Rolex As A Status Symbol

[TexEd]

I realize there are folks on this site, including myself, that do not consider Rolex watches, or any watches, as investments. Folks enjoy the ownership with little or no thought on future value. However, one cannot escape the fact that Rolex watches are considered status symbols. There is a common term that describes ownership of luxury goods whether they be watches, luxury cars, designer jewelry, etc. The term is Veblem Goods. Basically a Veblem good is one that is exclusive and sold in boutiques rather than in department stores. As the price of these goods increases it tends to increase the demand as it creates more exclusivity for the product and puts it in a situation where less folks can afford to purchase it. One only needs to look at a Rolex price at an AD when compared to the Rolex gray market. There are certain Rolex models that are highly sought after and the prices are reflective of that fact. The Pepsi comes to mind. One would think that normally as demand increases for an item the prices would go down but that is not the case for Veblen goods (e.g. Rolex watches). Anyway, I just thought I would throw this out there. I do enjoy my Rolex watches and one reason of many is the exclusivity. They are not as commonly worn as other inexpensive type watches. I do own a Citizen and wear it when working on cars, doing yard work, etc.

[DoubleDeac]

For many, I suspect the Rolex brand is what they desire over the specific model of the watch. They want to psychologically align with the brand that is perceived to be the best, on the wrist of successful people, etc. I would venture as far as to say that if the Daytona was made by Citizen, it would not garner the status that it has. Usually, the "Rolex" name and the crown still matters a lot for people - even those who wear the watch purely based on merit.

Lastly, I'd also consider this purchase as conspicuous consumption - and it comes w/ its own side effects :)

[Calatrava r]

[QUOTE=TexEd;13553448] "One would think that normally as demand increases for an item the prices would go down but that is not the case for Veblen goods (e.g. Rolex watches)."

The basic laws of supply and demand do not change as to any particular type of goods. If demand increases relative to supply, the price rises.

[georgekart]

Originally Posted by Calatrava r

The basic laws of supply and demand do not change as to any particular type of goods. If demand increases relative to supply, the price rises.

Nobody is arguing that. The Veblen good is a good that has it's demand increase as the price increases. The logic being that if it is harder to get, people want it more. And the more expensive they get the harder they are go get. The thing people tend to ignore when talking about Veblen goods is that it it has to be limited enough and there is a narrow window in which it works as well. Would raising prices by 1% increase the demand? Maybe. Would raising prices by 50% increase a demand? Definitely not.

[Calatrava r]

Originally Posted by georgekart

Nobody is arguing that. The Veblen good is a good that has it's demand increase as the price increases. The logic being that if it is harder to get, people want it more. And the more expensive they get the harder they are go get. The thing people tend to ignore when talking about Veblen goods is that it it has to be limited enough and there is a narrow window in which it works as well. Would raising prices by 1% increase the demand? Maybe. Would raising prices by 50% increase a demand? Definitely not.

It makes no difference. If I increase supply more than the demand, the price will drop. What is being said here is as the prices are being raised the demand increases. This can only happen if the supply remains constant or is even reduced, which is what most luxury makers do. They raise the prices AND cut supply to drive the hype and frenzy FOMO higher and higher. Daytona's are selling at a premium on the used market only because demand far outpaces the meager supply. Without increasing supply, price rises will increase demand but only to a point as you pointed out.

[Harry-57]

Originally Posted by TexEd

However, one cannot escape the fact that Rolex watches are considered status symbols.

I can because I don't think they are. I like watches. What anybody else thinks is their business and of no interest to me.

[WatchEater666]

Rolex sells billions of dollars of watches per year. Theres nothing exclusive or special about them. Every time I go to a gathering of some sort usually every third guy is wearing a rolex or an omega. Maybe an AP or PP. I don’t consider any of those rare given they all sell billions of dollars of product per year…

Personally I like the combo of comfort, excellent engineering and practicality. It’s actually hard to beat them for the $ at MSRP when you look at those factors together.

