AP New Pricing System in 2022?

[rockdrock]

When Tim Mosso speaks, I pay attention. He mentioned in a recent vid (link below at 28:40 min) that AP may have a new pricing structure system that resembles car dealerships where boutiques may sell their watches at close to market value and not list price. Please note that he did say he heard it through the grapevines.

This would definitely take me out of the AP family really quick. Deep pockets would prevail in this scenario.

Anyone heard this? This is the second comment I heard about this idea, other one at a local Watch AD.

https://youtu.be/Fnykcuco38c

[noshake]

I haven't heard that yet. Access to AP is already very limited. There're only 6 boutiques in the entire US. If true this would be a really obvious move to make the brand even more exclusive.

[Potawatomi]

It's already like this as far as I'm concerned. I don't see myself getting anything at current msrp so it doesn't really matter to me. It will curb the flippers but if the 15500 sells for 45k+ then that's the real price. If AP wants in on that action then they have every right to get in. The way the price increases every 3 months, it's apparent what their motive is.

[HMHM]

Originally Posted by rockdrock

When Tim Mosso speaks, I pay attention. He mentioned in a recent vid (link below at 28:40 min) that AP may have a new pricing structure system that resembles car dealerships where boutiques may sell their watches at close to market value and not list price. Please note that he did say he heard it through the grapevines.

This would definitely take me out of the AP family really quick. Deep pockets would prevail in this scenario.

Anyone heard this? This is the second comment I heard about this idea, other one at a local Watch AD.

https://youtu.be/Fnykcuco38c

i saw the video as well. I usually watch his stream every Monday. But I highly doubt that this will be the case with AP boutiques and AP house going forward. When a RO is priced at 50k right from the boutique, why do I want to buy a RO for 50k when I can get a Nautilus/Aquanaut from an AD? Unless FHB has let the recent demand and mad pricing get to his brain and ego, this move will only alienate customers, and I dare say that even the most hardcore AP supporters will have difficulty justifying paying 250k for a 15407ST from AP themselves, if they are allowed to set the price to match those of the grey market. AP is in the process of eliminating ADs, there's a known fact. If ADs pull out tricks like this, it will only drive customers more to boutiques and house under the management of AP themselves.

I might be wrong, but if the rumours do turn out to be true, I guess I won't be getting an AP for a very very long time.

[noshake]

I wonder if they do set the AP Boutiques pieces at market price, would you still have to "build a relationship" buying other watches you don't want. Very interesting times

[curare78]

I heard this also but only AD ( which there are very few left) and the AP owned boutiques will stick to retail. Guess we just wait and see.

[Fenrira]

Why throw a wrench in a system that’s operating so smoothly? AP is currently able to clear Codes because buyers believe they’ll eventually get a Royal Oak at retail after they’ve purchased a Code or two. If AP starts selling RO’s at close to market price, suddenly the long waiting lists would shrink significantly. Since everyone who’s willing to pay market for an RO will get one, it leaves no incentive to purchase a Code (except for avid fans), which leaves an excess stock of Codes and less popular RO’s. As we know, availability is the enemy of perceived exclusivity, a standing that AP has worked tirelessly to cultivate.

And what happens if and when market prices correct significantly? This will negatively affect consumer perception of the brand, especially in the eyes of those who bought RO’s from the boutique at stratospheric market prices and those who bought Codes at retail. I do not believe that AP I would be so short-sighted; if they are, they do not deserve to be in their current position.

A used-watch repurchase and resale program – akin to CPO Ferraris and Porsches – is an entirely different matter. As long as AP doesn’t start selling new-from-factory watches at market prices, I think the brand will be fine.

[noshake]

I just checked the website and never noticed this quote before. It usually just says prices subject to change without notice.... Well things are about to change.

[VogelPhoenix]

Originally Posted by rockdrock

When Tim Mosso speaks, I pay attention. He mentioned in a recent vid (link below at 28:40 min) that AP may have a new pricing structure system that resembles car dealerships where boutiques may sell their watches at close to market value and not list price. Please note that he did say he heard it through the grapevines.

This would definitely take me out of the AP family really quick. Deep pockets would prevail in this scenario.

Anyone heard this? This is the second comment I heard about this idea, other one at a local Watch AD.

https://youtu.be/Fnykcuco38c

Third thread (at least) in which this comes up. So far, everyone who asked their boutique about this rumor got the same answer: boutiques will not sell above MSRP. In my case, this was a direct question, with reference to the language on their website. They were aware of the rumor and the answer was unambiguous. So, either AP is lying to their boutique personnel, the boutiques are lying to their customers, or the rumor is BS.

[VogelPhoenix]

Originally Posted by Potawatomi

It's already like this as far as I'm concerned. I don't see myself getting anything at current msrp so it doesn't really matter to me. It will curb the flippers but if the 15500 sells for 45k+ then that's the real price. If AP wants in on that action then they have every right to get in. The way the price increases every 3 months, it's apparent what their motive is.

