Interesting WG Pepsi GMTIIC Perspective

[Steve260]

I stopped in my local Rolex AD yesterday, and had a chance to spend a few minutes with the owner. During our conversation, I expressed my disappointment that the new Pepsi GMTIIC will only be available in white gold, at a retail price expected to be around $40k, and that would put it out of reach for most. If they had released it in steel in the $8k - $10k range, it would likely be a best seller. There is certainly not $30k of white gold in the new model, to justify such a high premium over the existing GMTIIC lineup.

My AD's response was interesting - like any (profitable) manufacturer, Rolex needs to plan production, within their capacity to produce, to maximize profitability. Since Rolex makes so many different models, optimizing production planning across the entire product line is a complex undertaking.

Combine that complexity with a (reasonable) assumption that lighter-colored two-color ceramic bezels may currently be somewhat more challenging/time consuming/lower yield/etc. to produce than black or darker two-tone ceramic bezels, and Rolex could be faced with a production planning choice:

1) Produce a higher quantity of Pepsi ceramic bezels for a steel watch with anticipated high demand and a lower price point, which could also necessitate reducing production for other models, or, (since Rolex sells out it's entire production each year anyway),

2) Produce a smaller quantity of Pepsi ceramic bezels, put them only on WG watches at a high price point to "control demand", and continue to maximize profitability across the entire product line. Certainly looks like that is what they decided to do.

My AD also indicated that the BLNR GMTIIC was still in short supply most places, a year after its' introduction.

Disappointing, but certainly not surprising! Of course, this is all conjecture...

In the meantime, I am glad I was able to get a BLNR GMTIIC a few months ago, since a WG Pepsi is not likely in my future!

Steve

[tkerrmd]

well at least that is a logical explanation that seems to make sense!

[STL-16613]

I know some folks frown on the "franken" rolexes...but with the amount of demands for the Pepsi Ceramic in SS and some disappointment around the Pepsi Ceramic in WG...after the new Pepsi is out in circulation...couldnt you purchase just the bezel and place it on a SS model?

[Rashid.bk]

Interesting, sounds plausible.

[bparone]

I work with a business consultant who has worked for a confidential luxury watch brand (I'm considering Rolex in this group) and they were not interested in product margin optimization of 5-10% as margins are currently at 100's of % of total cost of production and sale. Interesting story.

[JJL]

I've heard some people say that they believe it will be offered in WG for a handful of years, then brought to SS. I hope that is true, however, I kind of get the impression that the GMT might have it's trademark WG model like the Sub (smurf) has.

In response to Frakenwatching a SS model by sourcing a Pepsi bezel... yeah I'm sure people will be doing this, however I get the impression that this bezel is going to be even more difficult and expensive to get your hands on than the Blue Sub bezel. The bezel alone might run nearly as much as a whole other SS Rolex lol!

[landroverking]

Originally Posted by STL-16613

I know some folks frown on the "franken" rolexes...but with the amount of demands for the Pepsi Ceramic in SS and some disappointment around the Pepsi Ceramic in WG...after the new Pepsi is out in circulation...couldnt you purchase just the bezel and place it on a SS model?

That to me would be like buying a fake.

[Speed]

Originally Posted by JJL

I've heard some people say that they believe it will be offered in WG for a handful of years, then brought to SS. I hope that is true, however, I kind of get the impression that the GMT might have it's trademark WG model like the Sub (smurf) has.

Yup.

Same situation as the Smurf.

We will never see a SS Pepsi Ceramic.

[cht]

Originally Posted by Steve260

I stopped in my local Rolex AD yesterday, and had a chance to spend a few minutes with the owner. During our conversation, I expressed my disappointment that the new Pepsi GMTIIC will only be available in white gold, at a retail price expected to be around $40k, and that would put it out of reach for most. If they had released it in steel in the $8k - $10k range, it would likely be a best seller. There is certainly not $30k of white gold in the new model, to justify such a high premium over the existing GMTIIC lineup.

My AD's response was interesting - like any (profitable) manufacturer, Rolex needs to plan production, within their capacity to produce, to maximize profitability. Since Rolex makes so many different models, optimizing production planning across the entire product line is a complex undertaking.

Combine that complexity with a (reasonable) assumption that lighter-colored two-color ceramic bezels may currently be somewhat more challenging/time consuming/lower yield/etc. to produce than black or darker two-tone ceramic bezels, and Rolex could be faced with a production planning choice:

1) Produce a higher quantity of Pepsi ceramic bezels for a steel watch with anticipated high demand and a lower price point, which could also necessitate reducing production for other models, or, (since Rolex sells out it's entire production each year anyway),

2) Produce a smaller quantity of Pepsi ceramic bezels, put them only on WG watches at a high price point to "control demand", and continue to maximize profitability across the entire product line. Certainly looks like that is what they decided to do.

My AD also indicated that the BLNR GMTIIC was still in short supply most places, a year after its' introduction.

Disappointing, but certainly not surprising! Of course, this is all conjecture...

In the meantime, I am glad I was able to get a BLNR GMTIIC a few months ago, since a WG Pepsi is not likely in my future!

Steve

All the more reason to pick up a mint 1675 GMT pepsi and to hell with all their profitability.

[tomchicago]

meh...

[boogiebot]

Originally Posted by bparone

I work with a business consultant who has worked for a confidential luxury watch brand (I'm considering Rolex in this group) and they were not interested in product margin optimization of 5-10% as margins are currently at 100's of % of total cost of production and sale. Interesting story.

this would make sense as its not a volume play for them.

