non-maxidial). After owning a few Breitlings, Tags and Omegas, I cannot go back in time and get watch for a huge pile of money that -- on the technical side -- belongs to the past, and feels like tinfoil. I'm a huge supporter of the technical improvements of the GMT IIC and Sub-C, and even though I would buy them with the old bezel too, I'm glad Rolex put a ceramic bezel on them. I love how Rado looks on women's wrists (I strongly believe it shouldn't be worn by men), and I'd be happy to put a shiny ceramic bezeled watch on my wrist.

Good points, well made




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Old 25 April 2010, 02:29 AM   #25
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Tastes of the market have changed and with the economy being down I think Rolex wants to pander to the market that is out there spending money... plus the upgrades cost to Rolex to produce as opposed to the huge jump in MSRP is a win/win situation for Rolex's profit margin which I beleive is the bottom line... sadly not tradition!
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Old 25 April 2010, 03:57 AM   #26
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Omega is growing because of good quality at affordable prices. I have bought my last Rolex because I think the prices no longer reflect the value. Of course my wife would say three is enough.
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Old 6 May 2010, 11:22 AM   #27
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