There are countless watch brands out there, but perhaps one of the most famous ones is Rolex. An icon in pop culture, but how did it grow to such fame and what can other brands learn from it?
Rolex has a certain appeal to the masses. Celebrities generate a luxury and elite feel for the brand. Iconic Rolex watches decorate the wrists of Rihanna, David Beckham, Bono, Roger Federer and even to the influencer space Casey Neistat. It’s a multigenerational blend of icons who promote the brand. The brand is such an icon it was ranked #78 of most valuable brands in 2019 by Forbes.
A name with marketing in mind
The history of the watch goes a long way with the first watches starting to emerge in the 16th century with the first iterations being made in Germany and France. These watches were far away from the wristwatch we are familiar with nowadays. The watches were worn around the neck, like a necklace or to be carried in the hand. The first wristwatch was a new year’s gift to Queen Elizabeth in 1571. Unfortunately this watch no longer exists and therefore remains speculative. In 1809 at the marriage between Eugène de Beauharnais and Princess Auguste-Amélie of Leuchtenbergin the first source of the wristwatch can be traced back, where the princess received a bracelet that incorporated a watch, which was made by Parisian based Nitot in 1806. Bracelet watches would be the trend for women during the 19th century and men stuck to the classic pocket watch, which in its encased housing was more resistant to the elements. The bracelet watch was considered to be only for the ladies as they were the only ones that wore exposed timepieces.
Rolex’s story however starts in 1905 through founder Hans Wilsdorf, who opened up shop in London, specializing in the distribution of timepieces. At the beginning of the 20th century, wearing a wrist watch still wasn’t as popular as the classic pocket watch which was carried around in this fashion for centuries. Wilsdorf wanted to create a reliable and fashionable wristwatch. It’s important to note that even back then, Rolex’s movements were not made inhouse, but by Swiss company based in Bienne. The name Rolex and its subsequent crown logo, were created by Hans Wildorf in 1908. He wanted a name and a look that would do justice to timepieces. The name also had to work for any language and needed to be easy to remember.
In 1919 Rolex moved its headquarters to Vienna, registering itself as Rolex S.A. in 1920. Choosing Geneva as its base is no coincidence. Switzerland was the epicenter of luxury watches. Some of the most iconic brands such as the ultra luxurious Patek Philippe, Blancpain, Zenith, Tag Heuer, Breitling and many others come from this mythical land. While not wanting to sound like a groupie, the spillover of such brands radiates onto Rolex as well. Just mentioning the fact it’s from Switzerland, gives the brand an aura of ingenuity and exclusivity. How Switzerland became a marketing statement on its own, is a topic for another time. Rolex was the first watchmaker who invented a waterproof watch in 1927 which didn’t look like a monstrosity. The legend was housed in the iconic Rolex Oyster. It was just a year later in 1928 when English inventor Louis Recordon patented the technology for a self winding wrist watch. An important step for the premium watch scene.
Rolex was the first watchmaker who invented a waterproof watch in 1927 which didn’t look like a monstrosity.
It was clear that from the beginning Hans Wilsdorf had a knack for marketing, creating something that would stick with its customers and create a sense of exclusivity around its brand. Today we can see this in the sponsorships and advertising by Rolex in all kinds of fields that highlights its portfolio and values. The company has been sponsoring the Wimbledon Tennis tournament for over 40 years since its start in 1978. In October 2011, Rolex signed a collaboration to deal with Tiger Woods to become the ambassador of the brand. While other brands were discontinuing their partnerships with Woods after scandals about his personal life surfaced, Rolex took the bet. Over a year later Rolex became the official timekeeper for the Formula One tournaments. It’s a perfect match for a watch brand as every second counts in the world of motorsports. Through sponsoring in sports such as golf, arts, yachting it speaks to the wealthy. With its sponsorship of exploration and motor sports, Rolex wants to prove that it’s products are durable, sturdy and precise when time is of the essence.
But it doesn’t answer the question how Rolex became the watch power house it is today with a revenue of $5.5 billion, exceeding its competitors top competitors Omega, Cartier Watches and Longines with margin to spare.
Rolex in pop culture
Music and its artists can play an important role in creating hype around a brand. Ferrari’s, Bugatti’s and Lambo’s are oftentimes featured in hip hop music videos. They are expensive, exclusive and exude luxury. Rolex rides high in this scene as well. It’s ingrained in rap culture. But it’s not just Rolex which is capturing spots, watches are a significant aspect of hip hop culture. Rolex is part of an ecosystem of brands that flow between artists and pop icons.
But, while hip hop was a pretty underground scene from disenfranchised minorities, as it entered the mainstream, lyrics morphed into emphasizing material success.
