How dangerous could the COVID-19 pandemic be for the watch industry? There’s no denying the current situation and the repercussions for the global economy, as well as the cancellation of the biggest watch fair — Baselworld — and the announcement of production halts for the remainder of 2020 from some of the leading luxury watch brands, including Rolex, Patek Philippe and Audemars Piguet.
But while the sector is having to adapt to a “new normal,” the vintage watch market remains healthy and strong, and seems to be thriving under these circumstances. Consumers’ growing shift to online to buy almost everything — including luxury goods — is providing an added boost.
For Rich Lopez, senior specialist at Sotheby’s watches department in New York, online sales have been fundamental. “One of the benefits of our push to online sales has been an uptick in purchases from first-time buyers, which has been very encouraging and a sign that the market is still very active and expanding at this time. The first six Watches Weekly sales held in April totaled more than $4.63 million, with participants from 40 countries across all continents, and 54 percent of the buyers had never bought a watch at Sotheby’s before.”
Watches have always been considered a great investment, even more so during the pandemic as first-time buyers and collectors alike deem timepieces to be a “safe haven” asset in times of stock market volatility.
For collector Gary Getz, this has been precisely his viewpoint. “I talk with a lot of collectors, and there is definitely an emerging group who are treating vintage watches as an asset class. Whether you are part of this group or not, though, once you have a substantial amount of money tied up in your watch collection you do need to pay attention to avoiding ‘getting hurt’ in any big downturn in watch values, and I think that the markets in luxury collectibles are just as vulnerable to volatility as any financial investments.”
One factor evident in the vintage market is that rare timepieces are getting harder to get hold of. The condition and authenticity of the timepieces itself are now more than ever becoming key factors to consider as well, especially when it pertains to mechanical and cosmetic condition, according to Cameron Barr, founder and chief executive officer of Craft + Tailored.
These factors are among the ground rules when looking at vintage watches for investment reasons. “Much like cars and/or art, the physical condition as well as the originality of the watches components very much determine the long-term collectability and retention of tangible value,” Barr said.
But interest from existing buyers, collectors and newbie collectors is up significantly since the lockdowns began. For Parmigiani Fleurier’s ceo Davide Traxler, interest has surged from a younger generation. “So far, we see mostly young clients looking to vintage more as a style choice rather than an investment move, while certainly the collectable rarities are still the playing ground of experienced collectors.”
Fabian Diaz, collector and ceo of private boutique JFKRolex, has had a mix of reactions. “It’s [the vintage market] definitely taken a small dip in sales,” he said. “In the beginning, people didn’t know what would happen to the market, if holding on to their money would be the best thing. But people still call me looking for the funkiest vintage pieces to add to their collection. I can say the uglier the better; it shows that it’s actually been worn, not just sitting in a safe or deposit box.”
“I have had maybe an average of one conversation per weekday since the quarantine started,” said Eric Wind of Wind Vintage, “with someone interested in purchasing their first vintage watch. I think that is significantly due to having the time to pursue a hobby, but also because a vintage watch is something real and tangible you can hold and enjoy versus having money in the market, where you cannot enjoy it.”
Buying trends will continue to shift as the course of the pandemic evolves, but Justin Reis, cofounder and global ceo of Watchbox, has seen a surge in demand from his existing client base. “Among our established clientele, we are finding ‘distraction by hobby’ to be a welcomed outlet as most of the world continues to work from home. And as vacations and special experiences fall from the calendar, many clients have shifted these funds to acquire special watches, gravitating toward timepieces they wish to own for the long term; rare and truly collectable pieces,” he said.
Vintage watches are, and will continue to be, in demand, and as every industry continues to find new ways to reinvent their current strategy during the COVID-19 pandemic, some have already forged new ground. Christie’s watch department has enhanced digital access to private sales, traditionally a bespoke service for buyers and sellers to complete transactions outside of the auction calendar. A new viewing room for watches is among the enhanced offerings, with the ability to view available timepieces remotely in close detail and confer directly with specialists.
For Christie’s watch specialist Rebecca Ross, this ensured a new path for locating timepieces, gaining clients and promoting sales via digital platforms. “Given our current travel restrictions, most specialists have adapted to finding new ways of discovery. During the last few months, I have been able to take some extra time to focus on the main appetite of our clients — exceptional vintage timepieces — and have been finding many of them through increased social and digital connections. While this is unconventional for luxury items, it has proven to be necessary as the demand for these watches has not only remained constant but has exponentially increased,” Ross said.
“It is too soon to see a change resulting from the changes brought forward by COVID-19,” said Alex Ghotbi, head of watches for continental Europe and the Middle East director at Phillips in association with Bacs & Russo. “In the past during the financial crisis or others, we have seen new clients wishing to invest in watches. Interestingly, almost systematically, what started as a purely financial operation ended with the client turning into a full-fledged collector, which is a different mind-set. What will be the long-term effects on the market is definitely the million dollar question, and while there is no exact answer, the fact of the matter remains that collecting vintage watches has and always will have an audience.”