Rolex really doing anything to put the brakes on Grey Market sales?

[gmtln]

Originally Posted by subsky

What do you think they are doing to stop the grey market and how?

What makes you think that they care or even want to do anything?

I'm a bit of a sneaker head, and in that industry, shortages creates hype and demand and it's not unusual for sneakers to go for 3x MSRP.
This situation is no different to SS Rolex watches atm.

[Cesium137]

The greys are doing the dirty work for Rolex. They are setting the market for future Rolex prices. So, as of now, they are doing absolutely nothing. The greys are helping the future of Rolex.

[Jamie1111]

Originally Posted by Cesium137

The greys are doing the dirty work for Rolex. They are setting the market for future Rolex prices. So, as of now, they are doing absolutely nothing. The greys are helping the future of Rolex.

Sheez, never looked at it that way myself. A good point perhaps


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[Dodger69]

Paul Thorpe has a theory. Check out his video on YouTube about the Rolex bubble. I can’t post the link as this is my first post.

[steve099]

Originally Posted by Dodger69

Paul Thorpe has a theory. Check out his video on YouTube about the Rolex bubble. I can’t post the link as this is my first post.

https://www.youtube.com/watch?v=VOp1tOuHWZ8

I also support this theory

[Rosex]

Originally Posted by steve099

https://www.youtube.com/watch?v=VOp1tOuHWZ8

I also support this theory

if he was running Rolex they would close after 2 years. Rolex have no interest in the premium, they know times will get hard again. If they put up the price we will see them in the window again and the whole house of cards will come down. Rolex doesn't need his business advice or cares about his opinion.

[AK797]

Originally Posted by Dodger69

Paul Thorpe has a theory. Check out his video on YouTube about the Rolex bubble. I can’t post the link as this is my first post.

If this guy is English where was he when Brexit started all this hype, where has he been for the past three years? Saying this is supply manipulation is what someone new to Rolex would say as they don't know the history of Rolex and the markets since 16, the Birkin argument is the easy, lazy and wrong explanation.

[steve099]

Originally Posted by AK797

If this guy is English where was he when Brexit started all this hype, where has he been for the past three years? Saying this is supply manipulation is what someone new to Rolex would say as they don't know the history of Rolex and the markets since 16, the Birkin argument is the easy, lazy and wrong explanation.

He got out of the grey market business after he was violently robbed for a 3rd time...

[AK797]

Originally Posted by steve099

He got out of the grey market business after he was violently robbed for a 3rd time...

That's a shame for him and a shame to see this kind of fake post, I know his firm and have dealt with them before and he knows exactly how we came to this situation, esp as he is from the UK, this is just playing up to the angry mob.

[zaydans]

Originally Posted by Dodger69

Paul Thorpe has a theory. Check out his video on YouTube about the Rolex bubble. I can’t post the link as this is my first post.

I saw that video too and he has a point. Bottom line is everyone has a theory but only Rolex really knows and they’re not telling anyone.....

[Robtayham]

To clarify, I was joking. A little to dry, sarcastic humor.

[Cesium137]

Originally Posted by Robtayham

To clarify, I was joking. A little to dry, sarcastic humor.

I wasn’t sure until I saw your location, then I assumed it was a joke. If your screen name was “LoveBeto”, then I would have thought you were serious.

[DLRIDES]

Originally Posted by subsky

What do you think they are doing to stop the grey market and how?

Rolex created the “gray” market by producing models their buyers do not want, and forcing ADs to stock them. In turn, the ADs package unpopular models with with a few popular models to entice the “gray” buyers, thus moving unwanted inventory.

While economic and “popularity” factors increase desirability, there has never been a reduction in production, or “created” rarity. When economic conditions change, as they always do, Rolex will be plentiful and prices will reflective of decreased demand.

[Henry.hoe]

When watch makers like Rolex and Patek see their watches appreciating value why shouke they prick the bubble? They will take it that they must have got theirnmarketing strategies right! So that every year they can justify their price increases. Look at other watch makers. They just can invpcrease their prices even though running costsnhave escalated.

