Consumer Behavioral Shift vs. Patek

[Fat_ninja]

Originally Posted by DVR

Mostly here it is all about value. Buying a watch that might lose money , oh the horror

Good thing you got that 5 digit sub then

[Fat_ninja]

Originally Posted by GB-man

My statement was not directed at you or anyone else unless the shoe fits. And honestly you don’t fit the description at all. You buy Tudors, RM, Patek dress watches and diamonds. If you are trying to avoid depreciation you work in mysterious ways!

I didn’t think you were insulting me... I was just taking the other side of the argument. but as always some witty responses which I enjoy.

Carry on then

[Ar_Mi]

Since I'm based in Dubai & LA, both high wealth concentration areas, im going to share my thoughts on this with you guys.
Growing up in LA I did see displays of wealth, but more so in Dubai as it was a hub for many of the regions wealthy.
Somewhere along the way the newer generation in both these regions, started to move further away from the previous generations belief of saving/investing more and spending less, towards spending most of what they make.
The question is how did that happen? IMO its a good mix of all the reasons mentioned on this thread. There has undeniably been an increase in wealth, as ninja mentioned.
But its also consumer behavior, affected by exposure to higher end goods and wealthier life styles, mostly through social media and the internet.
An aspiring young man/woman opens instagram and sees thousands of pages/posts of people 'stunting' and showing off their cars, houses, watches, clothes, etc and it gives them an idea of what success looks like, or the kind of lifestyle it brings about.
That young man/woman doesn't want to wait and invest more of his/her income to grow their wealth until they are 40. That young man/woman wants it now!
My father always instilled in me that if you want to buy luxury goods, you do it with your passive income. After you've taken the money from your main source of income and invested that into real estate.. etc, you then use that income, your passive income to buy luxury goods.
You DO NOT buy a Rolex with your main income, or on credit and pay interest!
Unfortunately that train of thought has slowly shifted, and snowballed into the, "everyone around me has a Rolex, I need a Rolex/PP/AP too".

[DVR]

Originally Posted by Fat_ninja

Good thing you got that 5 digit sub then

Don't get your remark, I bought it new in 2008 with a 10% discount. At least if you mean by 'sub' the GMT.
At that time it was surely not about 'value'.
It's the last M series and I always liked that watch a lot so bought it.

I buy what I like, sometimes they become 'investments', mostly not. That is out of my control :-)
But I do not complain, if someone likes collecting watches and only buys if and when they are sure to lose no money that is perfectly fine.
As they say, to each their own.

I buy a watch like I buy a nice pair of shoes. I accept they won't be worth anything when I am done with them. But during the time I own them they gave me pleasure in wearing them.
Because of that I look at a watch differently than most here as many questions asked in this and the Rolex section are 'is it a good investment?'

I just ordered my first Patek and I expect it to lose a big sum of money once I walk out the door of the AD. But I like the watch and I am sure I'll keep it.
So why should I worry about monetary value?
I want my 'value' to be elsewhere.

Ask yourself, what is the value in dining in a fine restaurant?
You can't sell that expierence and get your money back. But still very enjoyable. Same for a watch to me.

[Fat_ninja]

Originally Posted by DVR

Don't get your remark, I bought it new in 2008 with a 10% discount. At least if you mean by 'sub' the GMT.
At that time it was surely not about 'value'.
It's the last M series and I always liked that watch a lot so bought it.

I buy what I like, sometimes they become 'investments', mostly not. That is out of my control :-)
But I do not complain, if someone likes collecting watches and only buys if and when they are sure to lose no money that is perfectly fine.
As they say, to each their own.

I buy a watch like I buy a nice pair of shoes. I accept they won't be worth anything when I am done with them. But during the time I own them they gave me pleasure in wearing them.
Because of that I look at a watch differently than most here as many questions asked in this and the Rolex section are 'is it a good investment?'

I just ordered my first Patek and I expect it to lose a big sum of money once I walk out the door of the AD. But I like the watch and I am sure I'll keep it.
So why should I worry about monetary value?
I want my 'value' to be elsewhere.

Ask yourself, what is the value in dining in a fine restaurant?
You can't sell that expierence and get your money back. But still very enjoyable. Same for a watch to me.

Congrats on the new Patek! Can’t wait to see it!

I dine for free :) but I know what you are saying

[dj-dulux]

Originally Posted by cascavel

Watches are cars that you can wear on your wrist, which is why it's not a surprise that a lot of TRF members have expensive cars.

