Patek Philippe and the Auction Paradigm

You never own a Patek Philippe, you merely watch over it for the next generation. I'll say it's the best marketing campaign in history, a campaign appropriate for the world's premier watchmaker and a watchmaker worthy of a Business Breakdown.

Our guest today is John Reardon from Collectability. John has worked at Sotheby's, the auction house, and spent a decade at Patek Philippe in the early 2000s. He continues to write for Patek Philippe Magazine while he has launched Collectability, a brand dedicated to vintage and preowned Patek Philippe.

We cover what makes Patek such a special brand. There is an almost 200-year history in craftsmanship and countless patents (like that self-winding mechanism that powers all automatic watches today.) What Philippe Stern did in 1989 could be worthy of a 10-episode series, so there is much to learn from this episode. Please enjoy this breakdown of Patek Philippe.

For the full show notes, transcript, and links to the best content to learn more, check out the episode page here.

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CSIMA, Columbia Student Investment Management Association, is hosting its 27th annual conference in New York on Friday, February 9th. Keynote speakers include John Griffin from Blue Ridge, Ian McKinnon from Sandia, Jan Hummel from Paradigm, and Sally Krawcheck from Ellevest. Get your tickets at csima.info/conference.

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Show Notes

(00:00:00) Welcome to Business Breakdowns

(00:04:21) First Question, The main differences between Patek Philippe and Rolex  

(00:08:12) An introduction to Patek Philippe’s brand 

(00:10:27) The founding story of the business

(00:12:54) Henry Graves and the watches that he made for the brand 

(00:18:26) The production process for making a Patek Philippe watch

(00:21:36) A look at the 1989 and its importance to the business

(00:23:48) The types of people who were interested in the brand and purchasing at auction in 1989

(00:26:21) An overview of the successful marketing campaigns of the 1990s 

(00:29:06) Patek’s strategy at auctions, embracing both consignment and buying

(00:32:18) The general size and scope of the Patek Philippe secondary market

(00:34:00) The brand’s perspective of the secondary market and whether it affects the way they market new items

(00:38:27) John’s personal experience working at Patek Philippe 

(00:42:16) The company’s distribution strategy  

(00:45:22) Breaking down the points of sale, branded dealers versus authorized dealers

(00:46:09) The mindset behind consolidating dealers and the exclusivity it created as a byproduct 

(00:48:02) How the LVMH acquisition of Tiffany has affected Patek Philippe

(00:50:58) The potential of Patek Philippe being acquired by another company

(00:55:28) Lessons learned from Patek Philippe