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Old 4 December 2022, 10:25 AM   #1
Armis
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Pricing trajectory question

Given the collective experience and long time collectors on this forum, I’ve been wanting to ask whether the pattern we have seen where there is more than one price increase in a given year reflects what has been a historic pricing pattern, or is this a modern phenomenon based on the crazy levels of popularity and effect of supply/demand? Or is this how the luxury markets always have been?

I haven’t compared the pricing patterns of the big brands e.g. Rolex, PP, AP over the past couple of years, but I have admittedly been surprised when I would see that AP had another price increase. It is likely my own false impression that this pattern is odd or excessive, so I would appreciate any historical facts and modern insights anyone can share…or perhaps any older thread that has already discussed this (I couldn’t find one).
Thanks all.
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Old 4 December 2022, 12:32 PM   #2
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I can't speak to frequency, but I think all brands have been hiking RRPs aggressively. Have you seen the price of Calatrava's now?
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Old 4 December 2022, 12:50 PM   #3
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Don't know if the pattern is odd or excessive, but the increases have certainly accelerated in recent years. 15400 debuted in 2012, IIRC, for $16900. 7 years later, the 15500 was about $3k more (17% over 7 years). 15510 is now $26.6k - 33% in less than 4 years. Hm, maybe excessive is not a bad description.
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Old 4 December 2022, 01:14 PM   #4
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I think recently it’s gotten excessive with multiple increases per year... That wasn't the case previously.

As dmash already pointed out, at some point the value for money just isn't there. For example a new 43mm ROO is ALMOST 50K out the door without the metal bracelet for a Chrono only (non PM). It's certainly becoming hard to swallow but then again - plenty of wealthy people around who don't care
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Old 4 December 2022, 02:12 PM   #5
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I can't speak to frequency, but I think all brands have been hiking RRPs aggressively. Have you seen the price of Calatrava's now?
Exactly, Calatrava is another such example. Okay, just wanted to make sure that I wasn’t being unreasonable with respect to these changes.


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Originally Posted by VogelPhoenix View Post
Don't know if the pattern is odd or excessive, but the increases have certainly accelerated in recent years. 15400 debuted in 2012, IIRC, for $16900. 7 years later, the 15500 was about $3k more (17% over 7 years). 15510 is now $26.6k - 33% in less than 4 years. Hm, maybe excessive is not a bad description.
Now that is a notable statistic. It has me saying ”sky is the limit,” which is fair in the context of luxury. If willingness to pay is much higher, then from a business perspective they’re justified in increasing. Objectively, this is all interesting as a case study where I wonder what impact, if any, this has on reputation. Again, need to remind myself that this is the luxury market, so can’t be starting a movement based on “ROs for all!” :)))

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I think recently it’s gotten excessive with multiple increases per year... That wasn't the case previously.

As dmash already pointed out, at some point the value for money just isn't there. For example a new 43mm ROO is ALMOST 50K out the door without the metal bracelet for a Chrono only (non PM). It's certainly becoming hard to swallow but then again - plenty of wealthy people around who don't care
Well said. Okay, at least I’ve gotten the answer to my question. This is the new reality, and it will not likely be slowing.
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Old 4 December 2022, 04:35 PM   #6
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It was not that long ago that AP reduced their prices on certain pieces like ceramics. Everything runs in cycles and I wouldn't t be surprised if we went there again.
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Old 4 December 2022, 05:06 PM   #7
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It was not that long ago that AP reduced their prices on certain pieces like ceramics. Everything runs in cycles and I wouldn't t be surprised if we went there again.
Thank you for highlighting that fact, I did not know that. Also, that is an important reminder about cycles.
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Old 5 December 2022, 12:29 AM   #8
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Anything that goes from 78k to 106 in 1 day should be described as excessive. Looking at that RO QP in steel ugh
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Old 5 December 2022, 01:00 AM   #9
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It was not that long ago that AP reduced their prices on certain pieces like ceramics. Everything runs in cycles and I wouldn't t be surprised if we went there again.
Do you think they will seriously unwind CODE and SS RO pricing? My personal bet is highly doubt it and they will cut production before they do that. (Unless of course big daddy Arnault is in charge).

To OP, Vogel Phenoix data point is spot on. By way of analogy, the ascent feels like Chanel pricing up to Hermes. Will it work long term, who knows. But the premium pricing gap closed between the two at the rate it was closed is the closest analogy IMHO in the luxury space. To this point, I believe the Chanel pricing strategy almost exclusively was made with Asia consumers in mind.
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Old 5 December 2022, 02:02 AM   #10
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Anything that goes from 78k to 106 in 1 day should be described as excessive. Looking at that RO QP in steel ugh
Is that the case with the steel QP?? When seeing the recent $100k+ price I did seem to recollect it was a much more ‘reasonable’ price not too long ago…but then seeing the recent price going so prohibitively high, I figured I must have been confused about previous price. So now it appears that that price increase was true. But from 78 —> 106 in one fell swoop?! Beyond surprised, I’m more intrigued to understand how these decisions are made internally (which I can’t, of course).
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Old 5 December 2022, 03:27 AM   #11
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The price increase on the QPs was nothing more than opportunistic price gauging.
Other price increases over the past couple of years are, I believe, more inflation / currency related normalisations - but still not fun.
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Old 5 December 2022, 04:04 AM   #12
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Do you think they will seriously unwind CODE and SS RO pricing? My personal bet is highly doubt it and they will cut production before they do that. (Unless of course big daddy Arnault is in charge).