I do not believe this is actually the plan (see my other post). But hypothetically, one interesting aspect is that there is no well-defined "market price" the boutiques could follow. First, the asking prices on C24 etc are not the prices at which pieces actually sell. Second, the prices at which grey dealers can find an actual marginal buyer after advertising the same pieces for months and months are not the prices at which AP can shift their annual production of 44k watches. I have been following several models where asking prices are ~twice retail, and in 4 months a small fraction actually sold. Having inventory pile up year-over-year while occasionally selling a watch at a large premium over current MSRP would not be a good look for AP.

According to FHB, the prime directive at AP is to make sure the company still exists in 200 years. Introducing used-car-dealer-style haggling to the ultra-luxury market would be a very bold move. They would need to start by re-training their SA's in the car dealer arsenal of negotiation tactics, like letting the customer stew for an hour while "talking to the manager" and inventing reasons why any offer is only good that day.

[Potawatomi]

Originally Posted by VogelPhoenix

I do not believe this is actually the plan (see my other post). But hypothetically, one interesting aspect is that there is no well-defined "market price" the boutiques could follow. First, the asking prices on C24 etc are not the prices at which pieces actually sell. Second, the prices at which grey dealers can find an actual marginal buyer after advertising the same pieces for months and months are not the prices at which AP can shift their annual production of 44k watches. I have been following several models where asking prices are ~twice retail, and in 4 months a small fraction actually sold. Having inventory pile up year-over-year while occasionally selling a watch at a large premium over current MSRP would not be a good look for AP.

According to FHB, the prime directive at AP is to make sure the company still exists in 200 years. Introducing used-car-dealer-style haggling to the ultra-luxury market would be a very bold move. They would need to start by re-training their SA's in the car dealer arsenal of negotiation tactics, like letting the customer stew for an hour while "talking to the manager" and inventing reasons why any offer is only good that day.

They don't have to come all the way up to C24 pricing. They just have to close the gap some. I don't believe the real price of a 15500 is over 40k but I'm certain it's higher than current msrp. If they can creep up and get the price right to de-incentivize the flippers they could get the watches onto the wrists of the end users and still sell 100% of the product they manufacture. It is a foolish game to go too high in the event of a correction but I think they will continue to look for the $ where supply meets demand.

[AG_Watches]

Originally Posted by noshake

I just checked the website and never noticed this quote before. It usually just says prices subject to change without notice.... Well things are about to change.Attachment 1265398

Things are not about to change. This has been on the AP site since 2018. They did relocate the positioning to be more noticeable which has caught a lot of attention lately. Its directed at AD’s and not AP houses. Every AP house I spoke too confirmed they will be selling at msrp and its only the ADs that have that discretion over msrp.

[macrowatch]

Give me ceramic openworked perpetual, platinum jumbo, and RG chrono plus 2 week stay at AP hotel, I think that’s worth 1M! Better than endless waitlists or dealing with gray. Oh, and I still want free water bottles when I sit down to look at the watches. Ha.

[noshake]

Originally Posted by AG_Watches

Things are not about to change. This has been on the AP site since 2018. They did relocate the positioning to be more noticeable which has caught a lot of attention lately. Its directed at AD’s and not AP houses. Every AP house I spoke too confirmed they will be selling at msrp and its only the ADs that have that discretion over msrp.

oh ok, thanks for clearing that up.

[VogelPhoenix]

Originally Posted by Potawatomi

... I think they will continue to look for the $ where supply meets demand.

Nothing sells a luxury good better than having its perceived market value be equal or higher than MSRP. For that you need supply < demand. I expect that AP will continue to maximize $$$ by increasing MSRP at regular intervals while controlling supply, not with some grand experiment.

[dauster]

Originally Posted by macrowatch

Give me ceramic openworked perpetual, platinum jumbo, and RG chrono plus 2 week stay at AP hotel, I think that’s worth 1M! Better than endless waitlists or dealing with gray. Oh, and I still want free water bottles when I sit down to look at the watches. Ha.

with your budget of $1m I am sure you can buy some watches and make some moves.

new ROO 42mm/ 43mm + code chrono + maybe a concept should be doable and open some doors - thats less than 300k right there. leaves 700k to establish real VIP status.

[macrowatch]

I can sadly assure you that by middle of 2021, that game plan neither gets you ceramic open worked, and surprisingly that shopping list is that not easy to pull off from one boutique.


I was simply born 1-2 years too late! Lol.

Anyways, I tend to err on VogelPheonix's opinion, all of this is just for PR and a communication strategy, but more likely they will simply raise MSRP to near market, and then have pre-owned pieces at market for sell as well from boutiques.

[Ichiran]

Not AP per se but my AD previously sold Rolex at market price a few years ago until Rolex HQ stopped the practice. I bought my batman at a premium on par with the market rate with no wait at all. There was no waitlist, no bundling, no buttering anyone, and I actually quite liked that experience. I can buy anything listed on the Rolex website (for a premium of course), including both the black and white ceramic Daytona with no wait.

On the other hand, I can also buy unpopular Rolex at a discount from the same AD. Not necessarily market price but 20% off.

