David Rosenthal: belief

Transcript context

…But what do you mean release valve? Customers can’t get a Rolex, so they get a Tudor. I think that probably rarely happens, but to Hans’s original vision of I want everybody to be able to own a Rolex, this is the way that they can have that happen. I don’t think that’s it. I don’t think they care at all about that. Here’s my logic. It is a shockingly low percent of Rolex’s production. Less than 1%. If that were true, they would sell Tudors in volume. Let’s take a Black Bay. This is sort of the Tudor Submariner, $4000. Most people don’t know or care about the Black Bay. If they walk in thinking they want a Rolex, they’re not walking out with a Black Bay. They sell so few of these things. What are they doing? I think it’s 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, Tudor can go and implement it, and they can figure out how to produce it. If it’s a flop, that’s fine. The watch aficionados who know about Tudor expect them to come out with weird stuff that flops. But if it’s durable, then Rolex might get it in 5–10 years with even more polish and thoughtfulness. They’ve tested all sorts of stuff with Tudor—dial colors, ceramic bezels, titanium watches. A lot of these now are slowly making their way into Rolexes. I think the key thing is they can use Tudor to go and compete with Omega, TAG Heuer in the mid-market, and Tudor basically can punch up so that Rolex doesn’t ever have to punch down. I heard a great phrase that the shield protects the crown. The Tudor shield protects the Rolex crown, which makes total sense. It’s so that they don’t ever have to risk doing something dumb chasing a competitor with Rolex, and Tudor can always go figure it out.…

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