2018 Sneak Peak on AP Website

[Marciano490]

Originally Posted by GB-man

That's par for the course with most AP though. Mine was 22k before the margin cut.

That's the old world, man. They're closing down ADs and moving everything to boutiques with no discounts. I inquired after my status on the steel openwork wait list and was let know that it was unlikely to happen this year and that going forward AP was only going to make hot pieces available to VIPs who had paid full price for all pieces.

[tyler1980]

Originally Posted by GB-man

That's par for the course with most AP though. Mine was 22k before the margin cut.

In US dollar terms, I sold mine for more than that used to watchfinder on monday, quite a bit more. Its a different ballgame across the pond i guess considering they are going to mark it up vs what they paid me and resell it. Yet you can buy them new for less in the states.

[GB-man]

Originally Posted by Marciano490

That's the old world, man. They're closing down ADs and moving everything to boutiques with no discounts. I inquired after my status on the steel openwork wait list and was let know that it was unlikely to happen this year and that going forward AP was only going to make hot pieces available to VIPs who had paid full price for all pieces.

Damn is that at an AD or boutique?

[GB-man]

Originally Posted by tyler1980

In US dollar terms, I sold mine for more than that used to watchfinder on monday, quite a bit more. Its a different ballgame across the pond i guess considering they are going to mark it up vs what they paid me and resell it. Yet you can buy them new for less in the states.

Yeah talking to sam it seems the same rings true for PP. Prices are moving at an unreal pace.

[tyler1980]

Originally Posted by GB-man

Yeah talking to sam it seems the same rings true for PP. Prices are moving at an unreal pace.

the disparity is what is shocking between the two markets. Discounts are tight at AD's and resale is high because of it. Truthfully, i prefer it that way as pretty much everyone is paying the same price when buying new.

US AD's are awful at protecting their margins. It works when they are making up for it with volume, but with supply tightening its an issue because everyone is so accustomed to heavy discounting and might not buy.

[Soly20]

This camouflage strap looks so off! Who comes up with these ideas?

[Marciano490]

Originally Posted by GB-man

Damn is that at an AD or boutique?

Boutique. Someday you'll say "AD" and your grandkids will ask, "what's that?" My understanding is AP is closing a bunch of AD's in the US in the next year or two. I don't know how many total there are, but I'd assume it's a sizable percentage.

This will funnel everyone to boutiques, and with the added leverage, boutiques will not be discounting pieces going forward. They're also keeping production of desirable models like the 15202 and openwork low in order to use those to incentivize people to buy directly from the boutiques and making more models "boutique only."

Essentially, if you're a repeat player, it will likely soon be cheaper just to pay full price for everything. If you just want one offs, I suppose it'll be cheaper to just pay silly premiums to greys or abstain.

For example, steel openworks go for about 20k over retail right now. If I buy four APs a year and want one, it'll soon be cheaper just to pay full price for each than getting my 20% off from greys or ADs and then not putting that bundling those savings for the hot piece.

[Rickn]

The camo is for when the ting goes skrrrrrraaa pap pap ka ka ka skidiki.

[tyler1980]

Originally Posted by Marciano490

Boutique. Someday you'll say "AD" and your grandkids will ask, "what's that?" My understanding is AP is closing a bunch of AD's in the US in the next year or two. I don't know how many total there are, but I'd assume it's a sizable percentage.

This will funnel everyone to boutiques, and with the added leverage, boutiques will not be discounting pieces going forward. They're also keeping production of desirable models like the 15202 and openwork low in order to use those to incentivize people to buy directly from the boutiques and making more models "boutique only."

Essentially, if you're a repeat player, it will likely soon be cheaper just to pay full price for everything. If you just want one offs, I suppose it'll be cheaper to just pay silly premiums to greys or abstain.

For example, steel openworks go for about 20k over retail right now. If I buy four APs a year and want one, it'll soon be cheaper just to pay full price for each than getting my 20% off from greys or ADs and then not putting that bundling those savings for the hot piece.

come to London. Its the market squeeze in reality and happening right now. We dont even have a boutique and they still funnel all the hot models into an appointment only service center they call a lounge. AD's which are the only places that actually promote or display actual AP watches that you can see or try on and AP won't give them any. Its the weirdest thing ever. AD's pretty much get the watches that are slower movers, anything else is at the lounge for sale to people they want to sell the watches to. How their "lists" work i have no idea.