[liljctl]

Originally Posted by Ichiran

Not AP per se but my AD previously sold Rolex at market price a few years ago until Rolex HQ stopped the practice. I bought my batman at a premium on par with the market rate with no wait at all. There was no waitlist, no bundling, no buttering anyone, and I actually quite liked that experience. I can buy anything listed on the Rolex website (for a premium of course), including both the black and white ceramic Daytona with no wait.

On the other hand, I can also buy unpopular Rolex at a discount from the same AD. Not necessarily market price but 20% off.

That was the case 10 years ago. Nowadays even watches that are not ''hot watches'' are selling so close to their MRSP on the secondary market.

The flip side of the argument is that current market conditions have enticed collectors who would normally not consider less loved watches. If you go to the Patek section, 4 out of the last 10 threads are incomings of first Pateks. The 6119 trades at slightly above MRSP on the secondary and some collectors have been embolden to buy.

I remember buying my 5196J (I chose the J back then because J was the cheapest metal) and I lost 40% right out of the door. Those with just a passing interest would not have bought it.

But now, they take the plunge and start what could possibly be a lifelong journey.

[malba2366]

Tim Mosso has a vested interest in making these sorts of claims. A lot of the current craziness in the watch market is driven by the social media accounts of watch flippers suggesting to people that the current market prices make for a good "investment".

It would be an absolute horrible look for AP if their branded boutiques were to start charging over RRP for the watches...at that point, what would be the purpose of even having a RRP, may as well just hold online auctions for the watches. For all intents and purposes AP is all boutique at this point anyways, so whatever the 3 or 4 remaining ADs charge is immaterial, and it is not even certain if they will get Royal Oaks in meaningful quantities.

[fsprow]

I believe that for most manufacturers, the purpose of an MSRP is to ensure dealer pricing uniformity among dealers in different locales (at least in the same country).

Once a product becomes scarce for a long period, my belief is that is would be better to allow dealers to sell new goods above the MSRP (or to eliminate it altogether).

As someone who loves to bargain, this would clearly be better for me than "relationship" building.

[NYG1121]

Maybe this is about to turn into what is going on at porsche with their "ADMs"

[dauster]

Originally Posted by macrowatch

I can sadly assure you that by middle of 2021, that game plan neither gets you ceramic open worked, and surprisingly that shopping list is that not easy to pull off from one boutique.


I was simply born 1-2 years too late! Lol.

Anyways, I tend to err on VogelPheonix's opinion, all of this is just for PR and a communication strategy, but more likely they will simply raise MSRP to near market, and then have pre-owned pieces at market for sell as well from boutiques.

probably wont happen overnight that's for sure

[dauster]

Originally Posted by liljctl

That was the case 10 years ago. Nowadays even watches that are not ''hot watches'' are selling so close to their MRSP on the secondary market.

The flip side of the argument is that current market conditions have enticed collectors who would normally not consider less loved watches. If you go to the Patek section, 4 out of the last 10 threads are incomings of first Pateks. The 6119 trades at slightly above MRSP on the secondary and some collectors have been embolden to buy.

I remember buying my 5196J (I chose the J back then because J was the cheapest metal) and I lost 40% right out of the door. Those with just a passing interest would not have bought it.

But now, they take the plunge and start what could possibly be a lifelong journey.

a lot of truth to that, let's be honest if I could buy an aquanaut and nautilus at msrp I would probably not consider the beautiful 6119 but now I really want it.

even more true with AP I would have bought my 15400/15500 blue dial and moved on. maybe picked up a skeleton SS at around 50k (old price ) and PC SS. that's it.

[Vince_76]

This has been debunked - boutiques will sell at the price listed online. As the website notes, however, ADs can deviate.

[GW44]

What a complete load of nonsense. He should stick to hyping whatever he’s got to sell/offload.

And clearly he knows little to nothing about the Automotive Agency Model pricing either….

[911AP]

People are really desperate to spread the rumor of AP houses and boutiques charging over retail. They really are stupid. Do they not get it that if that happens the second hand market would die? The only reason people are nuts over the brand is because they want to make money. if you take that incentive away you only have real watch enthusiast, and they aren't going to pay 50k for a 15500.

I really don't know why people want to spread this rumor. I don't think they realize they are screwing themselves if it actually takes off.

[jojosnr]

There are many way ADs could sell above the MRSP. Not neccessary just raise the selling price of single watch.

[dauster]

Originally Posted by 911AP

People are really desperate to spread the rumor of AP houses and boutiques charging over retail. They really are stupid. Do they not get it that if that happens the second hand market would die? The only reason people are nuts over the brand is because they want to make money. if you take that incentive away you only have real watch enthusiast, and they aren't going to pay 50k for a 15500.

I really don't know why people want to spread this rumor. I don't think they realize they are screwing themselves if it actually takes off.

maybe it's nonsense maybe not, apparently it has been debunked but some ADs apparently can charge 60k for a time only code from now on :)

Also, wasn't there some talk from AP directly that they will have an official secondary market platform soon ? What happened to that ?

[THWatch]

One of these days AP is going to post on their Website under each model:

"We will have 100pcs of Model xxxxxx available in June, please place your bid by May 31"