Chapter I - Watch 101
Section III - Pricing Factors
Reasons that Affect the Price
After knowing various reasons for people’s selection of a watch, we are now going to analyze why there is such a huge price range for watches, ranging from the cheapest at a few of US dollars up to the incredibly expensive one at millions of US dollars. In general, factors affecting the price of watch are brand/manufacturer, movement, place of origin, material, craftsmanship, rarity, special meaning, trend, and etc.
Why some brands of watches are particularly expensive while other brands’ are especially cheap? Top brands usually have relatively long history and have contributed a lot for watch development. As aforesaid, Rolex has created the GMT watches for displaying times with different time zones, developed the Explorer watch for tough weather and environment, and has lots of achievements in refining movement. Cartier has developed the first piece of pilot watch and has started mass production of watch. Breguet, must mention, its founder Abraham-Louis Breguet, born in the 17th century, have many times in his life made improvements for watch movement. One of the top three mechanisms for watch, the tourbillon escapement, is also his invention. Watch produced by big brands like these are relatively expensive not only for its historical meaning, but also for its quality assurance and reliability. In addition, the manufacturing ability of brands, especially their ability in building their own movement, is also one of the major factors that positioning them at high end. Ability in modifying and refining movement will also place the brand at a high level. Big brands have rich resources for research and development, such as exploring and incorporating new materials into their design, and the development and invention of innovative features. Hublot is the first to introduce the rubber strap for watch in the 80s. At that time, he was a laughing stock of other brands. Today, however, rubber strap is popular among many various brands, either big or small.
In addition to timepieces made by big brands, watches made by those independent master watchmakers are especially valuable and precious too. Every independent watchmaker is able to build all parts including every screw and gear of a luxury watch by themselves. This also includes the extremely complicated Tourbillon watch. Challenge for today’s independent watchmakers, however, is no longer just the tourbillon. Harry Winston's Opus collection and Christophe Claret's Gamming Watches collection, for example, are fantastic workmanships which are so amazing that leave people stunned and speechless. It is the dream of numerous watch enthusiasts and collectors to own a masterpiece of these independent watchmakers. In addition to major brands’ and independent watchmakers’ high and strict quality demand, people can also find the passion and vision of them from their work. This is also reason why their timepieces are more expensive.
Small brands, in contrast, are lacking of historical background and achievement in the development of watch, and are usually unable to produce all parts of their watch, especially the movement, and thus their prices for timepieces are cheaper. Some of them are not only incapable of producing parts on their own, but also even lacking of demands for quality and craftsmanship. Also, there even some who just simply copy everything including the design from others, and brands like these, of course, cannot mark the price of their watches high. Nevertheless, there are those among small brands that have great idea and passion. Kaventsmann is among one of the best examples. His designs are all very bold and ground-breaking with a robustness sense, and most parts of his timepiece are handmade, which make his watch radiant with irresistible charm. At present, DELTAt is just a member of small brands, but we hope to move you all to share with us the joy of owning and appreciating a wristwatch by our passion, creativity and our persistent demand for quality.
