A macro of a Rolex Explorer II GMT.xrrr watch | iStock Editorial | Images
Many companies are vying to become the eBay of premium watchmaking, including the famous online marketplace itself.
The demand for premium watches has exploded during the Covid-19 pandemic. But the four major watch brands - Rolex, Patek Philippe, Audemars Piguet and Richard Mille - hold firm on the limited series that make their timepieces so rare. The result is an online boom in the business of buying, selling and turning over used and vintage watches and a growing number of start-ups are competing to become the dominant digital marketplace.
McKinsey estimates that used watch sales reached $ 18 billion in 2019 and could reach $ 30 billion by 2025. Used watch sales will be about half the size of the market retail new watches by 2025, conto be around a third today, according to the consulting firm.
"The used watch market still looks a lot like the Old West," said Toby Bateman, CEO of Hodinkee, a popular watch collectors site. "There are many platforms selling watches. And customers may not necessarily know who they are buying the watch from. They cannot guarantee that it is genuine. They cannot guarantee that it is genuine. is not a 'Frankenwatch. ' And they cannot guarantee that the watch is working properly. "
On Tuesday Hodinkee launched his second-hand watch store, here he goes buy and sell watches produced after 1990. The company - which raised $ 40 million in December from NFL quarterback Tom Brady, singer John Mayer, Apple alumnus Tony Fadell and investor Peter Chernin - aims to be the mThe world 's preeminent ark for all things w atches. "
Hodinkee Second Hand Shop will start with an assortment of 250 second hand watches and offer authentication and discount brand new from its state-of-the-art watch facility in Atlanta. Bateman said that Hodinkee's advantage over its growing list of competitors is its expertise and history as a trusted name in the watch business.
Nonetheless, rivals are attracting attention. investors. German company Chrono24 recently raised 100 million euros ($ 116). million) of investors including General Atlantic and Aglae Ventures of LVMH CEO Bernard Arnault. The investment valued Chrono24 at over $ 1 billion, making it the first 'unicorn' in the segment. The company said it carries around 500,000 watches from more than 3,000 retailers and more than 30,000 private sellers.
Meanwhile, Swiss company Chronext planned to raise around $ 270 million in an initial public offering, which would have valued the company at over $ 1 billion. Still, Chronext said last week that it was deferring its ut debt due to "unfavorable market conditions for high growth companies.
Chronext has set up a board of directors 'star administration - including the former Facebook chef marketing Gary Briggs and former Barneys New York CEO Daniella Vitale - and aims to expand in the US and Asia.
Companies like Watchfinder, WatchBox and Watchmaster are also expanding and looking to market shares. Even eBay is targeting the Rolex crowd, launching a guarantee of authenticity and targeting collectors of high-end watches.
The question is how long can the current watch boom continue and whether there are enough online sales for everyone. The four major watch brands that are the source of most premium collections are all privately owned and have maintained their low production numbers despite huge demand, in order to preserve their legendary quality and exclusivity. According to a Morgan Stanley report, Rolex sold 810,000 watches last year, while Patek sold 53,000 watches, Audemars 40,000 and Richard Mille 4,300.
Demand is expected to continue to exceed supply, at least in the short term. With stainless steel sports watches and other popular models almost impossible to purchase at retail, with long waiting lists and scarce allowances, aftermarket prices are rising. A Patek Philippe Ref. 5711 Green Dial, which sells for $ 35,000, was auctioned off in juillet for $ 490,000. The value of the Audemars Piguet Royal Oak 15500ST (blue dial) has almost tripled since 2017, reaching over $ 55,000, while the value of the Rolex Day-Date 40 has increased 76% since 2017 to reach more than $ 55,000. $ 50,000, according to Chronext.
Industry executives say the soaring global wealth, driven by stocks and crypto, along with a proliferation of Watch collectors and online information have spawned a whole new generation of young collectors who buy and sell watches online. Social media has also boosted sales, as more collectors like to display their Swiss status symbols on Instagram and TikTok. For watch buyers and sellers, start-ups and online marketplaces, it remains to be seen how many of these new traders will remain if prices and demand for second-hand decline.
" There's a lotmore people today who see themselves as collectors and enthusiasts than there were even a few years ago "said Bateman.