The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
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Gilbert: Rolex's High Quality Stems Directly From Unmatched Scale Economies
“The reason why they truly are among the very highest quality watches in the world is because they throw their scale economies around. They do absolutely unreasonable things to engineer and build and test these watches that other people in the industry just can…”
The Apple Watch launch was highly beneficial for ultra-luxury mechanical watchmakers
“It was the best thing to ever happen to Rolex, Audemars Piguet, Patek, etc.”
Rolex is not true luxury because it prioritizes high-volume revenue
“This is part of my argument that Rolex really isn't luxury at all. They have hit the sweet spot in the market. If you think about a curve, like an X, Y axis, they have found the sweet spot where you can maximize revenue, where you just sell an absolute ton of …”
Rolex is likely worth over $100 billion in enterprise value before assets
“There's no way that this business is worth 40. I don't know if it's worth 200, but it's worth a hundred plus. Zero doubt in my mind.”
Rolex uses Tudor as an R&D sandbox to protect its core brand
“I think it's kind of an innovation lab. It's a way to protect Rolex's brand, because if there's something new and interesting that might be a fad that customers seem to be caring about in the watch world, Tutor can go and implement it, and they can figure out …”
Modest annual price hikes establish a price floor and guarantee Rolex appreciation
“Well, they raise prices slowly every year. It's a modest price increase every year that kind of sets the floor. And frankly, if they do it over enough decades, Everybody just believes forever that these things are gonna appreciate, because it's almost like the…”
Gilbert: Rolex manufacturing and engineering quality surpasses any industry
“They're going to absurd lengths to make these things the highest quality engineered and produced products in the entire industry or in any other industry too.”
Gilbert: Rolex would probably rank among the world's top 50 companies
“And so if this thing were to publicly trade, listing with its assets, It's probably top 50 companies in the world.”
Rolex possesses zero direct customer contact data due to its dealer model
“They, like, don't have their customer's email address or names or addresses because that data belongs to the authorized dealer. Rolex doesn't actually know who's buying their product or who likes their product, which is kind of crazy for a modern company of th…”
Gilbert: Rolex Could Profitably Operate 1,500 Monobrand Stores
“Rolex has 1500 authorized dealer locations, and if all 1500 of those were Rolex stores, they would absolutely do a great job paying rent.”
Rolex likely captures roughly 40% of total Swiss watch industry profit
“I would bet it's way closer to 40% for Rolex's operating margin. My best guess is that while they account for 30% of the industry's revenue, it's in the neighborhood of 40% of the total Swiss profit.”
Gilbert: Rolex never intended to become a luxury brand
“I don't think Rolex wanted to be in the luxury business. I think they wanted to be a lifestyle brand. I think they wanted to have fantastic engineering. I think they wanted to continue making things a little bit better every year. They wanted to have the very …”
Rolex deliberately prices retail watches well below market-clearing levels
“They could sell their products for much, much more than they do, and they do not, because it is the right long-term decision to do so.”
Gilbert: Rolex Submariner is powerful enough to be its own standalone franchise
“If you separated Submariner from Rolex, Submariner may actually be a bigger deal. Submariner is its own whole franchise.”
Gilbert: Luxury brands sell functional alibis to rationalize social signaling
“Back on our Rolex episode, we threw out the idea of a functional alibi, a reason you could claim that you need such a watch. For Ferrari, they have lots of incredible alibis. Most people do not experience the thing that you just described, feeling maximally al…”
Rosenthal: Rolex watch buyers are roughly 50% men and 50% women
“And even to this day, I believe the market of buyers for Rolex watches is basically fifty-fifty, men and women.”
Rolex significantly doubled down on US marketing spend during the 2008 crisis
“So interestingly, Rolex actually massively doubled down on their marketing spend in the US during the 2008 financial crisis”
Rolex commands 30.3% of the entire Swiss watch market by revenue
“Morgan Stanley and Lux Consult estimate it at 30.3% of the whole Swiss watch industry. No one else even comes close. Cartier and Omega have 7.5% each.”
Omega was a significantly larger brand than Rolex through the 1960s
“In this forties, fifties, sixties, Omega was the big brand. Like Rolex had a target in mind to beat, and that target was Omega, who was bigger.”
Gilbert: Rolex navigated the quartz crisis through cash strength and conservatism
“Rolex had a built-in hedge because of their independence and because of their cash position. Everybody else is just gonna do all the scrambly stuff fast. They're all super reliant on each other, and they're all overextended. And Rolex is this incredibly conser…”
Rosenthal: Rolex Is the Most Optimally Positioned Company on the Supply-Demand Curve
“Rolex is positioned at the perfect point on the curve of price and quantity. They are the most optimally positioned supply-demand curve company I think we've ever covered.”
Gilbert: Rolex did not buy Bucherer to gain retailer leverage
“Yes, it will help them improve their economics for watches that they sell through Boucherer, but not why they did it. Yes, it will help them improve leverage over other retailers, but they didn't need that. They already do things like, gee, it would be nice if…”
Rosenthal: Paul Newman Daytona craze was luckiest event in Rolex history
“The Italian affair, the Paul Newman affair, is the luckiest thing that ever happened to Rolex, because this gave them the golden opportunity to do that.”
