Denis Diderot's Theory of Our Desire to Consume, Consume, Consume.
I was reading an article on Fratello this morning and found this somewhat fascinating, and unfortunately, I can relate a bit too much. The article also goes on to talk about watch companies continuing to raise and raise their prices. I'm curious to hear all of your thoughts on the subject.
"The reason I am talking about Denis Diderot is because of a phenomenon he identified that has since become known as the “Diderot effect.” He first acknowledged it in his 1769 essay “Regrets on Parting with My Old Dressing Gown.” It recounts the author’s experience of how getting a beautiful scarlet dressing gown as a gift and discarding his old one led him into a spiral of debt. While he was initially happy to have received the gift, Diderot came to regret it. This was because, compared to his new dressing gown, the rest of his humble possessions began to feel gaudy and cheap. Thus, he began to consume, consume, and consume some more.
Diderot replaced an old straw chair with an armchair covered in Moroccan leather, a desk with a pricey new writing table, and so it continued: “I was the absolute master of my old dressing gown,” Diderot said in his essay, “but I have become a slave to my new one … Beware of the contamination of sudden wealth. The poor man may take his ease without thinking of appearances, but the rich man is always under a strain.” And so Diderot identified the phenomenon that acquiring a new luxury possession can lead to a spiral of consumption that results in the acquisition of even more. If we replace the word “possession” with “luxury watch,” you will see where I am going with this. "
Link to full article on Fratello: https://www.fratellowatches.com/are-rising-watch-prices-changing-the-playing-field-for-enthusiasts/
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There is apparently no emoji to signify thoughtful…very interesting read.
There is apparently no emoji to signify thoughtful…very interesting read.
Very interesting indeed.
It's definitely something to consider. For example, I have a shot at a used Black Bay 58 for $3500 - which is about the used market going rate right now
But then, I tossed my Orient Kamasu back on a strap and have been wearing that since last evening.
Both are divers, both 200m rated, both COSC accurate (albeit the Kamasu isn't certified, it's just a unicorn), both tell the time.
The Orient even has a day/date to boot.
And the Orient is $280. About one tenth the cost of the Tudor.
The question is, is the Tudor an order of magnitude better?
Or am I caught up in this effect and marketing influence?
🤔
It's definitely something to consider. For example, I have a shot at a used Black Bay 58 for $3500 - which is about the used market going rate right now
But then, I tossed my Orient Kamasu back on a strap and have been wearing that since last evening.
Both are divers, both 200m rated, both COSC accurate (albeit the Kamasu isn't certified, it's just a unicorn), both tell the time.
The Orient even has a day/date to boot.
And the Orient is $280. About one tenth the cost of the Tudor.
The question is, is the Tudor an order of magnitude better?
Or am I caught up in this effect and marketing influence?
🤔
All very valid points! A year ago I was really only looking at the higher end brands like GS, Tudor, Omega, etc... As of late, I've been looking almost exclusively at watches that can be purchased for well under $1000. It's been refreshing to find cheaper watches that bring loads of enjoyment. It's proven to me that dollars spent doesn't always equate to more enjoyment.
I thought it was a great read and resonated a bit too close to home. I remember buying my SKX thinking it was the end game for me. Than it became a Sinn 104. Then a Nomos. Than a Tudor. What I’ve come to realize is the quality difference between a $4000 watch and a $10,000 watch isn’t nearly as substantial as the quality delta of a $500 watch vs a $2500 watch. Its all about finding the right limit where you have to say I’m not crossing this line financially.
Parsing a lot of watches and keeping what I want to wear for decades not months broke the cycle. I was fortunate enough to be able to afford this watches but the need to get a better watch than the one before is being perpetuated all over the place.
I've definitely fallen prey to this, but only when it comes to watches. I still drive a 12 year old car, still wear reasonable clothes, etc.
I have pretty much replaced all my sub $200 watches with watches around the $1,000-$2,000 mark as my income has increased. What I haven't done is jump to the >$5,000 realm and I haven't grown my collection. It's still one in, one out and I don't consider a $5,000 diver if I have a $1,000 one that I love immensely. So, it's a controlled obsession to some degree.
I feel like I'm slowly getting priced out of this hobby. Watches from all the brands I enjoy including Tudor have seen a ridiculous amount of inflation that sometimes it's almost criminal! It has really put me off from buying from boutiques and ADs no matter what drinks, freebies, merch and experience they're offering nowadays. I've since gone the grey and pre-owned route and have never looked back. It's a bonus that most of the watches I'm usually interested in tank in value on the secondary market 😎
I sometimes wonder about the watch enthusiast world and how this effects us. On one hand, I learned about so many brands and styles I would have never known about. On the other, the push towards your tudor/rolex/omega brands is wild.
