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From a practical perspective, all timepieces are the same. They keep track of time and add to our style. But it doesn’t mean investing in an expensive watch is a bad idea.
After all, expensive watches are often built with higher quality materials, are highly accurate and very reliable, and can last a long time. Wearing an expensive watch also shows you appreciate good craftsmanship.
So, what exactly makes watches so expensive? There are quite a few factors that go into creating, designing, manufacturing, and distributing a watch. We’ll cover the top reasons why watches cost so much money.
Before that, let’s first find out…
What counts as an expensive watch?
When it comes to wristwatches, they can be categorized into a low tier, mid-tier, and high tier. Good low-tier brands usually range between US$500- 2,000 and examples are watches from Oris, Hamilton, and Citizen.
On the other hand, mid-tier watches usually cost between $2,000 to 20,000. Meaning, they are more expensive because you are paying for the brand, craftsmanship, gemstones, and metals used in the timepiece. Notable mid-tier watch brands include Chanel, Bulgari, and Dior.
Then, there are high-tier watches that cost between $20,000 and above. For people who want to splurge or invest in these expensive watches, then look out for Omega, Hublot, Rolex, or Cartier brands.
Now, let’s proceed with the reasons why watches are so expensive.
Top Reasons Why Watches Cost So Much Money
1. They’re made from top quality materials
First and foremost, luxury timepieces are made from the finest materials to ensure longevity and robustness. Let’s say the standard is to use steel or precious metals, like platinum and gold. However, some brands have taken to using leading-edge and Avant-garde materials.
These include their own composition of quality materials, such as Rolex’s Cerachrom ceramic bezel and Omega’s Sedna gold. To date, Rolex is the sole watch brand to patent and produce its own metals. They are moreover the exclusive manufacturers of gold used for their bracelets and watches and they have their own patented rose gold mix called the Everose.
This is Rolex’s move to keep control of their products’ quality and own all aspects of their manufacturing process. In doing so, they are keeping the watch prices high.
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2. They take time to manufacture
The extreme attention to detail in every part of the watch production is often what separates luxury watch brands from affordable watch brands.
Driven by automation, affordable watch brands put more emphasis on efficiency and speed in their operation but prestige watch companies still rely on the steady hands of artisans before they produce items. In short, you are not just paying for the watch itself but the research and development that goes into it.
The years of research and development include refining every step of the watchmaking process, including specialized dial mounting, creating in-house movements, finishing techniques, and long power reserves to ensure that a luxury watch will remain elegant for years.
Consider the rare Blancpain 1735 Grande Complication with an estimate of 250,000-350,000 Swiss Francs or US$ 265,000-370,000. This limited-edition timepiece boasts 740 handmade parts.
The watches from the A. Lange & Söhne watch company also employ 70 workers in the finishing department alone. That’s where they handle the rudimentary aspects of the watch, like polishing, graining, and chamfering.
3. They are hand-assembled by highly trained people
Some luxury watches are still put together by artisans who train for almost a decade and their skills vary for every part of the watchmaking process. These highly trained people make sure that the mechanical watches or luxury watches they make have very low tolerances to variance or errors.
Furthermore, watch components, which are made of complex geometry and are very tiny, are assembled to the precision of a few microns – meaning a millionth of a meter. Of course, overhead costs and labor can impact the prices of luxury watches.
4. Brand prestige
Another reason for the price gap between watches in the watch world today is name association or branding. There are brands associated with luxury that is expected to be expensive. Although the watches from trusted brands are equipped with quality materials and movements, the brand name itself carries an extra cost.
It’s understandable why. For one, the way a luxury brand operates is quite different from those in the regular watch business. They focused not just on selling but also on building their brand and making it more exclusive.
5. Good movements are expensive
The machinery that allows many luxury watches to keep time and beat in a specific rhythm is called the movement or calibre. There are two types of watch movements: mechanical and quartz.
Mechanical watches use a spring that is wound precisely to operate while quartz watches are basic watches that need a battery to operate. So, another reason why watches are so expensive is that the movements are expensive.
So, the movement used by a luxury brand has a long life, and something that lasts long is going to cost more. Moreover, if the movements are in-house, the cost also becomes quite high because you need to have good workplaces, employ skilled watchmakers, and so on.
6. They are made in limited numbers
One of the fundamentals of luxury is scarcity. That is why to create hype, watch manufacturers limit the accessibility of some of their watches. Premium watch brands rely on making sure that supply never meets demand. In effect, customers want to get their hands on a handful of watches.
It’s not just because the more intricate a watch is, the longer it takes to design and manufacture, but it adds to the idea that a customer is making a luxury purchase.
Some watches are also rare by the original owner or by circumstance. A good example of this would be the Omega Speedmasters with a prestigious history of being the official watch of Apollo programs. In short, they were qualified by NASA for spaceflight. While there are now recent Omega Speedmasters released, there are already some modifications.