One thing to note is, do not easily fall into the trap of branding fallacies. Among the most common is the so-called having long historical background, business registry in Switzerland or Germany, or the creation of a branding phenomenon. Product image is highly emphasized in modern marketing, and the easiest way to build an image for a watch brand would be to package it with a historical background, or register it in the country where there is a strong watchmaking background. Since 1970s, the popularity of electronic movement and quartz movement has caused traditional clock and watch brands, in large-scale, ceased to operate. Among them were brands with history of decades up to history of over a hundred years. To add a historical background to a new brand, the easiest approach is to acquire these brands that have already closed down or about to close down, and to establish and develop the “new” brand using the name of the acquired brand. Having said that, however, does not imply that acquisition of a watch brand is a deceptive act. Among all these acquisitions, there were some very outstanding and well performed leading brands. All we have to do is to be discerning about the historical background of a brand and not to be confused by it. Speaking of acquisition, we really have to mention conglomerates such as LVMH (Louis Vuitton Moët Hennessy), Richemont and Swatch Group. These conglomerate giants have acquired a number of world-renowned brands such as Bulgari, Cartier, Baume & Mercier, IWC International Watch Co., Vacheron Constaintin, TAG Heuer, Zenith, Hublot, Chaumet, Breguet, Harry Winston, Roger Dubuis, Officine Panerai, Blancpain, Jaquet Droz, Omega and Tissot, to name just a few! And the Swatch Group has even acquired the famous movement brand, ETA Manufacture Horlogere. The Swatch group’s decision made in 2011 to phase out the supply of ETA movements to rivals is a really bad hit for small brands like us. As to the country of registration and country of origin, it is even easier to create an image of a brand with these. Try to imagine, there is only 8 million people in Switzerland, and in Geneva, there is only 180 thousand people; however, the annual watch production from Swiss is countless. So, are all people of Swiss population working in the watch industries? Obviously, this is impossible. Some small brands do not even care to establish a background for their brands, and they just falsely claim their country of registration and country or origin online and make up their company history. We should not be misled by this kind of "image packaging". Therefore, when evaluating small brand watches, what we need to concern about are, in fact, their craftsmanship, passion, design, materials, aftersales service, concept, quality, etc., rather than a fictional history or so-called country of origin.
It should also be noted that pricing does not determine the size and quality of the brand. There are some expensive brands in the market which are lacking of a historical background or a prestigious origin, and have no quality in craftsmanship, materials, and designs. This is very unbelievable, but true. So before purchasing a watch, please try to learn more about the background of the brand that you are interested in.
Movement or Function
It is not too much to claim that the movement is the soul of a watch. The higher price of a watch, the more the movement is to be counted for its value. For the top ones, movement is almost everything of a watch. The value of a movement is depending on its function, polishing, accuracy, performance, design, complexity, etc. Although quartz or electronic movement have more functions in general, they are cheaper than the mechanical movement with the same function because they can be mass-produced easily in large quantity. For example, as to chronograph movement, quartz movement is more than ten times cheaper than the mechanical movement. Also, due to its characteristics, quartz movement has a much better accuracy than mechanical movement. Being cheap and accurate is one of the reasons why quartz movement has once almost destroyed the market for mechanical movement. It is not until mechanical movement regained its public recognition through its historical significance, craftsmanship and aesthetic appeal that it could shine again. In the beginning of this article, we have mentioned that it is very difficult to measure time precisely by the mechanical way. As such, adding another complication to the tiny mechanical movement besides the basic time telling function is even more difficult. As a result, the more complex it is, the higher its price. If more functions are packed into the movement, it will become even more complicated and will become even more expensive. As to Patek Philippe's 175th Commemorative Watch, for example, it has 20 functions, 1366 movement components, reversible case, 214 case parts, five chiming complications, 6 new patents, and more. The watch is fully handmade and it took eight years to develop and 2 years for making it. Such a stunning masterpiece costs US$2.6millions. Movements with ground-breaking designs may also become a valuable one, and Urwerk is among one of the best examples. The method Urwerk uses for time displaying is the revolving satellite complication on planetary gears. This completely breaks away from the traditional way of time displaying and is an unprecedented innovation! If wearing an Urwerk watch, one will definitely become the focal point wherever he or she goes.
Masterpiece as abovementioned, of course, can only be built by just a handful of brands or independent watchmakers. Second to it are brands with their own R&D and production line for movement. These brands can develop movements for different functions and different market needs. In general, they will price their movements according to the grading of its design, craftsmanship, function, performance, complexity, and polish. Brands with their own in-house movement, in general, use these criteria to price their watches. Again, second to this are brands that can modify existing movement to add on new features to it or to enhance its accuracy, which is more effective and cost saving than developing and building their own movement from scratch. All movements used for their watch are usually tested for months and are proven to be excellent ones. Brands need to have their own R&D ability and technical skills in order to be able to refine or modify a movement, so modified movement is at high end too. Ludwig Oechslin, curator of the Musee International d'Horlogerie (International Watchmaking Museum), MIH, has modified the 7750 movement with an annual calendar feature by just adding 9 components to it. The next to this are those who use ready-made movements. Price for ready-made movement is varied depending on its country of origin, function, quality, complexity, performance, etc. For instance, mechanical movement costs more than quartz movement; movement with more functions cost more than those with less; Swiss movement cost more than Japan movement. There are many movement suppliers and there are many brands such as ETA, Valjoux, Ronda, La Joux, Sellita, Soprod from Switzerland, Miyota and Time Module from Japan, and Seagull and Shanghai Watch Factory from China. Each brand has good and bad movements, so it is impossible to make a generalized comment on a movement provided just its brand name and price.
