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Luxury goods

Rolex emerges as latest target of S.Korea’s luxury brand fever

High demand and limited supply are shooting up prices of the statement watch in the local second-hand market

By Aug 24, 2021 (Gmt+09:00)

Rolex Daytona White Dial (Courtesy of Raymond Lee Jewelers).
Rolex Daytona White Dial (Courtesy of Raymond Lee Jewelers).

Rolex watches are now the latest object of South Korea’s unwavering love for luxury goods. The high demand and limited supply of Rolex watches are driving drastic price hikes of the products in the second-hand market.

According to watch industry sources on Aug. 23, the second-hand Rolex Daytona White Dial watches are traded at 45 million won ($38,500) in the market, 29 million won ($24,800) higher than the official retail price of 16 million won ($13,700). Likewise, Rolex Green Submariner Date, nicknamed “Starbucks” for its green ceramic bezel and black dial, are traded at 27 million won ($23,100), about 130% higher than the retail price at 11.7 million won ($10,000).

A Rolex watch nicknamed 'Starbucks' for its resemblance to the coffee company's original logo (Courtesy of Jbstore).
A Rolex watch nicknamed 'Starbucks' for its resemblance to the coffee company's original logo (Courtesy of Jbstore).

In short, second-hand watches of the Swiss watchmaker’s most popular models are traded at more than double the retail prices of new products. Even the less popular models in the Submariner lineup are seeing additional premiums of about 5-15 million won ($4,300-12,800) apiece from the retail price.

“The prices of virtually all Rolex models have been moving up consistently over the past three or four months, setting new records,” said a second-hand luxury watch trader.

Every morning, about 50 people line up in front of the Rolex boutiques located within the main branches of Lotte Department Store and Shinsegae Department Store. They stand in line for many different reasons, from couples who want to buy the watches as wedding gifts to full-time resellers who hop around different branches to buy and sell the products for profit.

“I make my way to the department stores every morning. The Rolex store is virtually my workplace. But even for diligent people like me, it’s now difficult to buy one watch a month,” said a full-time reseller in his 40s.   

Rolex store at the main branch of the Shinsegae Department Store.
Rolex store at the main branch of the Shinsegae Department Store.

Rolex’s longstanding marketing strategy to sustain the level of scarcity by limiting global supply is a key factor impacting the price in Korea’s second-hand market. Rolex, unlike other major Swiss brands such as Patek Philippe or Omega that consumers can buy almost whenever they want, controls the supply so that its product maintains a status where a consumer can buy just one in his or her lifetime. 

While the big fashion and jewelry brands such as Chanel, Hermes, Tiffany & Co. and recently Chaumet have enchanted female consumers in the country, Rolex has become the must-get brand among male consumers.

“I have placed an order for a Daytona White Dial four years ago just before my wedding. I got a call from Rolex last month and could finally buy it. It was originally meant to be a wedding gift, but now I am going to sell it in the used item market as I expect to earn a premium of around 30 million won ($25,600),” said a male consumer in his 40s.

Another major factor impacting the price in the second-hand market is the high liquidity of Rolex watches, not only in Korea but also in different corners of the world. The second-hand market for Rolex is big and still growing in different regions thanks to the wide availability of watch components used for repair, allowing a stable supply of used watches. 

“Unlike the baby boomers who love to keep luxury items in the newest condition as long as possible and thus have not actively participated in the second-hand market, the millennials do not have any resistance to second-hand luxury goods. Moreover, the luxury goods are now considered as something to experience rather than something to own, further driving demand for used ones,” said professor Seo Yong-goo at Sookmyung Women’s University.

Write to Jeong-cheol Bae at bjc@hankyung.com

Daniel Cho edited this article.

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