Thoughts: Is Panerai fading?

[SuperLory]

Loss of two major brand ambassadors, Arnold and Stallone.

if this was the catalyst to the brand renaissance, for the past 5 years I cannot believe this has made an impact on the sales.

Who dafark buys a panerai in 2016 cos Stallone wore a daylight in 1996 ?

 

[d4m.test]

Panerai is in the midst of a marketing crisis.

One of their most important brand ambassadors, Sylvester Stallone, is ticked off at Panerai for reissuing a slytech model without his input or approval(or royalty) Panerai used basically the same design, but instead switched out slytech for "daylight" in their branding. The marginal benefit of additional revenue from this model cannot possibly offset the long term damage to its brand equity.

Nice post. What they did was blatantly copy the original watch without consent and by changing 8 letters. Originally it had been a limited 95 watch commission Stallone paid for ($14.000 each) to hand it out to everybody working on the movie. To top it off they really gave it the name of the original Sylvester-movie it figured in. It´s pure copyright-infringement backed by windy lawyers in plain "daylight" without legal consequences. Definitely not a "nice" move and the "real" slytechs (collectors value up to $400.000 each) dropped in value. Now talk of replicas....

 

[cornholio]

I know I probably risk the wrath of you Paneristi here, but its sometimes better to get an outside perspective of things, here's my opinion coming from someone who isn't a big fan of Panerai.

Now, there is the argument that all PAMs look the same, which to you Paneristi sounds absurd, but the truth is (coming from an outsider) is yes they do to us people who don't know much about them.

Take for example the Luminor line, yes they come in 3 different size variations, and yes they have different functions on the dial, yes they come in sausage or sandwich markers, but the case looks the same....as in, if you see it on someone's wrist sitting on the table next to you, chances are they all look the same and most of them have a generic movement. All of this doesn't really merit the high price that Panerai demands and that is what deters first time buyers.

I was at the Panerai store the other day and saw the 111 since I wanted to see what it is about Panerai that makes it so popular on RWI. It's a base PAM with a generic movement that goes for about the same price as a no date sub or for slightly (about $1k) more you can get a GMT II that both have an in house movement and an SS bracelet and is a watch that holds value much better, any logical person would choose them over the 111 which in my opinion looks no where near as good as say a GMT 2

 

[kilowattore]

I know I probably risk the wrath of you Paneristi here, but its sometimes better to get an outside perspective of things, here's my opinion coming from someone who isn't a big fan of Panerai.

Now, there is the argument that all PAMs look the same, which to you Paneristi sounds absurd, but the truth is (coming from an outsider) is yes they do to us people who don't know much about them.

Take for example the Luminor line, yes they come in 3 different size variations, and yes they have different functions on the dial, yes they come in sausage or sandwich markers, but the case looks the same....as in, if you see it on someone's wrist sitting on the table next to you, chances are they all look the same and most of them have a generic movement. All of this doesn't really merit the high price that Panerai demands and that is what deters first time buyers.

I was at the Panerai store the other day and saw the 111 since I wanted to see what it is about Panerai that makes it so popular on RWI. It's a base PAM with a generic movement that goes for about the same price as a no date sub or for slightly (about $1k) more you can get a GMT II that both have an in house movement and an SS bracelet and is a watch that holds value much better, any logical person would choose them over the 111 which in my opinion looks no where near as good as say a GMT 2

Not that Rolex or AP are doing differently. The sub is essentially the same for how many years? And what about the endless speciale edition AP chronos? Aren't they just changing the dials color and call it "special"?
Tbh for the non pasionate rolex observer the difference between a sub, a ND sub and a SD is just in how the date looks. Of course I know there are other different details, but I hope you get my point

It is inevitable for any brand with a strong identity to reiterate the same design with only minor tweaks/updates. The problem is at the opposite: when such brands loose their identity they loose their base.