Polishing of a mechanical movement is not just for aesthetics reason only. In addition to aesthetic appeal, fine polishing can effectively reduce the friction between parts, making movement more accurate and durable. So, polishing skill, in a way, can demonstrate the craftsmanship of a brand.
In conclusion, price of watches is generally determined by the price of movements, and their prices are ranging from, the lowest to the highest, electronic watches, quartz watches, limited supplied mechanical watches, mid-level mechanical watches, in-house refined mechanical watches, high end mechanical watch, fully in-house made mechanical watches. With the same kind of movement, price of watch will be further determined by the movement’s craftsmanship, performance, polishing, number of functions and complexity, and country of origin. Regarding craftsmanship, the more handcraft procedures and intensive techniques involved, the more expensive it is. However, there are some types of watches which prices are not determined by the movement, such as jewelry watch, especially those that are set with precious gems. Their main emphasis is gemstones, stone setting skills and designs, and movement is secondary. For example, a diamond-studded Piaget's lady quartz watch is sold for US$110,000 in spite of its movement being a quartz movement. Other brands with emphasis on design, special taste, or fashion trend, value of movement may not be significant for pricing decision. So the value of a watch is actually depends on what you are looking for from this watch. As a small brand, we, DELTAt, will only pick the highest quality movement among those with the same price. We are obligated to make our watch, inside and out, with the best materials and craftsmanship, hoping to give you all a choice that is worth more than it costs.
Country of origin or registration
In the public mind, a Swiss made watch seems like a guarantee of confidence and quality. This is due to Switzerland’s pivotal role in the history of watches and clocks. Therefore, when naming it as Swiss made or Swiss registered, people usually have good impression for it. Follow next to it is Germany. German is known as the first to create miniature timepiece that people can wear on as pendant or a decorative piece, and its watch industry reached its peak during World War I. The United States during World War I and World War II took over the place of Switzerland and became the leader of watch industry. During the quartz crisis in the 1970s, Japan became the key player in watch industry. However, since mechanical movement revived again, Switzerland has regained its leadership in the watch industry. Today, in general, the prestigiousness of origin or place of registrayion is ranking from the top of Switzerland, then Germany, then US/UK/Italy/Japan, and then others.
There are two things that need special attention: First of all, country of registry does not equal country of origin, and a brand registered in Switzerland can have its production in China. In addition, even if it is labelled as Swiss made, that does not necessarily mean the watch is made with high quality materials or craftsmanship. Watch plants In Switzerland are much varied in standard, so watchmaker from Switzerland is not necessarily a high end watchmaker. For the use of the name Swiss made on watches, watch company only has to meet with the following requirements (requirements would be modified with time, so you just need to understand the concept): movement must comply with the Swiss made standard; assembly of watch and final inspection must be completed in Switzerland; as to mechanical watch, at least 80% of the production cost is attributable to operations carried out in Switzerland (including movement); for electronic or quartz watch, at least 60% of the production cost is attributable to operations carried out in Switzerland (including movement). Generally speaking, movement is accounted for the largest portion of the cost, so one can meet with the Swiss made standard by using a Swiss movement and having a Swiss watch plant to assemble the watch. There are brands that have obtained the Certificate of Origin from Switzerland for their first batch of production, and thereafter, all their productions are not truly Swiss made. Nowadays, passing off fake products as genuine by this method are happening everywhere. So the first thing we need to think about is what does the label Swiss made represent. Of course, the position of existing high end Swiss watch is still cannot be shaken. Is it because it is Swiss made? According to Maximilian Büsser, founder of MB & F, position of existing high end Swiss brands could not be shaken is because they are so big, not because they are Swiss made. So how big is big? Swatch Group’s net income in 2014 alone is 1416 million francs, and Richemont’s is 2067 million Euros!