7. Markup makes a difference
It’s no secret that although luxury watches are expensive, they also have a good markup or the amount added to the actual price. Of course, this is needed for the survival of the brand.
There are so many “middlemen” and steps into getting the watch from the manufacturer to the customers’ wrists. Naturally, the price increases substantially in each of the processes. So before you know it, a luxury watch that costs $500 to manufacture ends up with a price tag of $4,000 or even $5,000.
8. They are Veblen goods
Veblen goods are a class of goods that demand increases as the price increases. The term was coined by American economist Thorstein Veblen in his book The Theory of the Leisure Class. In it, he theorized that the leisure class purchases items because they were expensive to create or produce.
This inspired Piaget to raise the price of their ultra-thin Altiplano watch to $19,000 from $6,000. In the case of other luxury watches, including Swiss watches, manufacturers are selling you on the promise that their products are crafted through ingenuity and rigorous care that speaks to the prestige and power of right now.
9. They have a timeless function
When properly maintained, a watch remains elegant and reliable for generations. And this is a good reason why quartz or mechanical watch is expensive. It just doesn’t depreciate quickly, but instead, keeps its value well.
Take Rolex models for example. Their prices go up by over 50% of their purchase price over the years and many Rolex owners get more than what they paid for them when selling it back or trading them.
10. Watch companies invest in marketing
The tenth reason why watches cost so much money is that watch companies invest in marketing. They are large marketing machines that compete with each other to peddle stories that make them stand out more than the next.
Nowadays, it’s not enough to just say your timepiece tells the time accurately because we have smartphones for that. So, brands have to invest in ads and budgets that are astronomical. Rolex took the spot as the top spender in advertising followed by Breitling, Omega, Cartier, Citizen, Chanel, and Movado.
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The Practical and Psychological Reasons Why People Wear an Expensive Watch
Now, let’s explore the practical and psychological benefits of wearing an expensive watch.
To exude confidence
Having an expensive watch strapped to your wrist will make a person appear more confident, not only because they look nice but because they know for themselves that they earned it.
And when you wear a respectable watch, you will also be less self-conscious. Instead, you will feel good about yourself, and this results in a feeling of self-worth.
Of course, just because one is wealthy doesn’t mean they would always prefer wearing an expensive watch. Sometimes, people feel wiser to wear a watch that just tells time or even no watch at all. Bill Gates himself prefers a $70 Casio Duro and Mark Zuckerberg doesn’t wear a timepiece at all. The reason for that is simple, a watch can both be a status symbol or a statement of one’s values.
You believe in quality over quantity
Since expensive watches take precision, time, and skill to create, they are made in fewer pieces and that is why they consequently cost more.
Going for an expensive watch shows that you believe in quality over quantity. Of course, you can buy several average brand timepieces but wearing a luxury watch is a reflection that you know how to get value for your money.
It’s because you believe in spending one good watch more than a few years with several others. It can even show that you are a good investor or make you appear more trustworthy to a potential employer or spouse.
To evoke a real appeal
The inherent value of a watch comes not just from the materials used to manufacture it but also from the time and skill of both the designer and the watchmaker employed. A watch with a complicated hand-made movement or case will even have more inherent value than one with less complicated movement.
So, when you wear a watch in the luxury bracket, it is as if you support the brand’s endeavor of craftsmanship that spans centuries. You evoke real appeal and your credibility will likely double. Just a glance at your wrist and your bank manager may even give you that loan you’ve been applying for.
To maximize chances of professional and personal growth
There are various ways to command respect in the room. A fine suit, proper grooming, and positive body language help command respect. However, a solid watch ties these different elements together. As a result, a good watch helps maximize chances of professional and personal growth.
Wearing a piece of luxury on the wrist may not necessarily seal important business deals, but it would give away a sense of authority.
Most Expensive Watches in the World (2022 List)
Here, we’ve compiled some of the most costly watches in the world. Keep reading to know their price as well as the reasons why they’re expensive.
Rolex Cosmograph Daytona
The Rolex Cosmograph Daytona is a dream come true for any watch collector or enthusiast. This watch costs around $36,000.
Surrounded by mystique, this watch is notoriously difficult to obtain because it is collectively vintage and made of high-quality materials. Even its design is a standout. Just look at the tachymeter scale and the combination black dial with blue luminescent hands and hour markers.
This watch is also water-resistant for up to 323 feet or 100 meters and features self-winding automatic movement. The chronograph function is accurate to within ⅛ of a second. Then, it features the Daytona signature, which was first introduced in 1964.
Graff Diamonds The Fascination
Priced at about $40 million, the Graff Diamonds The Fascination is one of the most expensive watches in the world. Called the Fascination, this timepiece comprises 152.96 carats of white diamonds and features a 38.13-carat, pear-shaped diamond.
This watch is also comfortable to wear and is easily convertible. Its stunning craftsmanship brings out the best from the Swiss watchmakers and the brand’s London-based jewelers.
