Fear of missing out — FOMO —is such a cliché it has its own hashtag.
It is normally used by teenagers, unable to unglue themselves from their social media feeds, but it is even more important to the business of luxury watches.
FOMO is why watchmakers create limited editions and boutique-only pieces and why they hoard these watches for their own boutiques.
By creating scarcity, they make potential customers fearful that they will miss out on buying a limited edition, so they rush, American Express in hand, to the only stores that stock them.
As I have written many times before, this is intensely annoying for the authorised dealers of watch brands, because they are left with core collection watches that are made in much larger quantities, and often for many years without alteration. Customers do not need to rush for these watches, so retailers have to use their other skills to stimulate demand.
I have always objected to boutique-only limited editions because they create an un-level playing field that gives directly-owned monobrand stores an unfair advantage over the authorised dealers that account for over 90% of sales in this country.
I continue to believe this is short-sighted because great store owners, with generations of experience and the passion of entrepreneurial small business owners, will always be much better retailers than Swiss watchmakers.
I have no problem with limited editions if authorised dealers can get hold of them as easily as directly-owned branded boutiques. But they can’t. I have heard too many stories of retailers calling their brand reps begging for a limited edition that one of their customers has requested, only to be told it is a boutique-only watch and they will need to send the customer their way.
I reckon at least half of these customers turn down the chance to head to the boutique because they want to stay loyal to their local store owner, so the brand doesn’t gain a customer while the AD loses one.
There is another way of generating FOMO, and that is by stimulating demand to such an extent that supply cannot keep up. This is the trick that Rolex, Patek Philippe, Audemars Piguet and Richard Mille have pulled off for their hottest models.
Richemont, Swatch Group and LVMH brands may look on with envy at this phenomenon as if they have no power to copy it without artificially restricting supply.
But what if they flipped this around and, rather than limiting supply, they focus instead on driving up demand?
This is precisely what Tudor managed with the launch of its highly commercial classic blue Black Bay Fifty Eight in July. Nothing had been heard from Tudor, or its parent organisation Rolex, since Baselworld was cancelled, so there was always going to be buzz around a new watch launch, but the impact of this single watch was off the scale.
Authorised dealers had been given sight of the watch ahead of the launch, and were ready to splash the news across their social media feeds. They had the watch in stock from the day it was launched and were highly motivated to promote it. Tudor helped them with digital assets and an Instagram post by David Beckham to his millions of followers.
The result, according to Tudor dealers I have spoken to, was an immediate rush for the watch because people worried (or hoped) it would become as hot as a Rolex Submariner, with waiting lists and rising prices to match. They might be right. The £2,760 list price watch is already being offered for sale on the secondary market for between £3,700 and £4,300, although it is unclear whether people are paying these prices.
Tudor is still a niche brand outside watchmaking circles, but it has generated the sort of FOMO normally reserved for a new Hermes Birkin. If Tudor can do it, I see no reason why IWC, Cartier, Omega or Breitling could not, and authorised dealers for these brands stand primed and eager to help them if they are given a fair and equal opportunity.