Second thing we need to pay attention to is its place of origin. In todays’ trend of internationalization and conglomeration, brand acquisitions are very common on one hand. In 2013, Chinese watchmaker Haldian Holdings purchased Corum. This is the first time a luxury Swiss watch brand was acquired by the Chinese. On the second hand, some brands will centralize production of most parts by one factory or to outsource parts from third parties in order to reduce cost. This contractor or third party may be located in India or China, or somewhere else. In this case, it is difficult to trace the origin of part, or even the brand. In fact, as we are based in Hong Kong, I am stunned by what brand logos I have seen engraved on parts or even watches when visiting a wide variety of watch factories! Hong Kong is the world's second largest exporter of watches and clocks, but globally, there only less than 1 percent of watches that are labelled as Hong Kong made. So what do these figures imply? Does mark of origin really matter as it is before?
Using different materials for different parts will also affect the price of the watch. The most direct cause is the cost of materials. For example, cost difference between the use of plastic and the use of sapphire crystal for watch glass is a hundred times, and cost difference between the use of plastic and the use of titanium for watch case is hundreds or even thousands times. There are also various parts such as straps, dial, hands, luminous, decorative components, etc., that might affect the price of watch. Without taking into account the cost of movement and the overall craftsmanship, cost difference between a watch made with all cheapest materials and the one made with all most expensive materials is tremendous, and cost difference will somewhat reflected in selling price. Generally speaking, cost of material is depending on the quality, rarity, production or processing costs. For instance, gold is more rare than steel, so its price is more expensive than steel. Production cost for sapphire crystal is more than that for the glass, and its hardness, clarity and durability is much better than those of the glass; therefore, sapphire crystal is more expensive than glass.
Since big brands have sufficient resources and sales assurance, they have more flexibility than smaller brands regarding materials choices, and can even develop and create new materials. In contrast, small brands are lacking of resources and are uncertain about sales performance, so they have serious limitation in material choices. Therefore cheap watches, in general, are usually made of inexpensive materials. Despite being a small brand, DELTAt will not bent on using cheap materials. What we choose to use must be the top material, such as sapphire crystal, 316L stainless steel, aluminum bronze, titanium, top leather, etc., in striving to craft you a stunning piece without hesitation.
Craftsmanship and Structure
Not only will the complexity of craftsmanship and structure of the movement affect the price of the watch, craftsmanship and structure of watch will also affect the price. Let’s start with craftsmanship. In appearance, a luxury watch must have a high end polishing and cutting. All edges have to be sharp but not abrasive. That is having a sharp looking, but not a cutting feeling when touched by hands. Poor polishing will make edges round, but not sharp, or edges too abrasive that will cut your hands. No matter what polishing technique is used, it is important to rub it in the same direction with average force and cover the entire surface evenly. Poor polishing is uneven and might leave unnecessary arcs in some areas due to a poor control of force. Based on appearance, quality of two identical watches can be differentiated by sharpness of its edges and quality of polishing. In general, the simpler of the case designs, the easier for us to examine its quality of craftsmanship and polishing technique. Of course, the more advanced of techniques are being used, the higher the price of a watch.
As to the structure, a good structure will make a watch very stable and not easily to fall apart, and the connecting point will be very tight and not showing any obvious gap. On the other hand, a watch with structural problem may fall apart very soon after being worn. I once have a US$200 watch, its bezel fell off after being worn for just a month. For a watch with a complex structure, the more components, edges and cuttings it has, the more expensive it costs because more advanced of craftsmanship and polishing are needed. Linde Werderlin’s watch design involves lots of cuttings, so you can easily tell it will not cost less. There are also some special structures such as IWC Aquatimer’s Safe Dive system and internal rotating bezel system, and IWC Aquatimer Deep Three’s mechanical depth gauge system. These are complex structures with a high price tag.