[tng11]

Hong Kong cut from 12 ADs earlier this year to 6, which is a huge cut for a market that large. I was told that a new condition is any AD who wants to continue to carry AP, must have it in a separate standalone "boutique-like" setup. Despite that, only the main company-owned boutique gets the 15202s, openworks, etc. And of course, the main boutique doesn't do discounts, or only does a very small amount on less popular pieces.

[tng11]

Originally Posted by tyler1980

In US dollar terms, I sold mine for more than that used to watchfinder on monday, quite a bit more. Its a different ballgame across the pond i guess considering they are going to mark it up vs what they paid me and resell it. Yet you can buy them new for less in the states.

UK prices are insane compared to the US. I've tested out Watchfinder bids on a couple of my pieces and they've always offered higher than what a TS would sell them in the US for, let alone a private individual. On my 26400SO, they offered almost 20% above what a TS in the US would have paid me for it.

[Marciano490]

Originally Posted by tyler1980

come to London. Its the market squeeze in reality and happening right now. We dont even have a boutique and they still funnel all the hot models into an appointment only service center they call a lounge. AD's which are the only places that actually promote or display actual AP watches that you can see or try on and AP won't give them any. Its the weirdest thing ever. AD's pretty much get the watches that are slower movers, anything else is at the lounge for sale to people they want to sell the watches to. How their "lists" work i have no idea.

It's funny, I was there the other month; stayed in Mayfair by the huge Watches of Switzerland store and was curious why I didn't see many/any APs either there or out and about.

Great city though!

[kunlun]

So, under the boutique-only model, where do the unsold watches go? Surely the gray market will continue.

[tyler1980]

Originally Posted by tng11

UK prices are insane compared to the US. I've tested out Watchfinder bids on a couple of my pieces and they've always offered higher than what a TS would sell them in the US for, let alone a private individual. On my 26400SO, they offered almost 20% above what a TS in the US would have paid me for it.

thats my point exactly as we don't have a boutique and AD's are doing what they are supposed to be doing. They are protecting the value of the brand and not discounting which AP should be thrilled with. They thank the AD's by cutting off their stock. Thats what makes no sense. My Ti 44 was one that is wildly available at AD's and that they could get. They still don't discount it though.

The AD system actually works in the UK. It may be a broken system elsewhere but it isnt here. You would think AP would reward that. A few AD's i am friendly with are not happy with AP at all.

[GB-man]

In my opinion if AP wants to continue to sell as many watches in the US as they are today then either cut prices or let the discounting continue.

I frequent the boutiques and don’t see them chock full of customers.

[tyler1980]

Originally Posted by GB-man

In my opinion if AP wants to continue to sell as many watches in the US as they are today then either cut prices or let the discounting continue.

I frequent the boutiques and don’t see them chock full of customers.

I think they should just sell them to markets where the demand is. Its not the US quite frankly and AP isnt as big of a thing. Their distribution isn't ideal as their retail pricing is much more acceptable in areas with stronger demand. The UK has had 3 retail price increases due to the pound falling so in local currency the brits are paying way more than two years ago and they still buy them. The US hasn't had an increase and only buy at 20% discount or more.

[Marciano490]

Originally Posted by kunlun

So, under the boutique-only model, where do the unsold watches go? Surely the gray market will continue.

No, they're sold/bundled with the popular models. The hot models are used as prods to move the colder pieces. After that, sure, they go to greys, so if you want a discount on that steel millenary, I guess it'll still be there.

[tyler1980]

Originally Posted by kunlun

So, under the boutique-only model, where do the unsold watches go? Surely the gray market will continue.

A boutique isnt under the same pressure to move inventory as an AD since its owned by the brand. Their margins are higher and they make more money per watch since there is no AD middle man. Boutiques cant heavily discount as AP in switzerland can see their books unlike and AD so it will affect the grey market no doubt.

Unsold watches would probably sit at the boutique and given enough time would probably go back to AP for "recycling". I doubt they will go out the back door at 40% off. A boutique system is 100% about control and AP would be the ones making those decisions not an independent AD.

[Marciano490]

Here's what's confusing to me: wouldn't these companies have sophisticated enough analytics to predict the demand for models after a few years? There's no reason why AP should be producing too many millenaries per year or Patek too many calatravas or ACs, and certainly no reason to overproduce grand complications. I imagine those markets and sales data are very stable.