I have a very expensive watch, but I feel like I'll fill the rest of my collection with the $1k-3k range.
As with anything, we should self reflect. Make sure we are buying things we like and not because we feel a weird obligation to do so.
I feel like I'm slowly getting priced out of this hobby. Watches from all the brands I enjoy including Tudor have seen a ridiculous amount of inflation that sometimes it's almost criminal! It has really put me off from buying from boutiques and ADs no matter what drinks, freebies, merch and experience they're offering nowadays. I've since gone the grey and pre-owned route and have never looked back. It's a bonus that most of the watches I'm usually interested in tank in value on the secondary market 😎
"I feel like I'm slowly getting priced out of this hobby."
You, me, and many others feel this way. The price increases we are seeing go well beyond typical inflation. I think that in 5-10 years the brands that have raised their prices like crazy are really going to start feeling the negative effects of their greed. I think it's going to pose a serious problem for the luxury watch market. I can only speak from experience, but 3 years ago I would've bought any new watch from Omega, whereas today, I don't even look at their website. I'd still consider buying one, but it would be used, which means Omega gets $0 from me. In this case, I still get what I want and Omega looses out. Once enough people have this thought process, the brands are really going to suffer.
I sometimes wonder about the watch enthusiast world and how this effects us. On one hand, I learned about so many brands and styles I would have never known about. On the other, the push towards your tudor/rolex/omega brands is wild.
I have a very expensive watch, but I feel like I'll fill the rest of my collection with the $1k-3k range.
As with anything, we should self reflect. Make sure we are buying things we like and not because we feel a weird obligation to do so.
I'm with you 100%. I have 1 watch that we will call my "stretch watch" because it was wayyyy more expensive than any other watch I've ever bought. I can't see myself ever spending close to that again, nor do I feel the need.
"I feel like I'm slowly getting priced out of this hobby."
You, me, and many others feel this way. The price increases we are seeing go well beyond typical inflation. I think that in 5-10 years the brands that have raised their prices like crazy are really going to start feeling the negative effects of their greed. I think it's going to pose a serious problem for the luxury watch market. I can only speak from experience, but 3 years ago I would've bought any new watch from Omega, whereas today, I don't even look at their website. I'd still consider buying one, but it would be used, which means Omega gets $0 from me. In this case, I still get what I want and Omega looses out. Once enough people have this thought process, the brands are really going to suffer.
How did you know I was hinting at Omega??😜 My experience in this was actually with the SMPc where in 2018 I bought a blue dial brand new on bracelet for below $5k which eventually left my collection. Then when the green dial came out I was so sure that I'd be buying it...until I saw the MSRP. I just can't justify paying an extra ~30% for the same exact watch. Funny thing is the grey market in Asia hasn't reflected it and still gives a more fair value.
I thought it was a great read and resonated a bit too close to home. I remember buying my SKX thinking it was the end game for me. Than it became a Sinn 104. Then a Nomos. Than a Tudor. What I’ve come to realize is the quality difference between a $4000 watch and a $10,000 watch isn’t nearly as substantial as the quality delta of a $500 watch vs a $2500 watch. Its all about finding the right limit where you have to say I’m not crossing this line financially.
Parsing a lot of watches and keeping what I want to wear for decades not months broke the cycle. I was fortunate enough to be able to afford this watches but the need to get a better watch than the one before is being perpetuated all over the place.
Agreed, I think the YouTube channel "This watch, That watch" talks about this.
In his opinion, once you get above ~$2500-$300 the returns start to get harder and harder to see.
Once you break ~$5000 they get REALLY hard to see.
I feel like I'm slowly getting priced out of this hobby. Watches from all the brands I enjoy including Tudor have seen a ridiculous amount of inflation that sometimes it's almost criminal! It has really put me off from buying from boutiques and ADs no matter what drinks, freebies, merch and experience they're offering nowadays. I've since gone the grey and pre-owned route and have never looked back. It's a bonus that most of the watches I'm usually interested in tank in value on the secondary market 😎
Exactly. A NiB Grey market watch at a 40% discount vs new is A OK in my book especially if the movement is "common" and not something that ONLY the manufacturer can service.
Or a gently used watch ay nearly a 50% discount form new with comments from the original owner on how accurate it is in day to day life
Interesting article. Glass half full for the inability to get Rolexes at retail. Getting my grail Speedy got me into the hobby so I immediately got myself on the list for a Pepsi and started looking at other Rolexes. If they were available, I’m sure I would have experienced the Diderot effect in full and picked up a Rolex or 2 and moved upstream and ruined my retirement savings.