I think cars are a major factor, cars (especially in the UK) are becoming a liability rather than a status symbol. Congestion charges, theft, speed cameras, parking are making car ownership a pain-in-the-rear. In addition, the improvements in public transport and private hire cars (UBER etc and short-term rentals) means that many 20-30-year old’s don't have a car, many I know don't even have a license.

Many families that I know are even considering just having 1 car, certainly people are having these conversations, something unheard of a few years ago.

So, if you not buying expensive cars to show wealth; watches, shoes, bags etc are an obvious choice.

A bonus of these new peacocking items is that they don't lose 50% of their value over 2-3 years either, many lose only 20% or so, some keep up with inflation, some even increase in value.

Dupe...

[AK797]

The fact that recent polls show more teenagers dream of becoming social media influencers than doctors, lawyers, teachers and engineers put together says it all about today's culture. The teenager dollar has been the main driving force behind many industries, like music and fashion, and now it and who they "like" has gone viral. It always amused me that because 22 year old pop stars were idolised by 13 year old girls that gave them the status and money to go out with Supermodels and Hollywood actresses.

[Fat_ninja]

Originally Posted by AK797

The fact that recent polls show more teenagers dream of becoming social media influencers than doctors, lawyers, teachers and engineers put together says it all about today's culture. The teenager dollar has been the main driving force behind many industries, like music and fashion, and now it and who they "like" has gone viral. It always amused me that because 22 year old pop stars were idolised by 13 year old girls that gave them the status and money to go out with Supermodels and Hollywood actresses.

My wife said Drake is dating Kylie that’s all I care about.

[locutus49]

Drake has some nice watches, John Mayer knows and inspires some of the celebrity watch guys.

Originally Posted by Fat_ninja

My wife said Drake is dating Kylie that’s all I care about.

[Murcielagoboy2]

Originally Posted by bearxj86

There is a certain level of narcissism that pervades social media these days. Just one look at many people's facebook/instagram accounts will show that even the most well intentioned and discreet people will have a strong bias to showing what is going well in their lives. Who wouldn't? We are social creatures and pea-cocking and social status forms a foundation of our lives.

It is not a surprise that watches are becoming what they are, both a status symbol as well as to celebrate milestones. A fine watch is like a fine sword or suit. It demonstrates taste, an appreciation for true quality and craftsmanship, and enjoying the finer things in life because you can. You can wear it like a big swinging dick or you can wear it discreetly and tastefully - either way you are projecting your self onto the watch and to others when you wear it.

For me, the choice to purchase a watch are based on three factors:
1) Aesthetics and the look (fits my personal style or mood "look" I am going for)
2) Collect-ability and value retention
3) Brand and what it says about you

PS: I have been eying a full YG submariner for a while now and I've kind of resigned myself to the fact that If I do buy one, it will probably for me to wear at home for ME, and probably not much in public :)

Completely and utterly correct. Best post I've read on TRF for years.

P.S. Such behavioural trends explain why so many people are so miserable, being bombarded with images and insights in goods and a lifestyle (and a body) they cannot afford...

P.P.S I've got a YG Sub as well. And I bought it because I'm dark skinned and the YG looks great with the blue dial. Lovely watch. HOWEVER, it's left largely at home in the safe these days...... I just feel too self conscious today wearing that around.... What a pity.

[ts3]

Originally Posted by dj-dulux

I think cars are a major factor, cars (especially in the UK) are becoming a liability rather than a status symbol. Congestion charges, theft, speed cameras, parking are making car ownership a pain-in-the-rear. In addition, the improvements in public transport and private hire cars (UBER etc and short-term rentals) means that many 20-30-year old’s don't have a car, many I know don't even have a license.

I agree and in Germany there are at least two more factors why high-end cars don't work as status symbols anymore for large segments of society: (1) the ever increasing environmental consciousness and (2) the utterly ruined reputation of the car industry as a whole after recent scandals.

[Humble michael]

Sorry,for me, I couldn’t disagree more with buying a timepiece with the idea of losing money. I have worked hard all my life ( as most have ) and I want to be a good steward of what I have been privileged to have. I would hardly compare buying a $30 - 55k or more timepiece to eating out in a fine restaurant. To be happy to buy and lose 15% when you walk out the door - really? The pieces I purchase , I will not buy unless I know I can sell them the next day for a profit. Even the grand complication I purchased from a gray at a huge discount trading in a piece I made a substantial profit - today I can still sell that piece for several thousand more than I paid. I enjoy these timepieces for the works of art and subtle elegance that they are. They are classic pieces which when purchased carefully can give great returns not only in enjoyment but in value retention. Just mo :-)

[italiafan]