To OP, Vogel Phenoix data point is spot on. By way of analogy, the ascent feels like Chanel pricing up to Hermes. Will it work long term, who knows. But the premium pricing gap closed between the two at the rate it was closed is the closest analogy IMHO in the luxury space. To this point, I believe the Chanel pricing strategy almost exclusively was made with Asia consumers in mind.


I don't think they will unwind CODE. They've put too much into it already. As far as pricing, it's hard to say. I've been on both sides of it though. I purchased a 44 CE ROO when retail was in the mid $40's and then they dropped the price about $8k into the 30's not long after. That didn't feel good. lol.

On the other end, I got my SS RO QP this year when retail was in the low $80k's and saw it go up to $106k a few months later. Hard to explain why the same watch is worth $20k+ overnight, but it felt good.

I think it will all depend on macro economics and demand. I sure hope they don't cut prices and reduce production instead as it's not good for the brand overall when you go through price cuts.
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Old 5 December 2022, 09:38 PM   #13
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Good enough??
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Old 5 December 2022, 11:54 PM   #14
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I don’t think that MRSP price will be cut….
Yes maybe special customers will get some discount but to cut no way.
They must do be crazy if do so…. Yes when 15400 are launched price are 16900€ but on secondary market price are 11-12000€….
Now 15510 have list price 26500€ but on the secondary market price are +40000€…. Also this day you not enter in AP Boutique and have all models to buy immediately and with discount….. now you enter and get out full of respect but without any watch and with some pieces on the list you might buy to qualify for a 15510….
Let’s not dream….
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Old 16 December 2022, 01:05 AM   #15
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The price increases has been crazy. The ROOD has gone up $10k in 4 years. $29k+tax for a time and date watch on a rubber strap with a machine finished movement…hmmmmm


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Old 16 December 2022, 01:56 AM   #16
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AP has a track record of cutting prices when they do not make sense. They did it with gold pieces back in 2013 ish and they did it with ceramic pieces a few years ago. They are far more open to moving prices in both directions than pretty much any other brand I am familiar with.

Do I see that happening anytime soon? Doubtful but it would not surprise me if they did it again if we had a material economic slowdown that lasted for a year or more.
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Old 16 December 2022, 04:39 AM   #17
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Quote:
Originally Posted by thekman View Post
Anything that goes from 78k to 106 in 1 day should be described as excessive. Looking at that RO QP in steel ugh
Quote:
Originally Posted by Armis View Post
Is that the case with the steel QP?? When seeing the recent $100k+ price I did seem to recollect it was a much more ‘reasonable’ price not too long ago…but then seeing the recent price going so prohibitively high, I figured I must have been confused about previous price. So now it appears that that price increase was true. But from 78 —> 106 in one fell swoop?! Beyond surprised, I’m more intrigued to understand how these decisions are made internally (which I can’t, of course).
The QP price increase is a bit of an anomaly.

When the Ti came out last Sept. it was $80,000 (so was the ST at the time). Then it went up to $84,800 on 1/1/22. Then to $89,100 on 9/1/22. And then to the now $106,000 only 6 days later on 9/7/2022.
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Old 16 December 2022, 05:25 AM   #18
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The QP price increase is a bit of an anomaly.

When the Ti came out last Sept. it was $80,000 (so was the ST at the time). Then it went up to $84,800 on 1/1/22. Then to $89,100 on 9/1/22. And then to the now $106,000 only 6 days later on 9/7/2022.
Anomaly or not still feels like a cash grab. A 26k price increase overnight without any change in the actual production cost (at least to match this increase) feels like a cash grab.
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Old 16 December 2022, 05:29 AM   #19
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LOL those were like 55k back in 2017
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Old 16 December 2022, 11:09 AM   #20
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LOL those were like 55k back in 2017
Don’t rub it in
This was a ‘reasonable’ piece I had been working towards…then the hike. *sigh*
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Old 16 December 2022, 11:15 AM   #21
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Don’t rub it in
This was a ‘reasonable’ piece I had been working towards…then the hike. *sigh*

Same here. It went from within reach to ugh now I gotta sell my whole collection to afford this


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Old 16 December 2022, 11:19 PM   #22
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Don’t rub it in
This was a ‘reasonable’ piece I had been working towards…then the hike. *sigh*

I was offered the silver dial with a 10% discount. One of many regrets.
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Old 16 December 2022, 11:36 PM   #23
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Same here. It went from within reach to ugh now I gotta sell my whole collection to afford this


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Ditto, more or less.

I'm (now) not inclined to pay £100k plus for any Steel (or Titanium) AP irrespective of the complication
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