PRICES, MARGINS AND POSITIONING

Today the price of a watch is mostly dictated by product positioning. If the difference between the price and the intrinsic value of a watch becomes too great, there is the risk of a explosion. We have decided to be completely transparent about our prices, and to use a price multiplier of 3.5.

Positioning

Today the price of a watch is mostly dictated by product positioning. Target consumers are defined by analyzing their behaviour; their buying habits, the brand of their toothpaste. Finally their dream watch can be created, suited to their budget.

After the positioning and price have been defined, production costs are optimized by playing with the origin, the complexity of the construction, and the quality of each component.

The goal is to match the industry standard multipliers, which are generally 6 to 8 times cost price. In practice there are ‘aggressive’ brands which use a multiplier of 5 and, rarely, some who have succeeded in creating a perceived high value, allowing them to apply a multiplier of 10 or more.

Usually the retail price is equal to the cost price multiplied by 6 to 8.

PRICES GO UP PRICES GO DOWN

Between the years 2005 and 2012 the Swiss watch endlessly broke export records. During this euphoria, the general trend was rising prices – meaning a change in market positioning – which has not always translated to rising quality. Often it is simply a case of the margins being raised.

Pricing policy relating to product positioning (which essentially states that the price of a watch should match the price the customer is willing to pay) can lead to excessive variation between the price and the intrinsic value of the product. This pricing approach represents a huge risk at a time of sudden fluctuations in the economy or in purchasing behaviour, as has been the case recently with the global crisis, the strong Swiss France and smartwatches. Prices are not infinitely elastic, and the consumer is not stupid.

In this new environment, many brands have lowered their prices and returned to a reasonable quality/price ratio. This is a healthy reaction, but some consider it to be too late. Inventories have grown amongst retailers who find themselves in a very difficult position. This creates a situation where alternative networks (the secondary market and gray market) are often the only safety valve preventing the explosion. We will go into further detail on this in Chapter 3 on April 27th: Exclusive distribution and community power.

If the difference between the price and the intrinsic value of a watch becomes too great, there is the risk of an explosion.

PRICE TRANSPARENCY

Purchasing behaviours are changing. The consumer compares, shares and comments. They want a watch that is well designed, loaded with emotion, and that has a high quality/price ratio.

We plan on doing two things to mark the foundation of our pricing policy: first, following our commitment to remain transparent we will communicate and explain the production cost of all of our watches. Secondly, by selling directly to the end consumer e will be able to apply a uniquely low multiplier of 3.5 to our production prices. The retail price will not be the result of product positioning; rather it will be directly related to production cost.

Some brands have already started selling online directly to the end consumer, thereby eliminating retailer and distributor margins. We believe this is a trend that will continue to grow in years to come. That said, our approach goes a step further. We will be selling our watches worldwide through our website, but not exclusively. More will be explained in the next chapter: Exclusive Distribution and Community Power.

The retail price will not be the result of product positioning; rather it will be directly related to production cost.

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    • Jonas
      Jonas says:

      Abbiamo un servizio clienti che vi risponde via e-mail, telefonicamente dal lunedì al venerdì dalle 9.00 alle 12.30 e dalle 13.30 alle 17.00.
      Se il vostro orologio deve essere spedito per la riparazione, ci occuperemo noi e metteremo in funzione il nostro centro di riparazione.
      Nessuna preoccupazione 🙂

    • Jonas
      Jonas says:

      Quel plaisir de vous lire Alain !
      Nos clients et clientes sont au centre de nos préoccupations.
      Nous sommes ravis d’apprendre que vous appréciez notre service client 😉

  1. l'houary perez bennabi says:

    J’adore vos montre seul reproche vous n’avez aucun modele en couleur OR avec le bracelet Or ou des models comme anomalie 01 que je trouve excellent mais en couleur OR elle dois encore plus mise etres en valeur dommage que personne ne sait poser la question
    J’espere qu’il ne s’agit pas d’une Anomalie mais d’un simple oublie

    • Valentine
      Valentine says:

      Bonjour,
      Effectivement nous ne proposons pas d’or dans nos modèles d’anomalies. Je pense que ce n’était pas un oubli mais un choix 🙂
      Nous notons toutefois votre avis pour nos projets futurs !
      Bonne journée

  2. Jonas
    Jonas says:

    Si vous ne souhaitez plus recevoir nos messages, je vous invite à cliquer sur le lien “se désinscrire” qui est situé au bas de chacune de nos communications.

    • Kasim
      Kasim says:

      Unsere Kollektionen und deren Preise finden Sie auf unserer Website, dazu müssen Sie nur oben links auf Kollektionen klicken und anschließend eine auswählen.

  3. Paolo Toscanelli says:

    Vi ho scoperti per caso, proprio oggi, mentre sfogliavo alcune pagine sul web.
    Complimenti per la vostra trasparenza e serietà.
    Da quando esistono i cellulari o smartphone che dir si voglia, non porto più l’orologio ma, le vostre creazioni, devo ammetterlo, mi stanno facendo tornare il desiderio di riaverne uno al polso.
    Seguirò con curiosità e ammirazione il vostro sviluppo e chissà che, tra pochi mesi, non faccia parte anche io della schiera dei vostri clienti.
    Bravi !!

    • Valentine
      Valentine says:

      Grazie per il vostro feedback. Infatti, ora con gli smartphone, gli orologi non hanno più lo stesso uso. D’altra parte, preferiamo vederlo come un bel gioiello, un’impresa meccanica 🙂

      • Jonas
        Jonas says:

        Voici la marche à suivre Klaus :
        Pour passer une commande, rendez-vous sur notre site internet https://code41watches.com, connectez-vous à votre compte ou créez en un. Ensuite:
        1) Cliquez sur l’onglet : Collections
        2) Cliquez sur l’onglet vert – Ajouter au panier qui se trouve à côté de la montre que vous désirez acheter
        3) Vous pouvez ajouter des montres et bracelets à votre panier en cliquant sur l’onglet “Poursuivre les achats”; ou cliquer sur l’onglet “Procéder à ma commande” pour finaliser votre commande
        4) Remplissez les détails de facturation et livraison avec vos informations personnelles
        5) Choisissez votre moyen de paiement
        6) Acceptez les conditions générales de ventes
        7) Et pour finir, cliquez sur l’onglet vert “Payer maintenant””

        N’hésitez pas à nous contacter si besoin 🙂