SE­COND TIME’S A CHARM

Pre-owned watches are com­ing up strong in very big ways and mar­ket play­ers are ready to sup­ply the de­mand.

The Peak (Hong Kong) - - Watches - STORY GLO­RIA FUNG

Sport­ing a used, vin­tage 1970s Omega or vin­tage Glashütte on some­one’s wrist says more about their horo­log­i­cal ap­ti­tude and suave, than their bank ac­counts.

Dustin Lam, a 20-some­thing en­gi­neer and re­cent trans­plant from Van­cou­ver flaunts a just-ac­quired 1950s Glashütte Spez­i­matic, a sim­ple three-hand watch that, al­beit a lit­tle roughed up, stands out among a crowd of shiny new Rolexes and Pan­erais.

Un­like the vin­tage 1970s Rolex Day-date (equally in­ter­est­ing of course) on the wrist of a fel­low Van­courite sit­ting across from him, Lam didn’t in­herit the Glashütte from his grand­fa­ther. Lam’s watch was bought from the most unas­sum­ing of places. “I bought this off ebay for 4000 bucks!” He was clearly en­thused and “su­per psyched” about this find.

The last place one would as­so­ciate with vin­tage watches 20 years ago, ebay is now one of the most pop­u­lar, and ac­ces­si­ble, plat­forms for vin­tage watch buy­ers and col­lec­tors. This form of on­line buy­ing and sell­ing has sparked the pop­u­lar­ity of C2C plat­forms and the rise of sites like Chrono24.

For this new gen­er­a­tion that val­ues ex­pe­ri­ences over ma­te­rial goods, it is the hunt that makes buy­ing watches in­ter­est­ing. “I’m not nec­es­sar­ily look­ing to have the most ex­pen­sive watch in the room, but I want to be that guy who wears a watch peo­ple might not im­me­di­ately be able to place and want to ask ques­tions about,” says Lam.

In­for­ma­tion is so read­ily avail­able; fo­rum users seem to be able to pro­vide each other with an­swers to even the most ob­scure of ques­tions about ori­gin, his­tory and even prove­nance. It also helps that mil­len­ni­als are now much less likely than gen­er­a­tions pre­vi­ous to pur­chase big-ticket items with the in­ten­tion of own­ing them for­ever, and are more ready to trade up and buy pre-owned.

Tim Bourne, in­ter­na­tional di­rec­tor of watches, Asia at Bon­hams, be­lieves that the on­line plat­form is one that’s con­trib­uted to the grow­ing knowl­edge that’s cir­cu­lated amongst col­lec­tors. “Peo­ple are be­com­ing wiser, more ed­u­cated all the time and schol­ar­ship changes over time, so it’s al­ways im­por­tant to keep up with the mar­ket anal­y­sis and trends, so one is able to cap­i­talise and be ahead of the curve when it comes to col­lect­ing and in­vest­ing care­fully.”

The preva­lence of on­line sales has prompted the tra­di­tional auc­tion house to dish out their ver­sions of e-shop­ping chan­nels. Bourne sees par­al­lels be­tween their on­line lots and those avail­able through more tra­di­tional on­line bid­ding sources. “The auc­tion houses have a role to play in the on­line auc­tions for sure, but they are just a small slice of the pre-owned watch mar­ket that is cur­rently be­ing of­fered to col­lec­tors and traders and the gen­eral con­sumer. It is not too dis­sim­i­lar to what ebay has been do­ing for years; slightly more cu­rated but ul­ti­mately it is of­fer­ing the same prod­uct.”

TAK­ING IT IN-HOUSE

Sell­ing pre-owned isn’t an en­tirely new con­cept that’s tar­geted at those with smaller bud­gets, how­ever. The big­gest play­ers in jew­ellery have em­braced it for decades. Cartier, Van Cleef & Ar­pels, all have legacy col­lec­tions that they’ve ac­quired, re­fur­bished and resold to cus­tomers, and th­ese col­lec­tions of­ten in­clude time­pieces as well.

Audemars Piguet’s CEO Fran­cois-henry Ben­nah­mias at this year’s SIHH has rolled out a selec­tion of used watches to be sold in its bou­tiques, with the op­tion for cus­tomers to trade in their old time­pieces. Ben­nah­mias be­lieves, ac­cord­ing to an in­ter­view with Reuters ear­lier in the year, that the pre­own trend will be the next shake-up for the in­dus­try.

Justin Reis, co-founder and di­rec­tor of Watch­box, an Amer­i­can on­line plat­form buy­ing and sell­ing pre-owned watches that has re­cently ex­panded to Hong Kong with a brick and mor­tar gallery in Cen­tral’s Dud­dell Street, for one, is ex­cited about

“THE AUC­TION HOUSES HAVE A ROLE TO PLAY IN THE ON­LINE AUC­TIONS FOR SURE, BUT THEY ARE JUST A SMALL SLICE OF THE PRE-OWNED WATCH MAR­KET.”

