the business of marketing watches ?

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JohnFiscal
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the business of marketing watches ?

Post by JohnFiscal » Tue Dec 01, 2015 2:17 pm

I am interested as a consumer in the business of selling watches: manufacture, marketing, etc. This applies to what I'll call mid-range watches with better quartz movements. Not talking about expensive Swiss, etc, watches with mechanical movements.

So, department stores like Macy's and Dillard's sell these "designer" watches for essentially MSRP, although they are able to mark these down by 50% quite often. Consider, say, an Anne Klein lady's watch. Now I could buy this at the mall for full price, or half-price if it's on sale. Or maybe I can buy the same model at Costco for less than 1/3 of the MSRP...Costco, Sam's, et al, often have huge displays of these watches at the holidays for very, very low prices. The prices are so low that it influences my perception of the brands on display...that they must be a cheapie make (now, talking about Anne Klein in particular, I have been very pleased to get my wife some exceptionally fine silk scarves over the years, so I know that this is not, in general, a "cheap" brand).

Then there's Amazon. I have bought some nice watches there in the past, but these days, I don't know what you're going to get from them, I think it's going to be highly variable with respect to the quality of the product and packaging (who wants to give a gift watch that's not in the designer's packaging?). The street prices for "designer" quartz watches range from 1/3 of the MSRP to full MSRP. Some of the designs have terrible reviews, indicating the watch was received with dead or near-dead battery, in some cases without the manufacturer's packaging, or other general poor craftsmanship. Amazon even indicates that their watches come via "many different distribution channels" and that they may come with the manufacturer's warranty or with Amazon's own warranty. This tells me that Amazon is getting a lot of these as "grey market" merchandise. And is it even legitimate or is it counterfeit?

I just don't get how a market or industry carries on like this, buying merchandise made in China, paying very very little for it, putting a designer name on it, and selling this (mostly junk) for a relatively high price...say an MSRP of $100 to $300 or more. The profit to the "middlemen" must run to a hundred dollars on these things. The whole thing puts me off any interest in buying anything like this. :confused

ellsbebc
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Re: the business of marketing watches ?

Post by ellsbebc » Tue Dec 01, 2015 2:44 pm

It comes down to marketing. People are willing to pay exorbitant premiums for brand names and fashion forward designs. You are correct in that these fashion watches use ordinary watch mechanics and plaster their name brand on the face. They are often inferior to true watch brands. I will take my $100-150 Seiko vs. a $400 Anne Klein watch any day.

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Re: the business of marketing watches ?

Post by jpelder » Tue Dec 01, 2015 3:34 pm

It's the case with most consumer products. With watches specifically, Michael Kors, Burberry, and several others all have movements by Fossil. You pay much more for the design. My wife is a jeweler, and she says that Seiko and Citizen seem to be the best value that her store sells

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Re: the business of marketing watches ?

Post by Jack FFR1846 » Tue Dec 01, 2015 3:43 pm

Its probably best to buy watches from watchmakers rather than designers. I bought my wife a beautiful Gucci watch. It was like jewlry. Too bad Gucci puts a $3 garbage movement inside the thing. Its what we found after having problems with it and bringing it to a trusted watch repairman.

I bought my later luxury watches with names like Seiko.
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Re: the business of marketing watches ?

Post by davebo » Tue Dec 01, 2015 3:58 pm

Who needs watches? Just ask someone what time it is or look at your phone.

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Re: the business of marketing watches ?

Post by Alex Frakt » Tue Dec 01, 2015 4:02 pm

I'm not sure why you are surprised. All name-brand fashion, including fashion accessories such as shoes, watches and bags, are sold this way. If you want to avoid paying markups over 100% on such items, you need to stick to the discount stores/websites, clearance racks, or the house brands at Wal-Mart and maybe Target.

At least with watches you have the option of buying them as consumer electronics or hardware devices rather than accessories, where the margins at MSRP are typically thinner.

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JohnFiscal
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Re: the business of marketing watches ?

Post by JohnFiscal » Tue Dec 01, 2015 4:37 pm

Alex: maybe my meandering thoughts are more about Amazon's marketing and "supply channels" than about the watches themselves. :)

Dave: I agree. I don't like to wear watches myself (except in rarified situations such as traveling). But I get watches as gifts for others who do like them and their fashion statement.

