Case Study: Something everyone can learn from Rolex
From the top of the world to the bottom of the sea, Rolex proves dependable (Rolex advertisement, 1954).
It’s a brand that has stood the test of time. Rolex means comfort, opulence, and dependability. Many of world’s most popular sportsmen love flaunting a Rolex: Tiger Woods, Roger Federer, and Phil Mickelson for example. But Rolex isn’t popular only with athletes and adventurers. Hollywood loves Rolex – just ask George Clooney and Leonardo Dicaprio – as do Bollywood stars like Shah Rukh Khan and Salman Khan.
Why, though, would someone pay thousands of dollars for a wristwatch? Is it a status symbol only? Just an exaggerated bit of overinflated ego?
Let’s take a look at the company itself. There may be something to the Rolex idea. Maybe it really is the best watch ever made.
Rolex in the marketplace
Rolex took watch making to another level. According to Statistic Brain Research Institute, Rolex demands 11.8% of the market share with an annual sales of 4.5 Billion!
There are over 4,000 Rolex craftsmen working in more than 100 countries to produce an estimated 2,000 watches each day. Sir Malcolm Campbell, British speed legend, broke the land speed record by going over 300 miles per hour (484 km/h) at Bonneville on September 3, 1935. Yes, he was wearing his Rolex watch on the big day. Rolex is currently ranked at no. 65 in Forbes list of the world’s most powerful global brands.
Could there be a secret to Rolex success in the company’s founding?
A brief history of the Rolex brand
Alfred Davis and his brother-in-law, Hans Wilsdorf. started a watch manufacturing company in London, England in 1905. It was known (appropriately) as Wilsdorf and Davis. They imported Swiss movements and fixed them in expensive cases made by others. Then they took these costly wristwatches to jewelers who sold them with their own names on the dial. In 1919, operations moved to Geneva Switzerland.
The Rolex trademark had been registered in 1908. Hans Wilsdorf gave the change plenty of thought. He wanted a name that was short, easy to remember and could be used in any language. It wasn’t until 1926, though, that the first watches were produced with the Rolex name on the dial.
Rolex was the first watch that received chronometer rating, the first wristwatch with automatically changing date, first with an oscillating winding rotor (this technology is used in today’s watches too!) and the first waterproof wristwatch – to name but a few of Rolex ‘firsts.’
Rolex is not only a brand leader, but a thought leader! According to Beckertime, “Rolex set the timing standard for the rest of the watch industry.”
Their watches are crafted using the best raw materials and assembled with precise attention to detail. Their precious watches range from stylish contemporary to elegant classics and traditional timepieces.
The watches are priced according to the material used and the model. New prices start at about $8,500, while the most expensive Rolex comes with a retail price of over $485,000.
That’s right – for a wristwatch.
So why do Rolex watches cost so much?
Prestige is certainly a big part of the Rolex phenomenon.
Notice, though, that the company set its sights on excellence from the beginning. Rolex was the first company to receive a certificate of precision – and that designation came from the Kew Observatory in England.
The testing involves 45 days in five positions and three temperatures. Prior to Rolex, these certificates were only awarded to marine chronometers. Realizing the value of timing certificates, Wilsdorf insisted that all Rolex timepieces would undergo similar testing and no Rolex should be sold without its “Official Timing Certificate.”
You see, Rolex isn’t a company with trumped up prices and a moment of fame. Rolex has exemplified quality from the beginning. That’s why the name demands high respect and a high price.
Would you like your products or services to stand out? Take a hint from Rolex: Don’t ever settle for mediocre.
Abel Cane lives and works in the Pacific Northwest. Abel loves to ask the tough questions. Contact Abel via Twitter @boomalive.
Photo source: Tomharlyu / Creative Commons