The News Herald (Willoughby, OH)
Watch geeks drive booming trade in preowned pieces
NEW YORK >> Around two dozen traders sit in an open-layout second floor of a building in suburban Philadelphia. Surrounded by computer monitors, loud conversation and ringing phones, the energy on this trading floor is high and the commodity is blingy.
At the headquarters of Govberg, they’re not dealing in diamonds or gold but preowned luxury watches, of which company sells about $200 million worth a year.
Some 100 miles northeast, 23-year-old Christian Zeron sits in his parents’ dining room in suburban New Jersey looking at around 30 preowned vintage watches. In a few days, he’ll put them up for sale on his company’s website, theoandharris.com, which sells $2 million worth of watches annually.
Govberg, in the watch business for 35 years, and Theo&Harris, founded only three years ago, are part of the thriving preowned luxury watch business. Along with dozens of other companies, they are the core of an industry that has exploded over the past few years, rivaling the new luxury timepiece business in size.
“It’s bigger than people think,” said Reginald Brack, executive director and industry analyst for watches and luxury at NPD Group, which studies $2 trillion in consumer spending across 20 industries.
Brack said it’s difficult to quantify precisely the market for preowned watches because nobody tracks it thoroughly. But some estimates put it at three times the new luxury watch market, itself estimated to be worth up to $10 billion just in the U.S.
“I wouldn’t disagree with that statement,” Brack said. “And it’s only getting bigger.”
Even though watches have been disappearing from people’s wrists with the spread of mobile phones, luxury watches remain a popular status symbol. In fact, sales have slightly crept up in the last two years.
The preowned business allows shoppers to get a good deal on modern watches like Rolex Submariner, while also offering a large selection of vintage pieces like an early 20thcentury Cartier Tank.
Danny Govberg, the founder of Govberg’s global watch operation WatchBox, compared the rise of preowned watches to the “quartz revolution” nearly five decades ago.
The introduction of battery-operated quartz movements in wristwatches took a big bite out of the market share from major automatic or mechanical watch brands such as Rolex, Omega, Patek Philippe, Jaeger-LeCoultre, and Audemars Piguet. Those
brands, which have since recovered, are now the bread and butter of today’s preowned watch traders.
“Preowned watches are coming out of drawers so fast and furious now that I’ve never seen anything like it,” Govberg said in an interview in the company’s headquarters in Bala Cynwyd, just outside Philadelphia. “It’s a real disruption coming to our industry.”
Luxury brands have taken note. In June, Richemont, the owner of such brands as Cartier and IWC, bought Watchfinder, a British online platform for trading preowned watches.
“The preowned market has taken some business from the new market, there’s no question,” said Steven Kaiser, a veteran watch industry executive and founder of Kaiser Time, a New York-based luxury industry consulting firm.
Govberg entered the preowned watch business in
1983 when he introduced watches to his family’s jewelry store on Jewelers’ Row on Philadelphia’s Sansom Street.
“People weren’t collecting vintage watches back then,” he said, recalling that he would travel to Europe to buy used Rolexes and Patek Philippes from watch shows. “Little shows that you would go to, almost like trading card shows. Like wristwatch swap shows.”
At the turn of the millennium, new platforms such as eBay drove Govberg to adopt his own online strategy. Ultimately, he founded WatchBox, a digital platform and app that includes video reviews and a trading market for valuable timepieces. The company recently launched a second season of “The Classroom,” a YouTube series that aims to educate watch enthusiasts about the intricacies of owning a watch that could be worth hundreds of thousands of dollars.