History
The fact that Rolex’s website breaks down its extensive history into several sections, beginning in 1905 under a different name, should be a hint as to just how long and illustrious its history is.
Rolex was founded by Hans Wilsdorf and his associates in London in 1905, but the name “Rolex” didn’t come about until 1908, and by 1919 Rolex moved to the renowned watchmaking centre of Geneva, where it has grown and flourished ever since.
Its long and prestigious history has long been one of its biggest assets in the luxury watch market.
When you buy a Rolex, you’re buying a watch from the watchmakers who supplied watches to those who swam the English Channel, broke race car speed records, ascended Everest and plumbed the ocean’s depths, and occupied the White House.
Reason 1 -Perception
With everyone from prime ministers and presidents to movie stars and athletes rocking Rolexes, it should come as no surprise that Rolexes have maintained a consistently-good public perception for decades and are likely to do so into the foreseeable future.
As with any brand, they have their ups and downs, but both the quality of the watches as well as their consistent star power have long made Rolex synonymous with quality luxury watches.
Justin Koupallis is the founder of The Watch Club, a respected, classic, luxury watch outlet and site for aficionados in Old Bond Street in London, and he put it best:
“Rolexes sell and hold their value so well in large part because it “has never sold out to its customers.”
Consumers respect Rolex’s commitment to quality, style, and aesthetic similarity without sameness and innovativeness without absurdity.
Their watches, as Koupallis puts it, have a “family resemblance” that remains “consistent” across the eras while still allowing plenty of room for innovation.
As a result, new models feel fresh, old models retain a timeless appeal, and when you buy a Rolex it’s recognizably “a Rolex” – and the sense of high craftsmanship, classic feel, and well-cultivated aura that entails.
Whether or not “perception is reality,” the enduring market perception of Rolex translates into a reality of great value accruement over time for their watches.
Reason 2 -Marketing and Branding
Of course, a lot of that has to do with the way in which Rolex markets its brand.
They certainly don’t skip over the fact that they’ve had so many celebrity wearers over the years.
On the contrary, you can buy models fashioned after some of their most famous classic designs worn by some of their biggest names.
Even more valuable than individual stardom, however, is Rolex’s ability to brand itself with an enduring aura of quality, which it does in part by linking itself to the amazing feats of its wearers.
As alluded to above, Rolexes have been worn at the top of Everest by mountaineers and submariners beneath the waves.
That’s an invaluable symbol of versatility.
Every watch brand says that they’re versatile, but how many can say that they’re versatile enough to be worn on the moon? Then there is the scarcity principle.
The laws of supply and demand heavily favor Rolex (as well as those looking to invest in one) because there are so many people looking to wear them but a limited number of people who can afford them.
That’s especially true with the biggest value-holding Rolexes, the ones worn by celebrities or in famous events or which have otherwise achieved some degree of fame.
As with a fine wine, these watches – as long as they remain in good condition – often get better with age in the eyes of eager collectors because they become scarcer and more sought after.
Reason 3 -Celebrity Endorsements
Winston Churchill, Paul Newman, Bono, Roger Federer, Tiger Woods, Warren Buffet, and Martin Luther King, Jr. all wore Rolexes, while Rihanna, Jennifer Aniston, Charlize Theron, Sophia Vergara, Sandra Bullock, Serena Williams, and Natalie Portman have shown off Rolex models designed for women.
And hey, celebrity couples love them too – just ask David and Victoria Beckham.
When you have that kind of star power behind your watch models, it’s no wonder why they continue to hold their value.
You can even track the specific Rolex models celebrities wear and buy them yourself, ensuring bragging points now and added value later on.
As that star’s legend grows, so too does the value of your Rolex.
Reason 4 -Quality of Materials
Rolex has a strong reputation and sturdy watchmaking materials to match.
The brand employs everything from its famed Oystersteel (a corrosion-resistant member of the 904L steel family that acquires an eye-catching sheen when polished to fine platinum) and precious stones and jewellery to create watches that look great and last for ages.
Reason 5 - High Craftsmanship
How are Rolexes able to make it to the moon and back? Quality craftsmanship is a big reason why, which is also why they hold their value so well.
That testament to quality is rooted in the company’s very beginnings: Rolex received a “Class A” certificate in 1914 for its quality craftsmanship and has never looked back.
Rolex even employs 3-D X-ray machines to check every link of every bracelet while ensuring that every watch conforms to +/- 2 second daily accuracy at a minimum.
Again, watches, like other forms of jewellery, can accrue value over time.
However, if the watch is cracked, rusty, or falling apart, it will lose value if not come apart completely and become worthless.
Thanks to the consistently high quality of craftsmanship in Rolex watches, however, there is a way higher chance that an investment in a model today will see significant returns on that value as decades pass, the watch grows scarcer, and the laws of supply and demand coupled with that aforementioned point about scarcity work in your favor.
Reason 6 -Price Point
Nothing sells like exclusivity, and that’s precisely the aura Rolex creates around its watches with its price points.
The idea that “not just anyone” can buy a high-end Rolex makes those who can feel even more confident in the watches they buy, helping those Rolexes hold or even grow their value via that aura of exclusivity and thus perpetuating the cycle.
For all of these reasons, Rolex holds and even accrues value over time better than most luxury watch brands, making them a savvy, timeless investment for watch lovers everywhere.