Because they weren’t, I bought a Seiko or 2, some Micros, Bulova, etc. to scratch the itch and keep the powder dry for when “I get the call” (5+ years in and no call). Funny thing is, like many of us, I enjoy the Seikos, Micros and others just as much and realized I enjoy all watches, not just the expensive ones or hype pieces so no Rolexes or better and more watches and travel.
Never test drive a too expensive car.
Don’t fix a room without money for your wife’s new curtains and furniture.
Never test drive a too expensive car.
Don’t fix a room without money for your wife’s new curtains and furniture.
Solid advice. I've had many hobbies over the years and quickly learned not to test out things that were out of my price range. It just creates a desire for something I can't have.
Hey Luke,
Very insightful read, thanks for sharing mate!
I would hazard a guess that as volume goes down, prices have been increased to keep revenues growing. Pricing yourself out of volume decline is great but it’s inherently a temporary strategy as the end result is volume will have gone down so much that you not only lose current year sales but also future year sales. But it’s hard to quantify those future sales, much easier to build financial models based on short-term trends.
I have been on the pre-owned route for a while. All my Tudors and Omegas are pre-owned. The same applies to a CW and also some Seiko. They all drop in price. The same applies to Grand Seiko, Longines, and many others.
Hey Luke,
Very insightful read, thanks for sharing mate!
I would hazard a guess that as volume goes down, prices have been increased to keep revenues growing. Pricing yourself out of volume decline is great but it’s inherently a temporary strategy as the end result is volume will have gone down so much that you not only lose current year sales but also future year sales. But it’s hard to quantify those future sales, much easier to build financial models based on short-term trends.
You’re welcome! Good points you make here. These companies are certainly benefiting in the short term by raising prices but it’s not sustainable at this rate. Being luxury brands, they can’t really just lower the price as it devalues the brand, and they have to protect the brand image at all costs. Brand image is always priority #1 for these luxury companies so just simply lowering the price isn’t going to work out well for them. They can come out with new models and price them cheaper but the models that spiked in price are going to stay that way.
You’re welcome! Good points you make here. These companies are certainly benefiting in the short term by raising prices but it’s not sustainable at this rate. Being luxury brands, they can’t really just lower the price as it devalues the brand, and they have to protect the brand image at all costs. Brand image is always priority #1 for these luxury companies so just simply lowering the price isn’t going to work out well for them. They can come out with new models and price them cheaper but the models that spiked in price are going to stay that way.
Exactly, and that creates a really interesting dynamic which we’re actually seeing in other fashion markets. Brands like Hermes whose usual clientele are relatively immune to the business cycle are doing well (+24% YTD) while those that are more aspirational like Kering (-11% YTD) or even Lululemon (-28%) are not doing so well.
I wonder if the same dynamic is playing out with watches. Places like Rolex probably are still doing well but how is Tudor or Longines going? Those two brands have spiked prices quite a bit that it’s now hard to call them “value” offerings.
Probably something to do with how do you condition your dopamine. (and I disagree with all the "get rid of dopamine addiction bs because the dopamine itself is the addiction and addiction itself is human motivation /mechanism)
With this in mind a lot of people says (sonce you cannot escape addiction which is a healthy human condition) you should be addicted to good things. (and this can goes along the way of collecting small wins, building good habits and stuff that's going to sound bs but it make common sense)
anyway will check the article for sure looks super fun to read
Exactly, and that creates a really interesting dynamic which we’re actually seeing in other fashion markets. Brands like Hermes whose usual clientele are relatively immune to the business cycle are doing well (+24% YTD) while those that are more aspirational like Kering (-11% YTD) or even Lululemon (-28%) are not doing so well.
I wonder if the same dynamic is playing out with watches. Places like Rolex probably are still doing well but how is Tudor or Longines going? Those two brands have spiked prices quite a bit that it’s now hard to call them “value” offerings.
Based on the Morgan Stanley Swiss watch industry report released earlier this year - Tudor and Longines aren’t doing that great. Rolex, Patek, Richard Mille (maybe Cartier) - they’ll be fine. Everything aspirational south of that elite crowd are going to be hurting this year and next.
Based on the Morgan Stanley Swiss watch industry report released earlier this year - Tudor and Longines aren’t doing that great. Rolex, Patek, Richard Mille (maybe Cartier) - they’ll be fine. Everything aspirational south of that elite crowd are going to be hurting this year and next.
Hey Ro,
Thanks for sharing a link to that report. It makes sense to see the same dynamic as what we saw in clothing/bags playing out in watches.
I hope the folks at Tudor and Swatch Group are keeping a pulse on the watch buying community. Enthusiasts like us but also general buyers. If enthusiasts are having a hard time justifying the prices a watch brand is charging, you can be sure that the average person will feel the same.