For me it has nothing to do with status; it is celebrating the finer things in life that decades of hard work and dreaming have now yielded.
I appreciate the history, the art, and the technology in mechanically-based things like cars and watches.
I have a number of Ferraris, and the attention they get is the part I like the least about owning and driving.
I don't need to impress people, and my friends could care less (many of who have far greater wealth than me). In our car club there is absolutely no hierarchy of ownership at status...the guy with the 348 is viewed no differently than the guy with the 10,000 sq foot "clubhouse" filled with the latest Ferraris.
We usually look like a bunch of bums rolling up to the barbecue place in a group of Ferraris, several people wearing very low-key Patek Grand Complications...two of the guys laughing about how they fly around in their private jets to find the cheapest jet fuel.

The people who might be impressed by my financial status I don't care to impress; the people who aren't impressed don't care about about my status.

[locutus49]

It is a pity that your watch stays largely unworn due to your self-consciousness. Perhaps after being on this forum for a while your confidence will increase. I would love it if you begin to feel comfortable wearing your watch. Maybe start by wearing it out in small doses and slowly increase as you begin to feel more comfortable. Best of luck.

Originally Posted by Murcielagoboy2

Completely and utterly correct. Best post I've read on TRF for years.

P.S. Such behavioural trends explain why so many people are so miserable, being bombarded with images and insights in goods and a lifestyle (and a body) they cannot afford...

P.P.S I've got a YG Sub as well. And I bought it because I'm dark skinned and the YG looks great with the blue dial. Lovely watch. HOWEVER, it's left largely at home in the safe these days...... I just feel too self conscious today wearing that around.... What a pity.

[AK797]

Originally Posted by Fat_ninja

My wife said Drake is dating Kylie that’s all I care about.

We have a comedy show here that rips the p1ss out of the stupidest posts of the Insta week and this week it was topped by the mother Kardashian with a trainwreck vid of her singing about how she loves her friends when she turned thirty, it is absolutely dire, and this beatch has 30m followers and her daughters have half a billion between then, climate change destruction can't come soon enough.

Originally Posted by ts3

I agree and in Germany there are at least two more factors why high-end cars don't work as status symbols anymore for large segments of society: (1) the ever increasing environmental consciousness and (2) the utterly ruined reputation of the car industry as a whole after recent scandals.

I was looking at my carbon footprint the other day, food, transport and home heating, but then I saw the Mother Kardashian vid and now I'm getting a private jet with a jacuzzi and steak kitchen on board.

[DVR]

Originally Posted by james272

To be happy to buy and lose 15% when you walk out the door - really?

With the Patek I ordered make that 30-35% at least

But as I said, to each their own.
I have a friend who loves a certain high end watch and has enough spending money to afford it. But he won't. Because he fears he might want to sell it down the road and does not want to take a hit on selling.

What does that mean? This person will deprive himself of enjoying and wearing a watch for numerous years just because it will cost him money to wear it.

We all enjoy things that cost money. Be it food, cars, holiday or whatever that gives us joy and happiness.
But for some reason a watch 'enthusiast' does not accept to 'spend' anything on a watch. That 'thing' has to gain or at least break even.

I simply don't get that and never will. I love watches. Not the value thing behind it. Maybe that's why I own 4 Grand Seiko's. A tough and hard sell used and not loved by the 'investor' crowd but the best watches money can buy.

[Bearxj86]

While I appreciate the love for watches for what they are, I will be straight up and honest. Outside of 1-2 watches that I would own regardless, most of my watches are owned primarily because the cost of ownership is low. Said another way, if I am to take a 15-30% bath on each one, I simply would not be owning them. There are other things in life that money can be spent on that can give me equivalent if not more value.

It's a simple pleasure to cost ratio for me. I do not like the watches enough or do not have the financial wherewithal to own so many watches without regard to their cost.

I actually like the fact that watches have taken off on social media and the new generation is in it. If not it would be a bunch of old crones and a dying art. You can reminiscence of how things "used to be" but at the same thing there is significant upside in watch collection becoming more mainstream.

Anyway my 2 cents and speaking for the "new generation" of collectors that started in the past 3-5 years.

[DVR]

Originally Posted by bearxj86

I do not like the watches enough.

I appreciate your honesty

I am more of an 'old timer', my first nice watch was bought in 1992.
And I have bought and sold 'a lot' of watches.
When sold, most were at a loss, some break even and a few with a little profit.

I don't have any social media accounts, be it facebook, instagram or whatever people use to brag. Primarily it's all about the joy of ownership (and use) it brings to me.