Furthermore, there are structure and assembly of hands, assembly of movement, structure and assembly of dial, quality of plating (PVD), and so on. For some structure and craftsmanship, it is difficult to count on our eyes in telling the quality. Another watch I have had stopped functioning after being worn for a few months, after opening it up for a checkup, the dial-foot was not attached to the movement. To put it correctly, the dial foot was actually missing. As a result, movement has slightly displaced as time goes by and the hand is therefore pressed towards the gap on the side, and thus it has stopped running. It is unbelievable that such defect is found in sale products in today’s market! However, the most scaring part of it is that such kind of defects cannot be detected by eyes at the time of purchase! Therefore, when choosing a brand without fame, it is better to check out comments on it by others.
What we are referring here is not the feature of movement, but the special features of the case or strap. Some simple functions can be achieved by a rotating bezel or watch dial, or a specially calibrated dial. The commons are tachometer, telemeter, pulsometer, and unidirectional rotating bezel. There are also pilot watches such as Breitling’s Navitimer 01 and Longines’ Lindbergh Hour Angle Watch. The former has implemented a slide-ruler (the bezel) to the watch to help pilots quickly making simple calculation, whereas the latter is to use wireless broadcast signals to calculate the current longitude. For the more complex ones, we have already mentioned earlier two examples with special features from the IWC Aquatimer collection. Also, the Helium Escape Valve, which was jointly developed by Rolex and Doxa in the 1960s, can effectively prevent the watch from damages due to helium trapped inside the watch expanded when pressure dropped during saturation diving. Another one we have to acknowledge is the Breitling Emergency collection. This collection of watches equipped with a personal locator signal device (Personal Locator Beacon, PLB), after activation, it will send out SOS signal to guide rescuers to the location for rescue. Further to this, Linde Werderlin’s diving watch has an additional dive digital device that can be clipped on to the watch. Although these two additional features are electronic, their functions and selling point are making them really not cheap. There are also some very exceptional functions. Snyper watch, for instance, has optional modules such as the laser targeting beam module (not for sold anymore) and the windproof lighter module (which resembles a targeting device) that can be clipped on to the side of the watch. To name a watch with a bizarre feature, the fold out knife integrated to the Sicura Safari knife watch is second to none! Generally speaking, as in the case of movement, a special function of the mechanical watch is more expensive than the same of the electronical one because of the higher level of difficulty and craftsmanship needed for making it. There is, however, no standard pricing guideline for special functions. It is reasonable for a special feature with practical value or historical meaning to cost more. However, does a ruler still have much practical value today? How often you have seen people using a speedometer or a distance meter? Is it really a good idea to clip on a lighter to a watch? How many people will appreciate the idea of integrating a fold out knife inside a watch? Eventually, it is all up to the buyer to decide on the value of the function; as long as you like it, it’s worth it. To be honest with you, I am one of those who appreciate the bizarre idea of Sicura Safari!
As expected, the more rareness of a watch, the more it will cost. In another way, the greater demand of a watch, the higher it will be priced. These are exceptionally true for the second-hand market. For example, watches with limited production targeted by collectors are tended to be expensive because its demand is often much greater than its supply. However, what are the most sought-after watches for collectors? This is actually a big question and no one can really come up with a perfect answer. In general, the followings are conditions taken into consideration: fame of brand, quality, specialness of features, historical significance or special meaning, rare production, lack of liquidity, favorable economic environment, in line with the trend, and so on. At first sight, there is no relationship between economic environment and the market trend, but in fact, there really is. Watch sales is correlated to economic health. When there is an increase of economic activity, watch sales has experienced growth accordingly which lead to an increase in watch prices, and vice-versa. Market trend, as well, will affect the sales of certain types of watches. When a particular style is popular, this style will certainly become a hot sales item. Therefore, the value of the same watch may vary according to the general tendency of economic environment and market trend, and won’t go steady up or steady down forever. The age of watch, in contrast, has a very limited account for its price. Most people think that the earlier the watch is made, the more it is worth, but this is not necessarily true. Even for luxury brands, not all watches they produced have a potential increase in value. Some famous brands have watches made over 30 years with market value much lower than their actual price. So there are other criteria for old watches to be sought out by collectors.
