Seiko should stop cannibalizing Grand Seiko

I just don't get it. Seiko has spring drive movement watches priced at $5k, why would I buy a Grand Seiko for $9k with the same movement? On top of that limited edition with similar dial colors and case design. I understand having a value brand that attracts lower end customers, but Seiko creeping into Grand Seiko territory is just a dumb idea. I have 4 Grand Seiko in my collection, if Seiko keeps eroding any value it built in Grand Seiko I think its time to stop collecting Grand Seiko. 

https://seikoluxe.com/products/snr049

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By the looks of how the Grand Seiko Evolution 9 is priced there soon won't be many Grand Seiko watches to cannibalise at 5000$. Even the Spring Drive GMT which doesn't have a new generation of movements is MUCH more expensive than comparable older models...

I'm curious to see where this is going since you can find the Evolution 9 watches heavily discounted on the secondary market so I'm not sure if it's working and I'm also not sure if Grand Seiko can compete with Vacheron Constantin's Fifty Six as a whole package deal.

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They have done so in their home market for ages, and I don't think the Japanese cared all that much. Personally I like having options. The problem I see is the inverse, that buyers in the rest of the world are not understanding why they should pay GS prices for something with a Seiko logo, and the mid-tear remaining unprofitable for Seiko. 

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These moves can certainly tarnish the brand for many. Couple items:

  • I question how many they will actually sell at full MSRP, they get heavily discounted and take big drop offs on the secondary market.
  • There are ample GS with Spring Drives at the $5k level. If given the choice, most will opt for the GS.
  • While both are Seiko companies, they are run separately and in different factories, granted there is definitely overall corporate strategy and oversight to prevent each other from eroding sales. The GS factory has higher standards for materials, finishes and tolerances.

Lastly, if someone is strictly looking for a GS, they are likely not going to settle for a Seiko. If they are simply shopping for a Spring Drive, they may grab a Seiko for a couple grand less.

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I remember watching an episode of Top Gear, and Jeremy Clarkson, James May, and Richard Hammond were all sitting around talking about Aston Martin.

  • They pointed out that the gear lever or some such came from the Ford Taurus - this was back when Aston was owned by Ford 
  • Hammond started to say something along the lines of, "Well, I can imagine that an Aston owner might be peeved that the gear lever in his Vantage is the same as the one in a cheap Taurus"
  • Clarkson retorted, "There is not a single Aston owner in the world who has ever set foot inside a Ford Taurus"

If the spring drive technology is what is most compelling for you, ABSOLUTELY you should get it in the form of a cheaper Seiko, as opposed to paying more for it in a GS!

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AllTheWatches

These moves can certainly tarnish the brand for many. Couple items:

  • I question how many they will actually sell at full MSRP, they get heavily discounted and take big drop offs on the secondary market.
  • There are ample GS with Spring Drives at the $5k level. If given the choice, most will opt for the GS.
  • While both are Seiko companies, they are run separately and in different factories, granted there is definitely overall corporate strategy and oversight to prevent each other from eroding sales. The GS factory has higher standards for materials, finishes and tolerances.

Lastly, if someone is strictly looking for a GS, they are likely not going to settle for a Seiko. If they are simply shopping for a Spring Drive, they may grab a Seiko for a couple grand less.

There are ample GS with Spring Drives at the $5k level. If given the choice, most will opt for the GS.

Do you think that situation is here to stay though? I was under the impression that these cheaper offerings will be slowly phased out with the new generation of movements, along with much increased prices, taking their places.

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At least GS isn't putting Seiko movements in the GS models :-) 

Joking aside, I still feel like the experience of a Seiko vs a Grand Seiko are completely different.  I don't own a Seiko, but I have handled many, and think  many are great timepieces.  But in hand and on wrist they do feel worlds apart to me.  

I do think GS is generally moving up market though, and I feel like the return of King Seiko and some higher end Seikos will backfill those spaces left open by the GSs of the past.   

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MegaBob

There are ample GS with Spring Drives at the $5k level. If given the choice, most will opt for the GS.

Do you think that situation is here to stay though? I was under the impression that these cheaper offerings will be slowly phased out with the new generation of movements, along with much increased prices, taking their places.

Great question, my guess is they will have less and less GS at the $5k mark, but that’d be a mistake. The $5-$10k market is already so competitive.

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HotWatchChick69

I remember watching an episode of Top Gear, and Jeremy Clarkson, James May, and Richard Hammond were all sitting around talking about Aston Martin.

  • They pointed out that the gear lever or some such came from the Ford Taurus - this was back when Aston was owned by Ford 
  • Hammond started to say something along the lines of, "Well, I can imagine that an Aston owner might be peeved that the gear lever in his Vantage is the same as the one in a cheap Taurus"
  • Clarkson retorted, "There is not a single Aston owner in the world who has ever set foot inside a Ford Taurus"

If the spring drive technology is what is most compelling for you, ABSOLUTELY you should get it in the form of a cheaper Seiko, as opposed to paying more for it in a GS!