Rolex is clearly the exception when it comes to luxury goods sold

[MortgageGuy]

Originally Posted by STL-16613

I know some folks frown on the "franken" rolexes...but with the amount of demands for the Pepsi Ceramic in SS and some disappointment around the Pepsi Ceramic in WG...after the new Pepsi is out in circulation...couldnt you purchase just the bezel and place it on a SS model?

umm... maybe. Two issues IMO to many including myself although all Rolex watch parts this would be a bit of a "franken" watch pretending to be/have something you don't. Secondly I would wish you the very best of luck getting your hands on one. In addition once you do expect to pay thousands and I mean thousands of dollars for the bezel and insert alone

[versatile1]

Originally Posted by STL-16613

I know some folks frown on the "franken" rolexes...but with the amount of demands for the Pepsi Ceramic in SS and some disappointment around the Pepsi Ceramic in WG...after the new Pepsi is out in circulation...couldnt you purchase just the bezel and place it on a SS model?

If you're going to go Frankenwatch and come off with something you don't actually have, you might as well wait for someone to come out with a replica bezel and stick that on your BLNR
If it's fake it may as well be cost effective.

[anothernewphone]

I said this before on here, but it's worth says it again with all of these posts - if it was a matter of profitability, they could come right out and just charge $12,000 for a stainless steel Pepsi GMT. The LN sells for around $8,000, and plenty of people would fork over the 50% premium for the bicolored bezel. Rolex has never worried about supply and demand. The demand is there, and they can meet it, or not. It won't affect them.

[Vanquish1551]

I think it's a simple matter of driving sales for a higher margin product. They probably don't have a demand issue with the SS GMTII, but the PanAm/Pepsi option could increase sales for the higher margin WG GMTII.

[SaddleSC]

I am glad to see Rolex gave the iconic Pepsi GMT the respect it deserves by making it in WG:)

[kegan]

Originally Posted by SaddleSC

I am glad to see Rolex give the iconic Pepsi GMT the respect it deserves by making it in WG:)

Yep its great. Maybe next year they will give the no date sub the respect it deserves by putting it out of reach of nearly everyone

[superdog]

Originally Posted by SaddleSC

I am glad to see Rolex gave the iconic Pepsi GMT the respect it deserves by making it in WG:)

Hells yeah

[Racerdj]

Originally Posted by SaddleSC

I am glad to see Rolex gave the iconic Pepsi GMT the respect it deserves by making it in WG:)

I have come around to this. I have plenty of time to justify buying one or finding the cure for the WG affection.

[submariner66]

WG just doesn't feel or look right on a sub or GMT to me. If I were looking at gold I would shop for yellow. WG seems more refined and
understated like a dress watch perhaps. Just can't see the point of a WG watch that so iconically refers to a SS one?

[ufboy73]

Originally Posted by SaddleSC

I am glad to see Rolex gave the iconic Pepsi GMT the respect it deserves by making it in WG:)

totally agree.

[Trouble15]

Originally Posted by SaddleSC

I am glad to see Rolex gave the iconic Pepsi GMT the respect it deserves by making it in WG:)

I have to say, I agree with you as well.

[Ector495]

Originally Posted by kegan

Yep its great. Maybe next year they will give the no date sub the respect it deserves by putting it out of reach of nearly everyone

[affalterbach]

I think the Stainless Ceramic Coke GMT is a sure bet for next year.

[bric]

Rolex is very very smart... the WG Pepsi will surely be in demand

[Starbucksboss]

Originally Posted by Steve260

I stopped in my local Rolex AD yesterday, and had a chance to spend a few minutes with the owner. During our conversation, I expressed my disappointment that the new Pepsi GMTIIC will only be available in white gold, at a retail price expected to be around $40k, and that would put it out of reach for most. If they had released it in steel in the $8k - $10k range, it would likely be a best seller. There is certainly not $30k of white gold in the new model, to justify such a high premium over the existing GMTIIC lineup.

My AD's response was interesting - like any (profitable) manufacturer, Rolex needs to plan production, within their capacity to produce, to maximize profitability. Since Rolex makes so many different models, optimizing production planning across the entire product line is a complex undertaking.

Combine that complexity with a (reasonable) assumption that lighter-colored two-color ceramic bezels may currently be somewhat more challenging/time consuming/lower yield/etc. to produce than black or darker two-tone ceramic bezels, and Rolex could be faced with a production planning choice:

1) Produce a higher quantity of Pepsi ceramic bezels for a steel watch with anticipated high demand and a lower price point, which could also necessitate reducing production for other models, or, (since Rolex sells out it's entire production each year anyway),

2) Produce a smaller quantity of Pepsi ceramic bezels, put them only on WG watches at a high price point to "control demand", and continue to maximize profitability across the entire product line. Certainly looks like that is what they decided to do.

My AD also indicated that the BLNR GMTIIC was still in short supply most places, a year after its' introduction.

Disappointing, but certainly not surprising! Of course, this is all conjecture...

In the meantime, I am glad I was able to get a BLNR GMTIIC a few months ago, since a WG Pepsi is not likely in my future!

Steve

Nonsense...it is nowhere a complex job for a retailer....it is in fact extreemly straight forward for a merchandiser / merchandise planner - ask a shoe retailer if merchandising a watch is complicated .If this is the reason then they are completely incompetant...I think not , its simply about what they concider is right in terms of elevating thier Brand as they see it...nothing technical about it.

[Starbucksboss]

Originally Posted by Trouble15

I have to say, I agree with you as well.

Me too!

[Speed]

Originally Posted by affalterbach

I think the Stainless Ceramic Coke GMT is a sure bet for next year.

Why?

[HL65]

Originally Posted by SaddleSC

I am glad to see Rolex gave the iconic Pepsi GMT the respect it deserves by making it in WG:)

[skprd13]

Vincent
"We will never see a SS Pepsi Ceramic."

I agree!