Thursday, October 15, 2015

Searching for Solutions

This is the 1966 Steel from Girard-Perregaux.  On the surface of it, this is a beautiful watch that offers a less expensive alternative to the current offerings which are primarily of gold.
Courtesy of Girard-Perregaux
As I said, on the surface.  But this watch is actually more of a symptom of the deep confusion that GP is struggling through right now.  In an interview some weeks back, the current CEO Antonio Calce enthused that THIS was clearly the price point that GP needed to cater to to make it somehow more accessible.  The price tag for this "entry point" watch?  $7,500.00 on a leather strap, and steel bracelet $8,200.00.

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So, let's talk about that "entry level" price point...

A new Fiat 500 hatchback will set you back $16,845,  so 2 GP steel watches, or transportation for that couple starting out...

I think, unfortunately, the brain trust at GP has lost touch with the reality of the current economic situation and their actual customer.  At the moment, at least from a degree of separation afforded by the fifth estate, they seem to be scrambling to find a solution to slumping sales.  The answer is in front of them if they are willing to open their eyes and accept it.  Yet they jump from one bold (and expensive) solution to the next not unlike the savant flinging poop at the wall hoping that something will stick.  When you jump from solution to solution it shows a degree of uncertainty that does not engender faith with your retail partners - or the buying public who have to ask themselves why on earth they would pay full price when they can get it for half-price already on the grey market and for 1/4 of that within a year's time.

And this is not limited to GP, but they are the working example here.

Dear Watch Brands -
Stop over-producing and then dumping the unsold stock on the grey market!

When someone can do a simple Google search and find the white gold version for, I dunno', LESS than what you are offering the steel version for, what does that do for the perceived value of these new steel models?

The solution is easier than one might think:

1.  Make fewer watches - create demand
2.  Clean up your grey-market dumping grounds
3.  Price your watches at realistic price levels so that your retail partners don't have to go "Deep South" to move them.

Punch your weight.

I love GP, but it's time for them to wake up and smell the espresso.

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