Preview

The secondary watch industry is pushing established players to evolve their approach, echoing developments in the sneaker market.

WHAT HAPPENED: Raymond Weil partnered with the second-hand watch retailer TrueFacet to create authentication programs and Richemont acquired a pre-owned watch seller called WatchFinder.

Why it matters

  • Luxury players have been reluctant to embrace secondhand for fear of diluting their brand with pre-used and/or inauthentic items. But shifting cultural tides are driving more brands to jump on activity seen in both secondary and secondhand markets. As sneakerhead culture blossomed, sneakers took on new status and meaning. Once consumers began selling them on the secondary market—often to the chagrin (and financial loss) of established retailers—these players decided to take control. In February 2018, LVMH Luxury Ventures invested in Stadium Goods, an ecommerce marketplace for buying and selling sneakers—since then, Stadium Goods has opened a shop at Nordstrom’s standalone men’s store in New York and began selling on Farfetch.

  • Pre-used watches are a more promising venture for luxury retailers than they might appear. For one, they are a long-established and time-tested market (pun intended) with higher retail prices. Secondly, many luxury brands have built their brands on legacy—a large part of the value prop behind secondhand watches, which can also attract shoppers as a scarce resource if their model is no longer manufactured. At the same time, watches function so long as they have a working chronograph or battery. NPD Group estimates that the pre-owned watch market is three-times bigger than the regular watch market in the U.S.—an opportunity for brands in the watch and jewelry sector that are falling behind. Given the preexisting consumer confidence in these legacy players, companies only need to authenticate the secondhand items. And unlike the traditionally decentralized sneaker market, premium watch retailers have fewer obstacles to cross as the watch market already aligns well with the luxury industry—it’s just about officializing the secondary market.

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