Gilbert: Rolex would only be a 'good' business today if it adopted quartz
“And so I think if they had gone quartz, Rolex would be fine today. That would be a way to build a good business. But the way to potentially build a great business was to try this crazy Blancpain-esque strategy, but at scale with one of the biggest and most suc…”
Gilbert: Rolex waitlists only applied to steel Daytonas until 2015
“Weightless were only really a thing for, until, honestly, like, twenty-fifteen for, like, steel Daytonas. The rest of it, you could just buy.”
Omega released the world's first dive watch in 1932, before Rolex
“In 1932, Omega released a waterproof watch, which is, I don't know, half a decade after Rolex. This is considered to be the world's first dive watch. No one talks about this today. You hear dive watch, you think Rolex, but Omega had the first dive watch.”
Rosenthal: Rolex is stronger than ever by restricting supply instead of price-gouging
“And Rolex followed this exact playbook over the last 10 years of not price-guiding themselves out of the market, but intentionally limiting supply, letting the secondary market go nuts, and then by keeping an even keel for themselves, and then now that there's…”
Rolex generates $10 billion in annual sales with 16,000 employees
“They have 16,000 employees doing ten billion a year in sales.”
Gilbert: Rolex does not engage in paid product placement
“Because Rolex does not engage in, ugh, paid product placement.”
In 1978, 80% of Americans had never heard of Rolex
“And incredibly, Joe Thompson tipped me off to this, in a study conducted by Gallup in 1978, they asked the question, have you heard of Rolex? Eight out of 10 Americans in 1978 answered no.”
Rolex originally manufactured Panerai's first dive watches for the Italian Navy
“This is Panerai. This is the Panerai watch. Rolex makes the Panerai watch. So, you know, anybody who knows Panerai, famous, you know, very Art Deco style dive watch. They have two main models now, the Luminor and the Radiomir. Yeah, Panerai was a retailer befo…”
Rolex operates its business model like Porsche, not Louis Vuitton
“My best comparison that I think I came up with is Rolex is Porsche. And I know there are different categories of price, but, like, cars are expensive things, and you do need one anyway. It's real scale manufacturing with a high-quality engineered product with …”
Rosenthal: Federer-Rolex ranks just behind Jordan-Nike among athlete partnerships
“I don't think the Federer Rolex relationship is quite like a Michael Jordan Nike relationship, but it's in that next tier of great athlete partnerships”
World War I was the best thing that ever happened to Rolex
“World War I is truly the first crucible moment for... Rolex, because it's the best thing that ever happened to the company and the industry. It made the whole world care about wristwatches.”
Rolex acquired its largest retail partner Bucherer for a rumored $5 billion
“Twenty-twenty-three, they spend a rumored five billion dollars. Five? Five, yeah, that's what I read. I mean, nobody knows the details of the transaction, but to buy one of, if not their largest single retail partner, the jeweler Boucher, eh?”
Gilbert: Sir Edmund Hillary preferred a Smiths watch over Rolex
“However, Sir Edmund Hillary did not prefer his Rolex. He had a Smith's watch that he preferred to wear.”
Gilbert: Iconic luxury products should only be tweaked every seven years
“Once you create the Porsche nine 11, you should just tweak the Porsche nine 11 once every seven, eight years, and that way you can buy a nine 11 just like your grandfather bought a nine 11.”
Louis Vuitton, Hermès, and Rolex founders were all 19th-century orphans
“The founders of arguably maybe the three biggest and most significant luxury brands in the world today were all orphans from the 1800.”
Rosenthal: Luxury brands cannot permit regional product quality variations
“That is the absolute opposite of what you need to do as a luxury company. It can't be like, this one's better than that one, or different levels of quality, or these imperfections here, and it's cute. It's like, absolutely not. That is critically important bec…”
Gilbert: Rolex steel watches had higher customer demand than precious metals (2020-2022)
“In the hype of 20 20 to 20 22, the precious metals were actually easier to come by as a customer because there was so much less demand to go buy a 30, 5000 thousand dollar watch that those would kind of be lying around while the steel ones were flying off the …”
Rosenthal: Rolex's key advantage is sticking to its strategy longer than anyone
“Not that there haven't been major changes and different eras of the company, but they have stuck with a strategy and a positioning and a product lineup and a culture longer than just about anybody else.”
Tudor accounts for less than 1% of Rolex's total production volume
“It is a shockingly low percent of Rolex's production. Less than one percent.”
The Lady-Datejust is the single best-selling watch model for Rolex
“Still to this day, the Lady Datejust, I believe, is the single best-selling model in the Rolex catalog.”
Gilbert: Rolex lifestyle ads transformed it into a real challenger to Omega
“And I do think this was the very first sort of chip of what made Rolex a real challenger to Omega, who had been kind of the standard big Swiss watch brand. Rolex was really the one to bring lifestyle advertising to bear.”
Gilbert: Rolex uses custom terminology to avoid standard product categorization
“You'll continue to see this in everything that is in the Rolex universe, is we don't want to be lumped into any sort of a category, so we have to refer to something entirely different, such that we can't be put into a box. Like, they don't make spore watches. …”
Rolex designed the Milgauss with CERN engineers for highly magnetic environments
“It was designed in association with the engineers at CERN in Switzerland, the particle accelerator, for scientists who are working While exposed to strong magnetic fields.”