As a Top Gear fan, I love this. For me it is definitely more of a reason to not buy something. 

“Hey cool Ghibli, how do you feel much of the interior came from a Dodge Dart dealers couldn’t sell even at $12k?“ Would never even consider a Maserati as a result. 

On the other hand we’re a fickle bunch. I want a Lotus because it has a Camry engine. But then…I want the new Supra because it has a BMW interior vs. the Fisher Price interior of a Toyota.

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GS's strength is in design, execution, and technology. They lack luxury and exclusivity. Omega's moonswatch strategy is brilliant, it brings awareness of a luxury brand to new customers. OTOH GS needs to bring aspects of luxury and exclusivity to their brand. When a customer looks at Omega they don't think of MoonSwatch... same can't be said about Grand Seiko. This is madness, I can't think of any brand wanting to be in the luxury market that does this. 

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Wait until the spring drive hits the movement wholesale scene like every other Seiko movement does. Seiko does good but the Microbrands do better.

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watchdawg

GS's strength is in design, execution, and technology. They lack luxury and exclusivity. Omega's moonswatch strategy is brilliant, it brings awareness of a luxury brand to new customers. OTOH GS needs to bring aspects of luxury and exclusivity to their brand. When a customer looks at Omega they don't think of MoonSwatch... same can't be said about Grand Seiko. This is madness, I can't think of any brand wanting to be in the luxury market that does this. 

I always go back to this trusty chart.

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The proof is in the pudding.  

I remember joining WC back in December of last year, and one of the very first threads I saw had to do with how GS's branding and positioning were hurting it, and how the association with Seiko was muddying the waters for them.

Sure.  Maybe.   

But, as a corporate manager type, all I  gotta say is, "Give me more of that!"  I mean, you know, going from 23rd in revenue in the U.S. to 4th between 2016 and 2020, leapfrogging the likes of IWC, Panerai, and Tag Heuer in the process...  all while suffering horribly from the dreaded brand dilution!!!

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I will be very frank…as I watch three moths fly out of my just opened wallet: I can’t afford either one. If I could…boy oh boy would I get the Seiko (especially if I could get one with a textured dial). 

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Get the textured dial from Aliexpress and put it in any NH35 diver. Most all local watchmakers could swap it out for you.

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Several responses:

The movement is the not the only thing there is to a watch. There's fit, finish, design, and the ever elusive brand equity. A watch with an ETA movement can cost hundreds to thousands. It's not just about the movement. And I dare say that a $9,000 Grand Seiko goes well beyond a $5,000 Seiko on all those fronts.

Grand Seiko is quickly moving out of their low end. Barely over a year ago, you could get a Spring Drive at full retail for $3,800. Suddenly, over night, those watches disappeared, and were replaced by near identical watches for $4,800. I expect that trend to continue, and there will be less and less overlap.

Buyers of high end Seiko and low end Grand Seiko are not necessarily the same people. Someone looking at a high end Prospex sports watch may not be interested in the dressy sporty everyday watches that are the mainstay of the Grand Seiko Heritage or Elegance Collection, and vice versa. I'll say that I love me a Grand Seiko, and have and love a Spring Drive. I have pretty much no interest in what Seiko offers in a Spring Drive. They're just not my kind of watch.

@watchdawg They lack luxury and exclusivity.

What does that even mean? A Grand Seiko is less luxurious than an Omega, a Tudor, any other watch in the same price range? How? I won't mention Rolex, cause that opens whole nother can of worms. And what the heck is exclusivity when you can walk into an AD, plunk down the $5,000, and walk out with a $5,000 Grand Seiko, Omega, or whatever other brand you care to buy? All those watches are exclusive to the extent that some people can't afford $5,000.

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At this juncture and imo, Epson is moving into the luxury market (if it hasn’t) with GS plus discontinuing lower tiered GS. They may also be re-modeling Seiko (prospex line and above) as a premium watch brand to compete with Tudor, Longines, Oris etc all the while maintaining Seiko 5s as their entry door. 

As a fan and collector, I do not see the negative aspect of this as it gets more people into the hobby. Would I buy a premium Seiko? Maybe. Would I buy A seiko with Spring drive over GS? only if its below 40mm, otherwise, no… so you see, i believe theyre just providing choices, not necessarily tarnishing their brand image. Because if they are, shouldnt they stop providing Spring Drive to GS since it will affect the value and brand image of their haute horologie line known as Credor?

NB; No offence, but if you’re investing into GS, you’re already losing your monies worth.