As to new watches, what determine the rarity of them? Production of a fully in-house made and designed watch by brands and independent watchmakers is relatively small. And if it is completely handmade, than the production will be even less. Nowadays, however, many brands have learned to limit the production of certain models in order to create a sense of rarity of them in the market. This is not only a small trick used by small brands, but also some big brands. Some big brands will produce a limited edition model with limited quantity such as 1500 pieces; however, they will make a collection of tens of this model each year. So tens of tens of this collection with limited quantity of 1500 pieces for each model will come up to an annual production of tens of thousands pieces of this collection. Therefore, we have to be discernable about the underlying reason for limited production. Is it because of a limitation of skills? Or, a limitation of resources? Or, a numerical significant of production quantity? Or, it is just simply a purpose to limit the quantity of production to make it looks rare? There are actually more we should appreciate about a watch besides the quantity of production. Without fame, I believe no one will appreciate a limited timepiece of five with no concept, no quality, and no uniqueness in design.
Special Significance of the Watch
A watch with special meaning attached to it is usually more expensive than those without. Special meaning for watches can be divided into 3 main categories: Firstly, it is the historical significance or the commemorative value of the watch itself; secondly, it is the commemorative value assigned to a watch for a certain historical or memorable figure or event; and thirdly, it is the special meaning or emotional value of the watch for a person or a group. The historical or commemorate meaning of a watch itself refers to the significance of the model or collection of this watch in a history or event that is memorable. For example, Cartier Santos, Rolex GMT, and Rolex Explorer, as mentioned earlier, are all having a significant role in the history of the watch industry and are milestones in the development of watch, and thus they are the hottest and the most famous watches of their generations. In addition, the Omega Speedmaster is the first watch landing the moon. In July 1969, Apollos 11 first launched the moon and Neil Armstrong is the first mankind to walk on the moon, which is an important milestone of the aerospace history. Therefore, the Omega Speedmaster, worn by Neil Armstrong in this pioneering work, is adequately enough to commemorate this historical milestone.
For some other watches, the purpose of its production is to assign them a significant commemorative value, and it could be of anything. There are watches made to commemorate a specific date and the previously mentioned Patek Philippe 175th Commemorative Watch, for instance, is to commemorate its 175th anniversary. There are also pieces that are made to commemorate a person, such as the Royal Oak Offshore LeBron James made by Audemars Piguet to commemorate a basketball superstar. There are also commemorative watches for films, such as the Royal Oak Offshore T3 launched by Audemars Piguet to commemorate the movie Terminator 3. And oh yes, by the way, we have also made the SoRa The First Flight to commemorate Alberto Santos Dumont’s contribution to the watch industry!
The act of commemorate is sometimes seemed to be a little bit abused by the industry today. For those I have seen, the one I most cannot relate to is the one made to commemorate a nearby dune from home! For all kinds of commemorative reasons, whether it is meaningful or not, depends on whether you can connect with what is being commemorated. Also important is the brand’ sincerity, that is, for example, whether the design, quality and craftsmanship of the watch itself are corresponding to the value of the watch. Back to the commemorative piece for the sand dune near home, sales performance of it is in fact not bad. It is because the watch has a unique design, plus its customers are mostly residents nearby this sand dune and thus they can connect with the commemorative value of the watch.
Special significance of a watch does have an impact on pricing. When a watch has a special meaning for you as an individual or a group, then you may be willing to pay a little more for it. For instance, if you have had a sweet and memorable puppy love and have received a Swatch watch as your first Valentine's Day gift, you probably will fall in love with this particular model or brand for your whole life and are willing to pay a lot more for it.