[Rosex]

and when the Rolex stock doesn't sell, we all run to the grey dealers for -20% discount.

hypocrisy at its best. grey will always be there, either at a premium or a discount, it is called basic economics 101. I think I learnt about supply and demand when I was 10 years old.

Thoes of us that paid the premiums then are now getting all the hard to get watches. That is called loyalty, I learnt that at about the age of 6 years old.

[Harry-57]

From the video. “Listen. I’m not the cleverest guy in the world. My theory may be wrong.“

He's dead right there.

[1William]

I watched the video referenced above and found it interesting. I don't know if I agree with it all but it is an opinion. I believe that Rolex is the reason we are in this position and that they are manipulating the market by limiting supply. If you watch any of the video's of the production facilities for Rolex they have state of the art production and can make as many watches as they choose. Current production numbers are estimated at 1 million a year but there is no official release from the company of those numbers. The demand outstrips production always makes me laugh as they could make 100,000 Daytona's and Hulks in a year if they chose and take care of demand in short order. They have had two years to modify production and ramp up to make the watches the current demand is for. But Rolex does not do it and they also do not address the issue with real solutions or a corporate statement. The solution is simple if they chose to do it. Cut the retail prices by 20-35%, take this out of the margin the AD's can buy the watches for, not the cost they charge the AD's. 62% of retail. Then supply the AD's with the hot watches, 10-20 a month, every month, until the AD's are busting with inventory. Get a e-commerce site up and sell from it directly to customers with endless supply. The speculators or so called investors will then flood the market with pre-owned models as they get destroyed on values and the Grey's will take huge hits as they can not sell the inventory they have for what they have in the watches. The roar you will hear will be the greatest of all time. There will be little to no secondary market and the shakeout will remove a lot of new watch people from watches for a long time. Long winded I know but just my thoughts.

[Calatrava r]

Originally Posted by 1William

I watched the video referenced above and found it interesting. I don't know if I agree with it all but it is an opinion. I believe that Rolex is the reason we are in this position and that they are manipulating the market by limiting supply. If you watch any of the video's of the production facilities for Rolex they have state of the art production and can make as many watches as they choose. Current production numbers are estimated at 1 million a year but there is no official release from the company of those numbers. The demand outstrips production always makes me laugh as they could make 100,000 Daytona's and Hulks in a year if they chose and take care of demand in short order. They have had two years to modify production and ramp up to make the watches the current demand is for. But Rolex does not do it and they also do not address the issue with real solutions or a corporate statement. The solution is simple if they chose to do it. Cut the retail prices by 20-35%, take this out of the margin the AD's can buy the watches for, not the cost they charge the AD's. 62% of retail. Then supply the AD's with the hot watches, 10-20 a month, every month, until the AD's are busting with inventory. Get a e-commerce site up and sell from it directly to customers with endless supply. The speculators or so called investors will then flood the market with pre-owned models as they get destroyed on values and the Grey's will take huge hits as they can not sell the inventory they have for what they have in the watches. The roar you will hear will be the greatest of all time. There will be little to no secondary market and the shakeout will remove a lot of new watch people from watches for a long time. Long winded I know but just my thoughts.

I agree. Rolex could correct the imbalance be delivering much more sports SS at reduced prices. They do not because they like to see the aftermarket premiums which adds "luxury value" to their products. Those watch companies that see their products selling at less than half of retail on the used market cannot feel real good as that is a good indication of the public's lack of appreciation of the value of their brand. Another point often made here is that to hold at currents prices, allows Rolex to come through this "cycle" with their long term value intact.

[Calatrava r]

I continue to believe that a very small amount of Rolex watches end up on the secondary market which are in fact are unworn and delivered directly by ADs.

Too much upside to selling to their own VIP customer base which will go elsewhere if they cannot get the hot models.

The few consumers who flip their watches for quick profits is probably not many and that is a reaction to supply and demand and will always happen until the imbalance more aligns.

Other than correct the overall market, there is nothing Rolex can do about what people do with their watches. I do believe Rolex could buy up all the newish Daytonas on the gray market, if they wanted to. What good that would do is not clear to me unless the watch was dealer flipped and then the AD could be dropped. I am sure tracks are always covered well, so its not clear what the real deal was.

