Here's how my thought process went when it came to developing this post:
Thought: "Hey, how popular is the new Vacheron 222 really? Let me look at Google Trends." (Note: Google Trends is a service from the search engine that allows you to see the volume of searches for a particular term.)
Result: Woah. That is a crazy hockey stick.
A vintage Vacheron Constantin 222, up for auction this May in Geneva at Phillips.The first lesson we learn from the data is that Vacheron Constantin's Watches and Wonders release of the gold Historiques 222, reference 4200H/222J-B935, was an absolute monster in terms of gaining global attention. Basically, nobody was searching for this reference before the drop, and searches increased roughly 25 fold after the watch was released. You couldn't wish for more confirmation that, a) Jorg Haysek's design for this watch is beloved and timeless and b) Vacheron has much to celebrate when it comes to this release.
Then this happened:
Thought: "What is the context for this interest in Vacheron? Let's compare Vacheron's attention gain to the other brands that participated in Watches and Wonders. Were people even more interested in what Rolex or Patek unveiled?"
Result: Uh, ok. This is complicated data to interpret.
Google Trends for five brands, beginning of 2022.
This graph is basically a pile of spaghetti. If you strain your mind and eyes, you can tease out some results. Typically, when I see something like this, where time series are highly volatile, I like to deploy as "low-pass filter" in order to get rid of some of the noise that makes time series hard to interpret. I went with a three day moving average because reasons. The resulting data was a lot easier to consider visually. Google Trends as a three month moving average for five brands, beginning of 2022. My next step:
Thought: "Ok, now I have to deal with some time regularity, those look like weekend spikes in searches for the brands."
Result: Yes, those are statistically significant spikes in searches for the brands on Saturday, Sunday and Monday.
As a person with a strong interest in the watch industry, this was a bit surprising to me. My own searches relating to watches are fairly constant. When you consider more mainstream interest in watches, though, it makes perfect sense. I'm calling this pattern "I Dream of References," as an homage to the TV show "I Dream of Jeannie." Basically, when people are away from work or handling their "bad case of the Mondays," their mind wanders into the territory of a possible watch purchase. I'm not certain the watch industry is aware of this attention pattern. If they were, it probably would be advisable to shift marketing to Saturday, Sunday and Monday in order to make marketing more effective (when eyeballs are already turned toward the industry, it is the perfect time to send your marketing message).
What's also interesting is that the I Dream of References effect is not the same across brands. It was strongest for Tag Heuer and Grand Seiko. It is noteworthy that these two brands are comparatively more accessible to buyers, if not by price then certainly by inventory (there aren't really waitlists for these two). This further suggests that brands with comparatively out-of-reach pricing and long wait lists are getting less attention when buyers are researching products. In the long run, this has the remote potential to impact their desirability.
Google Trends, 3 month moving average, Weekend + Monday effect removed.Next, I removed the I Dream of References effect and arrived at the final chart of time trends. I also shaded the days of Watches and Wonders. I think this reveals some really interesting patterns in Google searches around the time that Watches and Wonders began, a period that corresponds to the right of the chart. In these charts, I normalized all brands so that their Google search volume had the value of 1 on January 9, 2022 (I then took the three day moving average). The values in this last chart can be interpreted as the percentage by which a brand's Google searches increased or decreased on a particular day, compared to the start of the sample. All of the brands were seeing lower search volume heading into Watches and Wonders. This makes perfect sense, since the largest buying season for the watch industry is arguably late December and early January (due to holidays). February and March are most likely the months when the holiday tide of attention is in retreat.
Tag Heuer experienced the smallest loss of attention. Heading into Watches and Wonders, Patek and Rolex were virtually neck-and-neck when it came to loss of attention. Finally, interest in Grand Seiko and Vacheron Constant declined the most by the time late March arrived (GS may have lost slightly less attention).
The Google search data illustrate just how important Watches and Wonders was to Vacheron and Grand Seiko. Each brand saw the largest turnaround in attention. When the trade show doors opened in Geneva, their Google Search volume increased to 20% above the level we saw at the beginning of January. These brands had a good show, a result likely attributable to the 222 in the case of Vacheron and Grand Seiko's Kodo release. Heuer and Rolex saw similar gains, but given their comparatively strong starting point, those gains are slightly less noteworthy. Interestingly, Patek's attention gain of approximately 9% was the most modest of all.
What is also noteworthy is the fact that Grand Seiko's attention "bump" from Watches and Wonders showed the greatest staying power of all the brands discussed here. I don't really have an explanation for this result. Arguably, the Kondo was the vanguard of all watches released by Grand Seiko during Watches and Wonders. It was a major and unexpected innovation in the technical side of horology, featuring a constant force tourbillon. It may be the case that these types of reveals at a trade show pay dividends with more staying power when it comes to attention.
In summary, there is ample evidence that Watches and Wonders does what it is designed to do: draw attention back to brands after the post-holiday lull. It is difficult to determine if this benefit is large enough, compared to the cost. The benefit is clearly not the same for all brands. However, it is equally clear that participants do hold their fate in their own hands. With the right releases, the watchbuying public's attention is there for the taking.
News recently broke that watch brand Rolex was on the receiving end of a €91 million fine levied by French authorities. A view of Rolex's offices in France. Source: Google Maps. Generally, the headlines ascribed this fine to Rolex's alleged practice of prohibiting online sales of its watches. However, I've looked closely at the situation and I don't think those headlines are completely accurate (although they're probably what French authorities would want you to believe). I came to this conclusion after reading a Google translation of a 134 page report issued by the French Competition Authority on December 19, 2023. Generally speaking, such documents do not make for engaging reading. However, for those who know how successful Rolex has been at maintaining a comparatively high level of corporate secrecy, the French report provides a compelling and rare insight into some specific aspects of the brand's business. It is these insights which lead me to conclu
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Among many avid watch collectors, the term "in house movement" seems to elicit eyerolling disdain. Pieces of an assortment, including balance spring, from a non-Swiss movement. There is a sizeable perception that "in house" is, in fact, nothing more than an unnecessary marketing ploy designed to tease more money out of the wallet of buyers (by way of definition, an "in house" movement means that the mechanism inside a watch was predominently manufactured by a brand itself, kind of like "we make our own bread" at a restaurant). I'll confess that I'd begun to think similarly, that is, until I read a 66 page report posted by the Swiss Competition Commision on May 10, 2023. Yes, this is the kind of thing an economist finds interesting on a weekend, or at least this economist. Before we get into the details of this report, in the interest of full disclosure I should say that the original document was in a different language: lawyerese.
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