-Tim Bourne, Bon­hams

this new di­rec­tion. “We’re very ex­cited about the an­nounce­ment. We are cur­rently the only au­tho­rised pre-own dealer for Audemars Piguet, and we’re hope­ful that other brands like Greubel Forsey, Hublot and Bre­itling will start do­ing the same.”

As for Bourne, this move sig­ni­fies an in­dus­try that’s will­ing to adapt to the times. “It will be in­ter­est­ing to see the dif­fer­ent strate­gies of the man­u­fac­tur­ers cope with their evolv­ing mar­ket. It’s good to know they are want­ing to be cre­ative, as the tra­di­tional model of re­tail is not as pow­er­ful and rel­e­vant as it was. The brands have to change and move their tar­gets as to how to main­tain mar­ket lead­er­ship. It is all pos­i­tive, as this rep­re­sents the two huge in­dus­tries of pri­mary and pre­owned be­com­ing closer to­gether.”

TRAD­ING UP

In com­par­i­son to the sales of brand new watches that are worth US$ 45.3 bil­lion a year, ac­cord­ing to con­sul­tancy Bain & Com­pany, co-founder and chair­man of Watch­box Tay Liam Wee fig­ures there’s about US$ 5 bil­lion worth of used watches that are

“BUY­ING AND SELL­ING PRE-OWN AL­LOWS THEM TO EX­PE­RI­ENCE MORE WATCHES. THEY CAN HAVE 15 WATCHES OVER THE SPAN OF A FEW YEARS” - Justin Reis, Watch­box

look­ing for buy­ers an­nu­ally. And while there are plenty of pre-own deal­ers in Hong Kong, that’s not the case for other parts of the world. For mar­kets like the US, says Liam, where it is so ge­o­graph­i­cally spread out, a lot of peo­ple do not have ac­cess to re­li­able re­sell part­ners.

Add to that a new set of buy­ers ea­ger to dis­cover lux­ury watches with­out pay­ing the premium; the pre-own op­tion is a smart one for many. “For young peo­ple who might be just start­ing to build their watch col­lec­tion, buy­ing and sell­ing pre-own al­lows them to ex­pe­ri­ence more watches. They can have 15 watches over the span of a few years this way,” Reis says. With an in­ven­tory of around 18,000 pieces amassed from clients who sell, about 40 per cent of cus­tomers who sell walk out with an­other watch.

Oth­ers, Reis says, might be liq­ui­dat­ing to re­di­rect their col­lec­tion. “We had some­one come in with a col­lec­tion with 500 Pan­erais. Se­ri­ous watch col­lec­tors rarely turn to col­lect­ing some­thing else en­tirely. It might be that they want to shift their fo­cus to vin­tage pieces, for ex­am­ple.”

DEAL­ING IN TRUST

For many peo­ple, the big auc­tion houses are still the go-to place to en­trust their col­lec­tions, and there’s a good rea­son for that. “In the world of col­lect­ing fine art and ob­jects such as watches and jew­ellery this is highly im­por­tant in terms of es­tab­lish­ing a rep­u­ta­tion and longevity in the mar­ket place,” says Bourne. Watch brands that buy his­tor­i­cal pieces to add to their archives, like Breguet, will only buy at auc­tions for this rea­son. Trust and trans­parency are es­sen­tial when it comes to set­ting a prece­dent for prices; the ex­cite­ment and pub­lic­ity that’s drawn from an ul­tra­rare lot fac­tors into its price, af­ter all.

Watch­box’s ap­proach is vastly dif­fer­ent from that of tra­di­tional auc­tion houses and re­sellers in that they’ve aban­doned the con­sign­ment ap­proach and in­stead owns its en­tire pre-loved in­ven­tory. “We want to be able to stand by all of our watches and to pro­vide a 15-month war­ranty. But this also means we are able to com­plete a trans­ac­tion in 48 hours whereas you can ex­pect to wait nine months at an auc­tion house,” says Reis.

What­ever the ap­proach, the com­mon de­nom­i­na­tor is to build trust be­tween buyer and seller, some­thing that is a lit­tle hard to do through the likes of ebay for items in the hun­dred thou­sand dol­lar re­gion.

As for Lam, he re­veals that af­ter pur­chas­ing four watches off the plat­form, he’s since grad­u­ated from ebay and now scrolls through the pages of Sotheby’s on­line auc­tions, as well as B2C sites. “I’m on the look­out for a vin­tage Patek; I don’t want to keep bor­row­ing my dad’s ev­ery time I have some­thing spe­cial come up.”

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