7 Things That Give A Watch X Factor And Make It Worth More Than RRP

Luxury watches are usually purchased for their style, their functionality or even as a status symbol.

However a luxury watch can also make for a great investment if you buy wisely, because you can potentially sell it one day in the future for more than you paid for it and therefore make money.

But what is it that makes a watch appreciate in value?
Why do some watches go up in price and some watches do not..?

In this blog I’d like to share my thoughts…

I’d like to share the 7 things that I can think of that affect the resale value of a watch.

1.The Market

Good old supply and demand. Like stock prices, gold, and crypto currencies, the value of a commodity depends on its scarcity, availability, desirability and interest from buyers.
When you own a luxury watch, your ability to sell it ultimately comes down to its market demand and whether someone would be willing to buy it and how much they would be prepared to pay.

Some watches become collector items and their buyers thrive in a niche market.
Depending on tiny details of the model, it could be worth more or less than other similar looking ones. The more interest (and therefore demand) for a watch on the market, the more desirable a watch becomes.
The more desirable it is, the more likely it will sell. The quicker it sells (because of its desirability), the harder it will be to get NEW from an authorised dealer. Then availability shifts to the secondary market and this pushes prices up further. Years later that watch model gets discontinued, making it become even more rare and sought-after, pushing the price up even further still.

This is often a result that has been kickstarted by clever business activity from the brand with their advertising and marketing strategy around the watch. Which would have to be a decent watch or it wouldn’t achieve desirability in the first place. Demand creates a fanbase. It gets people talking. It can make a watch iconic.

All this creates the perfect storm for watch price appreciation.

2. The Brand

The watch brand will help make a watch appreciate in value.
Some brands command a higher ticket price than others. And that’s the power of the brand.

British company Superbrand says this about a “Brand” “A Superbrand offers consumers significant emotional and/or physical advantages over its competitors which (consciously or sub-consciously) consumers want, recognise, and are willing to pay a premium for.”

The brand (or watchmaker) matters when it comes to increasing resale value and there will be a link to “quality” here. We all know the big ones – Rolex, Patek Philippe, Audemars Piguet – but there are many MANY other incredible luxury watch brands that make watches that will increase in price if you buy wisely.

7 Things That Give A Watch X Factor And Make It Worth More Than RRP Prestige Watches

3. Low Production Numbers

The impact that low production numbers have on creating scarcity and therefore increasing the price.
If the production numbers are low, limited in numbers (limited edition), made for a short period of time before evolving to an updated model, has become discontinued,
or has rare or special qualities, perhaps a certain movement, a collaboration or unique printed dials can set certain watches apart from others, it is here, the devil is in the details.

Small details or minor changes can greatly increase the value of a watch, making it worth significantly more than the original model design simply because it’s unique.
Tiny but important details such as this would greatly increase the value of a watch but could be overlooked by less experienced collectors.

4. Popularity

Popularity creates waitlists and therefore supply shortages, demand and scarcity.
What makes a watch popular? A “Popular model”?
Normally the coming together of two forces.

1 – The physical attributes of the watch, which are jointly, the outstanding design (it has to look cool) coupled with superb performance.

2- A “cool story” and other intangible forces around the watch. The Story the brand tells and perhaps the provenance – which is different to the story. It has more to do with the previous owner’s story. Maybe they are or were someone of significance, importance or fame.

Perhaps the watch itself has certain claims to fame making it popular…
The first, biggest, smallest, thinnest, best, deepest, highest, fastest, most accurate, one and only, worn by…

Even accreditations such as sponsorships of events, affiliations and partnerships to other popular brands.
We all love bragging rights! Even watch brands. They know that their storytelling and sharing of details will help make the watches more popular.
Omega Moonwatch, Cartier Santos, Omega timing the Olympics, Rolex timing, Longines N13….

Let’s not forget trends too. What’s in right now? What’s hot? What’s not?
Certain luxury sports watches have been a great choice for price appreciation recently.
It’s worth mentioning that mechanical watches tend to do better than quartz watches.
However there was a time when it was gold watches. And BIG watches.
Times change, interests change, popularity changes and the market changes.
Ultimately popularity equates to high demand, and a higher demand for a certain watch model is likely to increase the resale value of a particular watch if supply is low.

5. Materials & Labour

It’s an obvious one but not to be forgotten. The physical attributes and properties of the watch. The price of the metal and sum of the parts. We know that a gold watch will cost more than a stainless steel one in most instances (but not all). And a platinum one will probably cost more than a gold one.
But there ARE variables here so be careful… for example, a 41mm all gold watch from Rolex will cost more than a 41mm gold watch from Omega. A 40mm gold watch from Longines may have a lower price tag than a stainless steel 40mm Rolex. When you couple materials and super brands, we have the X-factor price increase combination.

Let’s not forget the labour and finishing. The finest high end luxury watch makers on earth tend to hand make and hand finish their watches. All the parts of the movement are highly decorated and it makes them look incredible. This takes a lot of time from highly skilled craftsmen. So while at a quick glance, the movement of an Omega may look similar to that of a Patek, Breguet or A LANGE, the devil is in the detail. It’s this detail that will push up the price of a watch.

Collectors love hand finishing. That is why Bentley and Rolls Royce cars cost so much. The hand craftsmanship and hand finishing hand assembly. It’s the same for fine timepieces. Don’t get me wrong, Omega makes awesome watches and they look great, I’m a huge fan. But hand made they are not.

7 Things That Give A Watch X Factor And Make It Worth More Than RRP Prestige Watches

6. Condition

Another important factor that influences the resale value of a watch is its condition. If a watch is heavily marked, scuffed, scratched or damaged, these imperfections can negatively impact its overall value. Conversely, an in-demand watch that is in excellent condition, will have a higher resale value. This is true of any luxury second-hand item.
The better the condition, the better the resale value.

With watches there are a few little X-factor add ons…

  • Does the watch have any of its original stickers..?
  • Is the box original to the watch and also in excellent condition?
  • Are the papers original to the watch and in excellent condition?
  • Has the watch ever been polished..? Polishing removes metal and can slightly alter the original shape of the watch if done sloppily. Collectors prefer unpolished watches.

7. Age / Time

Finally, last but not least. Time is an important factor when it comes to the resale value of a luxury watch. Just like purchasing a car, the moment a watch is purchased – with some exceptions – a watch is likely to decrease in value.
However, over time, and depending on a variety of other circumstances that we just spoke about, the value of your watch could increase just by sitting back, relaxing, and letting time do its thing.

As with many investments, the value of a commodity, in this case, luxury watches is largely dependent on its supply and demand. The more popular the brand, the higher its demand. The lower the production numbers, the rarer the model and the smaller the supply – the higher its demand. Popular models appreciate in price better than lesser-known watch models. If the watch is made of precious material and has a longer labor of love in its making, it will have a higher price to a similar watch that is machine made. The better the condition, the higher its value. With many luxury branded items, it all takes time.

These are general guidelines for what gives luxury watches X-factor and makes them increase in value over time. But it certainly doesn’t mean that all luxury watches will increase in value and needless to say, there is no exact formula for predicting the future value of a luxury watch. Much of it is speculation.

If you ever decide to buy a luxury watch and you are hoping that one day you could sell it for more than what you bought it for, please get in touch.

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Before you do anything, you need to read this helpful guide from Marcelo at Prestige Watches.