 

[cornholio]

Not that Rolex or AP are doing differently. The sub is essentially the same for how many years? And what about the endless speciale edition AP chronos? Aren't they just changing the dials color and call it "special"?
Tbh for the non pasionate rolex observer the difference between a sub, a ND sub and a SD is just in how the date looks. Of course I know there are other different details, but I hope you get my point

It is inevitable for any brand with a strong identity to reiterate the same design with only minor tweaks/updates. The problem is at the opposite: when such brands loose their identity they loose their base.

Thats true, AP have fallen victim to the whole "limited edition" game and yet AP fans poke fun at Hublot for doing the same. And yes a sub has been the same more or less for a long time, but Rolex has the sub, gmt, DJ, DD, Daytona, YM, YM2 and a few others and each is different and has a number of variations unlike PAM that has 3 main ones and an endless number of variations. AP has the RO and the ROO mainly but then again AP is a smaller more exlcusive brand not owned by the likes of Richemonte so maybe that limits them somewhat

 

[shelby1501]

I know I probably risk the wrath of you Paneristi here, but its sometimes better to get an outside perspective of things, here's my opinion coming from someone who isn't a big fan of Panerai.

Now, there is the argument that all PAMs look the same, which to you Paneristi sounds absurd, but the truth is (coming from an outsider) is yes they do to us people who don't know much about them.

Take for example the Luminor line, yes they come in 3 different size variations, and yes they have different functions on the dial, yes they come in sausage or sandwich markers, but the case looks the same....as in, if you see it on someone's wrist sitting on the table next to you, chances are they all look the same and most of them have a generic movement. All of this doesn't really merit the high price that Panerai demands and that is what deters first time buyers.

I was at the Panerai store the other day and saw the 111 since I wanted to see what it is about Panerai that makes it so popular on RWI. It's a base PAM with a generic movement that goes for about the same price as a no date sub or for slightly (about $1k) more you can get a GMT II that both have an in house movement and an SS bracelet and is a watch that holds value much better, any logical person would choose them over the 111 which in my opinion looks no where near as good as say a GMT 2

Actually not many people would agree. Yes, many PAMs look similar but it's the same thing with Rolex for example. At the end, brand is recognizable because of that. When you see Panerai on someone's wrist, there's no doubt it's Panerai and you can't tell that for many brands.

In your example of Luminor line there are many models that look almost the same, let's say 000, 005, 111, 112 have so many things in common but thing about Panerai is in details and it's not that, because of so many similar models, you can't choose the model you want as all are the same. There are just additional options, for example if you want 000 without logo you can get 112 but if you want something completely different there is wide choice of models with different case shapes, materials, dial colors, dial configurations, functions, straps and movements to choose from.

And in what way all case shapes are the same? You have Bettarini case, 1950 case in 44 and 47mm, Radiomir in 42, 45 and 47 with cg or without, Submersible in 44 and 47, Mare Nostrum, Egi...

It's true that gen's are way overpriced, especially the ones with standard 6497 inside and that's why I would never buy gen base PAM, especially when we have so good reps of them. Also PAM 111 is one of my favorite watches and in my opinion it looks so much better than GMTII, it's all about taste, not logic. I wouldn't pay $7k for a watch that I don't like at all and would rather opt for 111 which suits me perfect no matter it's so much overpriced.

However there is also wide choice of models with in-house movement to choose from (which btw looks much better than Rolex in-house movement).

I'm not trying to say I don't like Rolex (I have few myself) and I hated Panerai when I first came here but you have to give them a chance, try few models and I'm pretty sure you'll change your mind.

And pardon my ignorance but I would much rather get this:



with this:



than this:



with this:



Just my $0.02 of course.

 

[SuperLory]

Not that Rolex or AP are doing differently. The sub is essentially the same for how many years? And what about the endless speciale edition AP chronos? Aren't they just changing the dials color and call it "special"?
Tbh for the non pasionate rolex observer the difference between a sub, a ND sub and a SD is just in how the date looks. Of course I know there are other different details, but I hope you get my point

It is inevitable for any brand with a strong identity to reiterate the same design with only minor tweaks/updates. The problem is at the opposite: when such brands loose their identity they loose their base.

yep, nailed it.

not to mention that in terms of style it all boils down to personal taste. I love nodate submariners and daytona, i despise (to be polite) YM. I will never buy a YM over a 111. Never.

