Something significant happened last week. Significant in the watch world, that is. (I adore horology, but even I wouldn’t venture so far as to say that watch events have an international impact. The time for that is past.) What happened? A steel watch that normally retails for just over 30,000 euros was sold at auction for 400,000 euros.
You guys know what I’m referring to. The Patek Philippe Nautilus ref. 5711/1A-014 that just went under the hammer at Antiquorum’s Monaco auction. Online reactions were strong, to put it lightly. Of course, on the most superficial level, this is an amazing result for an iconic watch, congratulations to everyone involved, big publicity was generated and that’s great for the watch world.
Unfortunately, I’m not able to limit my view of this to the superficial level. I say “unfortunately”, because I think I’d be a much happier person if I was less analytical.
Someone sent me an Instagram post from a popular account, run by an anonymous satirical watch critic. He (or she) stated that wearing this watch is now an indication of stupidity, because the wearer is either someone who bought a 30,000-euro watch for 400,000 euros, or someone who bought a 30,000-euro watch and said no to a potential 370,000-euro resale profit.
While I disagree with the severity and simplistic approach of this post, I recognise that it’s intended as sharp humour, and people shouldn’t get too upset about it. I do agree that this is a sign that the watch market is getting “out of hand” or “wild”, as I’ve seen some people comment online. But it’s more than out of hand. It’s more than wild. It’s dangerous.
A secondary market sale at more than ten times the retail price is not just a function of supply and demand. It is speculation. It drives genuine watch lovers away. It encourages commoditisation of watches in a way that is disconnected from their intrinsic value. It puts very few selected watches in hyper focus and ignores genuine merit in 99.9 percent of the watches out there. It increases market volatility and decreases consumer confidence. It rewards the bad-faith behaviour known as “flipping” — acquiring high-demand watches (often through falsely representing one’s intentions to the seller) with the sole purpose of immediately reselling them.
I have friends at the major watch auction houses; I love what they do and I think they’ve done some amazing work in bringing attention to the enduring value and beauty of mechanical watchmaking. But in this specific instance, the enduring value and beauty of mechanical watchmaking is perhaps the least relevant factor in play. When Patek Philippe announced the discontinuation of the Nautilus ref. 5711, one of the intended effects was precisely to curtail uncontrolled price inflation and shift attention to their other pieces.
I can hear people saying already, Don’t be naïve, Suzanne. If respected auction houses don’t do it, you’ll see it happening on some online marketplace anyway. Taking a stand doesn’t make a difference.
Well, I think it does make a difference. The watch still gets flipped at shocking prices, sure. But the perception that we can perpetuate, the perception we should perpetuate, is that those who claim to love and support the mechanical watch industry are principled about acting in ways that actually show their love and support for the watch industry. We can’t draw ethical or moral equivalencies between what unscrupulous dealers in the grey market do, and what established auction houses do. This is why reputation matters. This is what it means to be a responsible (and potentially leading) entity in the watch world.