Fashion Trend, Watch Design and Market Demand
In general, for those watches aimed for the fashion market, their trend of style is just like the trend of fashion which evolves in a cycle of emerging, peaking and falling out. For example, there was a time the trend for watches was a slim and classy style, and then in another time, the big hit is the huge and robust style. The trend of fashion, design, and market demand are inextricably linked, and are closely correlated. The trend will affect the direction of the design, and a unique design will also lead the trend; Trend will affect demand, while at the same time demand will decide the direction of design; when a style becomes popular, demand for it will be substantially increased and its price will go up corresponding, and vice versa. Whether which style will become popular and which style will be falling out are really not easy questions to answer, but we may able to glimpse a slightest clue by looking at some cases from the past. Since the establishment of Officine Panerai in 1860, its overall rising is indeed attributed to movie star Sylvester Stallone in spite of its history of over a century. When filming the movie Daylight in Rome in 1995, Stallone bought a Panerai Luminor from a jewellery store. Because he really like this watch, he bought a small batch of it, have the bottom cover of each engraved with his signature, and named them Slytech and giving them to friends and relatives as gifts. This making the Panerai's a big hit! In recent years, SevenFriday is one of the fastest rising new brands, its unique and innovative designs of watch dial are essential for its rise. The dial design of its V-Series is almost magical. It is built with an ordinary movement, however, with a skillful and ingenious way of layout, it deceives our vision and making us thought that it needs a special movement for doing so. The designer of it is actually a magician for watches! Its last two series of watches have already become the “reference” of a lot of other brands, and the V-Series will definitely lead to another trend of imitating the SevenFriday.
Other watches may have designs inspired by things that may connect with you. Some designs are inspired by sports car, some are by military devices, and some are by the nature, etc. Devon has launched a watch which inspiration for its design is from Darth Vader.
Integration of art
Art is priceless, its value cannot be measured by money; however, anything integrated with the elements of art, its price will increase accordingly, sometimes the increase is exponentially! In the watch industry, handmade movement itself is already a piece of art, so it is not cheap. The more complicated a handmade movement is made, the more artistic attainment in it. But in what way can we incorporate the art element into a watch besides having it built with a handmade movement? Basically, it cannot be done without having any hand-craftsmanship. For example, having the watch built with a hand-carved watch case, or a hand-painted watch dial, or a hand-made strap, and so on. Some artistic timepieces required special skills, extensive craftsmanship, and a great deal of time. Enamel painted watch dial (cloisonné dials), for instance, can only be fine made by a handful of major brands due to these harsh requirements. A very good example of an artistic hand-crafted timepiece with extensive craftsmanship is the Roger Dubuis Excalibur Round Table. Its 12-hour index is marked by twelve 3-Dimensional sculptural knight figurines casted in gold with details crafted and finished by hand. Wearing the Excalibur Round Table is like wearing a mini memorial hall of the Knights of the Round Table on the wrist. In general, the more skills are required, the higher it will be priced, of course. DELTAt has recently partnered with Hong Kong artists, Yplus7880, on a series of art watches, hoping to introduce and share their creativity in art to all art lovers in the world through our timepieces.
Remaining factors that will affect the price of a watch include R & D costs, marketing and promotion expenses, packaging costs, operating costs, profit sharing with retailers and wholesalers, etc. These costs are reflected in the price. For large brands, marketing and promotion expense is at least tens of millions of dollars. You might wonder if they could reduce the price of watch by omitting this expense. Theoretically, it could be. However, promotional campaign is not only used to market their watches, but also used as a way to showcase and retain their brands’ power and position in the industry. Without a large-scale of marketing campaign, the image and publicity of the brand will definitely decline substantially. Therefore, watch price of premium brands is including the cost for building and maintaining their brand image. Occasionally, we heard people saying that they know the cost of a watch and asking why the price of it is way much higher than its actual cost. So are watch brands really making huge profits? What people may know is the cost of components, materials and movement, and these are all they use to calculate the cost. Hereby, I can tell you for sure, if brands are all using this standard to price their watches, none of them can survive. There are also other hidden cost including opportunity cost that others may not know, and especially for small brands like us, you really cannot imagine how low our profit is. It is the passion for watch that keep us going.
I hope after reading this article, you can come up with a basic understanding on what factors that are affecting the price of a watch and will no longer be fooled by those brands that recklessly mark their price. Some brands in the market mark their prices unrealistically high for no reason. For this kind of brands, I believe you will no longer hold on to your belief of the higher the price, the better the quality. I hope you will also understand how to appreciate or evaluate different watches at different price levels, identify the value of each watch, and know whether it worth what it costs. Regardless the price of a watch, as long as you like it and it worth it, then it should be okay.