Sunday, July 28, 2024

Rolex Retail: What is Going on?

 

Rolex Retail

What is Going on?

Scarcity v. Abundance

I was recently in a Rolex authorized dealership and I noticed the strangest thing. I took the photo below which shows the ENTIRE Rolex retail showcase, and could not help but notice there were a total of ONLY 18 Rolex watches in these very small and minimalistic glass exhibition showcases.


Also there are small signs in each case with the watches that say "THE WATCHES DISPLAYED ARE FOR EXHIBITION ONLY". I also noticed there are copies of The Rolex Magazine showcased on the countertop which actually looks REALLY COOL!!!


Granted, the Rolex authorized dealership display case pictured above was in a smaller mall, and was NOT a big store, but nonetheless I was surprised at how sparse the collection was. I remember the first time I really noticed and studied the display case in a Rolex authorized dealership when I was 16 years old and that was 41 years ago, and I remember tripping on how many Rolex watches they had under the glass showcase. In other words, they had EVERY main Rolex model in the showcase, for sale. 


I took the photo above and below at Fourtane in Carmel, California in 2008, which is a Rolex authorized dealer, and notice the amazing difference in the retail casing, in the sense they used to carry their inventory in the exhibition cases out on the retail floor, but it seems now like they must keep their inventory in a safe in the back of the store. 


In the old days, it must have been a complete pain-in-the-ass for the retail employees to have to refill/repopulate the showcase every morning before the retail store opens by moving watches from the safe to the retail showcase cabinets. Then, at the end of the day, having to shlep them back into the safe.

So the question I ask is, why is Rolex moving toward such a minimalistic approach to retail showcasing in authorized dealers? I did notice that none of the other brands in the retailer had changed over to a minimalist approach—just Rolex. 


I wonder if Rolex is taking more of an Apple-like minimalist approach, or maybe it's an anti-theft approach based upon increased insurance premiums for exposure? I think if you walk into a store and there are hundreds of Rolex watches in a case it suggests abundance, coupled with a lack of scarcity. When there are are so few Rolex watch models in the sparsely populate small cases, is suggests rarity and scarcity.


So what is really going on with Rolex Supply and Demand? From what I understand, Rolex demand is still unusually high for many popular models, as Rolex has been able to increase supply a bit. While the broader watch market demand has been cooling down since interest rates increased significantly, Rolex remains at the top of their game as they evolve to embrace the future.