When this forum started in 2005 it was pure about the joy of ownership and sharing ones love for watches. Today it's mostly sharing ones love for getting 'hard to get watches', discount or resale value or everything combined.

But it is what it is and I am not complaining nor judging.
But there are still people out there that buy a watch because they genuinely like and want it. Not as an investment.

May we all live long and in good health.

[Bearxj86]

Originally Posted by DVR

I appreciate your honesty

I am more of an 'old timer', my first nice watch was bought in 1992.
And I have bought and sold 'a lot' of watches.
When sold, most were at a loss, some break even and a few with a little profit.

I don't have any social media accounts, be it facebook, instagram or whatever people use to brag. Primarily it's all about the joy of ownership (and use) it brings to me.

When this forum started in 2005 it was pure about the joy of ownership and sharing ones love for watches. Today it's mostly sharing ones love for getting 'hard to get watches', discount or resale value or everything combined.

But it is what it is and I am not complaining nor judging.
But there are still people out there that buy a watch because they genuinely like and want it. Not as an investment.

May we all live long and in good health.

Thanks you for giving your perspective - it is a valued one. I'll give you two examplesof mine (while we're sharing):

Patek 5170P - one of my absolute favorites. If I buy in at the mid $70s and enjoy it for several years with little to no cost of ownership, I am a really happy camper. I can "afford" to have my $70k tied up for several years earning little to no return. The 5170P is in my top 10 watches but who is to say whether after a few years I might want to get a Lange double split or a Journe Tourbillon (both gorgeous watches I would love to own). I do have a sizable investment portfolio but what if the market tanks or I find a good investment opportunity or need some capital to fund a seed business?

If I had to pay full retail at $90k and lose $20k out the door, I am now "stuck" with my choice. We all know that even marriage has uncertainty so can you truly say you love something enough never to part ways with it? I am also not in a financial position to pay $20-$30k just to own the watch with nothing back. Could I afford to lose $20k; yes, but it would be financial irresponsible for me.

Patek 5711 blue - A keeper for me. Could I afford to pay $70k for the love of the watch? No. I bought it at retail. Can I afford to keep it at $30k I paid? Yes. I consider the $30k dead to me. Is there a chance down the road that I need a resurrection of that $30k? Perhaps. Will I have $30k? I think so...

[joli160]

Originally Posted by ts3

high-end cars don't work as status symbols anymore for large segments of society: (1) the ever increasing environmental consciousness

Apart from a few snowflakes and some AFA types these segments are not so large I believe whenever I drive on the autobahn.

The horror if we all have to drive a musk thing look like car but is not

[srvrf]

Originally Posted by bearxj86

Thanks you for giving your perspective - it is a valued one. I'll give you two examplesof mine (while we're sharing):

Patek 5170P - one of my absolute favorites. If I buy in at the mid $70s and enjoy it for several years with little to no cost of ownership, I am a really happy camper. I can "afford" to have my $70k tied up for several years earning little to no return. The 5170P is in my top 10 watches but who is to say whether after a few years I might want to get a Lange double split or a Journe Tourbillon (both gorgeous watches I would love to own). I do have a sizable investment portfolio but what if the market tanks or I find a good investment opportunity or need some capital to fund a seed business?

If I had to pay full retail at $90k and lose $20k out the door, I am now "stuck" with my choice. We all know that even marriage has uncertainty so can you truly say you love something enough never to part ways with it? I am also not in a financial position to pay $20-$30k just to own the watch with nothing back. Could I afford to lose $20k; yes, but it would be financial irresponsible for me.

Patek 5711 blue - A keeper for me. Could I afford to pay $70k for the love of the watch? No. I bought it at retail. Can I afford to keep it at $30k I paid? Yes. I consider the $30k dead to me. Is there a chance down the road that I need a resurrection of that $30k? Perhaps. Will I have $30k? I think so...

I agree and think that it is effecting how many of us play this "game." In the past, depreciation was the norm for pretty much all watches. Now with the rise of steel Rolexes, PPs, and APs, there is a dichotomy in watch purchasing that I don't think was ever this wide before. Even as a WIS collector, when I consider how to spend say $12,000 USD on a watch, I'm faced with options that have vastly different financial outcomes.

1. If I can get a ceramic Daytona from an AD at $12,400 MSRP, the watch instantly goes up maybe $8000 USD in value when you walk out the door.
2. If I took that same money and bought an Omega DOSM at MSRP of $12,000, it drops about $5000 USD.

Of course getting the Daytona at MSRP is the tough part, but even in this example, the difference in value between these two choices (+$8k vs. -5k) is about the same at the watches themselves.