[Krash]

Whether people want to admit it or not, a Rolex watch is a status symbol. But does it really matter? I also like watches that aren’t status symbols.


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[Krash]

Originally Posted by WatchEater666

Rolex sells billions of dollars of watches per year. Theres nothing exclusive or special about them. Every time I go to a gathering of some sort usually every third guy is wearing a rolex or an omega. Maybe an AP or PP. I don’t consider any of those rare given they all sell billions of dollars of product per year…

Personally I like the combo of comfort, excellent engineering and practicality. It’s actually hard to beat them for the $ at MSRP when you look at those factors together.

I really disagree. A $2000 Tag Heuer is an exclusive watch for the overwhelming majority of the global population.

The “billions of dollars of watches per year” sounds impressive. But less than one percent of the global population are buying them.


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[KatGirl]

Originally Posted by Krash

Whether people want to admit it or not, a Rolex watch is a status symbol. But does it really matter? I also like watches that aren’t status symbols.


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I like them because I like watches, and I appreciate high quality classic looking watches. Rolex is probably the best brand I can comfortably afford, but I’m not sure status is involved, unless it is subliminally.

Kat


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[Kevin of Larchmont]

It’s only a status symbol if people observe you wearing it. In twenty-five years of Rolex ownership I’ve had four people total notice and comment on the Rolex I was wearing at the time. If I was looking for my Rolex to convey status I would be painfully disappointed.

[shaunylw]

I liked Rolex before i really knew what Rolex was. 1998 i was 12 or so, that’s when a family friend wore one and i was in. Money was irrelevant back then, i didn’t have $5 so everything was out of my league.

I never thought of it as status symbols. I wore a $100 Ironman watch to the gym yesterday, a vintage Rolex gmt to dinner, a seiko in the morning. I just like watches. COVID brought a level of Rolex status symbol stuff i don’t know that i had ever seen. The internet and YouTube made it even bigger.

I fear a lot of these new collectors will be disappointed with time. Generally nobody notices what you’re wearing so using it as a status symbol isn’t going to gain a lot of attention.


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[Andad]

Originally Posted by TexEd

I realize there are folks on this site, including myself, that do not consider Rolex watches, or any watches, as investments. Folks enjoy the ownership with little or no thought on future value. However, one cannot escape the fact that Rolex watches are considered status symbols. There is a common term that describes ownership of luxury goods whether they be watches, luxury cars, designer jewelry, etc. The term is Veblem Goods. Basically a Veblem good is one that is exclusive and sold in boutiques rather than in department stores. As the price of these goods increases it tends to increase the demand as it creates more exclusivity for the product and puts it in a situation where less folks can afford to purchase it. One only needs to look at a Rolex price at an AD when compared to the Rolex gray market. There are certain Rolex models that are highly sought after and the prices are reflective of that fact. The Pepsi comes to mind. One would think that normally as demand increases for an item the prices would go down but that is not the case for Veblen goods (e.g. Rolex watches). Anyway, I just thought I would throw this out there. I do enjoy my Rolex watches and one reason of many is the exclusivity. They are not as commonly worn as other inexpensive type watches. I do own a Citizen and wear it when working on cars, doing yard work, etc.

Veblem was as far as I read TexEd.

[brandrea]

IMHO, Rolex has built its brand around being an aspirational purchase … the “I’ve made it” symbol of success.

[4 Aussies]

Originally Posted by brandrea

IMHO, Rolex has built its brand around being an aspirational purchase … the “I’ve made it” symbol of success.

Bingo!

[Hkspwrsche]

Originally Posted by brandrea

IMHO, Rolex has built its brand around being an aspirational purchase … the “I’ve made it” symbol of success.