So, instead of continuing to overproduce disfavored models and then having to use hot models as a prod to move that merchandise, wouldn't the smarter business move be to more carefully tailor the production of the "cold" models, bulk up the production of the hot models and sell them as they're in demand?

[tyler1980]

Originally Posted by Marciano490

Here's what's confusing to me: wouldn't these companies have sophisticated enough analytics to predict the demand for models after a few years? There's no reason why AP should be producing too many millenaries per year or Patek too many calatravas or ACs, and certainly no reason to overproduce grand complications. I imagine those markets and sales data are very stable.

So, instead of continuing to overproduce disfavored models and then having to use hot models as a prod to move that merchandise, wouldn't the smarter business move be to more carefully tailor the production of the "cold" models, bulk up the production of the hot models and sell them as they're in demand?

Ive been saying that forever with AP. It makes no sense to me.

With Patek, its a little different as they are less of a sports watch company and dress pieces move slower and i dont think they want to be sports watch heavy. AP is sports watches. A millenary is in between dress and sports, but i have never once seen a JA in and AD ever. So they are sports watches.

Why they pump out funky colors and 37mm RO's that dont sell while neglecting pieces that have waitlists a mile long is weird. Why produce so many 15450's but not 15400's for example. Its the same movement. With Patek its grand comps or PC's which are different movements and not interchangeable. AP's core is the 3120 and they can stick that into many different cases across the RO and ROO lineup. Their dial production also doesnt match demand. Everyone wants the new blue dial ROC but they dont make that dial in the largest numbers. why? Ive seen the other two dials many times and won't buy them, i actually would have bought blue if an AD had one.

[GB-man]

Originally Posted by tyler1980

I think they should just sell them to markets where the demand is. Its not the US quite frankly and AP isnt as big of a thing. Their distribution isn't ideal as their retail pricing is much more acceptable in areas with stronger demand. The UK has had 3 retail price increases due to the pound falling so in local currency the brits are paying way more than two years ago and they still buy them. The US hasn't had an increase and only buy at 20% discount or more.

It will be a cold day in hell before AP abandons the US market

Frankly I don't think they can pull off a boutique only model like say LV. If they could just run a tighter ship like rolex that would be a start. Hell rolex sells what 20x as many watches and has better control of their distribution.

[AK797]

Originally Posted by Marciano490

Here's what's confusing to me: wouldn't these companies have sophisticated enough analytics to predict the demand for models after a few years? There's no reason why AP should be producing too many millenaries per year or Patek too many calatravas or ACs, and certainly no reason to overproduce grand complications. I imagine those markets and sales data are very stable.

So, instead of continuing to overproduce disfavored models and then having to use hot models as a prod to move that merchandise, wouldn't the smarter business move be to more carefully tailor the production of the "cold" models, bulk up the production of the hot models and sell them as they're in demand?

I think this will happen and with Rolex too as the huge demand for popular SS watches is now un-ignorable and the windows and windows of unsold DJs that desecrate the flagship expensive stores looks utterly ridiculous, and the brand then becomes laughable in the real world even if in the cyber world they are smashing it like never before.

[AK797]

Green watches are always a tough sell when they are first released, the LVc was no different but is an absolute darling now, however this one I'm not feeling at all.

[Marciano490]

Originally Posted by AK797

I think this will happen and with Rolex too as the huge demand for popular SS watches is now un-ignorable and the windows and windows of unsold DJs that desecrate the flagship expensive stores looks utterly ridiculous, and the brand then becomes laughable in the real world even if in the cyber world they are smashing it like never before.

I stopped in Wempe on 5th a couple weeks ago on my way to dinner to say hi to a friend who works there. Their Rolex display cases were half empty. She asked me if they had anything in I wanted. I pointed to all the empty slots/cushions and said, "see each one of those? That represents a Rolex I want that you don't have." It was like some steel watch ghost town.

[SMD]

Originally Posted by SC11

Chase is on the case

Someone has young kids

[SC11]

Originally Posted by SMD

Someone has young kids

Yep a 3yr old, a boy due in April and for my sins a teenager who turns 18 soon

Wonder I have any time or funds for watches.

But they do brighten up my world

[Marciano490]

Originally Posted by SC11

Yep a 3yr old, a boy due in April and for my sins a teenager who turns 18 soon

Wonder I have any time or funds for watches.

But they do brighten up my world

The watches or the kids...

[benlee]

Originally Posted by tyler1980

Ive been saying that forever with AP. It makes no sense to me.

