Luxury Watches at 40% Off Overcapacity at the luxury watch brands has created a flood of inventory that is now being hawked online. By STACY PERMAN April 21, 2017 11:30 p.m. ET The gray market for luxury watches—that colorful internet-driven bazaar of unauthorized sellers often offering 40%-plus discounts on fine timepieces—is upending the global watch industry. It’s also just the latest manifestation of troubles whirring under the hood of the business, already hit hard by economic and political gyrations and China’s crackdown on corruption. According to the Federation of the Swiss Watch Industry, last year exports fell nearly 10% to $19.4 billion, its steepest decline since the global financial markets collapsed in 2009. Sales fell 25% in Hong Kong and 9.1% in the U.S. But the industry’s problems are a boon for the gray market, as overcapacity at the luxury watch brands has created a flood of inventory that is being hawked online. Websites like Jomashop.com advertise Omega Speedmasters at 42% off the list price; IWC Portuguese Chronographs are listed at 29% below retail at WatchWarehouse.com; and limited-edition Hublot Big Bangs are hawked at 35% off by PrestigeTime.com... Internet forums and blogs have demystified the business and new digital entrants are changing the industry. Chrono24 is an online marketplace for new and preowned watches, based in Karlsruhe, Germany, that publishes all the available information about a watch, including its price. Co-founder Tim Stracke says that about 50% of the site’s listed pieces are new or “as new” (mint condition, unworn). Nearly 300,000 watches from Audemars Piguet to Zenith are offered from some 90 countries, by over 2,000 of the website’s dealers who are screened and preapproved. Last year, $750 million worth of watches were sold through Chrono24. Stracke claims sales are heading toward $1 billion... “The biggest impact we’ve had on the industry is that we’ve created a global price transparency that’s become a de facto standard among dealers,” says Stracke. That means a watch buyer in Silicon Valley can now confidently walk into a local jeweler and compare the watch’s local retail price to its global “spot” price listed on the German website—and see if he is getting a fair deal...
There is a definite struggle with mid level brands in the sub $25,000 price points. But the higher end seems to be raising there prices, if anything. But thats really nothing new, chrono 24 has sold grey market watches for years at steep discounts.
The same thing happening in real estate pricing. "Mid level" pricing (regular guy rich) is stagnant while high end luxury has been going ballistic.
Very true, great observation and analogy. There's a new condo across the lagoon in West Palm, called the Bristol. Entry level is $5 million and goes to over $20 million -- they are well on the way to being sold out. This is 10X plus historic high end condo prices in west palm. Times they are a changing----
It always sucks to be middle, and be slightly forgotten. Kind of reminds me of the middle girl child in the TV show Brady Bunch...complaining...'it's always about Marsha Marsha Marsha'
I second that, Chrono 24 has great prices ive bought all my watches there, to bad the CAD/US exchange sucks now.