[pam66]

Originally Posted by Fat_ninja

My wife said Drake is dating Kylie that’s all I care about.

sorry, drake who and kylie who????

[GB-man]

Originally Posted by pam66

sorry, drake who and kylie who????

One is arguably the most popular music artist of the past 5 years according to billboard and the other is one of the most influential people on social media with over 150 million followers and a billion dollar cosmetic company.

[Fat_ninja]

Originally Posted by GB-man

One is arguably the most popular music artist of the past 5 years according to billboard and the other is one of the most influential people on social media with over 150 million followers and a billion dollar cosmetic company.

Lol

[AK797]

Originally Posted by srvrf

I agree and think that it is effecting how many of us play this "game." In the past, depreciation was the norm for pretty much all watches.

Now with the rise of steel Rolexes, PPs, and APs, there is a dichotomy in watch purchasing that I don't think was ever this wide before. Even as a WIS collector, when I consider how to spend say $12,000 USD on a watch, I'm faced with options that have vastly different financial outcomes.

1. If I can get a ceramic Daytona from an AD at $12,400 MSRP, the watch instantly goes up maybe $8000 USD in value when you walk out the door.
2. If I took that same money and bought an Omega DOSM at MSRP of $12,000, it drops about $5000 USD.

Of course getting the Daytona at MSRP is the tough part, but even in this example, the difference in value between these two choices (+$8k vs. -5k) is about the same at the watches themselves.

Not only was it the norm but it was also what defined it as a luxury good, that you made a loss on it but you could take it, and for most people that would be 100% as they would not even think to sell it, be it a watch, bag, shoes etc, but the internet has changed the landscape by making these easily trade-able.

And now that prices have moved up due to some initial real world factors, the price momentum of most hot watches has been sustained merely by the profit motive which actually takes away the luxury aspect of the watch. They are mostly just being bought to be sold for a profit, thus anyone with some credit can do that, and indeed that is why Rolexes are so oversubscribed now, as every Tom and Dick can buy one, there is no luxury element to it anymore, so ironically just when they look the most like jewellery they have gone back to being tool watches ie investments again.

[Bearxj86]

Originally Posted by AK797

Not only was it the norm but it was also what defined it as a luxury good, that you made a loss on it but you could take it, and for most people that would be 100% as they would not even think to sell it, be it a watch, bag, shoes etc, but the internet has changed the landscape by making these easily trade-able.

And now that prices have moved up due to some initial real world factors, the price momentum of most hot watches has been sustained merely by the profit motive which actually takes away the luxury aspect of the watch. They are mostly just being bought to be sold for a profit, thus anyone with some credit can do that, and indeed that is why Rolexes are so oversubscribed now, as every Tom and Dick can buy one, there is no luxury element to it anymore, so ironically just when they look the most like jewellery they have gone back to being tool watches ie investments again.

One thing that is also worth pointing out is that watches as a whole were more "affordable" from a pure $ perspective. I mean the prices were much more attainable relative to income levels 3-5 years ago...

Said another way, the $ impact of taking a bath was a lot less and if you bought pre-owned you could at least keep your money ya?

[DJTOSUB]

Originally Posted by james272

Sorry,for me, I couldn’t disagree more with buying a timepiece with the idea of losing money.

Originally Posted by italiafan

For me it has nothing to do with status; it is celebrating the finer things in life that decades of hard work and dreaming have now yielded.

Two interesting and completely different viewpoints.

The downside of only buying watches that retain or increase in value is that the list of potential watches gets narrowed down to certain PP, Rolex, or AP references.

[Codik]

I wouldn’t buy watches with the expectation of making or retaining money. They are not investments with growing underlying value, like shares, and my guess is the current market is an anomaly. To be honest an anomaly that has helped me rationalise my purchases, but an anomaly nonetheless.

[Fat_ninja]

Originally Posted by DJTOSUB

Two interesting and completely different viewpoints.

The downside of only buying watches that retain or increase in value is that the list of potential watches gets narrowed down to certain PP, Rolex, or AP references.

Who has a ferrari and a Bentley? Or do both of them have one?

[simpleman]

Originally Posted by Fat_ninja

Feels like the watch hobby is only for Old independently wealthy folks that can afford to lose money. Almost like a country club in some ways... I could join but I don’t fit in. I grew up in the ghettos.

Buying Richard Mille and Nautilus for wifey and kid, then saying he can't afford to lose money... what a snob.

250k income I can easily afford to lose 100k on watches, while living the good life with another 100k and using the remaining 50k for retirement.