[tanask211]

Rolex has successfully marketed themselves as a highly sought after mid level luxury brand. The current situation has even make less popular models like DJ esp those blue dials become hot model that are no longer abundant in ADs and also 2 toned Sub are also facing similar situation. Nowadays you cannot even get a decent discount from ADs. Rolex has made themselves as transparent by stating the retail price on their website. By altering the price will hurt the brand except their periodic adjustment due to inflation. Rolex will treasure its branding and they knew no matter how much more Pepsi, Batman, Hulk or Daytona C.. there are always ready buyers or collectors to take up all inventories. But they are just not keen to do so!

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[beshannon]

Originally Posted by subsky

What do you think they are doing to stop the grey market and how?

Nothing.

Why should they?

[faimag]

Yeah, they have no reason to do anything. They are currently in heaven as far as brand recognition and demand goes.

[123Blueface]

Are you asking if a company who is selling a product that is so hot that it flies off the shelves, to then go to a grey market where people are willing to pay double what this company says the product should cost, should be concerned and do something to stop it?

[Jona]

My AD says Rolex takes offense at finding watches from an AD in the grey market and Rolex has pulled out of shops that supply greys. How true this is, and how Rolex knows is beyond me. Nor do I really know if they care.

BTW the AD last week was installing new displays that accommodate fewer watches. The SA was a bit ticked that they now had room for only 140 DJ's when they had 180 in stock with no dupes.

[Tavli3]

His theory is as good as anyone else’s.

One problem I have with it is he overlooked the Catch 22 portion of his own creation with his theory.

Let’s assume he’s correct and Rolex is withholding supply to create increased demand and will start increasing prices to price out PAUL the Plumber so to raise their level of exclusivity up to and beyond Patek. Then release all the stock they have been withholding once the retail price equals gray prices.

This is where the theory loses altitude. If they start raising prices so will the grays. If they unload their load of watches to contain gray prices then prices on gray market will fall along with retail prices and along with their coveted exclusivity.

If they hold back supply after raising prices through the roof as he suggests then gray prices would continue to skyrocket with the continued shortage. And now they have destroyed their customer base. I don’t see how Rolex gets out of these scenarios according to his theory.


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[csaltphoto]

The Greys are no different than someone who buys a bundle and flips one to offset the cost. But on a larger level. To us they are "Grey Dealers." To Rolex and the AD's they are "Great Customers."

The Greys also even out the price difference a bit between SS and PM models. Really, a PM version of something is only worth at most 10K more than a SS version.

[Fleetlord]

The grey market is a valuable sales and marketing channel for Rolex. Is it officially authorized? No way. Is it important to Rolex? Absolutely.

When controlled properly through limiting retail distribution, the GM promotes value retention and price appreciation to the consumer. Value retention is a key tenet of luxury marketing in 2019. If your luxury watch doesn't hold value, the market will reject it because it is undesirable. Combine this the obvious benefit of having an avenue other than the AD to move pieces (for zero cost to Rolex)...it's a slam dunk!

However, when distribution is uncontrolled causing AD to dump product in desperation, the GM is a mortal enemy of brand integrity as the pricing falls much lower than MSRP, thus creating a toxic cesspool of gross discounting and loss of cache'. " EWW...those Breitlings are like almost worthless after I buy one" ? "I'll pass"...

That's why brands who can't control themselves have to buy back product and get it off the grey market because it will get discounted so low that it will make the brand look like #$#%.

So, in Rolex eyes, a $8,500 Sub date with an $11,000 asking price on the grey market is great.

For Omega a $5300 Speedy selling for under $4k on the GM is not so great.

[radicalchic]

Sending home the warranty card to the new owner, “forcing him” to subscribe to a system on the Rolex website, seems to me a clever way to fight the grey.
You receive your warranty card only registering to this system and only if your purchasing is in an AD that you have to indicate clearly.
Obviously it works only on new pieces, but this is what matters.

[M45]

They're selling all the Pro models they make and people are even snapping up the classic collections. Display cases are empty because watches sell the second the delivery man walks out the door and AD's are pumping stock into a grey market they have a stake in. Literally the only people who are losing are first time customers who want to pay honest MSRP for a watch.

[radicalchic]

Anyone having a Rolex SA complaints email address?