Question: In investment terms is it better to buy a Rolex than another luxury watch brand?
All watches, from a £10 watch at Victoria station to a Patek Phillipe have their relative benefits (affordability being the obvious one in this case). So it depends what your objectives are for owning a watch. If it is about the value you will get when selling your watch, then as with many products, recognition combined with uniqueness and thus value goes a long way. And perhaps what is most important is that Rolex watches obviously have great recognition in many markets outside the main watch market’s inner circle.
Many experts would argue that Rolex watches are not great masterpieces nor are they hugely valuable within the serious watch investor. Rolex do not appear in Watchtime Magazine’s list of million dollar watches, but then neither do many of the other most recognisable luxury watch brands like Tag Heuer or Breitling. What makes great branding and what makes great investment opportunities are not always the same.
This graph produced by A Blog to Watch would indicate that the price of the Rolex Submariner has shot up over the years compared to inflation. However as they explain it doesn’t include changes in purchasing power, fluctuation in the cost of materials or advancements in the technology used in the watch.
When it comes to investing in watches, it is not as simple as picking a single brand that you believe will appreciate. The model, material, price and provenance will be as important when choosing your investment.
Is Rolex THE luxury watch brand?
If you were to do a list of the most recognisable watch brands, or the most iconic watches then Rolex would be there well above the Hublot, Daniel Roth Girard Perregaux notwithstanding any quality arguments. (So too may Tag Heuer and Breitling). However when asking the question how much is my Rolex watch worth, you have to consider how much of the ‘value’ of a luxury watch brand is down to marketing. An attractive motor racing driver may wear a Zenith but does that make the watch more valuable? Well maybe in the short-term. Other watch companies simply put huge prices on the value of their watches aiming their brand at the top-end, but is this a recommended long term business model for a luxury watch brand?
The Watch Snob in Ask Men says: “There are plenty of brands that most people consider “high-end” that, while I respect, simply aren’t superlative in any way: IWC, Vacheron, Piaget, and Zenith all make nice watches, but they are meaningless.”
A Rolex watch as an Investment
A watch can be a good investment, but like investing in cars, wine, art or any other tangible asset, it takes real expertise to make real money. If you are interested in a watch that will hold its value, Rolex are a potentially good choice of brand – but they are not a magic ticket to automatically making money.
A Rolex could be a better investment than many other luxury brands because quite simply people care about Rolex. This could be partly due to them holding their prices quite well through the years which creates a cycle – the better they hold their price, the more people value them, the better they hold their price.
There are many Rolex blogs, forums, social groups, single product events, entire coffee-table books about Rolex, fan clubs and high profile product placements. They are also more likely to be mimicked more than any other watch. So if you have a real Rolex more non-experts are likely to comment on it than if you had a $400,000 Girard Perregaux. That awareness creates a demand that helps sustain the value of the brand and of individual watches.
Myths about Rolex watches
Due to its global recognition Rolex has managed to inspire a lot of myths from all of us. I remember at School that a friend used to tell me that a Rolex was the most accurate in the world. Surely it depends who has set the time?
In this excellent website chronocentric.com you’ll find a superb Beginner’s guide to Major Watch Brands where they dispel some myths about Rolex Watches. Some of these myths are hotly debated, for example, the well-worn fact that ‘it takes a year’ to make each Rolex watch to all Rolex watches being hand-made to Rolex making “the most accurate watches in the world”. We also answered some commonly asked questions about Rolex watches in this article.
Separating the fact and the fiction when investing in watches is important, but also never underestimate the power a good myth has in boosting the value of an investment.
If you would like a free valuation of a Rolex or any other luxury branded watch then please get in touch.