This

[huncho]

Originally Posted by Kevin of Larchmont

It’s only a status symbol if people observe you wearing it. In twenty-five years of Rolex ownership I’ve had four people total notice and comment on the Rolex I was wearing at the time. If I was looking for my Rolex to convey status I would be painfully disappointed.

noticing and commenting are completely different things though. the consensus on this site that "nobody notices your rolex" is the biggest fallacy because it's just based on people not commenting. i've had maybe 1 or 2 people comment but i constantly see people's eyes glancing when i'm on the subway in the summer. whether or not they know what it is is a different story but they're definitely looking and some times it even makes me uncomfortable

[bluestreak]

Originally Posted by huncho

noticing and commenting are completely different things though. the consensus on this site that "nobody notices your rolex" is the biggest fallacy because it's just based on people not commenting

Yup. I noticed a guys Daytona on the train today. I noticed the two GMTs on the people on either side of me at dinner last night. I didn’t say anything to either.
People are very, very good at picking up on details on people and making quick assessments.


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[Mystro]

Of course Rolex is a status symbol. Rolex has marketed it that way and has very cleverly kept that idea alive in very subtle and not so subtle ways. It’s just advertising that has caught on to popular acceptance.
Why is this undeniable connection with the brand and “status symbol” so uncomfortable for some is puzzling??? There are many other fine watch brands that don’t embrace the “status crown” so unapologetically. It is what it is and the “status” image comes strait from Rolex themselves.

[inadeje]

Let’s be honest—anyone who says they don’t feel a little special wearing a nice watch isn’t being completely truthful. Period. We work hard, we play hard, and part of enjoying the rewards of that effort is owning things we appreciate and hope others can appreciate too. Is it a status symbol? Probably not. It’s more about personal satisfaction and loving what you wear.

[espanol]

Originally Posted by TexEd

I realize there are folks on this site, including myself, that do not consider Rolex watches, or any watches, as investments. Folks enjoy the ownership with little or no thought on future value. However, one cannot escape the fact that Rolex watches are considered status symbols. There is a common term that describes ownership of luxury goods whether they be watches, luxury cars, designer jewelry, etc. The term is Veblem Goods. Basically a Veblem good is one that is exclusive and sold in boutiques rather than in department stores. As the price of these goods increases it tends to increase the demand as it creates more exclusivity for the product and puts it in a situation where less folks can afford to purchase it. One only needs to look at a Rolex price at an AD when compared to the Rolex gray market. There are certain Rolex models that are highly sought after and the prices are reflective of that fact. The Pepsi comes to mind. One would think that normally as demand increases for an item the prices would go down but that is not the case for Veblen goods (e.g. Rolex watches). Anyway, I just thought I would throw this out there. I do enjoy my Rolex watches and one reason of many is the exclusivity. They are not as commonly worn as other inexpensive type watches. I do own a Citizen and wear it when working on cars, doing yard work, etc.

I've been into watches for quite a long time. Life caught up with me, and I took a long break from Rolex from ~2010 until about late-2017. At the time nothing really appealed and I was surprised with the catalogue in 2017 given the use of ceramic on seemingly all models.

Flash forward to 2018, and Rolex announced the release of the new BLRO. I loved it. It was awesome. Called a local dealer and had it on my wrist ~5 months later in late-2018. I wore it essentially every day for about one year.

After some time, I found the watch was getting noticed more and more while out and about. I had one guy in particular basically pin me into a corner to ask about it. It was fun for a while, but I'll admit I got a bit tired of it. I now only wear it sparingly and opt for an Explorer 99% of the time. Not one comment on the Explorer.

Some of us really don't want the stigma that comes with wearing a Rolex. I just like the watches, not the baggage that comes along with it.

[Kevin of Larchmont]

Originally Posted by huncho

noticing and commenting are completely different things though. the consensus on this site that "nobody notices your rolex" is the biggest fallacy because it's just based on people not commenting. i've had maybe 1 or 2 people comment but i constantly see people's eyes glancing when i'm on the subway in the summer. whether or not they know what it is is a different story but they're definitely looking and some times it even makes me uncomfortable

Understood but because I can’t measure the people who don’t comment (or react) I limited my observation to those that have. You confirmed my point though, these silent mystery observers still did not bestow upon me any status.