 

[shelby1501]

It is inevitable for any brand with a strong identity to reiterate the same design with only minor tweaks/updates. The problem is at the opposite: when such brands loose their identity they loose their base.

I don't want it to look like I'm holding Panerai's back but I completely agree with this.

Thats true, AP have fallen victim to the whole "limited edition" game and yet AP fans poke fun at Hublot for doing the same. And yes a sub has been the same more or less for a long time, but Rolex has the sub, gmt, DJ, DD, Daytona, YM, YM2 and a few others and each is different and has a number of variations unlike PAM that has 3 main ones and an endless number of variations. AP has the RO and the ROO mainly but then again AP is a smaller more exlcusive brand not owned by the likes of Richemonte so maybe that limits them somewhat

Rolex has equal number of models like Panerai (actually some of them like Yachtmaster II are ridiculous but so as in Panerai) but you should really look at it a bit wider. Panerai isn't just 111, there are so many different models with different functions and look, on leather or bracelet, chrono or non chrono, flyback, gmt and much more, with many different types of dial, hands and so on.

And talking about Hublot, there is a reason why AP fans have that opinion.

 

[cornholio]

Actually not many people would agree. Yes, many PAMs look similar but it's the same thing with Rolex for example. At the end, brand is recognizable because of that. When you see Panerai on someone's wrist, there's no doubt it's Panerai and you can't tell that for many brands.

It's true that gen's are way overpriced, especially the ones with standard 6497 inside and that's why I would never buy gen base PAM, especially when we have so good reps of them. Also PAM 111 is one of my favorite watches and in my opinion it looks so much better than GMTII, it's all about taste, not logic. I wouldn't pay $7k for a watch that I don't like at all and would rather opt for 111 which suits me perfect no matter it's so much overpriced.

I'm not trying to say I don't like Rolex (I have few myself) and I hated Panerai when I first came here but you have to give them a chance, try few models and I'm pretty sure you'll change your mind.
Just my $0.02 of course.

I agree that you can spot a PAM on someone's wrist as the design is quite unique and yes I want give Panerai a chance and probably pick up a 111 and thats mainly why I went to the Panerai store but once I tried on the 111 and 425 they didn't really scream out anything. But I'm going to keep and open mind about it and order a 111 or a 390 just to change around from AP and Rolex but I think the difference is that going gen on a rolex or AP makes more sense and is more likely than Panerai (unless its an in-house PAM) and IMO this is why Panerai seems to be fading, its just difficult to justify the gen prices for one

 

[shelby1501]

Good decision, at least try to give them some love and maybe you feel in love. Maybe gen Rolex is better investment (AP is different league) but I don't think Panerai is fading in movement area as base models with standard 6497 were common in many PAMs and were selling pretty good. Of course investing that much money in a watch woth $150 can be hard to justify. I think their problem lies in these ridiculous "saving methods" as mentioned earlier in this thread and some newer models like new Daylight which caused a lot of troubles with Sly, Carbotech which I like but I don't think it's good for a brands reputation and that pos smart watch concept which hopefully won't see production line.

 

[Superman76]

Panerai died a long time ago. richmonte makes some interesting Replicas, but the best are made by hobbyists. Hell, you can get two 6154s w/ an angelus 240 for the price of a "gen" 111...

That may seem cynical, but the watch market is a big scam - that's what drives people to homage and replicas.