With Patek, its a little different as they are less of a sports watch company and dress pieces move slower and i dont think they want to be sports watch heavy. AP is sports watches. A millenary is in between dress and sports, but i have never once seen a JA in and AD ever. So they are sports watches.

Why they pump out funky colors and 37mm RO's that dont sell while neglecting pieces that have waitlists a mile long is weird. Why produce so many 15450's but not 15400's for example. Its the same movement. With Patek its grand comps or PC's which are different movements and not interchangeable. AP's core is the 3120 and they can stick that into many different cases across the RO and ROO lineup. Their dial production also doesnt match demand. Everyone wants the new blue dial ROC but they dont make that dial in the largest numbers. why? Ive seen the other two dials many times and won't buy them, i actually would have bought blue if an AD had one.

To maintain exclusivity? By making fewer pieces available for selected popular references, they indirectly drive even higher demand and desirability for them and raise the brand profile. Basically, it's a marketing strategy they copied from Patek. With huge margins, AP doesn't need to sell a lot to cover cost and as a family business, they don't need to show profitability figures like Richemont or Swatch group to answer to shareholders either, and it's fine for them to make more of the less popular pieces that takes a longer time to sell ( I am sure they don't need the cashflow as well ). So actually this makes a lot of sense and I guess it will continue for some time, baring any external factors.

[Marciano490]

Originally Posted by benlee

To maintain exclusivity? By making fewer pieces available for selected popular references, they indirectly drive even higher demand and desirability for them and raise the brand profile. Basically, it's a marketing strategy they copied from Patek. With huge margins, AP doesn't need to sell a lot to cover cost and as a family business, they don't need to show profitability figures like Richemont or Swatch group to answer to shareholders either, and it's fine for them to make more of the less popular pieces that takes a longer time to sell ( I am sure they don't need the cashflow as well ). So actually this makes a lot of sense and I guess it will continue for some time, baring any external factors.

I disagree. You can have a brand like Mille that is all about exclusivity, but you can't have exclusivity within a brand that also has low barriers to entry. The overall prestige of Audemars isn't enhanced because the openwork or ceramic perpetual is hot right now. That doesn't carry over to people buying ROO 44s or 15400s or Millenaries.

Just like, BMW and Mercedes lost brand lustre when they started making models available for 30k.

If anything, it's alienating to the existing customer base to draw segments within people who have been buying from you for years. I get the psychological impulse to want a watch because you can't have it or because everyone else wants it - and I went through that with the 5711 - but at a certain point you wake up, realize you're being disrespected by sales people at a brand you've spent hundreds of thousands of dollars on, and stop letting some company play games with you.

[benlee]

Originally Posted by Marciano490

I disagree. You can have a brand like Mille that is all about exclusivity, but you can't have exclusivity within a brand that also has low barriers to entry. The overall prestige of Audemars isn't enhanced because the openwork or ceramic perpetual is hot right now. That doesn't carry over to people buying ROO 44s or 15400s or Millenaries.

Just like, BMW and Mercedes lost brand lustre when they started making models available for 30k.

If anything, it's alienating to the existing customer base to draw segments within people who have been buying from you for years. I get the psychological impulse to want a watch because you can't have it or because everyone else wants it - and I went through that with the 5711 - but at a certain point you wake up, realize you're being disrespected by sales people at a brand you've spent hundreds of thousands of dollars on, and stop letting some company play games with you.

Oh it most certainly does I think. All top brands have these hard to get desirable models. AP, PP, RM and to a certain degree even Rolex ( C-Daytona ),are prominent examples. By limiting supply on selected models, they further inflate demand and makes the brand seems more exclusive and desirable overall, kind of like a tail-coat effect. Or else, what is your explanation that these brands are pursuing this course of action? Or put it this way, when was the last time we heard about Breguet or IWC or Omega having a long waiting list? But again, these brands are corporations so immediate profits is probably more important than long term brand equity.

As for the "low barrier price point", it's all relative. Of course AP watches have much lower entry price than say RM of course, but they are on a different bracket and it's also by no means cheap to a lot of people.

Actually, I personally disliked all these "games" the brands played and watch collecting eventually is going to descend to become more like buying stocks and shares, where people look at a timepiece potential "investment value" vs it's horological merit as consideration for purchase. Actually it is already happening now and I am sometimes guilty of this also. Unfortunately, I think this trend is going to stay with us for a while.