Maybe I’m riding the wrong trains.

[dseig001]

I love my watches and do what I can to hide them.

It’s not a status symbol if you just like watches.

Christ it isn’t some gaudy Richard Mille.

My Jaeger and Patek are way more interesting than my Skydweller.

[willywilson]

I don't really consider them status symbols. When I see a lad or lady with a Rolex I think, "Hmm, someone who appreciates a classic and quality time piece". The opposite is true when I see Range Rover drivers. Why? BC the data is clear they have crappy reliability yet have super high MSRP vs a super reliable Lexus.

I always love it when a dude comments on the Rolex and then says check this out and shows me a DJ associated with a Grandparent etc. I keep an open mind.

[ROLEX MAN]

How does my Porsche Boxster make me feel?

Well certainly better than a Mazda Miata!

Same as my Rolex, it makes me feel happy.

[bluestreak]

Most people this around the term Veblen goods here to appear smart, when it’s typically much more complicated. Sure, there’s more demand for a Daytona than a Seiko, but it’s not exclusively about price. If Rolex increased the MSRP of a steel Daytona to 35,000 dollars more people wouldn’t buy it. And if it were solely about price, people wouldn’t be clamoring for the cheapest Daytona they could find (steel), they’d be way more into the precious metal versions, which are more exclusive and more expensive. Rolex’s cheapest men’s sized watch (the OP in almost all configurations) is harder to get than the more expensive Datejust and the much more expensive Day Date.

So it’s not just about price. It’s some combination of supply, brand cache, looks, perceived exclusivity, marketing, etc. Just like most goods. The laws of supply and demand aren’t suspended here

[Cru Jones]

Yes, for the majority of Rolex buyers, since at least the 1980s, Rolex is a status purchase (“I’ve made it!” or “Look at me”), just like with luxury cars and hand bags. That’s not a news flash. And there’s nothing inherently wrong with that.

That being said, there are also are some consumers who buy Rolex because they appreciate the quality and history. That’s probably the majority of regular TRF members.

[SLWoodster]

I think Rolex is definitely a status symbol but not much different than say driving a Lexus is, or eating at the local steakhouse, or drinking a Mac Allan 12. But depending on your own circles, tastes, world… the level of luxury is different. Rolex as a brand is not really that exclusive. They make and sell over 1 million watches per year. Over 80% of their line is accessible from an authorized dealer with little to no games. The only exclusivity from the brand is due to price or the model combo. However when looking at the rest of the “Big 4” as Morgan Stanley is calling them this year, Rolex has the least expensive per-watch average of app $13,000. AP is at app $49,000. I forget Patek and Richard Mille but that rounds out the “Big 4”.

So it’s actually quite accessible when compared to some others. It can also be argued that Rolex is actually the least expensive as Rolex ships with each watch app 12 “ROLEX” trademarks and 6 crown Logos between the dial, rehaut, bracelet. As brand is the most valuable item in luxury watches, you are almost assuredly getting a much better deal with Rolex receiving an item carrying 18 trademarks per $13,000 spent.

Originally Posted by TexEd

I realize there are folks on this site, including myself, that do not consider Rolex watches, or any watches, as investments. Folks enjoy the ownership with little or no thought on future value. However, one cannot escape the fact that Rolex watches are considered status symbols. There is a common term that describes ownership of luxury goods whether they be watches, luxury cars, designer jewelry, etc.

[joli160]

Brand image is the major reason why people including myself like them.
The brand is so strong that we put up with their crap policies.
Customer satisfaction is something Rolex does not care about either.

It’s all about the crown on the dial and they keep on fooling me in wanting to buy more

[wcgreiner]

I know many don't view Rolexes as investments but enjoy them for their unique exclusivity and design...

Yet, a Rolex remains a classic status symbol—a Veblen good—where higher prices and limited supply only enhance its allure...

Personally, I love my Rolex for the prestige it brings...