Breguet Marie-Antoinette Grande Complication
The Breguet Marie-Antoinette Grande Complication is an exceptional timepiece that takes the name of the Queen of France during the French Revolution. This watch features a minute repeater that on command strikes minutes, quarters, and hours as well as a full perpetual calendar showing the month, day, and date at eight and six o’clock respectively.
The timepiece’s self-winding movement (also called perpétuelle) composed 823 parts and components, finished with exceptional care. The watch is also encased in gold. Overall, this expensive watch is legendary with a compelling tale behind it.
Patek Philippe Henry Graves Supercomplication
A gold pocket that took seven years to design and build, the Patek Philippe Henry Graves Supercomplication was crafted in 1933 for wealthy banker Henry Graves. What’s more fascinating was that this watch was designed back when watchmaking still had to rely on craftsmen instead of the calculations of computers.
Today, it is one of the most expensive watches priced at $26 million. It features an impressive range of complications that include a minute repeater, a perpetual calendar, a celestial chart, and sunrise and sunset times. Truly, this timepiece can rival all pocket watches.
Graff Diamonds’ The Hallucination
The Graff Diamonds’ The Hallucination is a jewelry watch that takes the cake of the world’s most expensive watch. This was presented in 2014 with a $55 million price tag. This watch is composed of 110 carats of rare multi-colored diamonds in a range of different cuts along with a small dial.
Hallucination is a combination of high fashion and high watchmaking and is a culmination of thousands of hours of work from a team of expert craftsmen, designers, and gemologists.
FAQs on Luxury Watches
What is so special about expensive watches?
The special thing about expensive watches is that their complications cannot be mass-produced due to high-quality control. The other defining traits of luxury watches or expensive watches are the reputation of quality and exclusivity. As a result, these watches are extremely rare in the watch market and that rarity leads to an increase in their prices.
Are all luxury watches Swiss?
No, not all luxury watches are Swiss but more than half of the total expensive/ luxury watches nowadays are from Switzerland. The Swiss confederation is known for prominent brands, like Rolex, Omega, and Patek Philippe.
Nevertheless, it’s also possible to find high-quality watches beyond the Swiss borders. Some non-Swiss luxury watch brands are Panerai (watch manufacturing company in Florence, Italy), Andersen Genève (Denmark), A. Lange & Söhne (Germany), Arnold & Son (UK), and Seiko (Japan).
Which is the cheapest Rolex?
Rolex is one of the most sought-after and recognizable watch brands in the world and their watches typically come with a high price tag. But, some pre-owned Rolex watches suit every budget. This includes the Rolex Oyster Date, Rolex Explorer, Rolex Milgauss, Rolex Air-King, and Rolex Submariner.
How do I protect my expensive watch?
To make your expensive watch last a lifetime, keep it out of direct sunlight when not in use or store it in a place where the temperature doesn’t fluctuate too much. Prolonged exposure to strong sunlight could speed up the wear on the dial, hands, bezel, and other painted parts on the watch and could dry out the lubricants that run its components smoothly.
Other things you can do to protect your expensive watch is to protect its crown (remove the timepiece from your wrist with care), wind it at least once a month (especially if you have not worn it for a while), clean gently, and never use the complications while submerged underwater unless it’s a diver’s watch.
What watch will last a lifetime?
Some iconic timepieces that are designed to outlast trends include Rolex and Omega. Watches from both brands have phenomenal track records of being long-lasting and dependable. Patek Philippe also stands out as being a long-lasting watch and the most dependable when it comes to top-tier luxury timepieces. Another watch that is designed to be an enduring classic is the Cartier Santos de Cartier.
How much should I spend on a watch?
The easiest rule to follow is to spend around 1% of your annual income on a wristwatch. Or you can save that 1% of your annual income and buy a more expensive wristwatch later. Still, it depends on what kind of watch you want. Some prefer something that can last for a long time but some prefer to just wear a watch that tells time.
New vs. used luxury watches: Which is the better buy?
It depends on your personal preferences. Watches are emotional purchases too and are not always driven by logic. So, you can take into consideration the following factors when buying new or used luxury watches: the condition of the watch, accessories included, warranty, price, and depreciation.
The Bottom line: Are Expensive Watches Worth It?
You may already know by now that there are an endless number of things that affect a timepiece’s price, with everything from material, movement, brand, and so on. But are expensive watches worth it?
Well, if you are looking for a quality watch, then yes expensive watches are worth it. With a little bit of regular service or wearing rules, Rolex or Patek Philippe brands could even serve not just you but even your grandchildren.
So, if you are looking for a quality watch, you care about workmanship, and you have a personal story or attachment to the timepiece, then expensive watches are definitely worth investing in!
Ultimately, all of the factors we shared above come together to account for watches for the premium value put upon fine and luxury watches and explain why are watches so expensive.
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