- [Narrator] Let's say you wanted to buy
a popular Rolex Daytona watch,
a new one would cost you $14,800.
But if you wanted to buy a used version of this same watch,
you might need to pay over $38,000.
So why are people spending more money to get a used Rolex?
- If you use your watch primarily for telling time,
then we're not of the same mindset.
- [Narrator] Here's why the used watch market is booming,
and what Rolex is doing to get in on the action.
This is the economics of used Rolexes.
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Experts suggest that it takes about a year to make a Rolex,
and wait list for new watches can last months to years,
and because of that.
- These days you can't walk into any Rolex store
any Rolex dealer and just get any watch that you want.
For the past few years, as demand has increased,
Rolex has not been able to keep up with that demand,
their production just can't match
the number of people that want a Rolex.
If you've got 10, $20,000 to burn, you really wanna watch,
you're probably gonna go to the resale market
because the watch that you want is gonna be available there,
and so the prices on the resale market have then gone up
because there's more people going to that market.
- [Narrator] 29% of collectors
reported paying more than retail price
for their most recent pre-owned watch,
according to a report from Boston Consulting Group.
And 40% said that one of their top reasons
was that they were able to avoid long waiting lists
in the firsthand market,
this has created a boom in the secondary market.
Pre-owned watch sales reached 22 billion in 2021.
The used sector is actually growing faster
than the primary market,
and for some people
used watches are worth more than new ones
that's because some rare styles are more desirable,
or because Rolex has discontinued certain models and colors.
- An older model Rolex can have a patina,
it can have some wear marks,
and so those kind of personal details,
those kind of personal age marks,
those are things that collectors might want.
There is also a bragging rights thing
where if you have a Rolex from the '70s or the '80s,
you're able to say it's from this era,
it's, you know, 20, 30 years older than I am
and that is just kind of cool to collectors in a way.
The market about a decade ago
was softer than it is right now.
Back then, you could sell a watch and get a return on it,
but you could also sell a Rolex
and it could have depreciated in value
and you could lose money on it.
These days you now will likely make more money off of it
if you sell it on the resale market.
- [Narrator] Much of the success of the used watch market
is due to the rise of online watch resale marketplaces
over the past decade.
That's where people like Paul and Carol come in.
- (laughs) Can we hold that.
- Get over there buddy.
- [Narrator] The husband and wife duo
run Bob's Watches, an online marketplace
for buying, selling, and trading luxury watches.
They say that they currently have
one of the largest selections
of used Rolex watches in the world.
- I started out in the watch business
because I could see that there was no real safe,
transparent, honest place for people
to buy and sell pre-owned watches.
It's been an upward trend since 2010,
we've been growing consistently
about 30 to 40% year-over-year.
Two years ago we did $100 million in sales.
- There's so much more for us to tap into
that we haven't had the bandwidth to get to
because the growth has been so fast and furious.
- [Narrator] And Paul and Carol love Rolex's.
Sales of used watches online
already exceed auction and store sales,
and one report predicts
they're going to reach close to 60%
of the secondhand luxury market by 2026.
- During the pandemic, the stock market goes crazy.
You have the kind of crypto phenomenon,
you have meme stocks happening,
and people have a lot of extra capital
and they're taking that in many cases
and they're putting it toward assets,
luxury goods and in a lot of cases watches.
- [Narrator] Starting in 2020,
used luxury watches sold for 1.5
to three times their retail prices.
- Rolex is a brand that's really recognizable
in it's designed, it's, you know easy to spot on the street.
And a lot of people, they'll see that
their friend has a given Rolex,
and they think, "I want that too."
- But Rolex, the company, only sold new watches,
which meant that the brand
wasn't involved with used watch sales,
that is until late 2022.
Rolex opened a certified pre-owned program
for its used watches.
Retailers can send used Rolexes
that are at least three years old back to the watchmaker.
The certified pre-owned program
verifies that a watch is an authentic Rolex
and works properly,
then retailers can sell the watch
with an official Rolex certificate.
The program is already active
in one retail chain in six different countries.
Another chain of official Rolex retailers in the US
will enter the program this May.
Buying a watch with Rolex certification
could be a draw for first time buyers.
- You're buying a watch on the internet,
it can be a little bit of a daunting experience.
- Of all the watches on our website today,
almost 50% of them already have
the original box and papers from Rolex.
We've offered a CPO program,
a certified pre-owned program now for almost five years.
The only thing really new about it
is that Rolex is certifying
and doing the paperwork behind it.
So I don't feel that there's any increased competition,
but I do feel that the market is big enough
for everybody to participate.
- Today people buy Rolexes online
the way that they might buy toilet paper,
so it's really not a premium or a specialized experience.
There's still that consumer
that wants to have that experience of going into a store,
of being waited on, of kind of being shown watches
from a glass display case, and making it feel more special
because they're buying something of such a high value.
- [Narrator] This certified pre-owned program
means that Rolex can take a cut out of a market
that it previously left untapped,
but things might continue to shift
for the luxury watch market.
The used watch market is cooling down
as sellers eager to make a profit
have flooded the market with inventory.
Recent data shows the number of Rolex watches
available to buy secondhand,
roughly doubled from the beginning of 2022
to September of the same year.
- On those really coveted kind of brand name watches,
so to speak, the ones that collectors talk about
the resale value has gone down a little bit.
Resellers, people that watch that market,
they do say that the prices have come back down
to earth a little bit, but the volume of sales,
the amount of sales happening
that still remains pretty high,
we're seeing still a large number
of transactions in the resale market.
Your day-in, day-out Rolex
is still retaining a lot of value on the resale market,
you can still get a pretty good return for it.
As with any resale market,
there is a risk that the Rolex market
can fall out at any time.
Five years ago, we might not have been talking about
how crazy this market is,
and five years from now we might not be talking about
how crazy this market is.
The market is so large
that to a certain extent both things can be true.
You know, people that watch this market
will say that that's just actually a reflection
of how big the market is now,
where it can behave in many different ways
just because it is this kind of really large
transactional marketplace.
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