 

[Swaggerdad88]

I think the allure to panerai initially was their size. At the time of them going public after being bought by richemont, there really wasn't any other high end brand doing 44-47mm cases except maybe breitling. And at that time they even were a mid line brand using ETA movements. They gained steam by getting Hollywood exposure. I think where they lost their way was the intro of the super expensive models. This caused their entry line models to nearly double in price. $6k for a new 111? That watch was $2500 in the early 2000s. Now you're seeing many of the new ones enter the grey market unsold for years. Deeply discounted. Rolex no matter what will always appreciate. A $3000 mid 90s sub will still fetch $5k or more. However a used 104 that was $6500 is now worth $4000 maybe at best. Wholesale used outlets are paying $2500 for 111s or 005s and $3k for a 24. Used retail are mostly $3500 to $3800. Even panerai had a major price reduction recently. When has Rolex EVER had that? Never. I still love the brand but reality is what everyone said it was a few years ago. A fading fashion watch. With the recent cheapening of some of the models with snap on backs and spring bars, I think they hurt themselves from a purist point of view. I know I was thinking what the F

 

[Knifemaker]

I love the older ones for the simplistic designs. And the odd, yet colorful provenance.

Knife

 

[Goodwood]

I agree with comments that have alluded to the fact that Richemont has not necessarily managed the brand the best. Yes, the size was a new thing but look at some of their other counterproductive moves. An example, having one of the most unique metal bracelets in the business and doing away with the older design for a bracelet that is designed plain and adds nothing to the watch and then rumor has it on the Panerai Boards that the metal bracelet is being done away with entirely in the coming years. Another example, would be the flood of new models that Panerai has released, which confuses the customer. I am often confused by the array of models and I am just buying reps of their watch. Rolex has the same models and tweaks the improvements so that the new customer falls for the mystic of the sub, SD, or GMT and knows what to buy. Panerai's has too many models and have confused potential customers.

I don't think any of the above cannot be rectified but with Richemount make the right moves OR the right move to maintain revenues in the short term.....................

Goodwood

 

[JMMC]

IMHO, It´s simple, most pams are overpriced.

 

[Swaggerdad88]

I totally forgot about the bracelet change. That old style was bad ass. The new one sucks

 

[TheoreticalPhysician]

I'm new here but this is my two cents. Yes, they're fading. Which is unfortunate because I think they make some absolutely stunning watches. But they're not going anywhere. As I'm sure we all know even with the new in house movements Richemont's margins are still ridiculous. Panerai was able to enjoy an economic profit for a while but in the long run like any other firm in a monopolistically competitive market they're now only able to earn around a normal profit because of low barriers to entry and other firms cashing in on the large watch craze. And I'm not sure they're really able to be called a true Veblen good like Rolex or AP because no matter what we think of them the brand just doesn't carry the same prestige. For example, if Panerai starting increasing prices ten fold over the next few years they'd probably lose most of their business. In contrast, Rolex and AP did exactly that after the quartz crisis and they're not only still here but stronger than ever. So that really does limit Panerai to the standard market forces and suggests the best thing they can do is market the hell out of their design language, which is imo the best differentiation they have. Also, something I havn't seen them do recently.

Here's the worldwide Google Trends web search data for Panerai from 2004 to present. The peak search interest was in December of 2006 and every other point is graphed relative to that. The lowest point, which happens to be this month, is less than half of the relative search volume.

The US data tells more or less the same story, but with the peak shifted right a little and the most recent data pegging search volume at 29% relative to the peak.

All of that said, I still want to add a Pam 111 to my collection one day :smile:

 

[nalomb]

So that really does limit Panerai to the standard market forces and suggests the best thing they can do is market the hell out of their design language, which is imo the best differentiation they have.

I think you may have hit the nail on the head here -- branding is something even recognized labels have to maintain and constantly refresh. For me, I'd think a Dos Equis-type campaign might work well, although it would probably work well for any brand haha.

BTW, welcome to RWI and great graphs!!

 

[JMMC]

.

Here's the worldwide Google Trends web search data for Panerai from 2004 to present. The peak search interest was in December of 2006 and every other point is graphed relative to that. The lowest point, which happens to be this month, is less than half of the relative search volume.

Even more, I would bet 80-90% google searches are related to rep world.
You know people looking for a good picture or data to compare vs gen how good the rep is, how looks the gen strap etc...
:greedy:

 

[Swaggerdad88]

Definitely had its peak in 2007. I bought 3 genuine panerais that year into 2008.