By the way, wife got a deal at Amazon over the holiday weekend, Timex was offering 50% off (don't remember if it was msrp or selling price), along with Amazon discounts. She ended up getting 11 watches for gifts for $110. Admittedly these are pretty cheap watches, but they are for a particular audience who will appreciate them. At regular selling prices these might've run around $300. It was the variable condition of the packaging of these things that made me wonder about Amazon's "supply channels".

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Re: the business of marketing watches ?

Post by TimeRunner » Tue Dec 01, 2015 4:54 pm

Few barriers to entry on being an Amazon seller. People can and do buy items off the shelf with coupons then turn around and list them on Amazon. I looked at Apple Ipod Nano to replace my broken one a month ago. There were many sellers who stated that it would not come in Apple packaging and would be shipped with generic headphones, not the original Apple ones. No thank you. :shock:
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Re: the business of marketing watches ?

Post by jdb » Tue Dec 01, 2015 9:00 pm

We are inundated in cheap junk made overseas, mostly China and Asia but also Mexico and South America. Not just watches. Almost every brick and mortar store and catalogue and online operation predominantly sells this junk. So just accept it? Or actually look for more expensive quality products made in USA or in Europe like Swiss watches? What bothers me is even all my favorite tools now being made in China. So I wear an Apple Watch. At least made here.

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Re: the business of marketing watches ?

Post by nisiprius » Tue Dec 01, 2015 9:08 pm

I read about 1/6th of Priceless: The Myth of Fair Value, by William Poundstone. It was very good and I really ought to read the rest someday... but it was sort of a downer. Here's the blurb:
Prada stores carry a few obscenely expensive items in order to boost sales for everything else (which look like bargains in comparison). People used to download music for free, then Steve Jobs convinced them to pay. How? By charging 99 cents. That price has a hypnotic effect: the profit margin of the 99 Cents Only store is twice that of Wal-Mart. Why do text messages cost money, while e-mails are free? Why do jars of peanut butter keep getting smaller in order to keep the price the "same"? The answer is simple: prices are a collective hallucination.

In Priceless, the bestselling author William Poundstone reveals the hidden psychology of value. In psychological experiments, people are unable to estimate "fair" prices accurately and are strongly influenced by the unconscious, irrational, and politically incorrect. It hasn't taken long for marketers to apply these findings. "Price consultants" advise retailers on how to convince consumers to pay more for less, and negotiation coaches offer similar advice for businesspeople cutting deals. The new psychology of price dictates the design of price tags, menus, rebates, "sale" ads, cell phone plans, supermarket aisles, real estate offers, wage packages, tort demands, and corporate buyouts. Prices are the most pervasive hidden persuaders of all. Rooted in the emerging field of behavioral decision theory, Priceless should prove indispensable to anyone who negotiates.
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Re: the business of marketing watches ?

Post by neuro84 » Tue Dec 01, 2015 9:13 pm

jdb wrote:We are inundated in cheap junk made overseas, mostly China and Asia but also Mexico and South America. Not just watches. Almost every brick and mortar store and catalogue and online operation predominantly sells this junk. So just accept it? Or actually look for more expensive quality products made in USA or in Europe like Swiss watches? What bothers me is even all my favorite tools now being made in China. So I wear an Apple Watch. At least made here.
The Apple Watch is manufactured by Quanta, a Taiwanese company with most of its factories in South China.

http://blogs.wsj.com/digits/2014/06/20/ ... tch-maker/

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Re: the business of marketing watches ?

Post by jdb » Wed Dec 02, 2015 7:23 am

neuro84 wrote:
jdb wrote:We are inundated in cheap junk made overseas, mostly China and Asia but also Mexico and South America. Not just watches. Almost every brick and mortar store and catalogue and online operation predominantly sells this junk. So just accept it? Or actually look for more expensive quality products made in USA or in Europe like Swiss watches? What bothers me is even all my favorite tools now being made in China. So I wear an Apple Watch. At least made here.
The Apple Watch is manufactured by Quanta, a Taiwanese company with most of its factories in South China.

http://blogs.wsj.com/digits/2014/06/20/ ... tch-maker/
Oops. Knew components manufactured overseas but thought assembled here. As late great Gilda Ratner's character Roseanne Rosannadanna would say, Never Mind. :oops:

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