Start watch collecting in 2022
A state of play, and some thoughts about how to get started
I originally wrote this about 9-10 months ago, following a conversation with a friend who runs Unekual. We never got around to using it, so I figured I would update it and share for those who might be starting out with watch collecting now (God forbid!). The purpose of this post is to set out the 'state of play' in the world of watches and to provide some food for thought ... hopefully useful to any budding horologist who might find themselves going down the rabbit hole.
State of play
After some advice from a friend, I will start by clarifying why a "state of play" section is included at all. The analogy I used was related to stock market investing and the economy... you wouldn't start a post about investing in stocks without some broader context on the economy within which this investment would take place... so that's what this section is - a very brief run through the last few years, from 'pre-hype' to 'peak-hype' and finally, today's more dubious market.
One aspect of the watch market which many collectors may still remember, is how recent levels of hype didn't really exist a few years ago. I distinctly recall seeing Rolex sports models in shop windows, and the ability to walk in and buy these pieces; sometimes, even at a discount. Today, this sounds like a fantasy world, and the grey market is flooded with these very same watches for multiples of the retail price. What changed? I would argue that social media had a lot to do with it, as these pieces became a 'symbol' of sorts. Rightly or wrongly, watches have come to signify success, access, wealth etc ... and it is no different with watches, than it has been with other similar luxury goods such as Hermes Birkin bags or Travis Scott Jordans. In particular, watches in steel were the first to take off - clearly, these were more accessibly priced at retail, and this allowed people who wouldn't ordinarily splurge on the watches to buy them, knowing they were unlikely to lose money. They could 'flex' with a luxury watch, and then sell it for a profit. Not rocket science, perhaps.
Once this practice was commonplace, there was a visible frustration in the collector community, as the folks who had been collecting for a longer period of time, begrudged the new lack of access, and in particular, were frustrated by how the entire 'hype' model buying experience was centred around making a profit; If you were able to spend more, you could buy more. Gone were the days of being able to buy what you wanted, when you wanted it. The new rules of the game were financially driven - pay to play - since the retailers could attach the most absurd conditions to a watch allocation. Watches of Switzerland in the U.K. even retained Rolex warranty cards to prevent reselling, but this was later reversed reportedly due to pressure from Rolex HQ.
Perhaps more interesting, was what happened with people's tastes, which now seemed to be formed in the echo-chamber that is social media. Steel sports watches were seemingly the thing which everyone "loved". Did they really, though? Or were they loving the ability to make 100%+ profit off the bat? Were they loving the praise they received for being able to land a 'grail' Patek 3-hander in steel? I have written about this many times, and I maintain that a large proportion of people slowly turned into sheeple - following the herd, and not their own tastes.
Nevertheless, the self-proclaimed 'astute' collectors turned towards independent watchmaking, an area where each buck spent is arguably returning far more in the form of craftsmanship (and arguably, relationships too). Independent watchmakers were more accessible, and at the time, willing to customise your watch to your heart's content - they were not hyped yet, and so they welcomed the attention and the business. There was no profit to be made on the grey market, but people bought these independent brands because they loved the watches. I know of several collectors who own some incredible unique Journe watches, simply because they loved the man's work, and wanted to own these watches with a touch of their own design - and Journe was happy to oblige, even sometimes flying across to the world to deliver them personally. Of course, those days are long gone - and today, Journe might offer these unique customised pieces to the older collectors, but at most, only one per year - and they probably won't entertain these requests from new collectors, because they simply don't have the capacity to meet the demand for normal watches, let alone special orders.
The same is true for the rest of the independent brands - demand has now skyrocketed for all of them, and even the previously lesser-known brands such as Czapek are now getting the recognition of the wider public - and I would say, deservedly so. Others, like Gronefeld have simply closed their order books for the foreseeable future, as they cannot meet demand and want to focus on delivery, as well as R&D. So, the sheeple of old, realised where the smart money went (to independent watchmakers) and they too, followed suit.
So now we're talking around the fourth quarter of 2021. Rolex was still catering to the masses and early-entrants to the game, as well as the seasoned buyers who had good relationships with their authorised dealers - and these watches remained an easy decision to buy. Of course, Rolex make good watches, there's no denying that. The independents were now firmly on the 'hype-train', and there were no signs of this slowing down. Players like Watchbox who are, for the most part, responsible for kick-starting the F.P. Journe hype, were now looking for their next candidate and seemed to have found one in De Bethune. Anecdotally, around this time I was offered an option of 6 different pieces from the brand (DB) at ~40% off, and then, suddenly, there were none available ... and the ones that were for sale were well above retail! Utter bullsh*t; this was artificial scarcity, and we'd seen it before with Journe. Smaller independents such as Sarpaneva and Laventure were cranking out pieces and production was allocated/pre-sold long before you saw it on social media, and the same was true for almost all others in this league. Even if it wasn't entirely pre-sold, the production numbers were (and remained) so low, that the watches sold out fairly quickly... and this remains true all the way down to the lower price brackets, as evidenced by Baltic's recent collaboration with A Collected Man which sold out in a minute or two.
Then came, the circus of 2022... from Russia invading Ukraine, to the U.K proving itself to be a true banana republic. There was definitely a shift in the market sentiment around the start of the second quarter, where the seemingly unstoppable rise of watch values came to a grinding halt... A correction event, of sorts. Gone were the days of happy hour valuations across all categories... and since this period, what I believe we see is perhaps best described as more cautious pricing. This Christie's auction, for example, is still catching up it seems, as their opening bids seemed to be out of touch with reality, and many lots closed unsold, or have not come close to exceeding their expectations.
Of course, many watches still remain prohibitively expensive, but a premium (rightfully) remains when it comes to genuinely scarce watches. We still find ourselves in a precarious situation, with winter looming in the northern hemisphere, energy costs eating away at disposable income, and recession forecasts across the world. What that might mean for luxury watch collectors is of course, an open debate... what I remain certain about is this: there will always be a 1% crowd who want the best watches and have the money to pay for this stuff. This 'recessionary environment' will be a buyers' market for the 1%... and all the folks who bought into the late hype of 2021 with fringe brands cashing in on hype, will get burned - assuming they bought for profit/hype exposure, and not because they loved the watches. I say that because, if you bought it without the intention to sell, then you don't really care what the value is, or where it is going next.