The Gold Apple Watch; Not Going To Fly, Is It?
SO. Apple’s brought out the iWatch and as a piece of tech it looks not half bad. It’s a phone, a fitness gadget, can help you read maps and, well, it’s actually a blindingly interesting piece of kit. Whether people will go mad for it we’ll just have to see.
However, there’s a certain problem at the top end of the range, where they’ve got a gold iWatch. Yes, OK, there’s lots of gold watches out there. So, obviously, there should be a gold version of the apple Watch? Yes or no?
It’s a difficult question that. For the gold watches are really something called “Veblen Goods”. Put simply, this is stuff that you buy so that you can show that you’ve got enough nous, or style, or simply cash, to be able to buy these sorts of goods. This is true of a Rolex just as much as it is true of a Hermes scarf or Louis Vuitton luggage.
Apple can certainly compete with that, no doubt about it.
However, the other side of this is that people who go buy a gold watch are expecting it to last for a number of years. Generations in fact: people do indeed inherit grandad’s gold Rolex for example (actually, my brother got his steel one but the principle is still there). And those watches maintain their value well too.
But what’s the value of a second hand electronic watch? Even with a gold case? Pretty much spit actually. Maybe OK for a year or two: but after 5 years the electronics will be so behind the times that it will be valueless. And there’s another thing. For a horrible technical reason (“tin whiskers”, basically electronics made without lead based solder die after three or four years on average) even if the electronics isn’t superceded it’s still go wrong soon enough.
So that electronic gold watch has some benefits: yup, still terribly cool and a status symbol to have one. But also some disadvantages re mechanical ones: it won’t keeps its value and after a couple of years it’ll be worthless.
Be interesting to see how this works out. But Jony Ive, the apple designer, is on record as saying that Switzerland’s in trouble with this Apple Watch release. But that’s to misunderstand that high end watch business. As the CEO of Rolex once said, what do I care how the watch business is doing, I’m not in that business, I’m in the luxury business.
And luxuries that blow up after a couple of years tend not to do all that well.
Posted: 10th, September 2014 | In: Money Comment | TrackBack | Permalink