The website Magneticmag wrote a great piece on the presence of watches in hip hop through the decades. Watches have been around since the 70’s with groups such as Sugarhill Gang popularizing. But, while hip hop was a pretty underground scene from disenfranchised minorities, as it entered the mainstream, lyrics morphed into emphasizing material success. According to Harvard Politics, 1990’s lyrics and contemporary ones are nearly unrecognizable, saying, “Rap was the story of the ghetto life and the anthem of gangsters, which prevented hip-hop from joining pop and rock in the mainstream.” Lyrics were about the struggle of living in poverty, violence and hustling to make ends meet. Kanye West heralded the transition in 2004 with his debut album, away from ‘ghetto life’ to other themes, such as religion. Drake writes music about relationships and it’s complicated aspects, skipping most of the misogynistic aspects that previous artists fancied years earlier.
As hip hop was moving into the mainstream, it was also transitioning into the digital age. If you’ve ever scrolled across Ïnstagram you’ll quickly discover that despite its shallow appearances, it has become a feast of portraying wealth. It’s the perfect catalyst for hip hop to reinforce its materialistic message and push luxury products across the platform to younger generations.
The power of perceived value
Having a beautiful origin story and being referenced in pop culture is all great, but we haven’t answered the fundamental question that lies at the core of many of the most valuable brands today, why are consumers envying those who have it and why do they aspire to buy it? Many in the advertising and marketing world will know the term perceived value, where a product’s value is higher than the actual cost of producing it.
In an article written by Harvard Business Review in 2016, they’ve identified 30 elements of value in which consumers weigh a product’s worth and hence its price. I won’t bore you with all the 30 different elements, but to give you a overall picture, they’ve nested the 30 elements of value in four different categories, namely functional, emotional, life changing, social impact. Each level touches on a different aspect of how the consumer perceives a product. Ranging from it having a purely functional feature such as quality, cost reduction or simplification to creating a sense of affiliation and belonging.
They said about Leica, one of the top camera manufacturers in the world, “And when the owner of a $10,000 Leica talks about the quality of the product and the pictures it takes, an underlying life-changing element is self-actualization, arising from the pride of owning a camera that famous photographers have used for a century.” You can also ask why would people rather drive a BMW compared to a Honda? It’s not because the BMW is vastly different from a Honda. The technology is the same, both using a combustion engine. It’s because consumers would rather pull up with a BMW at the office than a Honda. The BMW uzes success.
According to the research conducted by Harvard, they discovered that quality reigns supreme above all other of the 30 elements in the value pyramid. Quality is followed by sensory appeal.
Piecing the elements together it becomes clear why Rolex has such a high appeal. Through its sponsoring the brand positions itself among the elites of society. It’s high price tag, ranging in the thousands of dollars, makes it unreachable for those not part of this elite group. Moving its headquarters to Geneva and entering the ranks of the top of the shelf watch brands, Rolex created an aura of quality, whilst not even making its own timepieces. Every aspect is a well choreographed marketing machine that creates value around a mass production watch.
Rolex’s value and status is enforced by record breaking sales of iconic watch pieces. During an auction at Phillips in New York, the Rolex Daytona of Hollywood icon Paul Newman was sold for a whopping $17.8 million in 2017. The brand crawled to the ranks of Patek Phillipe which sold for $24 million just three years earlier. A Rolex Bao Dai, belonging to the last emperor of Vietnam, his Majesty Bao Dai was sold for $5 million in 2017. The list of Rolex’s fetching high prices at auctions is long and extensive. Worn by a multitude of celebrities.
Pop culture references and it’s persistent dominance in the celebrity scene, create desirability also among the elites, as they have the validation of being part of a privileged community. A Rolex does not differ much from a Seiko, Swatch or Tissot wrist watch, but they do not come with the value attached to it. We can even argue that the latter ones cannot attain such heights anymore if they wanted to despite being just as reliable.
Creating value for your brand
I hear you thinking, that’s great, I’ve learned a lot about how Rolex has become an icon. You’re envisioning you need to rally the influencer troops to make your brand enviable. Desirable. And the dollars will come your way. But remember that the Rolex appeal from a celebrity like Paul Newman didn’t come out of thin air. A lot went into making the watchpiece an icon. Paul Newman wore the Daytona for the cover of an Italian magazine and the Italian enthusiasts and dealers were eager to buy the unique watch piece. But a magazine cover alone won’t make your product sell like hot cakes. Paul Newman was the embodiment of Hollywood allure. The Italians loved it and started buying the watch, creating a form of scarcity.
A lot of new watch brands that cirkel the Instagram and YouTube space today devalue themselves by aiming at the high price point of established brands, claiming they can do the same for less. And while in technical terms that is correct, you won’t persuade the watch enthusiast for your cause. Your targeting an audience that wasn’t aiming to buy into high end watches anyway. The same goes for other products and brands. Positioning is key, because the new brands that sell themselves as bang for buck, will never nudge themselves in the elite watch class and consumers will never envy your product.
For you as a business owner or marketer, you need to look for a unique proposition which justifies the higher price. If that’s your aim at least, because there is nothing wrong with wanting to be the underdog. But the underdog won’t become a legend by undercutting competition. An icon is born from history, performance and appeal. You need to find the right channels, the right people and sponsorships to lift your brand into something more than just a product. This requires serious investments and a healthy dose of patience, because brands don’t become icons overnight.
